Wall Street stocks end higher after US Federal Reserve opts to keep rates low (UPDATES)

U.S. stock markets reacted wildly Tuesday to the U.S. Federal Reserve's statement that it will keep short-term interest rates low through 2013.

After zigzagging in volatile trading Tuesday afternoon, the Dow soared 429.92 points, or almost 4 percent.

The S&P 500 Index rose 53 points, or 4.7 percent. The Nasdaq jumped 5.3 percent.

Monday's close for the Dow industrials was among the top 10 worst by points in history. Tuesday's was among the top 10 best.

All eyes today were on the Federal Reserve, which held a one-day meeting and released a statement this afternoon about its latest views on the U.S. economy.

The Federal Open Market Committee statement indicated a sharply downgraded view of the U.S. economy, though it stopped short of endorsing another round of quantitative easing, known as QE3. 

The Wall Street Journal reports:

Fed officials said they expect the weak economy to warrant exceptionally low levels for the federal funds rate "at least through mid-2013." Seven voted in favor of this action, with three voting against. 

Tuesday's session on Wall Street followed a difficult trading day across Asia's stock markets. 

On Monday, during the first session since Standard and Poor's downgraded the U.S. AAA credit rating to AA+, equities nosedived into "bear market territory," Reuters reports.

The Dow fell 5.55 percent or 634.76 points on Monday — its steepest one-day drop since late 2008 — to close at 10,809.85.

(GlobalPost reports: Wall Street: Time to face the ugly truth)