An index of global stocks on Wednesday climbed to near its highest point of the year, while the dollar weakened as easing concerns about potential interest rate increases led investors into riskier assets.
Oil prices edged higher, paring stronger initial gains as US crude inventories built up.
Federal Reserve Chair Janet Yellen had said on Tuesday the US central bank should proceed cautiously as it looks to raise interest rates, pushing back on a handful of her colleagues who had suggested another move may be just around the corner.
Yellen's comments were echoed on Wednesday by Chicago Fed President Charles Evans, who said there was a high hurdle to raising rates in April, given low inflation.
“It's been a pretty nice couple of days here thanks to the Fed after they caused some angst earlier in the week,” said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.
The Dow Jones industrial average rose 83.55 points, or 0.47 per cent, to 17,716.66, the S&P 500 gained 8.94 points, or 0.44 per cent, to 2,063.95 and the Nasdaq Composite added 22.67 points, or 0.47 per cent, to 4,869.29.
The pan-European FTSEurofirst 300 index advanced 1.3 per cent.
MSCI's index of world shares gained 1.1 per cent. The index pulled back from stronger earlier-session gains that had put it in positive territory for 2016.
After sliding on Tuesday against a basket of major currencies, the dollar fell another 0.3 per cent. It is down about 4 per cent this year and on track to post its biggest quarterly percentage decline in five years. The euro rose 0.4 per cent against the dollar on Wednesday.
Traders are “trying to digest the dovish (Yellen) comments and assess whether this is a real turning point for the Fed," said Steven Englander, managing director and global head of G10 FX strategy at Citigroup in New York.
US jobs data
US private employers added 200,000 jobs in March, above economists' expectations, a report by a payrolls processor showed.
Oil prices gained, buttressed by the weak dollar, which makes commodities denominated in the greenback more attractive to users of other currencies. But they pulled back as a report showed that US crude stockpiles rose 2.3 million barrels last week.
US crude prices settled up 4 cents at $38.32 a barrel, after rising about 3 per cent earlier, while benchmark Brent settled up 12 cents at $39.26 a barrel.
Oil prices have rebounded about 50 per cent since mid-February after major producers within and outside OPEC floated the idea of freezing production at January's highs.
Shorter-dated US Treasury yields fell as traders piled on bets the Fed would raise interest rates gradually in the coming months. Benchmark 10-year Treasury notes traded down 5/32 in price, to yield 1.8281 per cent.