The stock market bounced to its highest close since spring Wednesday after the Federal Reserve pledged to keep interest rates near zero for almost three more years.

Bond yields dropped sharply then climbed back later in the day when investors began looking more closely into the Fed's deliberations. The yield on the five-year Treasury note hit a low.

The big moves in both markets occurred at 12:30 p.m., when the Fed's monetary policy committee said it was unlikely to raise interest rates before late 2014. It had previously promised to keep rates low into the middle of 2013.

The Dow Jones industrial average was down as much as 95 points in the morning and about 60 points before the Fed announcement. It shot to a gain of 103 points during the afternoon.

The Dow closed up 83.10 points, or 0.7 percent, at 12,758.85. That's the highest close since May. The Dow peaked for last year in April at 12,810. Before that, it had not been so high since May 2008.

In the bond market, the yield on the 10-year Treasury note was at 2.05 percent an hour before the announcement and quickly fell to 1.92, a significant move. It rose to 1.99 percent two hours later.

The bounce-back happened at about 2 p.m., when the Fed released details of how the committee voted. Six of its 17 members had favored an interest rate increase this year or next -- well before late 2014 in either case.

The yield on the five-year Treasury note hit 0.76 percent, a low. Bond yields fall when their prices rise.

The promise of lower rates pushed the dollar lower against other major currencies. Low interest rates make the dollar less attractive because they reduce the returns traders get on U.S. debt and other bonds priced in dollars.

Technology stocks rose all morning, bucking the wider market, after Apple reported its best quarter and blew away analyst estimates because of strong holiday sales of the iPhone and iPad.

Apple once again passed Exxon Mobil as the company with the biggest market value. Wall Street was watching the results closely because they were for the company's first quarter since the death of founder Steve Jobs.

Apple stock jumped 6.3 percent, helping lift the Nasdaq composite index by 31.67 points, or 1.1 percent, to close at 2,818.31. The Nasdaq is up 8.2 percent this year, nearly twice the gain for the Dow Jones industrial average.

Netflix Inc., the DVD-by-mail and video streaming provider, jumped 13 percent in after-hours trading after reporting earnings that far exceeded Wall Street's expectations.

The Standard & Poor's 500 index rose 11.41 points, or 0.9 percent, to 1,326.06. The S&P is up 5.4 percent for the year and more than 14 percent from its Nov. 25 low.

As fears recede about Europe, big-time investors such as hedge funds will be drawn back into the market, fueling more gains, said Joe Bell, senior Equity Strategist at Schaeffer's Investment Research.

After such a strong rally, there might be a slight decline, but "overall we're bullish," Bell said.