* Financials add to gains; utilities lead declines
* Apple rises after strong results
* Indexes up: Dow 0.6 pct, S&P 0.7 pct, Nasdaq 0.7 pct (Updates to late afternoon)
By Caroline Valetkevitch
Oct 28 (Reuters) - U.S. stocks rebounded in volatile afternoon trading after initially selling off following the Federal Reserve’s statement that suggested a December rate hike was still on the table.
The central bank left interest rates unchanged, as was expected, and, in a direct reference to its next meeting, put a December rate hike firmly in play. It also downplayed global economic headwinds in its statement.
“It’s definitely trying to keep the possibility of a hike alive. But it just keeps the door open. It doesn’t necessarily signal to me strongly that they have an intention of hiking (in December),” said Aneta Markowska, chief U.S. economist at Societe Generale in New York.
The Fed has not hiked rates in about a decade.
S&P financials, which benefit from higher rates, added to gains following the statement and were last up 2 percent, on track for their best day in two weeks. The KBW Nasdaq regional bank index jumped 3.5 percent.
At the same time, S&P utilities, which tend to do worse when interest rates are rising, were down 2 percent and leading S&P sector declines.
At 3:15 p.m., the Dow Jones industrial average rose 108.63 points, or 0.62 percent, to 17,690.06, the S&P 500 gained 15.09 points, or 0.73 percent, to 2,080.98 and the Nasdaq Composite added 35.32 points, or 0.7 percent, to 5,065.47.
Gains in Apple’s shares, up 3.5 percent at $118.62, helped to support indexes, a day after its reported stronger-than-expected results.
Advancing issues outnumbered declining ones on the NYSE by 2,106 to 926, for a 2.27-to-1 ratio on the upside; on the Nasdaq, 2,099 issues rose and 716 fell for a 2.93-to-1 ratio favoring advancers.
The S&P 500 posted 30 new 52-week highs and 6 new lows; the Nasdaq recorded 125 new highs and 75 new lows. (Additional reporting by Lewis Krauskopf; Editing by Saumyadeb Chakrabarty and Nick Zieminski)