The FOMC announced Thursday that it would engage in a third round of bond purchases to stimulate the U.S. economy.

In a statement at the conclusion of a two-day meeting, the Federal Reserve said it will expand its holdings of long-term securities with open-ended purchases of $40 billion of mortgage debt a month in a third round of quantitative easing as it seeks to boost growth and reduce unemployment.

Financial markets rallied hard on the news, with the benchmark S&P 500 rising to its highest intraday level since January 2008 and the Nasdaq up 1 percent.