Stocks ended higher, once again hitting multi-year highs as the S&P finished at double its lowest level during the financial crisis.
The Dow Jones Industrial Average rose 61.53 points, or 0.5 percent to close at 12,288.17, its highest close since June 13,2008.
Among Dow components, JPMorgan , Hewlett-Packard and Boeing rose, while Verizon and Wal-Mart fell.
The S&P 500 gained 8.31 points, or 0.6 percent, to close at 1,336.32, more double the March 6, 2009 intraday low of 666.79.
The Nasdaq gained 21.21 points, or 0.76 percent, to close at 2,825.56, its highest close since October 31, 2007.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, rose above 16.
Most key S&P sectors gained, led by energy, materials and consumer discretionary, while telecom fell.
Minutes from the Federal Reserve's Jan. 25-26 policy setting meeting, released on Wednesday, revealed some Federal Reserve officials believed the strengthening economy warranted putting the brakes on the Fed's $600 billion economic stimulus program, but they concluded the economy remained weak enough to continue.
The Fed also revealed their latest economic forecasts, lowering their outlook for core inflation to 1.25 percent for 2012, a signal the central bank is not in a hurry to raise rates, said John Canally, economist at LPL Financial.
The fact inflation is projected to remain subdued isn't a surprise, despite the focus lately on rising food and energy costs and their eventual effects on the U.S. economy, Canally added. Food and energy costs actually make up a small percentage of the costs consumers pay, while prices of other elements of the CPI, such as furnishings, are falling.
"There a disconnect between actual inflation and perceptions of inflation that has to be resolved," Canally added. "All the measures I look at, both observed and forecast, are low and stable."
Oil, meanwhile, gained after news from Israel's foreign minister that Iran plans to move two warships through the Suez Canalto Syria, although prices eased off highs of the day. Brent crude rose to nearly $104 a barrel, while U.S. light sweet crude rose more than $85 a barrel.
The dollar, however, fell against the euro and a basket of currencies. The price of gold rose above $1,374 an ounce.(Read more: Dollar Zigs Instead of Zags.)
"The dollar is being sold off against the Swiss franc and the euro because, should there be a conflict with Israel, this would be bad for the U.S. as well," Brian Dolan, chief currency strategist at Forex.com told CNBC.
The market continues to trend upward, buoyed by steadily improving economic news and a strong batch of earnings in the fourth quarter, according to Paul Brigandi, vice president of trading at Direxion Funds. Even on down days, like Tuesday, there's little follow through, Brigandi said.
"That tells you there’s underlying support in the market, that buyers are coming in at any little signs of weakness," he said.
Nearly 90 percent of all energy stocks rose on Wednesday, led by Denbury Resources , Halliburton and FMC Technologies .
Meanwhile, Air Products & Chemicals led materials stocks higher after news it would no longer pursue Airgas. That's because a judge upheld Airgas's use of a poison pill defense against Air Product's $5.9 billion hostile bid for the company. Also higher were metals and mining companies, including US Steel , AK Steel and Titanium Metals .