By Carla Mozee

Latin American equities finished higher Wednesday following an assessment by U.S. interest-rate policymakers that the U.S. economy is showing signs of stabilization.

Brazil's Bovespa rose 1.3% to 56,588.26 after the Federal Open Market Committee said it will keep interest rates at their low level "for an extended period of time," at 0% to 0.25%. The index recouped the bulk of its loss from the previous session.

Mexico's IPC also won back a portion of its decline in the previous session, closing up 1.1% at 28,096.02.

"Economic activity is leveling out," the FOMC said after its two-day meeting, and with the prospect of improvement in the economic activity the central bank said it will slow its purchases of long-term U.S. Treasurys and let the purchase program peter out in October.

The Fed's statement also struck notes of caution, with observations from policymakers that businesses are still cutting back on fixed investment and a projection that overall activity will likely to remain weak for a while, said Jack Dzierwa, global strategist at investment advisory firm U.S. Global Investors (GROW).

As the MSCI Latin American Equity Index has jumped 80% from its March lows, Dzierwa said the Fed's statement is unlikely to be a long-term catalyst for the next move higher.

Equities in Latin America "are trading at 14 times trailing earnings," in line with historical valuations, he said. "I would like to see acceleration in earnings in Latin America, and once that happens that will provide a trigger for a further rally, more than any statement that things are stabilizing in the U.S."

U.S. stock gains accelerated after the FOMC's announcement. The Dow Jones Industrial Average (DJI) rose 120 points, or 1.3%, to 9.362 (SPX) rose 1.1% to 1,005.58.

Mexico's currency also strengthened, fetching 12.967 pesos per U.S. dollar compared with Tuesday's close at 13.010. Improvement in the U.S. economy helps Mexico because it sends more than 80% of its products to its northerly neighbor.

"Everybody over there is almost praying for any recovery in the U.S.," said Dzierwa, who just returned from a business trip to Mexico. "Having said that, Mexico has had a good run...and maybe it's time to take a breath."

Mexico's equity benchmark has bounced up nearly 60% from March lows.

Among market heavyweights Wednesday, Mexico's America Movil (AMX) rose 1% and cement maker Cemex (CX) climbed 2.1%. Advancers were fronted by Carso Global Telecom, whose shares gained 4.8%.

In Brazil, stock in Gol (GOL) leaped 13% after the air carrier said lower costs contributed to its swing to a better-than-expected profit of 353.7 million reals for the second quarter. Revenue fell 4.8% to 1.39 billion reals.

Shares of Brazilian oil giant Petrobras (PBR) jumped 2.2%.

Chile's IPSA rose 0.6% to 3,265.77 and Argentina's Merval gained 0.8% to 1,779.05.