NEW YORK - Wall Street ended an erratic day with a modest gain after the Federal Reserve left interest rates unchanged and issued a mixed assessment of the economy.

The Fed pointed to a few positive signs in the economy, including "some firming in household spending." But it also said persistently rising energy prices are likely to limit growth ¡ª and not just quicken inflation, which also remains a major concern for the central bank.

The central bank said after a two-day meeting it is keeping the benchmark federal funds rate at 2 percent. The hold was expected, after several speeches by Fed officials suggesting that inflation is becoming a bigger worry for policy makers. It was the first time in 10 months that the central bank did not cut rates ¡ª last summer, the key rate was above 5 percent.

The Fed is at a critical turning point, said Quincy Krosby, chief investment strategist for The Hartford. There are still big credit troubles at the nation's major banks, the job market has been deteriorating for several months, and home prices are still tumbling; to raise rates prematurely could cause these trends to worsen further.

"The goal of the central banks is to get us through this as smoothly as possible, but this is not a science; it is an art form," Krosby said. "This is as delicate as it gets."

Barring another sharp rise in unemployment or a dramatic drop in gross domestic product, the Fed seems to be leaning toward raising rates again, Krosby said. "Nonetheless, they've left the window open for a cut if need be."

The Dow Jones industrial average closed up 4.40, or 0.04 percent, to 11,811.83, after rising more than 100 points shortly after the Fed announcement.

Broader stock indicators managed to log stronger gains than the blue chips. The Standard & Poor's 500 index rose 7.68, or 0.58 percent, to 1,321.97, and the Nasdaq composite index rose 32.98, or 1.39 percent, to 2,401.26.

Trading is often uneven after a rate decision as the market parses the central bank's statement.

"One of the other factors complicating trading today is that we're close to the end of the quarter," said Michael Sheldon, chief market strategist at RDM Financial Group in Westport, Conn. Volatility can arise when managers shift their portfolios' holdings before presenting them to shareholders at the end of the quarter.

Moreover, a sharp drop in Boeing Inc. also dragged on Dow. Shares of the aircraft manufacturer dropped to their lowest level in more than two years, and finished down $5.15, or 6.9 percent, at $69.64.

Government bond prices pared their losses after the rate decision. The yield on the 10-year Treasury note, which moves opposite its price, traded at 4.10 percent by late afternoon, the same as late Tuesday.

Crude oil fell $2.45 to $134.55 a barrel on the New York Mercantile Exchange. Gold prices also slid, while the dollar weakened against most other major currencies.

Some investors were relieved that policymakers did not talk tougher on inflation.

"I think it was a conscious effort, probably, to hold down expectations that they are going to immediately start fighting inflation and look to raise interest rates," said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland.

McCain said the Fed needs time to determine what will happen with energy prices, because they are set by worldwide demand. China's decision to decrease fuel subsidies and possible interest rate hikes in Europe could help curb energy demand, he said.

"I think the Federal Reserve legitimately would like to see the effect of some of those things before they have to determine if they have to take the step of raising rates here to slow the economy further," he said.

European Central Bank President Jean-Claude Trichet said Wednesday that investors shouldn't necessarily expect a series of interest rate hikes in the coming months. While the ECB is expected to raise rates at its July 3 meeting, he said he wouldn't "precommit" to rate hikes beyond that.

On Thursday, the technology sector is likely to come into focus. After the market closed Wednesday, Research In Motion Ltd. shares dropped when the BlackBerry maker reported rises in quarterly profit and revenue that fell just short of analyst expectations. Research in Motion shares fell nearly 9 percent to $129.61 in after-hours trading.

On the New York Stock Exchange, advancing issues outnumbered decliners by more than 2 to 1. Consolidated volume came to 4.72 billion shares, up from 4.06 billion shares on Tuesday.

The Russell 2000 index of smaller companies rose 8.38, or 1.18 percent, to 716.30.

Overseas, Japan's Nikkei stock average slipped 0.14 percent. Britain's FTSE 100 rose 0.56 percent, Germany's DAX index added 1.25 percent, and France's CAC-40 rose 1.40 percent.