TORONTO — The Toronto stock market posted a modest advance Thursday while American markets enjoyed a big bounce a day after the U.S. Federal Reserve surprised many by taking a more dovish stance than expected on interest rates.The S&P/TSX composite index closed up 37.66 points at 14,770.64, held back largely by the heavily weighted financial and energy sectors. The loonie was up 0.06 of a U.S. cent at 81.79 cents.On commodity markets, the July crude contract rose 53 cents to US$60.45 a barrel, but the energy sector was mired in negative territory, down 0.53 per cent. The financial sector was also a weight, down 0.14 per cent.Meanwhile, gold issues advanced more than one per cent as August bullion shot up $25.20 to US$1,202 an ounce.U.S. markets were sharply higher following word from the Fed that it was cutting its forecast for economic growth, a move that could also delay an increase in historically low interest rates.The Fed’s benchmark rate, which has sat near zero since 2008, is seen as a significant factor in fuelling strength in stock markets since the Great Recession.In New York, the tech-heavy Nasdaq soared 68.07 points to an all-time high close of 5,132.95, while the widely watched Dow Jones industrial average posted a 180.1-point gain to 18,115.84. And the S&P 500 surged 20.80 points to 2,121.24, not far off its record close of 2,130.82 back in May.The rally on Wall Street partly reflected relief among investors after the Fed’s latest policy update on Wednesday.“Particularly in the U.S., but also in Canada, I think its almost all Fed-driven,” said Benjamin Jang, portfolio manager at Nicola Wealth Management.“(In Canada) you can see it in the commodity space. Oil is up and . . . you see gold is up as well.”Jang described the dovish nature of the comments from the U.S. central bank as “a little bit surprising,” indicating that a rate hike is likely to come “slightly” later in the year.“But more importantly, the pace of the rate hike is (likely) slower. So I think the pace is probably more important for the long-term market.”Apart from the Fed, Jang said improvements in the U.S. economy give reason for markets to drive higher.“The concern that I have is that when you have a market that is so macro-driven . . . we’re just pushing out volatility until we see that initial hike in interest rates,” he said.“But it’s really up to the Fed to ensure that they do that (raise rates) soon enough that we don’t create this asset price bubble and kind of burst that bubble.”In other economic news, an index designed to predict the future health of the U.S. economy posted another strong increase in May, indicating the economy should gain strength in the second half of this year.The Conference Board said its index of leading U.S. indicators rose 0.7 per cent in May, matching the gain in April. Both months represented the strongest increase since a one per cent rise last July.