By Ankika Biswas and Amruta Khandekar

(Reuters) - The Nasdaq led the rally among Wall Street's main indexes as major rate-sensitive technology and growth stocks advanced after the Federal Reserve hinted it was close to pausing interest rate hikes amid turbulence in the banking sector.

As U.S. Treasury yields slipped on growing hopes of an end to the Fed's tightening cycle, Apple Inc (NASDAQ:), (NASDAQ:) and Amazon.com Inc (NASDAQ:) gained around 2% each on Thursday.

Nvidia (NASDAQ:) Corp jumped 3.3% after Needham raised its price target on the chipmaker on likely benefit from near-term data center strength.

Communication services and technology shares led the gains among sector indexes.

The U.S. central bank on Wednesday raised rates by an expected 25 basis points, but its policy statement no longer said "ongoing increases" would likely be appropriate, indicating a clear shift in its stance.

The Fed's softer tone relieved markets that have been roiled by liquidity-crisis concerns in the banking sector since the failure of two U.S. regional lenders earlier this month.

"Markets are hoping that you have one more interest rate hike to go, probably," said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut.

"I would imagine the hopes (of a rate cut) are smashed. You don't want things going so south that you need a rate cut."

Traders' bets are almost equally split between the Fed pausing its rate hikes in May and another 25 bps hike, according to CME Group's (NASDAQ:) Fedwatch tool.

Meanwhile, troubled regional lender (NYSE:) dropped 6% and extended losses amid volatile trading following Treasury Secretary Janet Yellen's remark that there was no discussion on insuring all bank deposits.

Peers Truist Financial (NYSE:) Corp and Western Alliance (NYSE:) Bancorp, however, were up 2.1% and 4.4%, respectively.

Data showed jobless claims fell to 191,000 last week from the week prior, against expectations that the number would rise to 197,000.

Globally, the Bank of England raised interest rates by a further quarter of a percentage point and expects the surge in British inflation to cool faster than before.

At 12:07 p.m. ET, the was up 398.52 points, or 1.24%, at 32,428.63, the S&P 500 was up 59.20 points, or 1.50%, at 3,996.17, and the was up 251.34 points, or 2.15%, at 11,921.30.

Block Inc tanked 12.8% after Hindenburg Research said it held short positions in the Jack Dorsey-led payments firm.

Coinbase (NASDAQ:) Global Inc slid 11.1% after the U.S. Securities and Exchange Commission threatened to sue the crypto exchange over some of its products.

Accenture (NYSE:) jumped 7.7% on plans to cut about 2.5% of its workforce.

Advancing issues outnumbered decliners for a 3.08-to-1 ratio on the NYSE and a 2.01-to-1 ratio on the Nasdaq.

The S&P index recorded four new 52-week highs and 10 new lows, while the Nasdaq recorded 42 new highs and 130 new lows.