Stocks rallied more than 1 percent on Thursday after the Federal Reserve launched another aggressive stimulus program and pledged to maintain it until the ailing labor market improves substantially.

The Dow and the S&P 500 both climbed to their highest intraday levels in nearly five years, while the Nasdaq advanced to a 12-year high, extending a recent rally on hopes for central bank action.

In a significant shift in monetary policy, the Fed said it would buy $40 billion of agency mortgage debt per month and if necessary will add purchases other assets until the U.S. unemployment rate, currently at 8.1 percent, significantly improves.

Many investors expected the Fed to act, as reflected in the latest run-up in equity prices, but analysts said there were still some who believed that the Fed would wait until after the November presidential election.

"There was a certain level of expectation built in, but I think there were really a lot of doubters out there. From that standpoint, a lot of those doubters had to be brought up to speed here, so to speak," said Ron Rowland, president of Capital Cities Asset Management in Austin, Texas.

"The other thing is that people realize that the Fed is trying to be serious about this. This isn't just a game to them."

In an additional move that reflects just how concerned Fed officials are about the economy, officials said they were not likely to raise interest rates from near zero until at least mid-2015. Previously, it had set such guidance at late 2014.

The Dow Jones industrial average <.DJI> gained 210.27 points, or 1.58 percent, to 13,543.62. The Standard & Poor's 500 Index <.SPX> rose 24.33 points, or 1.69 percent, to 1,460.89. The Nasdaq Composite Index <.IXIC> added 48.20 points, or 1.55 percent, to 3,162.52.

Some analysts said with the S&P 500 index up 16 percent since the beginning of the year and stocks' recent advance on hopes for help from central banks, the gains may be an opportunity for investors to pare positions.

"The market is obviously reacting positively to this news, but it wouldn't surprise me if we saw some of these gains dissipate as the day wears on," said Thomas Villalta, portfolio manager at Jones Villalta asset Management in Austin, Texas.

"I think a lot of this was already built into the price. Long term, a lot of people have to be looking at this as inflationary."

Economic data showed the number of Americans filing new claims for jobless benefits rose more than expected last week. Wholesale prices rose 1.7 percent in August, the largest gain since June 2009, although core inflation was stable.

Apple's stock was up 2.13 percent to $684.15 after analysts said sales of the new iPhone 5 could double those of the previous model in its first week on the market.

(Editing by Kenneth Barry)