US STOCKS-Wall St builds on Fed-fueled rally; Nasdaq hits new high

* S&P set for best two-day run in more than two months

* U.S. jobless claims drop to two-month low

* Amazon.com (NasdaqGS: AMZN - news) hits all-time high on analyst report

* Indexes up: Dow 0.39 pct, S&P 0.45 pct, Nasdaq (NasdaqGS: NDAQ - news) 0.62 pct (Updates to late afternoon)

By Lewis Krauskopf

Sept 22 (Reuters) - U.S. stocks climbed on Thursday, led by big tech names, building on gains from a day earlier that were fueled by the Federal Reserve's decision to stand pat on interest rates.

The S&P 500 was on pace for its best two-day performance in more than two months, while the Nasdaq set a new intraday high.

Fed Chair Janet Yellen said on Wednesday that U.S. growth was looking stronger and rate increases would be needed to keep the economy from overheating and fueling high inflation. But the central bank maintained the low-interest rate environment that has helped underpin the bull market for stocks.

"Lower for longer is a good thing for the equity markets..." said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. "It basically says risk back on."

The Dow Jones industrial average rose 71.26 points, or 0.39 percent, to 18,364.96, the S&P 500 gained 9.78 points, or 0.45 percent, to 2,172.9 and the Nasdaq Composite added 32.97 points, or 0.62 percent, to 5,328.15.

The three indexes were on track for their third straight session of gains.

Concerns over whether the Fed would raise rates prompted a return of volatility to the stock market in recent weeks after two months of calm. For the year, the benchmark S&P 500 is up more than 6 percent.

The Fed strongly signaled it could still tighten monetary policy by year-end, and as of Thursday afternoon traders set the probability of a hike at the Fed's December meeting at 54 percent, according to the CME Group (Kuala Lumpur: 7018.KL - news) 's FedWatch website. Those bets were pared back from about a 58 percent chance of a December hike on Wednesday.

Adding some support for the Fed to raise rates later this year, a report showed number of Americans filing for unemployment benefits unexpectedly fell last week to a two-month low.

All 11 major S&P sectors were in positive territory, led by a 1.6-percent gain for the real estate sector.

Shares (Berlin: DI6.BE - news) of Amazon.com rose 1.4 percent after hitting a record following a price target raise by BMO. Apple (NasdaqGS: AAPL - news) shares gained 0.7 percent after positive analyst reports. The stocks were among the biggest positive influences on the S&P.

Advancing issues outnumbered declining ones on the NYSE by a 4.30-to-1 ratio; on Nasdaq, a 2.71-to-1 ratio favored advancers.

The S&P 500 posted 27 new 52-week highs and no new lows; the Nasdaq Composite recorded 146 new highs and 12 new lows. (Additional reporting by Yashaswini Swamynathan in Bengaluru; Editing by Don Sebastian and Nick Zieminski)