Stocks sharply extended gains on Wednesday after the Federal Reserve kept interest rates unchanged and said the pace of economic contraction appears somewhat slower.

* Government data suggest inventories need rebuilding

* The Dow Jones industrial average <.DJI> rose 224.53 points, or 2.80 percent, to 8,241.48. The Standard & Poor's 500 Index <.SPX> gained 25.05 points, or 2.93 percent, to 880.21. The Nasdaq Composite Index <.IXIC> jumped 51.41 points, or 3.07 percent, to 1,725.22.

(Reporting by Rodrigo Campos; Editing by Jan Paschal)