Fed chair Jerome Powell signaled that the central bank would be more "patient" with monetary policy, remarks that were needed to ease investors' fears on slowing economic growth, said Jeffrey Schulze, investment strategist at ClearBridge Investments. Fears of a downturn in economic activity have threatened to upend the nearly 10-year bull market.

"The markets were playing chicken with the Fed," Mr. Schulze said, referring to the recent turbulence in stocks. "Investors are calmer now that the Fed is signaling that it won't choke off this recovery."

If the Fed takes a more measured pace in lifting interest rates, it would likely keep the dollar's gains in check, which would help multinational companies with exposure overseas, Mr. Schulze said. A stronger dollar makes converting foreign profits into the U.S. currency more expensive, weighing on earnings.