Stocks carve out fresh 11-month highs after gaining in eight of the past nine sessions. The Dow Jones Industrial Average closes up more than 1%. The S&P 500 ends up 1.5%. The Nasdaq Composite closes up 1.4%.

Crude oil closes up 2.2% at $72.51 a barrel, gaining amid a weaker dollar and a bigger-than-expected drop of 4.7 million barrels in U.S. stockpiles in the week ended Sept. 11.

December Gold finished at $1,020.20 an ounce, up $13.90, or 1.4%, on the day. It earlier reached an intraday high of $1,023.30, its highest level since March 2008.

Stronger-than-expected industrial production data lifted stocks and commodities.

The Federal Reserve said industrial activity surged 0.8 percent in August, better than the 0.6 percent increase economists had forecast. The Fed also revised July's figures to a 1 percent increase, twice as much as originally reported.

Earlier, the Commerce Department said its Consumer Price Index, a measure of inflation at the retail level, rose 0.4 percent in August, just above the 0.3 percent rise economists polled by Thomson Reuters expected.

Excluding volatile energy and food prices, the index rose 0.1 percent and was in line with expectations.

Mergers and acquisitions, a couple of analyst upgrades and other positive company news also gave an early boost to stocks.

Among active movers, Citigroup (C) took back some of the 9% drop posted in Tuesday's regular session following reports the company is in talks with the U.S. government about selling some of the government's nearly 8 billion share stake in the bank.

Adobe (ADBE) declined but its deal news is considered encouraging on Wall Street. Adobe beat on Q3, set Q4 guidance that straddled Street estimates, and announced a deal to acquire Omniture (OMTR).