Extending the upward trend seen in recent sessions, stocks moved moderately higher during trading on Wednesday. The major averages all moved to the upside, closing higher for the fourth consecutive session.
The Nasdaq climbed 75.55 points or 0.5 percent to 14,019.31, the S&P 500 rose 17.24 points or 0.4 percent to 4,514.87 and the Dow inched up 37.57 points or 0.1 percent to 34,890.24.
The strength on Wall Street came following the release of a report from payroll processor ADP showing a notable slowdown in the pace of private sector job growth in the month of August.
ADP said private sector employment climbed by 177,000 jobs in August after surging by an upwardly revised 371,000 jobs in July.
Economists had expected private sector employment to advance by 195,000 jobs compared to the jump of 324,000 jobs originally reported for the previous month.
The slightly smaller than expected increase in private sector employment added to recent optimism about the outlook for interest rates.
“While the ADP report does not necessarily enjoy an exceptionally strong positive correlation with the government’s payroll report due on Friday morning, it nonetheless suggests that the overheated jobs market may be cooling—- clearly what the Fed wants to see, as it should bring the labor market into balance,” said Quincy Krosby, Chief Global Strategist for LPL Financial.
Separately, revised data released by the Commerce Department showed the U.S. economy grew by less than previously estimated in the second quarter.
The report said the increase in gross domestic product in the second quarter was downwardly revised to 2.1 percent from the previously reported 2.4 percent. Economists had expected the pace of GDP growth to be unrevised.
Sector News
Housing stocks saw considerable strength on the day, resulting in a 1.2 percent advance by the Philadelphia Housing Sector Index.
The strength in the sector came after the National Association of Realtors released a report showing an unexpected increase in pending home sales in the month of July.
NAR said its pending home sales index climbed by 0.9 percent to 77.6 in July after rising by 0.4 percent to a revised 76.9 in June.
Economists had expected pending home sales to decrease by 0.6 percent compared to the 0.3 percent uptick originally reported for the previous month.
Telecom and oil service stocks also saw notable strength, while most of the other major sectors showed more modest moves.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan’s Nikkei 225 Index rose by 0.3 percent, while Australia’s S&P/ASX 200 Index jumped by 1.2 percent.
Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.’s FTSE 100 Index inched up by 0.1 percent, the French CAC 40 Index edged down by 0.1 and the German DAX Index dipped by 0.2 percent.
In the bond market, treasuries ended the session little changed following the rally seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 4.118 percent.
Looking Ahead
A Commerce Department report on personal income and spending is likely to be in focus on Thursday, as it includes a reading on inflation said to be preferred by the Federal Reserve.
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