The U.S. stock market ended a choppy session moderately higher on Wednesday, with the S&P 500 closing at a record. Market reaction to a pair of better-than-expected economic reports was largely muted in early trading; indexes pushed higher in late afternoon.
Private-sector hiring in March picked up to the fastest pace in three months while factory orders rose in February.
The S&P 500 index SPX +0.29% ended the day at a session high, up 5.38 points, or 0.3%, to 1,890.90, closing at a record for the eight time this year. Consumer discretionary and industrials sector stocks led the gains.
The Dow Jones Industrial AverageDJIA +0.24% closed up 40.39 points, or 0.2%, at 16,573.00, only a few points shy of its record close reached Dec 31. 2014. The blue-chip index is now flat for the year.
The Nasdaq Composite COMP +0.20% finished the day up 8.42 points, or 0.2%, at 4,276.46.
“Today’s ADP numbers should be taken not in isolation but as a part March data package—together with the ISM and jobless claims figures, they indicate a nice progression growing at moderate rate,” said Jim Russell, senior equity strategist at U.S. Bank Wealth Management.
“It appears that cold winter weather and not something fundamental held back the growth and resulted in weakness,” Russell added.
Private-sector-employment gains picked up in March, with employers adding the most jobs in three months, and quicker hiring may be ahead, Automatic Data Processing Inc.reported Wednesday.
ADP said private-sector employers added 191,000 jobs last month, up from 178,000 in February. A prior estimate pegged February’s increase at 139,000.
While some economists use ADP’s number to get a feeling for the official nonfarm payrolls data, it is not always a reliable indicator, according to Ian Shepherdson, chief economist at Pantheon Macroeconomics.
“We no longer view ADP as a useful advance indicator of the official payroll numbers. Since ADP was revamped in October 2012 it has clearly tended to lag movements in the official numbers by a month. We still look for 250,000 jobs gain on Friday,” wrote Shepherdson in an emailed comments.
Separately, orders for goods produced in U.S. factories rose 1.6% in February, the U.S. Commerce Department said Wednesday. Orders for durable goods–products meant to last at least three years–rose 2.2% in February. Orders for nondurable goods increased 1%.
Two Federal Reserve officials speaking publicly on Wednesday offered slightly different views about the timing of the first rate hike. In an interview on Bloomberg Radio on Wednesday, St. Louis Fed President James Bullard said that he expects the first rate hike to come in the first quarter of 2015, though he conceded that he’s ahead of most of his colleagues.
Atlanta Fed President Dennis Lockhart said that the first rate hike is not likely to be warranted until at least the last half of next year.
Among individual stocks, Monsanto Co. MON +0.76% shares rose 0.8% after the agricultural company reported its second-quarter earnings. The company said its fiscal second-quarter earnings grew 13% thanks to continued strength in its soybean seed sales as well as improved margins. Results beat expectations.
Shares of MannKind Corp. MNKD +0.43% , which surged 100% in after-hours trading on Tuesday, were up another 74% to $6.99 on news a Food and Drug Administration advisory panel recommended approval of the biopharmaceutical company’s inhaled diabetes drug Afrezza.
General Motors Co. GM +1.57% rose 1.6% as chief executive Mary Barra returned to Capitol Hill to continue her testimony on the company’s handling of a massive recall linked to an ignition defect. GM said on Tuesday that U.S. sales in March rose 4% to 256,047 vehicles.
Nomura analysts initiated coverage of GM on Wednesday with a reduce rating, alongside a neutral rating for Ford MotorCo. F +0.86% . “We believe increasing macroeconomic headwinds will affect Ford and GM’s profitability negatively relative to very high expectations for a FY15 earnings-per-share recovery,” said analyst Harald Hendrikse in a note. Ford shares were 0.9% higher.
Shares of Intuitive Surgical Inc. ISRG -0.51% rose 5% after surging 11% on Tuesday after the company said it received the go-ahead from the U.S. Food and Drug Administrationfor its da Vinci Xi Surgical System.
In overseas markets, the Stoxx Europe 600 index XX:SXXP +0.06% logged light gains as investors awaited U.S. data and Thursday’s European Central Bank meeting. Asia stocks chased up Wall Street gains, with a 1% rose for Japan’s Nikkei Average JP:NIK +0.84% and more modest advances elsewhere. A weaker yen USDJPY +0.09% contributed to the gains on the Nikkei. Gold GCM4 -0.33% rose 0.9%, breaking a 5-day losing streak, while oil CLK4 -0.44% edged lower.
Source: Market Watch