Strong economic data sparked a rally Wednesday. The Dow Jones Industrial Average jumped 196.2 points (+1.5%), Standard & Poor's 500 index increased 22.2 points (+1.5%), and the Nasdaq finished up 46.5 points (+1.8%). Volume at the NYSE was 1.35 billion shares, and advancers beat decliners by a ratio of about 3:1.
The ADP employment estimate showed that November private payrolls increased by 189,000, more than tripling economists' estimates (full story). This sparked speculation that the Friday nonfarm payroll number will be well ahead of economists' current 70,000 estimate. November factory orders also helped the rally, coming in up 0.5%. Also, third quarter productivity was revised up to an annual rate of 6.3% from a previously reported 4.9%. November's ISM Non-Manufacturing Index fell to 54.1%, below expectations (full story), but was largely ignored. The U.S. 10 -Year Treasury fell 12/32, pulling yields up to 3.94%.
All sectors finished up, with tech (+2.2%) and energies (+2.7%) enjoying the healthiest gains. Crude ended lower by $0.83 to finish at $87.49/barrel. Comcast (CMCSA, -12.3%) fell after the company said it would lower its forecast for subscriber growth (full story). Bond insurer MBIA (MBI, -16.0%) sank on the possibility Moody's will cut the company's financial strength rating. Fannie Mae (FNM, +2.7%) was up despite announcing it would cuts its dividend 30% next year (full story). Retailer Chico's FAS (CHS, -12.5%) announced third-quarter profits fell 44% from last year (full story).
Jobless claims (8:30 AM) will be announced Thursday. Expect trading later in the day on Thursday to be a little quieter than normal, as many investors and traders will stay on the sidelines and wait for the nonfarm payrolls figure to be released Friday morning before picking a direction.
Additional Reading: Wednesday's Market View: Jobs, SIVs and the Fed's Next Move • Fed Likely to Weigh 0.25% vs. 0.50% Cut Next Week