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Stocks Finish Rough Month On Positive Note - U.S. Commentary


Stocks moved mostly higher during the trading day on Wednesday, extending the strong upward move seen late in the previous session. With the gains, the major averages climbed further off the multi-month closing lows set on Monday.

The major averages pulled back well off their highs in the final hour of trading but remained firmly positive. The Dow jumped 241.12 points or 1 percent to 25,115.76, the Nasdaq soared 144.25 points or 2 percent to 7,305.90 and the S&P 500 surged up 29.11 points or 1.1 percent to 2,711.74.

The continued strength on Wall Street partly reflected a positive reaction to the latest earnings news from several big-name companies.

Auto giant General Motors (GM), eCommerce giant eBay (EBAY), and social media giant Facebook (FB) posted notable gains after reporting better than expected quarterly earnings.

Buying interest was also generated in reaction to a report from payroll processor ADP showing stronger than expected private sector job growth in the month of October.

ADP said private employment jumped by 227,000 jobs in October after surging up by a downwardly revised 218,000 jobs in September.

Economists had expected an increase of about 189,000 jobs compared to the addition of 230,000 jobs originally reported for the previous month.

The stronger than expected job growth in October reflected the biggest increase in private sector employment since a jump of 241,000 jobs in February.

The upbeat private sector jobs data has generated some optimism about the Labor Department's more closely watched monthly jobs report due to be released on Friday.

Investors were also likely doing some window dressing, picking up stocks at reduced levels after one of the worst months for the markets in years.

Sector News

Computer hardware stocks turned in some of the market's best performances on the day, resulting in a 3.8 percent spike by the NYSE Arca Computer Hardware Index, The index continued to recover from the well over one-year closing low set on Monday.

Significant strength was also visible among software stocks, as reflected by the 2.8 percent jump by the Dow Jones Software Index.

Steel stocks also saw considerable strength on the day, driving the NYSE Arca Steel Index up by 2.8 percent despite the release of disappointing Chinese manufacturing data.

Networking, chemical, and banking stocks also moved notably higher, while gold and utilities stocks bucked the uptrend.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved notably higher during trading on Wednesday. Japan's Nikkei 225 Index spiked by 2.2 percent, while Hong Kong's Hang Seng Index shot up by 1.6 percent.

The major European markets also showed significant moves to the upside on the day. While the French CAC 40 Index surged up by 2.3 percent, the German DAX Index and the U.K.'s FTSE 100 Index jumped by 1.4 percent and 1.3 percent, respectively.

In the bond market, treasuries came under pressure following the release of the upbeat employment data. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, climbed by 4.9 basis points to 3.159 percent.

Looking Ahead

A slew of economic data is scheduled to be released on Thursday, including reports on weekly jobless claims, labor productivity and costs, manufacturing activity and construction spending.

Trading activity may be somewhat subdued, however, as traders look ahead to the release of the Labor Department's monthly jobs report on Friday.

A number of companies are also releasing their quarterly results after the close of today's trading and before the start of trading on Thursday.

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