NEW YORK—A batch of good news on the economy Wednesday pushed the stock market to new highs.
Payroll processer ADP said that U.S. companies added 208,000 jobs in November, the third straight month that hiring has topped 200,000. A separate report showed that service sector activity climbed close to an eight-month high in November.
The reports were an encouraging sign before the government’s monthly jobs survey is published on Friday.
“There is nothing more important than employment data,” said Russell Price, senior economist at Ameriprise Financial. “More income fuels more consumer spending over time.”
The Standard & Poor’s 500 index rose 7.78 points, or 0.4 percent, to 2,074.33. The Dow Jones industrial average rose 33.07 points, or 0.2 percent, to 17,912.62. The Nasdaq composite climbed 18.66 points, or 0.4 percent, to 4,774.47.
After rebounding from a slump in mid-October, stocks have been gradually moving higher on optimism that the U.S. economy will continue to improve next year. Investors are also hopeful that actions by central banks outside of the U.S. will help bolster global growth.
Economists forecast that the U.S. government will say employers added 225,000 jobs in November and that the unemployment rate slipped to 5.7 percent from 5.8 percent, according the financial data provider FactSet.
“The biggest, most important economic statistic in the world looks like it will continue its winning streak if this morning’s ADP employment report is to be believed,” Christopher Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi, wrote in a note to clients. “Things are better than you think.”
On Wednesday, stocks also got a lift from the energy sector as the price of oil showed signs of stabilizing. The sector rose for a third straight day, as drilling companies and other businesses that provide services to the oil and gas industry gained.
Cimarex Energy, an oil and gas exploration company, was among the biggest gainers in the S&P 500. Its stock surged $5.27, or 5.1 percent, to $108.17.
The energy sector has pared its loss for the year to 7.4 percent after this week’s gains. The industry group is the only one of the 10 industry groups in the S&P 500 to be down for the year.
In energy trading, the price of U.S. benchmark crude rose 50 cents to $67.38 a barrel on the New York Mercantile Exchange. Brent crude, a benchmark for international oils used by many U.S. refineries, fell 62 cents to close at $69.92 on the ICE Futures exchange in London. That’s the lowest close for Brent since May of 2010.
Among individual stocks, Abercrombie & Fitch surged after the clothing store for teens reported that its quarterly profit topped analysts’ estimates, even though sales slumped. Abercrombie gained 97 cents, or 3.5 percent, to $28.81.
In government bond trading, prices for U.S. government bonds edged higher. The yield on the 10-year Treasury note declined to 2.28 from 2.29 percent on Tuesday.
Prices of precious metals were mixed. Gold rose $9.30 to settle at $1,208.70 an ounce, while silver slipped 4 cents to $16.41 an ounce. Copper dipped 2 cents to $2.87 a pound.
In currency trading, the dollar rose against the Japanese yen, to 119.83 yen from 119.22 yen. The U.S. currency also gained against the euro, pushing the euro down to $1.231.
In other energy futures trading on the NYMEX:
- Wholesale gasoline fell 0.5 cents to close at $1.807 a gallon
- Heating oil fell 2.1 cents to close at $2.133 a gallon.
- Natural gas fell 6.9 cents to close at $3.805 per 1,000 cubic feet.
From The Associated Press
