FOX Business: The Power to Prosper
After fluctuating throughout the day, U.S. stocks reached the finish line on Wednesday with modest gains on the heels of new employment and service-sector data that beat Wall Street's low expectations.
The Dow Jones Industrial Average rose 12.25 points, or 0.09%, to 13494.61, the S&P 500 advanced 5.24 points, or 0.36%, to 1450.99 and the Nasdaq Composite jumped 15.19 points, or 0.49%, to 3135.23. The FOX 50 picked up 5.57 points, or 0.51%, to 1096.78.
The higher close broke a two-day streak of mixed performances, yet Wall Street still displayed muted enthusiasm for the economic data ahead of Friday's looming government jobs report.
"We’re in a stall pattern. We’re waiting for that jobs number,” said Scott Wren, senior equity strategist at Wells Fargo’s (NYSE:WFC) Wells Fargo Advisors.
Wall Street was also held back by crude oil's worst performance of the year, which weighed on energy stocks, and plummeting shares of Hewlett Packard (NYSE:HPQ).
Most of the Dow's 30 members gained ground, led by Bank of America (NYSE:BAC) and Walt Disney (NYSE:DIS). The index's biggest laggards were Chevron (NYSE:CVX) and H-P, which plummeted 13% to 2003 lows on a gloomy guidance.
By closing in the green, the blue chips have now closed in the opposite direction of the previous day for five consecutive sessions, the longest such streak in a month. Meanwhile, the S&P 500 has advanced for three straight days.
“I think we’ve reached a level that is pretty close to what I would call fair value for the year," said Wren.
Most of the attention on Wednesday was on the economic data. The Institute for Supply Management's gauge of service-sector activity rose to a six-month high of 55.1 in September from 53.7 in August, suggesting the sector is expanding at a faster rate. Economists had expected expansion would slow to 53.1. A reading above 50 indicates expansion.
“Today’s report reinforces the resiliency of the U.S. economy in the face of considerable headwinds and uncertainty,” Dan Greenhaus, chief global strategist at BTIG, wrote in a note.
Meanwhile, ADP's private sector labor report revealed the U.S. private sector created 162,000 jobs in September, besting forecasts from economists for 143,000. However, ADP trimmed its August job growth estimate down to 189,000 jobs from 201,000.
The ADP data serve as a preview for Friday's more closely watched government jobs report, which is forecasted to show nonfarm payroll growth rose to 115,000 last month from 96,000 the month before.
However, the energy sector declined about 1.2%, with individual names like Valero (NYSE:VLO) seeing even deeper losses as crude oil suffered its steepest one-day percentage dive since last December. Selling in crude picked up stream after new data showed crude stockpiles declined last week, but gasoline inventories unexpectedly climbed.
Crude tumbled $3.75 a barrel, or 4.08%, to $88.14 -- its lowest settle since August 2. Gold added $4.60 a troy ounce, or 0.26%, to $1,777.30.
In the bond markets, the yield on the 10-year Treasury note inched up to 1.622% from 1.613%, snapping a three day streak of declining yields.
Wall Street is also waiting for the start of third-quarter earnings season next week with results from aluminum maker Alcoa (NYSE:AA). The bar has been set very low, with analysts calling for S&P 500 companies to suffer a 1.66% year-over-year decline in earnings -- the weakest performance in three years.
MetroPCS (NYSE:PCS) approved a combination with Deutsche Telekom's T-Mobile USA unit in a deal that marries the No. 4 and No. 5 U.S. wireless providers. MetroPCS shareholders will receive $1.5 billion in cash and a 24% stake of the new entity, while Deutsche Telekom will hold 74%.
Hewlett-Packard (NYSE:HPQ) tumbled after projecting full-year non-GAAP EPS of $3.40 to $3.60, compared with the Street's view of $4.18. H-P, holding its analyst day, said it expects all segments except software to suffer declining revenue.
Monsanto (NYSE:MON) slumped 2.2% after the world's largest seed giant disclosed a deeper-than-expected quarterly loss and a cautious outlook for fiscal 2013.
Best Buy (NYSE:BBY) founder Richard Schulze and at least four private-equity firms are moving forward with due diligence for a potential $11 billion takeover of the electronics retailer, Reuters reported. The PE firms include Apollo Global Management, Cerberus Capital Management and TPG Capital.
Family Dollar (NYSE:FDO) met expectations with a 1.4% rise in fiscal fourth-quarter earnings amid a 5.4% gain in same-store sales. The discounter's fiscal 2013 guidance exceeded expectations.
The Euro Stoxx 50 dipped 0.04% to 2492.48, London’s FTSE 100 gained 0.28% to 5825.81 and the German DAX added 0.22% to 7322.08.
In Asia, Japan’s Nikkei 225 slid 0.45% to 8746.87 and Hong Kong's Hang Seng returned from a two-day break by advancing 0.23% to 20888.28.