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Stocks Rise amid Stimulus Hope 09/30 09:37
Wall Street is rallying Wednesday on optimism for the economy and rising
hope that Washington may pierce through its paralyzing partisanship to offer
more aid for it.
NEW YORK (AP) -- Wall Street is rallying Wednesday on optimism for the
economy and rising hope that Washington may pierce through its paralyzing
partisanship to offer more aid for it.
The S&P 500 was up 1% in early trading, on pace to more than reverse the
prior day's losses. After setting a record high early this month, the benchmark
index has been mostly tumbling on a wide range of worries, and it's still on
pace for a 3.7% drop in September, which would be its first monthly loss since
March.
The Dow Jones Industrial Average was up 374 points, or 1.4%, at 27,826, as
of 10:05 a.m. Eastern time, and the Nasdaq composite was 0.9% higher.
Stocks and Treasury yields rose following a stronger-than-expected report on
hiring by private employers. They then accelerated amid revived hopes that the
U.S. government could soon deliver more support for the economy. Treasury
Secretary Steven Mnuchin said at a conference presented by CNBC and
Institutional Investor that he will talk with House Speaker Nancy Pelosi again
this afternoon, "and I hope we can get something done."
Investors have been frustrated waiting for Congress to deliver more stimulus
after weekly unemployment benefits and other aid it had earlier approved for
the economy expired. They have long called such programs crucial for an economy
that's still struggling under the weight of the coronavirus pandemic.
The number of layoffs sweeping the country has remained stubbornly high, and
other areas of the economy have seen growth slow since the Congressional aid
went away.
But a report from payroll processor ADP on Wednesday gave some
encouragement. It said hiring by private employers accelerated this month, with
749,000 jobs added versus economists' expectations for 605,000.
That raises hopes for the federal government's more comprehensive jobs
report, which arrives on Friday. For that, economists had been expecting to see
hiring slowed to 850,000 from 1.4 million in August.
This month's jobs report will take on even more importance than usual
because it will be the final one released before Election Day in November.
Tuesday night's debate between President Donald Trump and the Democratic
nominee, Joe Biden, was the first of this election season, and it amplified
some of the market's concerns. Trump said it may take months to learn the
election's results, and such a long period of uncertainty could make an already
shaky market even more volatile.
But several analysts said they didn't see the debate having a big effect on
the stock market, whose path depends much more on what happens with corporate
profits, interest rates and the coronavirus pandemic than who sits in the White
House.
"Last night was pretty much a nothing burger from a market perspective,
other than perhaps suggesting more uncertainty in the weeks ahead, which could
continue to drive volatility," said Mike Loewengart, managing director of
investment strategy at E-Trade Financial.
Trump again lobbed claims of fraud at the voting process, even when the head
of the FBI has said there has not been any significant coordinated national
voter fraud. The tone was combative through the night, with plenty of insults
and talking over one another, and reflective of the country's deepening
partisan divide.
Shares of data-mining outfit Palantir are set to begin trading on Wednesday,
17 years after it was born with the help of CIA seed money. The company isn't
selling new shares to raise money. Instead, it's listing existing shares for
public trading.
In Europe, Germany's DAX was close to flat after shaking off an earlier
loss. The CAC 40 in Paris rose 0.1%, and London's FTSE 100 added 0.2%.
In Asia, Japan's Nikkei 225 lost 1.5%, Hong Kong's Hang Seng rose 0.8% and
stocks in Shanghai slipped 0.2% .
The yield on the 10-year Treasury was holding steady at 0.66% after erasing
earlier losses.
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