Stocks moved to the downside early in the session on Wednesday but have shown a notable turnaround over the course of the trading day. The major averages have climbed well off worst levels of the day and into positive territory.
Currently, the major averages are just off their best levels of the day. The Nasdaq is up 167.36 points or 0.9 percent at 18,452.52, the S&P 500 is up 40.29 points or 0.7 percent at 5,818.44 and the Dow is up 315.00 points or 0.7 percent at 42,835.99.
The early weakness on Wall Street reflected lingering concerns about the economic impact of President Donald Trump’s new tariffs on Canada, Mexico and China.
However stocks rebounded after a report from Bloomberg said the Trump administration is considering a one-month delay for automakers from newly imposed tariffs on Mexico and Canada.
The White House later confirmed the exemption for automakers, noting the move came after Trump spoke with heads of General Motors (GM), Ford Motor (F) and Stellantis (STLA).
Earlier in the day, some negative sentiment was generated in reaction to a report from payroll processor ADP showing much weaker than expected private sector job growth in the month of February.
ADP said private sector employment rose by 77,000 jobs in February after climbing by an upwardly revised 186,000 jobs in January.
Economists had expected private sector employment to grow by 140,000 jobs compared to the addition of 183,000 jobs originally reported for the previous month.
Private sector job growth slowed to the lowest level since last July, with trade and transportation, health care and education, and information showing job losses, ADP said.
“Policy uncertainty and a slowdown in consumer spending might have led to layoffs or a slowdown in hiring last month,” said ADP chief economist Nela Richardson.
She added, “Our data, combined with other recent indicators, suggests a hiring hesitancy among employers as they assess the economic climate ahead.”
Meanwhile, the Institute for Supply Management released a separate report showing an unexpected uptick by its reading on U.S. service sector activity in the month of February.
The ISM said its services PMI inched up to 53.5 in February from 52.8 in January, with a reading above 50 indicating growth. Economists had expected the index to edge down to 52.6.
Sector News
Airline stocks have shown a substantial move back to the upside following recent weakness, with the NYSE Arca Airline Index soaring by 3.0 percent after ending the previous session at its lowest closing level in well over four months.
Significant strength is also visible among gold stocks, as reflected by the 2.7 percent surge by the NYSE Arca Gold Bugs Index. The rally by gold stocks comes amid a modest increase by the price of the precious metal.
Steel stocks are also seeing considerable strength on the day, resulting in a 2.5 percent jump by the NYSE Arca Steel Index.
Telecom, housing and software stocks have also moved notably higher, while oil producer stocks remain sharply lower amid a steep drop by the price of crude oil.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Wednesday. Japan’s Nikkei 225 Index edged up by 0.2 percent, China’s Shanghai Composite Index rose by 0.5 percent and Hong Kong’s Hang Seng Index surged by 2.8 percent.
European stocks also showed a strong move to the upside on the day. The German DAX Index spiked by 3.4 percent and the French CAC 40 Index jumped by 1.6 percent, although the U.K.’s FTSE 100 Index bucked the uptrend and closed just below the unchanged line.
In the bond market, treasuries are extending the pullback seen over the course of the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 5.9 basis points at 4.269 percent.
Business News
U.S Stocks Turn Positive After Trump Grants Automakers One-Month Tariff Exemption
2025-03-05 19:03:16
