By Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch)--The U.S. stock market ended a choppy
session moderately higher on Wednesday, with the S&P 500
closing at a record. Market reaction to a pair of
better-than-expected economic reports was largely muted in early
trading; indexes pushed higher in late afternoon.
Private-sector hiring in March picked up to the fastest pace in
three months while factory orders rose in February.
The S&P 500 index (SPX) ended the day at a session high, up
5.38 points, or 0.3%, to 1,890.90, closing at a record for the
eighth time this year. Consumer discretionary and industrials
sector stocks led the gains.
The Dow Jones Industrial Average (DJI) closed up 40.39 points,
or 0.2%, at 16,573.00, only a few points shy of its record close
reached Dec 31. 2013. The blue-chip index is now flat for the
year.
The Nasdaq Composite (RIXF) finished the day up 8.42 points, or
0.2%, at 4,276.46.
"Today's ADP numbers should be taken not in isolation but as a
part March data package--together with the ISM and jobless claims
figures, they indicate a nice progression growing at moderate
rate," said Jim Russell, senior equity strategist at U.S. Bank
Wealth Management.
"It appears that cold winter weather and not something
fundamental held back the growth and resulted in weakness," Russell
added.
Private-sector-employment gains picked up in March, with
employers adding the most jobs in three months, and quicker hiring
may be ahead, Automatic Data Processing Inc. reported
Wednesday.
ADP said private-sector employers added 191,000 jobs last month,
up from 178,000 in February. A prior estimate pegged February's
increase at 139,000.
While some economists use ADP's number to get a feeling for the
official nonfarm payrolls data, it is not always a reliable
indicator, according to Ian Shepherdson, chief economist at
Pantheon Macroeconomics.
"We no longer view ADP as a useful advance indicator of the
official payroll numbers. Since ADP was revamped in October 2012 it
has clearly tended to lag movements in the official numbers by a
month. We still look for 250,000 jobs gain on Friday," wrote
Shepherdson in an emailed comments.
Separately, orders for goods produced in U.S. factories rose
1.6% in February, the U.S. Commerce Department said Wednesday.
Orders for durable goods--products meant to last at least three
years--rose 2.2% in February. Orders for nondurable goods increased
1%.
Two Federal Reserve officials speaking publicly on Wednesday
offered slightly different views about the timing of the first rate
hike. In an interview on Bloomberg Radio on Wednesday, St. Louis
Fed President James Bullard said that he expects the first rate
hike to come in the first quarter of 2015, though he conceded that
he's ahead of most of his colleagues.
Atlanta Fed President Dennis Lockhart said that the first rate
hike is not likely to be warranted until at least the last half of
next year.
Among individual stocks, Monsanto Co. (MON) shares rose 0.8%
after the agricultural company reported its second-quarter
earnings. The company said its fiscal second-quarter earnings grew
13% thanks to continued strength in its soybean seed sales as well
as improved margins. Results beat expectations.
Shares of MannKind Corp. (MNKD), which surged 100% in
after-hours trading on Tuesday, were up another 74% to $6.99 on
news a Food and Drug Administration advisory panel recommended
approval of the biopharmaceutical company's inhaled diabetes drug
Afrezza.
General Motors Co. (GM.XX) rose 1.6% as chief executive Mary
Barra returned to Capitol Hill to continue her testimony on the
company's handling of a massive recall linked to an ignition
defect. GM said on Tuesday that U.S. sales in March rose 4% to
256,047 vehicles.
Nomura analysts initiated coverage of GM on Wednesday with a
reduce rating, alongside a neutral rating for Ford Motor Co. (F).
"We believe increasing macroeconomic headwinds will affect Ford and
GM's profitability negatively relative to very high expectations
for a FY15 earnings-per-share recovery," said analyst Harald
Hendrikse in a note. Ford shares were 0.9% higher.
Shares of Intuitive Surgical Inc. (ISRG) rose 5% after surging
11% on Tuesday after the company said it received the go-ahead from
the U.S. Food and Drug Administration for its da Vinci Xi Surgical
System.
In overseas markets, the Stoxx Europe 600 index logged light
gains as investors awaited U.S. data and Thursday's European
Central Bank meeting. Asia stocks chased up Wall Street gains, with
a 1% rose for Japan's Nikkei Average and more modest advances
elsewhere. A weaker yen (USDJPY) contributed to the gains on the
Nikkei. Gold (GCM4) rose 0.9%, breaking a 5-day losing streak,
while oil (CLK4) edged lower.
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