US stocks zipped higher on Wednesday, leaving the S&P 500 on track for its best day in three weeks, as traders eyed upbeat data on the labour market and rising oil prices.
The S&P 500 climbed by 0.7 per cent in mid-morning action to 2,377.3, the Dow Jones Industrial Average rallied 0.9 per cent to 20,871.6 and the Nasdaq Composite gained 0.4 per cent to 5,922.8.
Investors homed in on the ADP report, which showed the US private sector tacked on more jobs than expected last month, and prompted numerous investment banks to increase their outlook for non-farm payroll data that are due out on Friday.
US crude oil prices also rallied as much as 1.6 per cent to $51.83 a barrel, further bolstering the mood across Wall Street trading desks. However, the gains fizzled to 0.7 per cent after the weekly crude inventories report.
Every major sector was in the black, but economically sensitive industries posted the best performance. Energy climbed 1.6 per cent, and industrials and financials rose 1 per cent each. Defensives lagged behind, with utilities up 0.1 per cent, and real estate climbing 0.3 per cent.
Traders appeared to shrug off disappointing data on the US services sector, which showed that growth cooled off to the lowest levels since before the election.
“While the March outcomes was indeed weaker than anticipated, it followed four months of results that were stronger than one would expect given the prevailing pace of aggregate growth,” said Joshua Shapiro, chief US economist at MFR.
Still, Peter Boockvar, chief market analyst at The Lindsey Group, said, “confidence is still high but it’s clearly cooled since the post election driven euphoria”.