Major stock indexes rose about 1 percent Wednesday after a report showing stabilization in manufacturing activity in the United States. Investors also appeared pleased about a fourth straight monthly rise in pending home sales in May. European markets had risen earlier following similarly upbeat data on manufacturing in that region.
Some of Wednesday's bounce may simply be due to stocks appearing cheaper following a big sell-off Tuesday and as investors look to put money to work as the new quarter begins.
Some of Wednesday's bounce may simply be due to stocks appearing cheaper following a big sell-off Tuesday and as investors look to put money to work as the new quarter begins.
Not all the new economic data was upbeat. Construction spending fell in May by more than the market expected, and the private sector lost more jobs in June than anticipated. The most anticipated report of the week will come on Thursday, when the Labor Department releases its June jobs report.
Scott Fullman, director of derivatives investment strategy for WJB Capital Group, said the employment report — along with thin, pre-holiday trading volumes — could make for a volatile market Thursday. U.S. markets are closed Friday in observance of the Independence Day holiday.
The Dow Jones industrial average rose 57.06, or 0.68 percent, to 8,504.06. The Standard & Poor's 500 index rose 4.01, or 0.44 percent, to 923.33. The Nasdaq composite index rose 10.68, or 0.58 percent, to 1,845.72.
Analysts say earnings reports coming in the next few weeks will largely determine which way the market heads in the third quarter. Investors are especially eager to hear what companies have to say about business prospects in the second half of the year.
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