ADP Jobs Numbers Lift Stocks

Markets were risk-on on Wednesday after a jobs report confirmed the U.S. economic recovery is still on a fast-track.

The S&P 500 rose 0.5%, with the tech-heavy Nasdaq down up just 0.3%, signifying it was non-tech stocks and a broad rally doing the legwork for the major indices. The 10-Year Treasury yield rose  to 0.67% fro 0.65%. Inflation expectations have been marginally improving.

Aiding sentiment in cyclicals was the ADP jobs report that showed 749,000 jobs added in September against economists estimates of 600,000. Even with questions lingering over whether the House’s proposed $2.2 trillion stimulus bill will be passed, consumer confidence was strong in September and businesses were adding employees, keeping the V-shaped economic and earnings recovery alive. Banks and oil stocks were up 1.4% and 0.5%, respectively.

“The pace of economic recovery is certainly key to future growth, and with private sector employment coming in better than expected this morning—the largest gain in 3 months—this could point to signs of strength in the labor market,” wrote Mike Loewengart, managing director of investment strategy at E*Trade in emailed remarks to reporters.

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