Stocks are broadly higher on Wall Street in afternoon trading Wednesday, on track to extend the market's milestone-setting run.
The S&P 500 was up 1.3%, with health care, technology and communications companies driving the rally. Technology stocks, which have led the market's rebound this year, stumbled in the early going, but gained strength into the afternoon. Energy companies fell as oil prices closed lower. Treasury yields were mixed.
Investors appeared to shrug off a report showing that U.S. companies added only 428,000 jobs in August, far fewer than what economists had expected. The survey by payroll processor ADP comes ahead of the government's more comprehensive monthly hiring report due out Friday.
Speculation that negotiators in Congress and the White House will reach an agreement on a coronavirus relief package and optimism that a COVID-19 vaccine will become available this year helped put traders in a buying mood Wednesday, said J.J. Kinahan, chief strategist with TD Ameritrade.
“That, along with the fact that people continue to want to buy the stocks that have performed so well,” he said. “You look around for alternatives to put your money in right now and there really aren't many great places to say ‘this is where I want to have my money.’”
The Dow Jones Industrial Average was up 360 points, or 1.3%, to 29,005 as of 3:04 p.m. Eastern time. The Nasdaq composite, which is heavily weighted with tech stocks, rose 0.7%, recovering from an early drop. The Russell 2000 index of smaller company stocks was up 0.5%.
DraftKings was among the big gainers, vaulting 8.1% after announcing that basketball legend Michael Jordan would take an ownership stake in the company in exchange for becoming a special advisor to the sports betting site.
Macy’s rose 0.4% after reporting a quarterly loss that was much smaller than analysts were anticipating. The department store chain said its digital sales rose more than 50% in the latest quarter.
Chipmakers were big gainers, reflecting optimism about demand for computers, video games and other devices. Nvidia climbed 4.2% and Lam Research rose 6.5%.
U.S. stocks remain in record territory after the S&P 500 and Nasdaq set all-time highs in recent weeks. The benchmark S&P 500 index is up 10.5% this year following a five month streak of gains, while the Nasdaq is up more than 34%.
Wall Street's push higher has been powered by gains in technology stocks that investors expect will remain safe bets throughout the pandemic and beyond, reflecting how reliant people have become on internet-connected devices and online services while spending more time at home.
Encouraging data on business reopenings and the race to develop a vaccine for COVID-19 by the end of the year have fueled investor optimism that the economy will bounce back from a deep recession.
“Investors are sort of in this very comfortable area of anticipating a sort of slow-grind recovery,” said Katie Nixon, chief investment officer at Northern Trust Wealth Management.
Traders are also anticipating that Congress will reach an agreement on a new coronavirus aid package. The GOP and Democrats have been in a monthslong stalemate over new relief legislation, with the two sides trillions of dollars apart.
“There’s a desire on both sides and they’re recognizing they are going to have to come to a deal some time soon,” Nixon said, adding that the longer the economy goes without government support, the more fragile the prospects for a recovery become.
Treasury yields were mixed. The yield on the 10-year Treasury note fell to 0.64% from 0.67% late Tuesday, while the yield on the 2-year note rose to 0.13% from 0.12%.
Oil prices headed lower. Benchmark U.S. crude oil fell 2.9% to $41.51 a barrel, while Brent crude oil, the international standard, slid 2.5% to $44.43 a barrel.