Stocks closed modestly higher on Wall Street, chipping away at the market's losses for August. Treasury yields fell Wednesday after some weaker-than expected readings on the US economy and job market. The S&P 500 rose 17.24 points, or 0.4%, to 4,514.87 for its fourth gain in a row. It's still down 1.6% for August, with one trading day left in the month, the AP reports. The Dow Jones Industrial Average rose 37.57 points, or 0.1%, to 34,890.24. The Nasdaq composite rose 75.55 points, or 0.5%, to 14,019.31. Technology stocks led the market's gains. Apple rose 1.9% and Palo Alto Networks rose 1.7%. HP was on the losing end with a 6.6% slump after cutting its profit forecast for the year.
Wall Street's focus this week remains a broad mix of data that investors hope will paint a clearer picture of where the economy is headed and whether the Federal Reserve has enough reason to hold off on further interest rate hikes. A survey of private-sector employers in the US showed that hiring cooled more than expected by economists. The report reinforces the latest government data on job openings from Tuesday, which also showed that hiring is cooling somewhat. The US downgraded its economic growth estimate for the second quarter to an annual rate of 2.1% from 2.4%. Economists had forecast that the gross domestic product, or GDP, assessment would remain unchanged though it still marks a slight increase from growth of 2% during the first quarter.
"Right now, what's bad is good," says Scott Wren, senior global market strategist at Wells Fargo Investment Institute. "It feels like this week, anyway, we're fully back into bad economic news is good for the market." The latest round of economic updates are signaling that the Fed may be able to pause hiking its main interest rate, which it has pushed to its highest level since 2001 in an effort to tame inflation. The central bank held rates steady at its last meeting and investors expect the same at its upcoming meeting in September.
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On Thursday, the government will release its latest update on inflation with the July report on personal consumption and expenditures. On Friday, the government's monthly employment report for August will cap a heavy week of updates about hiring and jobs. "If you have modest growth and modest inflation and that's what we're moving toward, stocks will have a bumpy road in the interim, but that's a good environment for stocks," Wren says. (More stock market stories.)
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