Stocks Surge Despite Weak Job Growth in February

New Delhi (The Uttam Hindu): Stocks surged on Wednesday, with the Nasdaq up by 1.5%, the S&P 500 gaining 1.1%, and the Dow rising 1.1%, driven by strong sector performances and a rise in service sector activity, despite weak job growth in February. The Nasdaq gained 267.57 points (1.5%), closing at 18,552.73, the S&P 500 rose by 64.48 points (1.1%) to 5,842.63, and the Dow jumped 485.60 points (1.1%) to 43,006.59. The market's rally came despite negative sentiment early in the day following a report from payroll processor ADP, which revealed weaker-than-expected private sector job growth in February. ADP reported that private sector employment grew by just 77,000 jobs in February, a sharp decline from the 186,000 jobs added in January. This marked the lowest job growth since last July, with significant losses in trade, transportation, healthcare, education, and information sectors.

ADP's chief economist, Nela Richardson, attributed the slowdown to policy uncertainty and a potential reduction in consumer spending. She noted that these factors might have led to layoffs and a slowdown in hiring as employers evaluate the economic climate.

Despite the weak job report, several sectors performed well. Airline stocks surged, with the NYSE Arca Airline Index soaring 4.3%. Gold stocks also gained strength, reflected by a 4.0% surge in the NYSE Arca Gold Bugs Index, as the price of gold rose. Steel stocks saw notable gains, with the NYSE Arca Steel Index climbing 3.5%. Telecom, software, and networking stocks also moved notably higher. However, oil producer stocks fell sharply, driven by a significant drop in crude oil prices.

In global markets, stocks in the Asia-Pacific region moved mostly higher. Japan's Nikkei 225 Index rose by 0.2%, China's Shanghai Composite Index gained 0.5%, and Hong Kong's Hang Seng Index surged 2.8%. European stocks also saw gains, with the German DAX Index spiking 3.4% and the French CAC 40 Index jumping 1.6%. However, the U.K.'s FTSE 100 Index closed just below the unchanged line, bucking the uptrend.

In the bond market, treasuries continued their pullback from the previous session, causing the yield on the benchmark ten-year note to climb 5.5 basis points to 4.26%.