U.S. stocks closed higher Wednesday after the Federal Reserve's Beige Book said economic activity expanded at a "modest to moderate" pace over the past few months, signaling the economy will rebound in the spring following a sluggish first quarter. Wednesday’s gains were led by the industrial and consumer goods and services sectors, while declines were driven by losses in the utilities sector.
The Dow Jones Industrial Average (INDEXDJX:.DJI) gained 64.33 points, or 0.36 percent, to close at 18,076. The Standard & Poor's 500 (INDEXNASDAQ:.IXIC) added 4.47 points, or 0.21 percent, to finish at 2,114. The Nasdaq composite (INDEXSP:.INX) rose 22.71 points, or 0.45 percent, to end at 5,099.
The outlook for U.S. economic activity was optimistic across multiple sectors over the past few months, including the construction, manufacturing, retail and auto sectors over the past few months, the Federal Reserve’s Beige Book revealed Wednesday. The report provides further evidence the economy is rebounding after shrinking in the first three months of the year, thanks to a slowdown in shipping at West Coast ports due to labor disputes.
Market professionals are looking ahead to Thursday’s economic calendar, which includes weekly jobless claims, or the number of Americans filing new claims for unemployment, due out at 8:30 a.m. EDT. Initial claims for state unemployment benefits rose last week as initial claims for state unemployment benefits increased 7,000 to a seasonally adjusted 282,000 for the week ended May 23, the U.S. Labor Department said last week.
Economists forecast jobless claims to fall by 3,000 to 279,000 for the week ended May 30, according to analysts polled by Thomson Reuters.
U.S. stocks rallied in morning trading, with the Dow leaping 150 points after U.S. private employers topped Wall Street forecasts and added 201,000 jobs in May, boosted by the service sector, the monthly ADP National Employment Report showed.
Investors are also watching developments in Greece this week as Prime Minister Alexis Tsipras meets with senior European officials in Brussels Wednesday to discuss proposed reforms for Athen’s bailout program.
Home Depot Inc. (NYSE:HD), the world's No. 1 home-improvement retailer, led the Dow higher Wednesday, gaining 1.4 percent. Dow Component JPMorgan Chase & Co. (NYSE:JPM) and Goldman Sachs Group Inc. (NYSE:GS) added 1 percent.
Intel Corporation (NASDAQ:INTC) was the biggest laggard in the blue-chip index, shedding 1.6 percent.
The S&P 500 consumer discretionary sector gained nearly 1 percent, boosted by a nearly 4 percent gain from Urban Outfitters, Inc. (NASDAQ:URBN). However, the S&P 500 utilities sector lost more than 1 percent, led by 2 percent declines from Public Service Enterprise Group Inc. (NYSE:PEG), Consolidated Edison, Inc. (NYSE:ED) and CMS Energy Corporation (NYSE:CMS).
Shares of Synchronoss Technologies, Inc. (NASDAQ:SNCR) soared 15 percent Wednesday to close at $49.02, following a report the wireless-software company is exploring a sale, valued at more than $2 billion, the Wall Street Journal reported.