Wall Street jumped on Wednesday as an increase in U.S. manufacturing activity and new signs of growth in China and Australia boosted investor confidence in the state of the global economy.
The three major U.S. stock indexes rose nearly 3 percent after the Institute for Supply Management's closely watched index showed U.S. manufacturing grew faster than forecast and chalked up a 13th straight month of expansion.
It's definitely good for the market that we're getting a little bit of positive data, said Giri Cherukuri, head trader at Oakbrook Investments, in Lisle, Illinois. On top of that, it's the beginning of the month, and people are putting their money to work.
U.S. stocks rose initially after reports showed China's manufacturing staged a moderate rebound, while Australia's economy grew at its fastest pace in three years on a boost in household spending.
The Dow Jones industrial average <.DJI> gained 231.74 points, or 2.31 percent, to 10,246.46. The Standard & Poor's 500 Index <.SPX> rose 27.81 points, or 2.65 percent, to 1,077.14. The Nasdaq Composite Index <.IXIC> added 55.49 points, or 2.62 percent, to 2,169.52.
The S&P 500 index moved above its 14-day moving average at 1,063 for the first time since August 11, but fell just short of taking out its 50-day moving average at around 1,081.
Shares of aluminum producer Alcoa Inc
The overseas data helped boost oil futures 3 percent to $74.07 a barrel and lifted the energy sector. The NYSE Arca Oil index <.XOI> rose 3.5 percent.
Investors shrugged off a report from ADP Employer Services that showed private U.S. companies unexpectedly cut 10,000 jobs in August and government data indicated U.S. construction spending fell to its lowest rate in 10 years.
Shares of Burger King Holdings Inc
(Reporting by Edward Krudy; Additional reporting by Caroline Valetkevich; Editing by Jan Paschal)