Financial Markets                      11/05 15:33

   

   NEW YORK (AP) -- Stocks gained ground on Wall Street Wednesday following 
several upbeat economic updates and a steady flow of quarterly reports from 
U.S. companies.

   The gains were broad and marked a reversal from the prior day's dip. Much of 
the market's push and pull came from the technology sector, where several 
companies with huge values have an outsized influence over the market.

   Google's parent, Alphabet, jumped 2.4%, Broadcom rose 2%, and Facebook 
parent Meta Platforms rose 1.4%. They helped lead the way higher for the 
broader market. Their gains also helped counter losses from a few technology 
behemoths, including Nvidia and Microsoft.

   Overall The S&P 500 rose 24.74 points, or 0.4% to 6,796.29. The Dow Jones 
Industrial Average rose 225.76 points, or 0.5%, to 47,311. The Nasdaq composite 
rose 151.16 points, or 0.6%, to 23,499.80.

   Company earnings and forecasts were once again a big focus for Wall Street, 
with results coming from a broad spectrum of industries.

   McDonald's rose 2.2% after reporting that its sales benefited from the 
return of its popular Snack Wraps in the third quarter. International Flavors & 
Fragrances jumped 4.1% after beating Wall Street's latest quarterly profit 
forecasts.

   On the losing side, Taser maker Axon Enterprise slumped 9.4% after 
forecasting weaker profits than analysts were expecting. Live Nation 
Entertainment fell 10.6% after its latest results fell short of analysts' 
forecasts.

   The latest round of earnings offers Wall Street a source of information on 
consumers, businesses and the economy that is otherwise lacking amid the 
government shutdown. Important monthly updates on inflation and employment have 
ceased, leaving investors, economists and the Federal Reserve without a fuller 
picture of the economy.

   There are still several informative private economic updates that Wall 
Street can review.

   A monthly report from ADP showed that private payrolls rose more than 
expected in October. The report offers a partial glimpse into the job market, 
which has been generally weakening and raising broader concerns about economic 
growth.

   The services sector, which is the largest part of the U.S. economy, expanded 
in October more than Wall Street expected, according to the Institute for 
Supply Management. The report shows that while overall business activity grew, 
employment was still contracting.

   "The survey provides a reassuring sign that economic growth persisted in 
October despite the government shutdown," Bill Adams, chief economist for 
Comerica Bank, wrote in a note to investors.

   A weaker job market remains a big concern for the Fed. The central bank cut 
its benchmark rate for the second time this year at its most recent meeting, in 
part to help bolster the economy amid a weakening job market. Lower interest 
rates can make a wide range of loans and credit less expensive, potentially 
promoting economic growth. But, lower rates can also add fuel to inflation, 
which could stunt economic growth.

   Fed Chair Jerome Powell and several other Fed officials have expressed 
concerns about more rate cuts, as inflation remains stubbornly above the 
central bank's target of 2%. Consumer prices rose 3% in September.

   The mix of a weaker job market and hot inflation leaves the Fed in a tough 
position.

   "For Fed watchers, this ADP report should make it clear that a December rate 
cut is now in play," said Jamie Cox, managing partner for Harris Financial 
Group, in a note to investors. "We are nearing stall speed in the labor market, 
and that will get the Fed's attention."

   Wall Street has tempered its expectations for another interest rate cut in 
December. Investors are now forecasting a 63% chance that the Fed will cut 
interest rates, according to CME FedWatch. That's down from a 90% chance just 
prior to the previous rate cut.

   The threat of tariffs also continues to hang over consumers and businesses. 
President Donald Trump's trade war with China, Canada and many other nations 
has been unpredictable. The full impact of higher prices is difficult to 
forecast because of constant shifts in policy. The U.S. Supreme Court heard 
arguments Wednesday about the legality of the sweeping tariffs.

   Treasury yields rose in the bond market. The yield on the 10-year Treasury 
rose to 4.16% from 4.09% late Tuesday. The yield on the two-year Treasury rose 
to 3.63% from 3.58% late Tuesday.

   European markets gained ground and Asian markets closed mostly lower.

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