Stocks finished higher Wednesday, rebounding from a three-day slide on renewed U.S.-China trade optimism. Reports suggested that Washington and Beijing are close to finalizing the amount of tariffs each side would rescind in a preliminary trade pact. Meanwhile, President Trump commented that the negotiations are going “very well,” despite previously suggesting that a deal could wait until after the 2020 U.S. presidential election. The Dow gained 146 points, while the S&P 500 added 0.6%. The Nasdaq Composite rose 0.5%.
On the data front, the Institute for Supply Management revealed that the pace of U.S. services sector expansion slowed last month. However, underlying components were mixed, with improvements in both new orders and employment helping to offset a sharp drop in business activity. Separately, the ADP reported that only 67,000 private payrolls were added in November, the lowest in six months and second-worst reading since 2010.
Treasuries erased the week’s gains, with the yield on the 10-year note up six basis points to 1.77%. In commodities, WTI crude jumped more than 4% to $58.40/barrel, notching its best day since mid-September on reports that “key members” of OPEC prefer deeper supply curbs ahead of tomorrow’s cartel meeting. Oil prices were also supported by larger-than-expected drawdown in U.S. crude stockpiles.
All 11 S&P 500 sectors closed in positive territory with Energy and Financials advancing at least 1%. In earnings, Salesforce.com slid 3.2% after the business software provider reported a net loss during the third quarter. Human resources software company Workday lost 4.7% following a disappointing forward outlook.