WASHINGTON: US stocks edged up Wednesday as news of slower private hiring, softening pay increases and a downward revision in economic growth fueled hopes the US Federal Reserve could loosen monetary policy.
Private hiring came in well below expectations according to payroll firm ADP, with employers adding just 177,000 new jobs in August, while pay growth eased to 5.9 percent year-on-year.
GDP growth for the second quarter was also revised down on slower business investment, the Commerce Department said.
Wall St gains, Treasury yields drop as data raises potential for Fed pause
Around 15 minutes into trading, the Dow Jones Industrial Average was up 0.3 percent at 34,969.88.
The broad-based S&P 500 rose 0.3 percent to 4,505.15, while the tech-heavy Nasdaq Composite Index climbed 0.1 percent to 13,956.68.
The hope among traders is that slowing economic growth and softer hiring figures could spur the Fed to ease its aggressive cycle of interest rate hikes targeting high inflation.
This would have the effect of stimulating the economy, and also making stocks a more appealing investment once again.
While all three major indices on Wall Street rose on Wednesday, more muted trading could signal that traders think stocks have already priced in the prospects of a slowing economy, said Briefing.com chief market analyst Patrick O’Hare.
“We suspect traders might be showing some hesitation, thinking that this heady action can’t persist or, at least, opting to wait and see if it does,” he wrote in a note on Wednesday.
Among individual stocks, shares in the audio company Sirius XM were up more than five percent in early trading, building on recent gains.
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