US close: Stocks rebound as investors digest PMI readings

(Sharecast News) - Major indices closed higher on Wednesday as market participants were zeroed in on a Supreme Court hearing on Donald Trump's "reciprocal tariffs" and a pair of fresh PMI readings.

At the close, the Dow Jones Industrial Average was up 0.48% at 47,311.00, while the S&P 500 advanced 0.37% to 6,796.29, and the Nasdaq Composite saw out the session 0.65% firmer at 23,499.80.

The Dow closed 225.76 points higher on Wednesday, reclaiming the majority of the previous session's losses after Palantir's Wall Street-beating third-quarter earnings left investors increasingly concerned about valuations in the bull market-leading sector.

Investors kept a close eye on the Supreme Court on Wednesday as justices heard arguments over the legality of Donald Trump's tariffs under the International Emergency Economic Powers Act. The hearing centred on whether the administration had the authority to impose sweeping duties under the emergency powers framework, with both conservative and liberal justices pressing Solicitor General D John Sauer on the rationale behind the measures. Traders in prediction markets trimmed expectations that the court would uphold the tariffs, citing apparent judicial scepticism.

On the macro front, US mortgage applications fell 1.9% in the week ended 24 October, according to the Mortgage Bankers Association, trimming the prior week's 7.1% surge. Applications to refinance a mortgage, which are more sensitive to short-term changes in interest rates, dropped 2.8% week-on-week, while applications to purchase a home fell by 0.7%.

Elsewhere, private sector payrolls rose more than expected in October, according to ADP, offering a modest sign of resilience in the US labour market. ADP said on Wednesday that US firms had added 42,000 jobs during October, topping consensus estimates of 22,000 gain and reversing a revised 29,000 decline in September. Despite subdued headline growth, wage inflation remained firm, with pay for job stayers rising 4.5% year-on-year, unchanged from September, while job switchers saw a 6.7% increase.

On another note, the S&P Global services PMI edged up to 54.8 in October from 54.2 in September, revised down from the initial flash reading of 55.2 but still ahead of consensus expectations for a print of 53.5. Stronger new order volumes underpinned the improvement, reflecting firm client demand despite ongoing uncertainty around US economic policy. Export demand, however, declined during the month, with respondents citing increased focus on tariff-related risks. S&P's composite PMI rose to 54.6 in October, up from 53.9 in September but slightly below the 54.8 flash estimate.

Finally, the Institute for Supply Management's services PMI rose to 52.4 in October, up from 50 in September, beating forecasts of 50.8 and pointing to the strongest expansion in the sector since February. Both business activity and new orders rebounded, while employment continued to contract, pointing to a lack of confidence in the continued strength of the US economy.

In the corporate space, fast food giant McDonald's Q3 earnings rose from $2.26bn to $2.28bn but fell short of estimates as it continued to operate in a 'challenging environment', while Qualcomm issued Q1 revenue guidance that came in well and truly ahead of estimates after Q4 sales and earnings beat expectations.

Robinhood Q3 results topped estimates on the back of the recent crypto trading boom, and DoorDash reported its quarterly growth performance in more than two years and said it invest "several hundred million" next year in order to beef up internal artificial intelligence tools.

Reporting by Iain Gilbert at Sharecast.com

Dow Jones - Risers

Amgen Inc. (AMGN) $319.86 7.81%

Caterpillar Inc. (CAT) $572.27 3.94%

Intel Corp. (INTC) $38.38 3.65%

3M Co. (MMM) $164.54 2.32%

McDonald's Corp. (MCD) $307.17 2.16%

International Business Machines Corporation (CDI) (IBM) $306.90 1.97%

American Express Co. (AXP) $367.41 1.47%

Nike Inc. (NKE) $62.18 1.44%

Verizon Communications Inc. (VZ) $39.67 0.94%

Dow Chemical Co. (DOW) $22.67 0.80%

Dow Jones - Fallers

Home Depot Inc. (HD) $374.38 -2.41%

Microsoft Corp. (MSFT) $507.16 -1.39%

Procter & Gamble Co. (PG) $145.83 -0.94%

Unitedhealth Group Inc. (UNH) $327.34 -0.93%

Walmart Inc. (WMT) $101.76 -0.78%

Salesforce.Com Inc. (CRM) $253.53 -0.69%

Chevron Corp. (CVX) $153.39 -0.48%

Johnson & Johnson (JNJ) $186.43 -0.46%

Cisco Systems Inc. (CSCO) $72.10 -0.30%

Travelers Company Inc. (TRV) $277.76 -0.23%

S&P 500 - Risers

Seagate Technology Plc (STX) $275.77 10.14%

Micron Technology Inc. (MU) $237.50 8.93%

Kohls Corp. (KSS) $17.90 8.88%

Johnson Controls International plc (JCI) $120.94 8.84%

Amgen Inc. (AMGN) $319.86 7.81%

VF Corp. (VFC) $14.81 7.41%

Macy's Inc. (M) $20.89 6.96%

Southwest Airlines Co. (LUV) $31.53 6.57%

United Airlines Holdings Inc (UAL) $96.65 6.48%

American Airlines Group (AAL) $13.42 6.09%

S&P 500 - Fallers

Perrigo Company plc (PRGO) $15.41 -25.21%

Zimmer Biomet Holdings Inc (ZBH) $87.22 -15.15%

Arista Networks Inc. (ANET) $141.52 -8.55%

Archer-Daniels-Midland Co. (ADM) $56.62 -6.37%

Humana Inc. (HUM) $262.63 -6.01%

American International Group Inc. (AIG) $76.92 -5.44%

Brighthouse Financial, Inc. (BHF) $51.80 -4.59%

Emerson Electric Co. (EMR) $133.12 -3.84%

Zoetis Inc (ZTS) $121.18 -3.19%

Nektar Therapeutics (NKTR) $54.26 -3.14%

Nasdaq 100 - Risers

Seagate Technology Plc (STX) $275.77 10.14%

Micron Technology Inc. (MU) $237.50 8.93%

Amgen Inc. (AMGN) $319.86 7.81%

American Airlines Group (AAL) $13.42 6.09%

Lam Research Corp. (LRCX) $165.05 5.95%

Western Digital Corp. (WDC) $160.10 5.20%

Illumina Inc. (ILMN) $122.44 4.77%

Applied Materials Inc. (AMAT) $240.89 4.65%

Starbucks Corp. (SBUX) $82.88 4.12%

Tesla Inc (TSLA) $462.07 4.01%

Nasdaq 100 - Fallers

Qvc Group Inc Series A (QVCGA) $6.25 -39.61%

Verisk Analytics Inc. (VRSK) $214.05 -2.70%

Nvidia Corp. (NVDA) $195.21 -1.75%

Synopsys Inc. (SNPS) $409.11 -1.74%

Cadence Design Systems Inc. (CDNS) $327.63 -1.68%

Booking Holdings Inc. (BKNG) $4,911.15 -1.61%

CSX Corp. (CSX) $35.32 -1.45%

Microsoft Corp. (MSFT) $507.16 -1.39%

J.B. Hunt Transport Services Inc. (JBHT) $170.25 -1.38%

Baidu Inc. (BIDU) $123.33 -1.33%