Stocks Hold Gains as Strong Data Offsets HP
NEW YORK ( TheStreet) -- U.S. stocks finished with mild gains Wednesday as better-than-expected services sector and payrolls data offset a sharp decline in Dow component Hewlett-Packard(HPQ) .
The Dow Jones Industrial Average rose more than 12 points, or 0.09%, to finish at 13,495. The blue-chip index, which briefly dipped below the flat line in the final hour, has now risen in two of the past three sessions and is up 10.45% so far in 2012.
HP was by far the biggest loser in the Dow, falling nearly 13% as CEO Meg Whitman, at a her first analyst meeting Wednesday since taking over at the helm in September 2011, warned that earnings are expected to weaken in 2013 before her efforts at improving the company begin to kick in.
The strongest sectors in the broad market were transportation, services and financials. Energy and basic materials finished in the red.
Volume totaled 3.52 billion on the New York Stock Exchange and 1.70 billion on the Nasdaq. Breadth was even on the Big Board while losers ran slightly ahead of winners on the Nasdaq.
Investors got some welcome economic news early as the Institute for Supply Management said that its headline services index pointed to yet another and faster month of sector expansion in September, with the number coming in at 55.1 in September, which was 1.4 points higher than the 53.7 registered in August. It's the best number since March, and better than the 53 level economists were expecting.
"This is unquestionably positive especially for those worried the U.S. may have fallen into recession," according to a note from BTIG Economics .
Most of the sub-index components of the report showed improvement. However, the employment sub-index in the report decreased by 2.7 points to 51.1, indicating growth in employment for the second straight month but at a slower rate.
Meantime, the ADP private sector employment change report showed a rise in private payrolls in September of 162,000, down from a downwardly revised 189,000 increase in August, but ahead of the consensus view. Economists, on average, were forecasting a private payrolls increase in September of 133,000.
The FTSE 100 in London settled up 0.28% and the DAX in Germany closed up 0.22% on Wednesday. The Nikkei Average in Japan closed down 0.45% and the Hang Seng in Hong Kong finished up 0.23%.