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Tesla rises as sales in China nearly double in November -
U.S. private payrolls growth slows in November - ADP
Powell says Fed could scale back rate hikes in December
Indexes end: S&P 500 +3.09%, Nasdaq +4.41%, Dow +2.18%
Nov 30 (Reuters) - Wall Street ended sharply higher on
Wednesday after Federal Reserve Chair Jerome Powell said the
central bank might scale back the pace of its interest rate
hikes as soon as December.
The S&P 500 rallied from an earlier loss and the Nasdaq
jumped after the release of Powell's remarks prepared for
delivery at the Brookings Institution think tank in Washington.
Powell also cautioned that the fight against inflation was
far from over and that key questions remain unanswered,
including how high rates will ultimately need to rise and for
"(The market) has waited with bated breath, looking for that
clarification in terms of duration and extent of Fed tightening.
And anything that gives hope to the idea the Fed is becoming
less hawkish is viewed as a positive for stocks, at least on a
short-term basis," said Chuck Carlson, Chief Executive Officer
at Horizon Investment Services in Hammond, Indiana.
Bets that the Fed will reduce the size of its rate hikes, as
well as recent data pointing to a mild cooling in inflation, led
the benchmark S&P 500 index to its second straight month
The CME FedWatch Tool showed futures traders seeing a 75%
chance that the Fed will raise interest rates by 50 basis points
at its December meeting, up from a 65% chance before Powell's
comments were released. The FedWatch tool now shows a 25% chance
of a 75 basis point increase.
Nvidia rallied more than 8%, Microsoft
jumped 6.2% and Apple climbed 4.9%.
Tesla Inc's shares surged 7.7% after China
Merchants Bank International said Tesla's sales in China in
November were boosted by price cuts and incentives offered on
its Model 3 and Model Y.
The S&P 500 climbed 3.09% to end the session at 4,079.97
The Nasdaq gained 4.41% to 11,468.00 points, while Dow
Jones Industrial Average rose 2.18% to 34,589.24 points.
The Philadelphia Semiconductor index surged
5.85%, trimming its loss in 2022 to about 28%.
Volume on U.S. exchanges was heavy, with 15.0 billion
shares traded, compared to an average of 11.1 billion shares
over the previous 20 sessions.
For November, the S&P 500 climbed 5.4%, the Dow added
5.7% and the Nasdaq increased 4.4%.
An ADP National Employment report showed private employment
increased by 127,000 in November, below expectations of 200,000
jobs, suggesting demand for labor was cooling amid high interest
"The ADP employment number not meeting expectations fits
into the narrative that the Fed will have room and start slowing
down its rate hikes, and that definitely benefits interest rate
sensitive assets," said Keith Buchanan, a portfolio manager at
Globalt in Atlanta.
The Labor Department's closely watched nonfarm payrolls data
is due on Friday. A report showed U.S. job openings falling to
10.334 million in October, against 10.687 million in the prior
Another reading showed the U.S. economy rebounded more
strongly than initially thought in the third quarter.
The S&P 500 remains down about 14% so far in 2022, while the
Nasdaq index has lost about 27%.
Biogen Inc jumped 4.7% after its experimental
Alzheimer's drug slowed cognitive decline in a closely watched
Advancing issues outnumbered falling ones within the S&P
500 by a 24.1-to-one ratio.
The S&P 500 posted 24 new highs and 1 new low; the
Nasdaq recorded 117 new highs and 167 new lows.
(Reporting by Shreyashi Sanyal, Devik Jain & Bansari Mayur
Kamdar in Bengaluru, and by Noel Randewich in Oakland, Calif.;
additional reporting by Stephen Culp in New York; Editing by
Shounak Dasgupta, Chizu Nomiyama and Diane Craft)