US stock indexes closed higher on Wednesday, with the S&P 500 up +0.37%, Dow Jones up +0.48%, and Nasdaq 100 up +0.72%. Positive economic news led to the rally, with ADP employment report showing more jobs added than expected, and the service sector activity expanding by the most in 8 months. Chipmakers also boosted the market.

Initial downward movement was seen in stock indexes on Wednesday, with the S&P 500 and Nasdaq 100 hitting 1.5-week lows. AI-infrastructure stocks continued their correction, with Super Micro Computer dropping over -10% after weaker-than-expected Q1 net sales. Higher T-note yields also impacted stocks negatively, hitting a 4-week high.

In the US, the ADP employment change for October exceeded expectations with a rise of +42,000. The ISM services index for October also showed strength, with a rise of +2.4 to 52.4, the fastest expansion in 8 months. However, price pressures in the service sector increased, with the prices paid sub-index hitting a 3-year high of 70.0.

The US Treasury announced $125 billion in sales of T-notes and T-bonds for next week’s quarterly refunding, in line with expectations. The Treasury stated no plans to increase note and bond sales until next year, relying more on short-term T-bills. The MBA mortgage applications fell by -1.9% in the week ended October 31.

The US Supreme Court is questioning the legality of President Trump’s reciprocal tariffs, with concerns over emergency powers used to collect tariffs. A ruling is expected by late this year or early next year. Q3 earnings season continues strong, with most S&P 500 companies beating forecasts. Q3 profits are expected to rise by +7.2% y/y.

Read more at Yahoo Finance: Stocks Rally on Positive US Economic News and Strength in Chipmakers