Stocks finished on a high note Wednesday, recouping earlier losses on news of a possible short-term agreement to raise the debt ceiling and avoid a default.
The Dow Jones Industrial Average ended up 102 points, or 0.3%, to 34,416, while the broader S&P 500 was 0.41% higher and the tech-heavy Nasdaq added 0.47%.
Senate Minority Leader Mitch McConnell said he would not block a debt limit extension into December, NBC reported, making an offer to temporarily end a partisan standoff just 12 days before the government's deadline to avert default.
“To protect the American people from a near-term Democrat-created crisis, we will also allow Democrats to use normal procedures to pass an emergency debt limit extension at a fixed dollar amount to cover current spending levels into December,” he said in a statement posted to Twitter.
Sen. Tim Kaine, D-Va., said it was not not clear if Democrats would accept McConnell’s offer, as they have yet to digest and discuss it.
Stocks had been down earlier in the session over concerns about rising energy costs, the reopening of the economy and inflation.
“Volatility is the price of admission,” said LPL Financial Chief Market Strategist Ryan Detrick. “Sure, we’d all prefer stocks go straight up forever, but that isn’t reality. Investors must learn to embrace and accept the eventual scares and bouts of volatility that are common even in the strongest bull markets.”
Stocks were also given some support by a stronger-than-expected reading of private sector jobs gains in September. ADP reported the addition of 568,000 new positions last month.
WTI futures for November delivery down 2.4% at $77.06 per barrel while Brent contracts for December, the global pricing benchmark, slipped 2.1% to $80.83 per barrel.
The 10-year Treasury note yield was little changed at 1.52%.
"The beat on private payroll numbers is a positive but there’s no shortage of catalysts out there that could move the market; surging energy prices, debt ceiling impasse, and booster uncertainty," said Mike Loewengart, managing director of investment strategy at E-Trade Financial.
"And positive labor market data comes with the implication that the Fed can tighten policy at a quicker pace. But the fact that hiring is up shouldn’t be discounted — it’s definitely a good thing in terms of recovery."
Facebook (FB) - Get Facebook, Inc. Class A Report ended marginally higher as Chief Executive Mark Zuckerberg, in a rare public post, addressed both accusations from a whistleblower that the social-media giant prioritizes profit over people, as well as a crippling error that shut down its platforms for six hours earlier this week.
Constellation Brands (STZ) - Get Constellation Brands, Inc. Class A Report ended down after the Corona and Modelo beer maker posted weaker-than-expected second quarter earnings, but topped Street revenue forecasts and boosted its full-year profit outlook.
U.S. Steel (X) - Get United States Steel Corporation Report tumbled after analysts at Goldman Sachs published a sector note that lower price targets on many major producers in advance of a potential steel price correction.