Stocks are rising sharply after a report showed that small businesses are hiring more workers than economists expected.
ADP Employer Services said that private companies added 93,000 jobs in November. Economists were expecting a 70,000 increase. ADP says small businesses added their largest number of workers in three years.
Overseas, European stocks are rising after a better than expected bond auction in Portugal helped push the euro higher. Asian stocks rose after a report said that manufacturing activity in China accelerated.
The Dow Jones industrial average is up 143, or 1.3 percent, to 11,149. The S&P 500 is up 13, or 1 percent, to 1,193. The Nasdaq composite is up 40, or 1.6 percent, to 2,538.
ADP Employer Services said employment at private companies jumped by 93,000 in November as small businesses added the largest amount of workers since November 2007. Economists had expected private companies to add 70,000 jobs. Private sector employment grew by 83,000 in October, the company said.
“The U.S. economy is all about jobs and anything that leads folks to believe that there’s a better job market will be good for equities,” said Paul Zemsky, the head of asset allocation at ING Investment Management.
Global stocks rose before the U.S. market opened after reports indicated that the Chinese economy is growing. A Chinese state index of manufacturing activity rose to 55.2 in November from 54.7 in October. Any number above 50 indicates economic expansion. Monthly readings have stayed above that number for 21 straight months. A competing Chinese survey by HSBC rose to an eight-month high.
Fears that the European financial crisis would spread eased after European Central Bank President Jean-Claude Trichet suggested that the bank could buy bonds issued by struggling countries within the European Union. That, along with a better-than-expected bond auction by Portugal, helped send the euro and European stock indexes sharply higher. Investors worry that the country could be the next member of the European Union to need help from its neighbors.
The euro rose 0.9 percent after the auction. The Euro Stoxx 50 index, which tracks blue chip companies in countries that use the euro, rose 1.6 percent.
Hong Kong’s Hang Seng rose 1.1 percent. China’s benchmark Shanghai Composite Index rose 0.1 percent. Stocks have fallen in Asia since early November after China raised a key interest rate to combat inflation.
Several economic reports will be released Wednesday that will give a better indication of where the U.S. economy is headed.
The Labor Department reported that productivity grew at an annual rate of 2.3 percent during the third quarter, better than the initial estimate a month ago.
November figures for auto sales and manufacturing activity will also come out by the end of the day. The Federal Reserve will also put out its report on regional economic activity.
Dow Jones industrial average futures rose 144, or 1.3 percent, to 11,140. S&P 500 futures rose 17, or 1.4 percent, to 1,196.60. Nasdaq 100 futures rose 30.50, or 1.4 percent, to 2,147.50.
