S&P 500 Rises as Tech Rebounds and Labor Market Shows Strength
The S&P 500 moved higher on Wednesday, rebounding from the previous session’s tech-led selloff, supported by encouraging signs of U.S. labor market resilience.
By 1:01 p.m. ET (18:01 GMT), the Dow Jones Industrial Average was up 297 points (0.6%), the S&P 500 gained 0.8%, and the NASDAQ Composite rose 1.1%.
Tech Stocks Lead Market Recovery
Technology shares helped drive Wednesday’s recovery, led by Advanced Micro Devices (AMD), which pared earlier losses and traded over 2% higher after reporting stronger-than-expected AI chip sales and profit.
In contrast, Pinterest (NYSE:PINS) plunged after issuing disappointing revenue guidance, raising investor concerns over a slowdown in the digital advertising market.
The earnings season remains in full swing, with 82% of S&P 500 companies beating analyst expectations so far, according to FactSet data.
Mixed Corporate Results
McDonald’s (NYSE:MCD) shares advanced after its U.S. stores reported better-than-expected same-store sales growth, though quarterly earnings slightly missed forecasts.
Novo Nordisk (NYSE:NVO) dipped 1%, even after announcing a favorable Medicare pricing deal, as it trimmed its full-year profit and revenue outlook due to slower sales growth.
Meanwhile, Humana (NYSE:HUM) slumped after the health insurer posted lower third-quarter profits and reduced its 2025 earnings guidance, citing rising medical costs.
Investor Caution Persists
The tech rebound followed cautious remarks from Morgan Stanley and Goldman Sachs CEOs, who warned about overheated valuations and speculative trading in major tech stocks.
Their comments fueled concerns that Wall Street’s rally — powered by the “Magnificent Seven” tech giants — may be nearing a tipping point. Analysts have warned that record valuations could pose concentration risks for investors.
“History shows that paying high valuations rarely leads to strong long-term returns,” said Sean Peche, founder of Ranmore Fund Management. “Perhaps global investors, like politicians, are realizing they can’t rely solely on America anymore.”
Labor Market Data Eases Worries
The rebound was also supported by fresh data signaling job market strength. The ADP employment report showed that U.S. private payrolls increased by 42,000 jobs in October, following a revised 29,000-job decline in September.
Economists had expected a gain of around 28,000 jobs, suggesting stronger-than-expected labor conditions despite recent economic uncertainty.
This report carries added significance since the official U.S. jobs report from the Bureau of Labor Statistics has been delayed due to the government shutdown, leaving investors searching for reliable labor indicators.
Meanwhile, Federal Reserve officials remain divided on policy direction. Some suggested another rate cut in December if inflation continues to ease, while others signaled that strong job growth and resilient demand may justify keeping policy restrictive for longer.
