Iran says it will free the British hostages, while two economic reports were weaker than expected
Stocks finished slightly higher on news that Iran would release the British sailors held captive, which sent oil prices down. This offset weaker than expected factory orders, ISM services index and ADP employment data. Traders were also likely comforted by Dallas Fed President Fisher's comments that subprime mortgage woes are "largely contained," says Standard & Poor's.
The Dow Jones industrial average rose 19.75 points, or 0.16%, to 12,530.05. The broader Standard & Poor's 500 index edged up 1.6 points, or 0.11%, to 1,439.37. The tech-heavy Nasdaq composite gained 8.36 points, or 0.34%, to 2,458.69.
In the energy markets, May futures for West Texas Intermediate crude oil fell 25 cents to $64.39 per barrel after Iran President Mahmoud Ahmadinejad said he would release the British sailors being held for the last two weeks. The EIA inventory data revealed a 4.3 million barrel build in crude stocks, vs. expectations for a 500,000 barrel rise.
Economic news also held the spotlight Wednesday.
U.S. factory orders rebounded only 1.0% in February, after a revised 5.7% slump in January (-5.8% previously), reports Action Economics.
The March services index from the Institute for Supply Management fell to 52.4 in March from 54.3 in February, as activity slowed further after a big jump in January. Most of the real sector sub-components declined and are below their 6-month averages, says Action Economics. This report was also weaker than expected.
Markets showed little reaction to an ADP report showing private sector jobs rose 106,000 in March from a 65,000 increase in February, which was revised from 57,000 previously. The release comes in advance of the Apr. 6 March employment report.
Among stocks moving in Wednesday's session, electronics retailers Circuit City (CC) and Best Buy (BBY) were in focus after the rivals posted quarterly results. Shares of Circuit City dipped in premarket trading as the chain posted a fourth-quarter loss and said it expected to be in the red for the first half of the current fiscal year, while Best Buy was slightly lower after its full-year profit forecast fell short of Street expectations.
Shares of Pozen (POZN) were higher, while GlaxoSmithKline (GSK) was flat following news that two reports showed Trexima, an experimental pill GSK is developing with Pozen, relieved migraine headaches more effectively when it's used in combination with the Imitrex tablet and the painkiller naproxen sodium.
Icagen (ICGN) was lower after the company said it ended the advanced study of senicapoc, an experimental drug to treat sickle cell disease in adults, following the recommendation of a data monitoring committee.
General Motors (GM) and Ford Motor (F) were off after Prudential Equity initiated coverage on shares of the automakers with an "underweight" recommendation.
European stock markets were mixed Wednesday. In London, the FTSE 100 index fell 1.4 points, or 0.02%, to 6,364.7. France's CAC 40 index was up 27.1 points, or 0.47%, to 5,739.01. In Frankfurt, the DAX index gained 28.35 points, or 0.4%, to 7,073.91.
Major Asian indexes rallied Wednesday. In Japan, the Nikkei 225 index climbed 300.04 points, or 1.74%, to 17,544.09. Hong Kong's Hang Seng index rose 207.01 points, or 1.03%, to 20,209.71.
Bonds moved up in price on disappointing economic data, as the bond market continued to gear up for the main event: Friday's employment report, says Action Economics. The 10-year Treasury note yield dipped to 4.652%.