US stocks edged higher on Wednesday after new labor market figures strengthened bets on another rate cut at the Federal Reserve’s final meeting of 2025. A softer dollar, steady Treasury yields, and small gains in global equities set a cautious but positive tone for risk assets.
The S&P 500 rose about 0.1% late in the New York morning, while the Dow Jones Industrial Average added 0.4%. The NASDAQ 100 traded little changed as gains in smaller companies pushed the Russell 2000 up 1.1%.
Private-sector payrolls fell by 32,000 in November, the biggest drop since early 2023, according to ADP Research. Economists had expected a gain of 10,000. The report increased confidence that the Fed will deliver a third straight rate cut next week, even as officials debate the pace of easing in 2026.
Jeff Roach at LPL Financial said the faltering labor market will likely dominate the Fed’s December discussions. He noted that weakening labor demand now gives policymakers room to support growth. Chris Zaccarelli at Northlight Asset Management said the data confirm the view that officials should focus more on jobs than on inflation slightly above target.
Treasury yields showed only modest moves. The two-year yield held around 3.50%, while the benchmark 10-year yield hovered near 4.08%. The 30-year yield traded close to 4.75%.
The Bloomberg Dollar Spot Index slipped 0.3% as traders positioned for easier Fed policy. The euro rose 0.3% to $1.1657, while the British pound gained 0.9% to $1.3326. The Japanese yen strengthened 0.4% to 155.32 per dollar.
Bitcoin added 1% to trade near $92,507, and Ether climbed 2.9% to about $3,084. In commodities, West Texas Intermediate crude rose 1.2% to $59.35 a barrel. Spot gold advanced 0.3% to around $4,220 an ounce.
Florian Ielpo at Lombard Odier Asset Management said the ADP numbers highlight stalling job creation rather than a sharp downturn. He said rate cut expectations now act as a key support for equities.
Company headlines added stock-specific swings within the broader US stock market. Microsoft shares fell as much as 3% after a report suggested the company cut internal targets for selling new artificial intelligence products to corporate clients. The stock later trimmed losses to about 1.7% after another report said the firm had not reduced sales quotas for staff.
Marvell Technology rose about 4.7% after the chip designer signaled that its custom silicon business continues to win repeat orders tied to data center AI spending. The Bloomberg Magnificent 7 Total Return Index, which includes Microsoft, advanced about 0.4%.
In the consumer sector, American Eagle Outfitters jumped after the apparel retailer reported stronger-than-expected quarterly results and raised its outlook. Macy’s slipped as its profit guidance failed to match investor hopes, even though recent trading ahead of the holiday season met expectations.
Investors watched US stock market indexes closely as each new jobs report shaped rate expectations. Analysts said the latest data and price moves fit a “soft landing” narrative for the US economy. Markets now price modest policy easing, slower but positive growth, and ongoing support for risk assets as long as labor market weakness remains gradual.
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