Stocks rose Wednesday as better-than-estimated growth in American and Chinese manufacturing bolstered confidence in the global economic recovery.
The Dow Jones industrial average closed up 254.75 points, or 2.54%, at 10,269.47; the S&P 500 rose 30.96, or 2.95%, closing at 1,080.29; and the Nasdaq composite was up 62.81 points, or 2.97%, to close at 2,176.84. All numbers are preliminary.
The S&P 500 dropped 4.7% in August amid growing concern the economic rebound was stalling. The benchmark for U.S. stocks is trading at less than 12.6 times forecast earnings of its companies, near the lowest valuation since March 2009.
The Institute for Supply Management’s factory index unexpectedly rose to 56.3 in August from 55.5 in July. The median estimate of 78 economists surveyed by Bloomberg News forecast that the measure would fall to 52.8. Readings above 50 signal growth.
U.S. futures joined a global advance in equities after China’s purchasing managers’ index rose to 51.7 from 51.2, exceeding forecasts, according to a government-backed report. A separate PMI released by HSBC Holdings and Markit Economics increased to 51.9 from 49.4.
September is historically the worst month for stocks, with the S&P 500 falling 0.7% and the Dow dropping 1% on average since 1950, according to the Stock Trader’s Almanac.
Also, the Wilshire 5000 Total Market Index’s worst average return month is September, the only month with an average negative return for the last 25 years of the index history, according to Wilshire spokeswoman Kim Shepherd.
The 39-year average Wilshire 5000 Total Return for September is -0.73%; its 25-year average for the month is -0.82%.
News Editor Rick Baert contributed to this story.