Dow closes 400 points higher as ADP jobs data strengthens Fed rate cut hopes

The three major averages finished higher on Wednesday.

The S&P 500 rose 0.30% to 6,849.72, while the Nasdaq Composite climbed 0.17% to 23,454.09. The Dow Jones Industrial Average climbed 408.44 points, or 0.86%, to 47,882.90.

— Sean Conlon

"The Big Short" investor Michael Burry said the artificial intelligence market bubble could unwind within about the next two years.

"What you see in every prior one was the relevant stock market peak was before you were even halfway done with the capital expenditure," Burry told host Michael Lewis on his podcast "Against The Rules: The Big Short Companion."

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— Alex Harring

Treasury Secretary Scott Bessent on Wednesday predicted that the administration still will be able to implement its tariff agenda regardless of whether it prevails in a pending case before the Supreme Court.

Repeating assertions he had made prior to the high court hearing a month ago, Bessent cited several sections of 1962 Trade Act that give the president sweeping powers over import duties.

"We can recreate the exact tariff structure with [sections] 301, with 232, with 122," he said during an onstage interview at The New York Times DealBook Summit. Read more.

— Jeff Cox

On Wednesday, 17 stocks in the S&P 500 traded at new 52-week highs.

Of these names, 10 stocks reached new all-time highs. Tickers that hit this milestone included:

• Fox Corporation Class A trading at all-time highs back to its creation as the portion not acquired by Disney in 2019
• General Motors trading at all-time highs back to the "new" GM IPO in November 2010
• Marriott International trading at all-time high levels back through its spin-off from Marriott Corp in 1993
• Walmart Stores trading at all-time high levels back to when it first began trading on the NYSE in August 1972
• Synchrony Financial trading at all-time highs back to its IPO in July 2014
• Cummins Inc trading at all-time highs back to its IPO in 1947
• Apple Inc. trading at all-time high levels back to its IPO in December 1980
• Analog Devices trading at all-time highs back through our history to 1972
• Teradyne trading at all-time highs back to when it listed on the NYSE in 1970 
• Steel Dynamics trading at all-time highs back to its IPO in November 1996

Just one stock in the index traded at a new 52-week low: SBA Communications.

— Christopher Hayes, Lisa Kailai Han

Commerce Secretary Howard Lutnick on Wednesday denied that the Trump administration's tariff policies were to blame after a new report showed a surprise drop in private payrolls in November.

Instead, Lutnick argued on CNBC's "Squawk on the Street" that the government shutdown temporarily slowed small-business activity. He added that the federal efforts to enact mass deportations of undocumented immigrants also suppressed jobs numbers.

"No, no, it's not tariffs," Lutnick said when asked whether President Donald Trump's import duties explained Wednesday morning's report from ADP, which revealed an unexpected 32,000-worker drop in the labor market. Read more.

— Kevin Breuninger

Check out the companies making the biggest moves midday:

• Genius Sports — The sports analytics company jumped 8% after setting lofty 2028 targets at its investor day. Genius sees "group revenue" totaling $1.2 billion by then, along with free cash flow of $220 million.
• Netflix — Shares declined 5% as investors waited to see how much the leading streaming platform would bid for Warner Bros Discovery. Reuters reported Tuesday that Netflix made an offer that was mostly cash.
• American Eagle Outfitters — Shares rose 14% after the clothing company raised its fourth quarter outlook and reported better-than-expected earnings in the third quarter.

Read the full list of names here.

— Fred Imbert

Small-cap stocks outpaced the three leading U.S. indexes on Wednesday.

As of midday trading, the Russell 2000 index was up 1.3%. By comparison, the blue-chip Dow Jones Industrial Average climbed 348 points, or 0.7%, while the broad-based S&P 500 and the tech-heavy Nasdaq Composite were higher by 0.3% and 0.1%, respectively.

— Sean Conlon

The state of labor market will be a focal point for Wall Street into next year, according to Michael Feroli, chief U.S. economist at JPMorgan.

"As we turn into 2026 this softening in the labor market looms large," he wrote in a Wednesday note. "While the ongoing slowdown in labor supply was well-advertised, slower labor demand does not appear to have run its course. And while gross hiring has been cooling for several quarters, more recent indicators of increased layoff activity are compounding concerns about net job growth."

Looking ahead, Feroli anticipates that the next three to six months will see "uncomfortably slow" employment growth, saying that "the corresponding slowdown in labor income carries with it risks to the broader economy."

His forecast comes as ADP reported a surprising drop in private sector payrolls for the month of November.

On top of that, Feroli thinks that the recent stickiness in inflation will continue in 2026, further impacting the interest rate outlook for the year.

"A stabilizing labor market and persistent above-2% inflation should limit how much further easing the Fed can deliver next year," he said. "While we look for near-term labor market weakness to prompt cuts at the upcoming December and January FOMC meetings, we expect policy to be on hold after that."

— Sean Conlon

Jefferies is stepping to the sidelines on Wayfair, downgrading the online retailer to hold on Wednesday.

The stock now trades at a near 40% premium to its peers and holiday shopping has gotten off to a weak start, analyst Jonathan Matuszewski wrote in a note to clients. November website visits are down by 300 basis points in November from October, while Black Friday and Saturday saw visits decrease 12% year over year, he said.

"With web traffic revealing a slow start to the official kick-off for holiday shopping and consumer survey data signaling a downshift in go-forward buying propensity on the marketplace, risk/reward skews more balanced, in our view," Matuszewski said.

His price target of $94 suggests 7% downside from Tuesday's close. Shares shed nearly 8% in morning trading.

— Michelle Fox

Activity in the U.S. services sector appeared to hold up in November, the Institute for Supply Management reported Wednesday.

For the month, the Services PMI — which represents the share of companies reporting growth, or expansion — increased a bit from October to 52.6%. That's slightly better than the Dow Jones forecast for 52.5%.

October had recorded a Services PMI reading of 52.4%.

— Sean Conlon

Stocks opened Wednesday's session in negative territory.

The S&P 500 fell 0.2% after the opening bell, while the Nasdaq Composite moved 0.5% lower. The Dow Jones Industrial Average traded just below the flatline.

— Sean Conlon

Check out the companies making headlines before the bell:

• American Eagle Outfitters —  Shares jumped nearly 13% after the retailer reported third-quarter earnings of 53 cents per share on revenue of $1.36 billion, beating the Street's expected earnings of 44 cents per share on revenue of $1.32 billion, according to LSEG data. Strong sales in the company's Aerie division contributed to the better-than-expected results. 
• Marvell Technology — The stock popped 9% after the provider of data infrastructure semiconductor solutions posted third-quarter earnings of 76 cents per share excluding one-time items on revenue of $2.08 billion, topping analysts' consensus estimate of 73 cents per share on revenue of $2.07 billion, LSEG data shows. 
• Okta — An earnings beat boosted Okta shares by 4%. The company reported third-quarter earnings of 82 cents per share excluding one-time items on revenue of $742 million versus analysts' expected earnings of 76 cents per share on revenue of $730 million, according to LSEG data.

Read the full list here.

— Liz Napolitano

Private payrolls unexpectedly fell by 32,000 in November, led by big cuts in small businesses. Establishments with less than 50 workers cut 120,000 jobs last month. Large businesses with 50 or more employees reported a net gain of 90,000. Economists polled by Dow Jones expected a gain of 40,000 jobs.

— Jeff Cox

Wells Fargo believes that Oracle has more AI-fueled gains ahead.

In a Wednesday note, the bank initiated the stock at an overweight rating and set a price target of $280, which implies 39% upside.

Shares of Oracle are up 21% this year, but they've fallen nearly 29% in the fourth quarter as investors worry the company can sustain its sky high valuations. However, analyst Michael Turrin believes that it is still early days for Oracle, with the artificial intelligence boom presenting room for the stock to run.

CNBC Pro subscribers can read more here.

— Lisa Kailai Han

Macy's shares were down slightly in the premarket even after the company posted a surprise profit for the third quarter. The company earned an adjusted 9 cents per share, while analysts polled by LSEG expected a loss of 14 cents per share. Revenue of $4.71 billion also beat a consensus forecast of $4.62 billion.

— Fred Imbert

Analyst Nicole DeBlase raised her price target on GE Vernova to $769 from $724, signaling upside of 27.8% from Tuesday's close. The move comes ahead of GE Vernova's annual investor update, slated for next week.

"We think GEV will likely raise its 2025 guidance for both revenue and adj. EBITDA margins," DeBlase said in a note. "We have heard some investor criticism over GEV's decision to maintain its full-year guidance when it reported 3Q25 results - but we think management was merely saving the raise for the December 9th event, at which point it will have much clearer visibility into how 4Q is shaping up. Based on what is embedded in our own model, we think the company can raise its 2025 revenue outlook to $37-38bn (we sit closer to $38bn) and its adj. EBITDA margin outlook to 9%, at the high end of the current range."

— Fred Imbert

Semiconductor company Marvell on Tuesday announced that it will acquire Celestial AI for at least $3.25 billion in cash and stock. The purchase price could increase to $5.5 billion if Celestial hits revenue milestones, Marvell said.

The company also reported third-quarter earnings that beat expectations and said on its earnings call that it expected data center revenue will rise 25% in next fiscal year. Marvell shares jumped more than 10% after the upbeat outlook, which topped analyst predictions and doesn't include any benefit from the Celestial AI deal.

For more, read here.

— Kif Leswing, Pia Singh

Check out the companies making headlines in after-hours trading.

• Pure Storage — Shares of the data management and storage company plunged nearly 10% after Pure Storage reported third-quarter adjusted earnings of 58 cents per share that matched consensus expectations, according to LSEG. The company posted revenue for the period of $964.5 million, up 16% year-over-year, which exceeded the $956 million expected from analysts polled by LSEG.
• CrowdStrike Holdings — The cybersecurity provider fell more than 1% after posting third-quarter earnings and revenue, and issuing full-year earnings guidance that topped analyst estimates, as compiled by LSEG. CrowdStrike has rallied 25% over the past three months.
• Okta — Shares of the identity management provider fell more than 3% after Okta CEO Todd McKinnon said upside from its AI agents aren't "fully baked" into results. Still, Okta beat third-quarter estimates and gave an upbeat outlook. The company earned 82 cents per share, on an adjusted basis, on revenue of $742 million. Analysts polled by LSEG forecasted earnings of 76 cents per share on revenue of $730 million.

For the full list, read here.

— Pia Singh

Shortly after 6 p.m. ET on Tuesday, futures tied to the S&P 500 and Nasdaq-100 futures each traded above the flatline. Futures tied to the Dow Jones Industrial Average added 24 points, or less than 0.1%.

— Pia Singh