Stocks closed higher Wednesday, though gains were contained as Treasury yields held near recent highs. Market participants also weighed weak private payrolls data, which arrived ahead of this Friday’s all-important August jobs report.
At the close, the blue-chip Dow Jones Industrial Average was up 0.6% at 53,061, the broader S&P 500 was 0.5% higher at 7,666, and the tech-heavy Nasdaq Composite gained 0.5% to 26,217.
Easing Treasury yields provided some relief on Wall Street today. The yield on the 2-year Treasury hit its highest level since mid-2024 in intraday trading, but ended the session down 2.3 basis points at 4.371%. Likewise, the 10-year Treasury yield topped out at a nearly three-year peak before settling down 1.6 basis points at 4.78%.
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“Today’s weaker-than-anticipated ADP employment report, paired with market-friendly commentary from New York Fed President John Williams and Treasury Secretary Scott Bessent, is halting bond pain and driving bargain hunters into equities,” says José Torres, senior economist at Interactive Brokers.
The ADP report showed the U.S. added 38,000 private payrolls, below the 46,000 economists expected and the lowest level since January. This, says Torres, signals “an increasingly fragile labor market that may prevent the U.S. monetary policy authority from hiking rates more than once.”
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Meanwhile, New York Fed President John Williams, who, because of his position, is a permanent voting member of the Federal Open Market Committee (FOMC), told CNBC that the central bank just needs to “wait and see” on interest rates.
While the regional Fed president said that inflation data have “been encouraging,” he added that “there’s no clear signs right now whether monetary policy currently is sufficient to make sure we bring inflation back to target.”
According to CME Group FedWatch, futures traders are currently pricing in a 62% chance the Fed will raise the federal funds rate by a quarter-percentage point when its September policy meeting wraps up two weeks from today — up from 37% one week ago.
Credo Technology plunges 20% after beat-and-raise quarter
In single-stock news, Credo Technology Group (CRDO) plunged 20% — the tech stock‘s worst day since January 2025 — after the high-speed digital connectivity and semiconductor solutions specialist reported earnings.
For its fiscal 2027 first quarter, CRDO reported better-than-expected earnings and revenue. It also raised its full-year revenue growth outlook.
But Wall Street may have been looking for a more substantial fiscal Q2 revenue forecast, with Credo guiding for $525 million to $535 million — only matching analysts’ estimates at the midpoint.
Still, William Blair analyst Sebastien Naji says the fiscal Q1 print was “clean,” and he expects “a strong inflection through the second half as the company ramps up toward its more than $600 million optical revenue target while benefiting from expanding AEC [Active Electrical Cable] engagements and the transition to 100G/200G per lane solutions.”
Phillips Edison hikes its monthly dividend payout
Phillips Edison & Company (PECO), which operates grocery-anchored shopping centers, rose 0.8% today after the real estate investment trust (REIT) raised its monthly dividend payout by 6.2% to 11.5 cents per share. This works out to an annualized rate of $1.38 per share.
PECO has been a reliable dividend grower, having increased its annual payout in each of the past six years. This latest hike also marks its third consecutive increase of over 5%.
Why is dividend growth important?
“Shares in companies that raise their payouts like clockwork decade after decade can produce superior total returns (price change plus dividends) over the long run, even if they sport apparently ho-hum yields to begin with,” explains Kiplinger contributor Dan Burrows in his feature on the best dividend stocks for dependable growth. “That’s partly because regular dividend increases lift the yield on an investor’s original cost basis. Stick around long enough, and the modest yield you received on your initial investment can hit double digits one day.”
