US Equities Rally as Automotive Tariff Exemptions Offset Weak Jobs Data

US stock indices staged a significant recovery on Wednesday, overcoming early volatility to post strong gains across the board. The Nasdaq led the rally, climbing 1.5% to 18,552.73, while the S&P 500 and Dow Jones Industrial Average both rose 1.1%, closing at 5,842.63 and 43,006.59, respectively. The turnaround was primarily driven by a policy shift from the White House. After consultations with the leadership of General Motors, Ford, and Stellantis, the administration confirmed a one-month delay on newly imposed tariffs for automakers in Mexico and Canada. This move alleviated immediate fears regarding the economic fallout of the administration's broader trade strategy, with the White House indicating openness to further exemptions. The session began on a fragile note following a weak ADP private payrolls report. Private sector employment grew by only 77,000 jobs in February, significantly missing the 140,000 forecast and marking the lowest growth level since last July. However, this was countered by the Institute for Supply Management (ISM) reporting an unexpected rise in the services PMI to 53.5, signaling continued growth in the service sector. Sectoral performance was varied. The NYSE Arca Airline Index surged 4.3%, while gold and steel stocks rose 4.0% and 3.5%, respectively. Conversely, oil producers faced sharp declines amid a steep drop in crude oil prices. Globally, the bullish sentiment extended to the German DAX, which spiked 3.4%, and the Hang Seng Index, which surged 2.8%.