* Non-manufacturing PMI rises to 57.1 vs est. 53
* Financials rise to more than three-week high
* Oil prices touch highest level since June
* Indexes up: Dow 0.69 pct, S&P 0.52 pct, Nasdaq 0.74 pct
(Updates to early afternoon)
By Yashaswini Swamynathan
Oct 5 Wall Street rose after two days of losses
on Wednesday after strong economic data boosted financial stocks
and a surge in oil prices helped the energy sector.
A report from the Institute of Supply Management showed
activity in the U.S. services sector saw a big rebound in
September, after having slowed to more than a six-year low in
the previous month.
The data raised the prospects of a U.S. interest rate hike
in the near term and comes before a carefully watched non-farm
payrolls report on Friday.
Oil prices rose above $52 - a level not seen since June -
after data showed a bigger-than-expected draw in U.S. crude
"The markets are taking the economic news positively, but it
is a double-edged sword in our opinion because a better economy
means the Fed is going to finally start moving on rates," said
Brad Lamensdorf, co-manager at Ranger Alternative Management in
A growing number of Fed officials have argued for a rate
hike before the year ends as conditions in the labor market
improve and inflation inches toward the central bank's 2 percent
Traders priced in a near 65 percent chance of a rate hike in
December after the ISM report, according to the CME Group's
The odds had slightly reduced earlier in the day after data
showed that fewer-than-expected jobs were added in the private
sector last month.
The S&P financial sector rose 1.46 percent to more
than a three-week high.
Wells Fargo and Bank of America rose 2.2
percent and were the top influences on the S&P 500 index.
At 12:24 p.m. ET (1624 GMT), the Dow Jones Industrial
Average was up 125.12 points, or 0.69 percent, at
The S&P 500 was up 11.27 points, or 0.52 percent, at
2,161.76 and the Nasdaq Composite was up 39.24 points,
or 0.74 percent, at 5,328.90.
Seven of the 11 major S&P 500 indexes were higher, with
energy surging 1.7 percent. Exxon Mobil and
Chevron were up about 0.8 percent.
Chesapeake Energy rose 5.8 percent and was the
biggest gainer on the S&P.
Telecom services, consumer staples and
utilities, sectors that pay high dividends, were worst
Twitter rose 4.4 percent after the Wall Street
Journal reported that the micro-blogging website is expected to
field bids this week.
Salesforce dropped 6.5 percent after a Mizuho
analyst raised concerns about Chief Executive Marc Benioff's
rumored quest to buy Twitter.
Advancing issues outnumbered decliners on the NYSE by 1,912
to 975. On the Nasdaq, 2,040 issues rose and 672 fell.
The S&P 500 index showed 23 new 52-week highs and four new
lows, while the Nasdaq recorded 86 new highs and 17 new lows.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by