US STOCKS-Wall Street closes higher with defensive bets out front

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(Updates prices to close, adds commentary)
By Sinéad Carew
NEW YORK, Sept 2 (Reuters) - The S&P 500 closed higher on
Wednesday for the ninth time in the past 10 sessions, with
defensive and value stocks taking their turns to lead the gains
after data showed U.S. private payrolls expanded last month, but
at a much slower pace than expected.
The indexes hit session highs in the last hour of trading
after losing ground briefly following the Federal Reserve's
"Beige Book" report which showed a modest increase in activity
for U.S. businesses and an increase in employment through late
August, while economic growth remained sluggish in parts of the
country. The blue-chip Dow edged closer to its Feb. 12 record high
while the tech-heavy Nasdaq, now well over 20% above its
pre-crisis high, rose at a slower pace on Wednesday.
While much of the rally from March lows has already been
fueled by Federal Reserve support, Lindsey Bell, chief
investment strategist at Ally Invest, said investors may still
be digesting the central bank's policy announcement last week
which indicated continued support.
"What you're seeing today is a bit of a rotation after
yesterday's blockbuster day," said Bell. "Unless you really
think tech is going to completely crash it can take a breather
and allow some of the other value-oriented and cyclical sectors
to take the reins for a while."
The defensive utilities .SPLRCU , consumer staples
.SPLRCS and real estate .SPRLCR , which have trailed the
broader market this year, were some of the biggest gainers among
major S&P sectors on Wednesday.
Financials .SPSY , a value sector which has also sharply
underperformed this year, also gained on Wednesday.
Unofficially, the Dow Jones Industrial Average .DJI rose
452.74 points, or 1.58%, to 29,098.4, the S&P 500 .SPX gained
53.96 points, or 1.53%, to 3,580.61 and the Nasdaq Composite
.IXIC added 116.78 points, or 0.98%, to 12,056.44.
U.S. private payrolls increased last month from July,
according to the ADP report, but fell short of economists'
forecast. Investor focus will now be on the government's
comprehensive employment report which is slated for
Friday. Janet Walker, senior portfolio manager at Abbot Downing in
San Francisco, expects Friday's government payroll numbers to
also reflect a stalling from July to August. As a result she
says it will be important for U.S. lawmakers to reach an
agreement for a new fiscal coronavirus relief bill.
Weakness in the jobs report "could become a bigger risk if
there's a delay in stimulus," she said. "For us to continue to
recover we're going to need to see additional stimulus."
Nvidia Corp NVDA.O , the best-performing S&P 500
constituent this year and one of the benchmark's biggest boosts
on Wednesday, gained after several brokerages hiked their price
targets on its shares after its announcement of powerful gaming
chips in collaboration with Micron Technology Inc MU.O and
Samsung Electronics Co Ltd 005930.KS .