NEW YORK (AP) -- A jump in hiring by small businesses and reports of global expansion in the manufacturing industry sent U.S. stocks sharply higher Wednesday and pushed bond prices down. Fears that the European financial crisis would spread also eased after European Central Bank President Jean-Claude Trichet suggested that the bank could buy bonds by struggling countries within the European Union. That, along with a better-than-expected bond auction by Portugal, helped send the euro and European stock indexes sharply higher.
The euro rose 0.8 percent after the auction. The Euro Stoxx 50 index, which tracks blue chip companies in countries that use the euro, rose 1.8 percent.
The Dow Jones industrial average gained almost 200 points in morning trading. All 30 stocks in the index rose. Home Depot Inc. and United Technologies Corp. each rose more than 3 percent.
ADP Employer Services said employment at private companies jumped by 93,000 in November as small businesses added the largest amount of workers in three years. Economists had expected private companies to add 70,000 jobs. Private sector employment grew by 83,000 in October, ADP said.
"The U.S. economy is all about jobs and anything that leads folks to believe that there's a better job market will be good for equities," said Paul Zemsky, the head of asset allocation at ING Investment Management.
Manufacturing orders increased in November, the Institute of Supply Management said. It is the 16th consecutive month that its index showed that manufacturing activity expanded.
Bonds fell sharply as investors bought riskier assets. The yield on the 10-year Treasury bond rose to 2.91 percent from 2.80 percent late Tuesday.
Stock rose in Asia after reports signaled that the Chinese economy is growing. A Chinese state index of manufacturing activity rose to 55.2 in November from 54.7 in October. Any number above 50 indicates economic expansion. Monthly readings have stayed above that number for 21 straight months. A competing Chinese survey by HSBC rose to an eight-month high.
Hong Kong's Hang Seng rose 1.1 percent. China's benchmark Shanghai Composite Index rose 0.1 percent. Stocks have fallen in Asia since early November after China raised a key interest rate to combat inflation.
Before the U.S. market opened, the Labor Department reported that productivity grew at an annual rate of 2.3 percent during the third quarter, better than the initial estimate a month ago. The Federal Reserve will put out its report on regional economic activity later in the day.
The Dow Jones industrial average rose 198.37, or 1.8 percent, to 11,204.14 in morning trading. The S&P 500 rose 19.59, or 1.7 percent, to 1,200.14. The Nasdaq composite rose 48.61, or 2.0 percent, to 2,546.84.
