By Sinead Carew
(Reuters) - U.S. stocks were up more than 1 percent on Wednesday afternoon supported by U.S. data and technology stocks led a rebound from Tuesday's steep losses.
The market briefly hit a session high after the Federal Reserve Beige Book report said U.S. labour markets were tight enough to fuel small wage gains in some professions in recent weeks, though some companies were already feeling a chill from an economic slowdown in China.
Wall Street had closed sharply lower on Tuesday, with concerns about China's economy pushing major indexes down almost 3 percent and intensifying fears of a long-term selloff.
Chinese stocks moved off steep losses to end almost flat on Wednesday as Chinese brokerages bought shares after government calls to support the stock market.
"What we're seeing today is not a recovery. It's market volatility, it's nervousness, it's an inability to call the direction of the market," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma. "Through now and October we're going to see a lot more of this, a lot of volatility. This is a fantastic environment to pick up some high quality companies at much lower prices."
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Nine of the 10 major S&P sectors were higher and five were up more than 1 percent. The technology index's <.SPLRCT> 1.8 percent rise was led by Apple and Microsoft .
However, Netflix fell 2.8 percent after Citron Research recommended a short call on the stock.
The S&P energy index <.SPNY> had a seesaw session as oil prices oscillated. The index was up 0.64 percent in afternoon trade. The utilities index <.SPLRCU> fell 0.34 percent.
At 2:28PM the Dow Jones industrial average rose 215.93 points, or 1.34 percent, to 16,274.28, the S&P 500 gained 23.34 points, or 1.22 percent, to 1,937.19 and the Nasdaq Composite added 75.48 points, or 1.63 percent, to 4,711.59.
In earlier economic data, an ADP report showed U.S. private employers maintained a solid pace of hiring in August.
The report came ahead of Friday's more comprehensive non-farm payrolls data, the last monthly employment report before the Federal Reserve meets on Sept. 16-17, when an announcement on interest rates is widely expected.
In corporate news, shares of banks and bond insurers rose after Puerto Rico's indebted public utility PREPA reached a deal with a key bondholder group.
OFG Bancorp surged 20.7 percent, First Bancorp rose 9.7 percent and MBIA Inc 13.9 percent.
Ambarella slid 12.7 percent after the chipmaker's third-quarter revenue forecast largely fell short of estimates.
GoPro , Ambarella's key customer, fell 7 percent to $40.59. Raymond James said Ambarella's forecast likely means GoPro will not launch more products this year.
Advancing issues outnumbered declining ones on the NYSE by 2,068 to 953, for a 2.17-to-1 ratio on the upside; on the Nasdaq, 1,903 issues rose and 875 fell for a 2.17-to-1 ratio favouring advancers.
The benchmark S&P 500 index was posting 1 new 52-week highs and 10 new lows; the Nasdaq Composite was recording 17 new highs and 42 new lows.
(Additional reporting by Noel Randewich in New York and Tanya Agrawal in Bengaluru; Editing by Meredith Mazzilli)