Bank of America is looking to sell its correspondent mortgage business and the unit's employees could be notified as soon as Wednesday, according to the Wall Street Journal.
Meanwhile, a rally among regional banks helped boost the financial sector higher. HuntingtonBank , PNC Financial and State Street all climbed 2 percent.
Zipcar jumped after Ford agreed to supply vehicles to the car-sharing firm at over 250 colleges throughout the nation .
Gold prices gained to settle at $1,828.50 an ounce. The precious metal has soared almost $200 an ounce this month, or 12 percent, logging its largest monthly percentage gain since Nov. 2009.
Trading volume was on the lighter side with the consolidated tape of the NYSE at 4.43 billion shares, while 1.27 billion shares changed hands on the floor ahead of a holiday weekend.
On the employment front, private sector job growth slowed for the second month in August with employers adding 91,000 jobs, according to payrolls processor ADP. Meanwhile, outplacement firm Challenger, Gray & Christmas reported that planned layoffs fell 23 percent to 51,114 in August.
The employment reports come ahead of the widely-followed government non-farm payroll figures at the end of the week.
Meanwhile, President Obama urged Congress to pass an extension of a federal highway bill, which will protect a million jobs. The President's statement comes ahead of a speech after the Labor Day holiday on the jobs market and the economy. However, some economists are skeptical Obama will get Congress to agreeto significant new spending on jobs.
“We still have a lot of economic data coming up—and September is going to be determined by whether the numbers hold together,” said Jim Paulsen, strategist at Wells Capital Management. “As long as we don’t have recessionary numbers, we’re going to continue seeing a rally.”
Paulsen said he’s optimistic of the economic outlook in the second half of the year.
“I think we’re going to grow 3 percent in the second half,” he said, adding that the market will see a rebound as equities have been largely oversold in the recent months. “We’ll take 4 or 5 weeks before people calm down.”
Among other economic news, new orders for U.S. factory goods jumped in July, according to the Commerce Department. Meanwhile, Chicago PMI slowed in August, hitting its lowest level since Dec. 2009.
Weekly mortgage applications showed a sharp dropoff as refinancing requests tumbled, according to the Mortgage Bankers Association.
European shares closed sharply higherfor the third session, but posted its biggest monthly decline in almost three years.
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Coming Up This Week:
THURSDAY: Weekly jobless claims, productivity and costs, ISM Mfg index, construction spending, chain store sales, auto sales
FRIDAY: Non-farm payroll
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