Stocks turn it around, rise as oil clears $40 level

Stocks edged a little higher Wednesday, a change of pace for the Dow, which pulled out of a seven-session losing streak.

The Dow Jones industrial average closed up 41 points, or 0.2%. The broader Standard & Poor's 500 stock index and the Nasdaq composite were up 0.3% and 0.4%, respectively.

All three market gauges had opened lower.

Service sector grew at slower pace in July

The stock market had lost momentum in the past week, as shares had been weighed down by a fourth straight quarter of negative profit growth for the S&P 500, above-average valuations and a renewed dip in oil prices. U.S.-produced crude had tumbled more than 20% from its recent high and below $40 per barrel, before jumping 3.6% to $40.94 Wednesday.

The good news is the losses in the Dow's seven-day losing streak have been muted, with the Dow off just 1.4% in the period. Compare that to the Dow's last eight-session losing streak, back in July and August of 2011, when it fell nearly 860 points, or 6.7%, as investors dumped stocks during the Congressional impasse over raising the debt ceiling which resulted in a U.S. credit rating agency stripping the USA of its AAA-rated credit rating.

10 companies' profits put smiles on faces

Despite the recent soft patch for stocks, the Dow is down just 1.5% from its July 20 all-time high and remains up 5.1% on the year. Similarly, the S&P 500 is down less than 1% from its July 22 record and is up 5.5% in 2016.

Wall Street also got more good news on the jobs front. Private employers added 179,000 jobs in July, topping expectations and lifting hopes that the government's July employment report set for release Friday will also come in solid.

"The ADP report shows the labor market is still holding up well," Paul Ashworth, chief U.S. economist at Capital Economics, wrote in a report.

Stocks were lower in Europe, with the broad Stoxx Europe 600 index off 0.2%. Stocks also closed 1.9% lower in Japan and fell 1.8% in Hong Kong.