Every line of the report shows sequential improvement," said Art Hogan, chief market strategist at B. Riley Financial. The report prompted traders to adjust their rate hike bets, with bets of a 50-basis point rate hike in December jumping to more than 70% from 45% before the data was released. Following last week's Fed policy meeting, some U.S. central bank officials have made comments that pointed to slower rate rises over coming meetings. The Fed's policy rate is currently in a range of 3.75%-4.00%. The CBOE volatility index (.VIX), also known as Wall Street's fear gauge, fell to a near two-month low of 23.94.points.

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