US stocks gained on Wednesday, boosted by better-than-expected data on manufacturing in the country’s industrial heartland, while still ending the month of August with losses.

The Dow Jones Industrial Average gained 53.58 points (0.46 per cent) to close at 11,613.53. The broader S&P 500 rose 5.97 points (0.49 per cent) to 1,218.89, while the tech-heavy Nasdaq Composite edged up 3.35 points (0.13 per cent) to close at 2,579.46.

Markets got a lift when the Institute of Supply Management-Chicago reported that its purchasing managers’ index came in at 56.5 in August, above analysts’ forecasts. Any number greater than 50 indicates expansion.

Separately, payrolls firm ADP said the US private sector created 91,000 jobs in August, which fell short of expectations.

The Dow was down 4.4 per cent for August after a volatile month in which markets were rattled by the debt-ceiling mess in Washington, Standard & Poor’s downgrade of the United States, fears of a new recession and Europe’s sovereign debt crisis.

“It was a very bad month, you want to forget it as quickly as possible,” said Gregorio Alekhine, president of Meeschaert Capital Markets.

AT&T slumped 3.9 per cent on Wednesday after US authorities challenged its proposed $US39 billion takeover of the United States’s number-four wireless provider T-Mobile, a unit of Deutsche Telekom, on antitrust grounds.

AT&T’s smaller rival Sprint Nextel, which many analysts said would be doomed if the takeover went through, surged 5.9 per cent.

Aluminum giant Alcoa was the best performer among the Dow’s list of 30 blue-chip stocks, rallying 3.6 per cent.

Bond prices fell. The yield on the 10-year Treasury note increased to 2.22 per cent from 2.18 per cent late Tuesday, while that on the 30-year bond climbed to 3.59 per cent from 3.51 per cent.

Bond prices and yields move in opposite directions.