US stocks open sharply higher after heavy sell-off

US stocks opened sharply higher on Wednesday following the previous day's steep decline as Wall Street was digesting mixed economic data.

US nonfarm business sector labour productivity increased at a 3.3-percent annual rate during the second quarter of 2015, beating market expectations of 2.8 percent, the Labor Department reported on Wednesday.

From the second quarter of 2014 to the second quarter of 2015, productivity increased 0.7 percent, reflecting increases in output and hours worked of 3.3 percent and 2.6 percent, respectively.

Meanwhile, US private sector employment increased by 190,000 jobs from July to August, missing market consensus of 210,000, according to the August ADP National Employment Report released Wednesday.

The ADP figure was watched closely as a pre-indicator for the nonfarm payrolls data due on Friday. Some analysts thought that a soft ADP report could give the Federal Reserve an excuse to postpone rate hikes.

Investors will also keep a close eye on the Fed's Beige Book scheduled for release in the afternoon, which is expected to give more clues on the timing of an interest rate hike.

Shortly after the opening bell, the Dow Jones Industrial Average jumped 210.92 points (1.31 percent), to 16,269.27. The S&P 500 added 22.76 points (1.19 percent), to 1,936.61. The Nasdaq Composite Index surged 65.06 points (1.40 percent), to 4,701.16.

On Tuesday, US stocks suffered big losses, with all three major indices tumbling over 2.8 percent, as a renewed broad-based sell-off around the world rattled nervous investors.