U.S. stocks rose on Thursday despite weak earnings from Tesla (TSLA) and after surprisingly higher-than-expected U.S. economic growth.
The Dow Jones Industrial Average (^DJI) opened 0.2% higher, while the S&P 500 (^GSPC) gained 0.4% after the benchmark posted a fourth straight record close on Wednesday. Shares of the tech-heavy Nasdaq 100 (^NDX) rose about 0.5%.
An advance estimate of U.S. gross domestic product (GDP) for the fourth quarter released Thursday morning showed the economy grew 3.3% on an annual basis. in the period under review, much faster than the 2% annual rate of increase expected by economists.
Tesla warned in quarterly results of “significantly” slower growth in electric vehicle production that missed profits, with CEO Elon Musk citing the risk of Chinese automakers “destroying” their rivals if there are no trade restrictions. Shares of the electric vehicle maker fell 8% in premarket trading, continuing to underperform the other tech-focused stocks in the Magnificent Seven that have driven the S&P 500's rally.
Intel's (INTC) results are a post-market highlight in the deluge of reports as Wall Street eyes an AI boost for the chipmaker.
American Airlines (AAL) shares rose on Thursday morning after the company issued better-than-expected 2024 guidance. Southwest Airlines (LUV) shares also rose after beating the airline's latest quarterly results.
Alaska Airlines (ALK) said it would incur $150 million in costs resulting from the recent grounding of its Boeing 737 Max 9 fleet following a mid-air door jam incident.
The FAA gave the green light Wednesday for those 737 Max 9 jets to return to service once airlines complete safety reviews. But the agency also ordered Boeing (BA) to freeze any planned production increases of the model, causing disruptions for its customers and suppliers and contributing to a decline in stock prices.
Read more: What the Fed's pause on rate hikes means for bank accounts, CDs, loans and credit cards
- Thu, Jan 25, 2024 at 3:15 p.m. GMT
Oil rebounds after strong US economic growth
Oil futures rose on Thursday morning following the release of hotter-than-expected U.S. economic growth data.
West Texas Intermediate (CL=F) gained more than 1% to cross $76 a barrel. Brent (BZ=F), the international benchmark price, rose more than 1% to surpass $81 a barrel.
Prices rose to session highs after a preliminary GDP number showed the U.S. economy grew at an annual rate of 3.3%, beating economists' estimates for 2.2% growth.
Oil futures extended gains from the previous session following the release of U.S. inventories, which fell sharply last week.
U.S. production also fell by 1 million barrels per day last week amid frigid temperatures in oil-producing states, according to the latest data from the Energy Information Administration.
Government data also shows refineries were hit by the freezing temperatures and were operating at 85.5% capacity last week.
- Thu, Jan 25, 2024 at 2:33 p.m. GMT
US stocks are rising on the back of stronger-than-expected US economic growth
Stocks opened higher on Thursday after preliminary U.S. economic growth numbers came in hotter than expected.
The Dow Jones Industrial Average (^DJI) rose 0.3% while the S&P 500 (^GSPC) opened 0.4% higher after the benchmark posted its fourth straight record close on Wednesday. The tech-heavy Nasdaq Composite (^IXIC) rose 0.4%.
An advance estimate of U.S. gross domestic product (GDP) for the fourth quarter showed the economy grew at an annual rate of 3.3% in the period, much faster than the 2% annual rate expected by economists.
Stocks rose despite a poor earnings release from Tesla (TSLA) on Wednesday. The electric vehicle giant missed profit in its latest quarter and warned of “significantly” slower production growth. Tesla shares fell about 7% on Thursday morning.
- Thu, Jan 25, 2024 at 1:34 p.m. GMT
The U.S. economy grew 3.3% in the fourth quarter, beating estimates
The US economy continues to impress.
The first look at fourth-quarter GDP growth released Thursday showed the economy grew at an annual rate of 3.3% in the final three months of 2023. Economists had expected growth of 2%, according to data compiled by Bloomberg.
With this value, the first estimate of cumulative GDP growth for 2023 shows that the economy grew by 2.5% last year, an acceleration from the 1.9% growth in 2022. The economy grew in all four quarters of the year and has now grown for six quarters a series.
In its press release, the BEA said fourth-quarter growth was driven by “increases in consumer spending, exports, state and local government spending, nonresidential fixed asset investment, federal spending, private warehouse investment and residential fixed asset investment.”
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