U.S. stocks rallied on Thursday as investors digested the release of gross domestic product data and another round of corporate earnings.
The S&P 500 (^GSPC) rose 1.1%, while the Dow Jones Industrial Average (^ DJI) added by 0.6%. The technology-intensive Nasdaq composite (^IXIC) rose about 1.8%, driven by a more than 10% jump in Tesla (TSLA).
The yield on the benchmark 10-year US Treasury rose to 3.497% from 3.461% on Wednesday. The dollar index rose nearly 0.2% to $101.82.
US GDP increased 2.9% annual rate in the last quarter of 2022, above expectations, according to the Bureau of Economic Analysis. Personal consumption expenditure (PCE), undermining two-thirds of domestic activity, added 2.1%, a slowdown from the previous quarter of 2.3%.
Meanwhile, initial jobless claims fell again to 187,000, the lowest level since April 2022. Together, the data represented more signs of resilience for the US economy amid concerns about a possible recession.
New home sales rose 2.3% last month to a seasonally adjusted annual rate of 616,000, report says Census Bureau Thursdaywhile mortgage rates slipped to 6.13%, compared to Freddie Mac.
Thursday’s market moves came after stocks rallied from session lows on Wednesday, finish the session almost flat as 12 of the 24 industry groups hit positive territory for the day.
Bed Bath and Beyond Actions (BBBY) sunk Thursday after the company said in a filing with the SEC that he does not have enough cash to repay his debts and that he defaulted on his line of credit with JP Morgan.
You’re here (TSLA) also took center stage on the corporate front, with shares rising more than 10% after the company reported strong earnings. Its results showed the electric vehicle maker made better-than-expected profits in the latest quarter, generating net profit of $3.7 billion on revenue of $24.3 billion. Tesla said it would deliver about 1.8 million vehicles this year, which would represent a 37% jump in production.
International Business Machines Corp. (IBM) joined the wave of corporate layoffs, saying it will cut about 3,900 workers. The cuts will come from Kyndryl Holdings, the IT services company that IBM started last year. As a result, the company said it would take a hit of $300 million in the first quarter to pay out employee severance.
The hybrid cloud and infrastructure company also reported fourth-quarter earnings slightly above analysts’ expectations with revenue of $16.69 billion. Adjusted earnings per share were $3.60, in line with analysts’ forecasts. Shares fell 4% on Thursday.
Facebook meta parent (META) shares rose following the announcement that the company decided to restore former President Donald Trump’s Instagram and Facebook accounts. The end of the ban resulting from the January 6, 2021 uprising comes at the start of the 2024 presidential campaign.
Elsewhere in stock movements, American Airlines (AAL) shares rebounded on Thursday after the company announced it expects a profit for this year exceed forecasts as the industry remains in recovery mode.
South West Airlines (LUV) shares traded after the carrier reported a fourth-quarter loss of $220 million due to its holiday collapse last month which resulted in thousands of flight cancellations. Southwest cut its revenue forecast for this year to $350 million as the company faces ongoing cancellations and reduced bookings.
Comcast Stock (CMCSA) were flat after the media company reported fourth-quarter earnings that beat expectations with revenue of $30.55 billion. Comcast said it lost 26,000 total broadband customers due to Hurricane Ian, which hit the southeast coast in September. However, the company managed to recover, in part by increasing its share of advertising spend on its networks during the FIFA World Cup and the US election in November.
BuzzFeed(BZFD) shares jumped after the company announced it would use the AI tools provided by ChatGPT OpenAI creator to “enrich” and “customize” its content.
Finally, Toyota boss Akio Toyoda announced Thursday he would step down as CEO on April 1 to be replaced by current brand director Koji Sato. Toyoda will become the new chairman of the board.
Investors will continue to digest earnings season, with reports from names like Visa (V) and Intel (INTC) in the queue for Thursday.
Herringbone (CLC) is due to report on Friday morning, but announced in advance that he would be buy back shares up to $75 billion of its actions in the future.
With earnings season in full swing this week, 173 companies reported on Wednesday. Of these, six stocks recorded a triple play of profits, according to Bespoke Investments. A triple play occurs when a company shows earnings that exceed revenue and net income, while increasing guidance forecast.
Pending the Federal Reserve’s decision next week, investors and economists received a decision from the Bank of Canada on Wednesday. The central bank raised its benchmark index by 25 basis points to 4.5% on Wednesday, the highest level in 15 years. This was an early move that came with a clear signal that the bank is ready to take a break from its aggressive tightening cycle.
Bank of Canada Governor Tiff Macklem has made it clear that “this is a conditional pause,” but it suggests officials are confident the current policy rate is tight enough to restore price stability. .
Meanwhile, back at home, Fed officials are in their blackout period ahead of their next monetary policy meeting, which begins Jan. 31.
However, the The Washington Post reported On Wednesday, Federal Reserve Vice Chairman Lael Brainard is seen as one of the top contenders to head the National Economic Council for the White House. As it stands, Brainard’s position as governor and vice president currently holds until 2026.
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Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv
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