S&P 500 and Nasdaq rise after US GDP data and chip stocks rise

by

US stocks rose on Thursday, setting the stage for fresh record highs. Investors welcomed a number of news including strong US economic data, upbeat results from Micron (MU) and promises from China for more stimulus as they awaited news from Jerome Powell.

The Dow Jones Industrial Average (^DJI) rose 0.5%, while the S&P 500 (^GSPC) added 0.7% after both gauges retreated from their all-time highs in the previous session. The tech-heavy Nasdaq Composite (^IXIC) led the advance, up 1.2% amid a sharp rise in Micron shares.

Stocks are looking solidly positive again thanks to a triple dose of optimism over AI trade, the health of the US economy and China's stimulus push, which could spill over into US markets.

Nvidia (NVDA) supplier Micron raised its revenue forecast for the next quarter, citing strong demand for its memory chips used in AI data centers. Chip stocks Nvidia (NVDA), AMD (AMD), ASML (ASML) and STMicro (STM) rose following the earnings report.

In addition, a final update from the US government on second-quarter GDP growth beat Wall Street expectations, while weekly jobless claims unexpectedly fell to the lowest levels in four months.

Meanwhile, China's top leaders signaled they are doing everything they can to revive its moribund economy with fresh pledges to boost fiscal spending, stem the property crisis and support the stock market. A big jump in mainland stocks put the CSI 300 (000300.SS) on track for its best week in a decade.

Optimism was bolstered by growing expectations that the Federal Reserve will sharply cut interest rates again. Prices with a probability of 60% a 0.5% move at its November meeting, compared with 40% a week ago.

Read more: What the Fed's rate cut means for bank accounts, CDs, loans and credit cards

Investors are looking to Fed Chair Powell for a statement to test those hopes, the highlight of a parade of Fed speakers on Thursday. His comments will set the stage for Friday’s highly anticipated reading of the PCE index, the Fed’s preferred inflation metric.

Live2 updates

  • Stocks rise on strong economic growth data, chip stocks advance

    US stocks rose on Thursday, with the S&P 500 (^GSPC) hitting an intraday record high after stronger-than-expected GDP data and upbeat earnings from Micron (MU) lifted the chip sector higher.

    The Dow Jones Industrial Average (^DJI) rose 0.5%, while the S&P 500 gained 0.7%. The tech-heavy Nasdaq Composite (^IXIC) led markets higher, gaining 1.2% thanks to a gain in Micron shares.

    Micros' results helped boost the chip sector, including artificial intelligence heavyweight Nvidia (NVDA), which rose more than 2% in early trading.

    The latest economic data show that US gross domestic product (GDP) rose 3% year-on-year in the second quarter, a faster pace than Wall Street had expected.

  • New economic data is better than expected

    The U.S. economy grew at an annualized pace of 3% in the second quarter, a faster pace than Wall Street had expected.

    The third report of the Bureau of Economic Analysis US second quarter gross domestic product (GDP) estimate) Annualized GDP growth for the second quarter was unchanged from the second estimate, which showed annualized growth of 3%. Economists had forecast that the reading would show annualized growth of 2.9%. The third estimate for second-quarter GDP confirms that economic growth was higher than the 1.4% annualized growth seen in the first quarter.

    Separately, Data from the U.S. Department of Labor On Thursday, it was reported that 218,000 applications for unemployment benefits were filed in the week ending September 21, below Wall Street expectations of 223,000. This marked the lowest level of weekly applications since mid-May.

    Also released Thursday, durable goods orders for August were flat, better than the 2.6% drop Wall Street had expected.

Source link

Leave a Comment