Stocks Inch Higher on Positive Earnings and Strong Economic Data
US stocks are expected to open higher today following yesterday’s mixed trading session. Futures for the S&P 500 are up 0.8 percent, indicating a positive start for the markets. The tech-heavy Nasdaq is likely to be led by Meta Platforms (formerly Facebook), whose stock is surging by 9.7 percent in pre-market trading after reporting better-than-expected second-quarter results and providing optimistic guidance. McDonald’s is also expected to see initial strength after beating analyst estimates on both the top and bottom lines in their second-quarter earnings report. Another company that contributed to the positive sentiment is Comcast, with its stock experiencing significant pre-market strength following better-than-expected second-quarter results.
Additionally, upbeat economic data from the Commerce Department is further fueling optimism. The report showed an unexpected acceleration in the US economic growth rate for the second quarter. Real gross domestic product (GDP) surged by 2.4 percent, surpassing the 2.0 percent growth observed in the first quarter. Economists had projected a slower growth rate of 1.8 percent. The report attributes the unexpected acceleration to increased private inventory investment and nonresidential fixed investment. Although there were some offsets in exports, consumer spending, federal government spending, and state and local government spending, the overall GDP growth remained strong.
The positive economic data continued with the release of the Labor Department’s report, which showed a modest decrease in first-time claims for unemployment benefits. Initial jobless claims fell to 221,000, down 7,000 from the previous week and below economists’ expectations. The decrease indicates a healthy job market.
Adding to the positive sentiment, the Commerce Department also reported that new orders for US manufactured durable goods increased more than expected in June. Durable goods orders rose by 4.7 percent, surpassing the 1.0 percent growth expected by economists. Excluding transportation equipment, durable goods orders rose by 0.6 percent.
Looking ahead, the National Association of Realtors is set to release its report on pending home sales in June, which is anticipated to show a 0.5 percent decrease following a 2.7 percent decline in May.
Overseas markets have also experienced gains, with stock markets across the Asia-Pacific region moving higher. Japan’s Nikkei 225 Index rose by 0.7 percent, while Hong Kong’s Hang Seng Index jumped by 1.4 percent. In Europe, the French CAC 40 Index surged by 1.8 percent, the German DAX Index was up by 1.1 percent, and the UK’s FTSE 100 Index increased by 0.2 percent.
In commodities trading, crude oil futures are jumping to $79.77 a barrel, rebounding from a decline yesterday, while gold futures are edging down to $1,969.10 an ounce after a significant increase in the previous session.
In the currency market, the US dollar is trading slightly higher against the Japanese yen and the euro.
Overall, stocks are expected to rise today on the back of positive earnings news and robust economic data, contributing to a sense of optimism in the markets.
