U.S. stocks rallied Thursday as investors digested the release of gross domestic product data and another round of corporate earnings.
The S&P 500 (^GSPC) increased by 1.1%, while the Dow Jones Industrial Average (^DJI) added by 0.6%. The technology-heavy Nasdaq Composite (^IXIC) rose by roughly 1.8%, led by a more than 10% jump from Tesla (TSLA).
The yield on the benchmark 10-year U.S. Treasury note ticked up to 3.497% from 3.461% on Wednesday. The dollar index rose nearly 0.2% to $101.82.
U.S. GDP grew 2.9% annual rate in the final quarter of 2022, above expectations, according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE), compromised two-thirds of domestic activity, added 2.1%, a slowdown from the prior 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 U.S. economy amid worries over a potential recession.
Sales of new homes rose 2.3% last month to a seasonally adjusted annual rate of 616,000, according to a report Thursday from the Census Bureau, while mortgage rates slipped to 6.13%, per Freddie Mac.
Market moves Thursday came after stocks climbed back from session lows Wednesday, ending the session nearly flat as 12 of the 24 industry groups hit positive territory for the day.
Shares of Bed Bath and Beyond (BBBY) sank on Thursday after the company said in an SEC filing that it doesn't have enough cash to pay down its debts and has defaulted on its credit line with JP Morgan.
Tesla (TSLA) also took center stage on the corporate front as shares increased more than 10% after the company reported strong earnings. Its results showed the electric vehicle maker had better-than-expected profits in the latest quarter, earning $3.7 billion in net income on $24.3 billion in revenue. Tesla announced 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 company layoffs, saying it will cut about 3,900 workers. The cuts will come from Kyndryl Holdings, the IT services business IBM spun off last year. As a result, the company said it will take a $300 million hit in the first quarter to pay for employee severance costs.
The hybrid cloud and infrastructure company also reported fourth-quarter earnings that came in slightly above analysts expectations with revenue of $16.69 billion. Adjusted earnings per share came in at $3.60, in line with analyst forecasts. Shares were down 4% on Thursday.
Facebook parent Meta (META) shares moved higher following the news that the company decided to restore former President Donald Trump’s Instagram and Facebook accounts. The end of the ban stemming from the Jan. 6, 2021, insurrection comes at the start of the 2024 presidential campaign season.
Elsewhere in stock moves, American Airlines (AAL) shares rallied Thursday after the company said it expects profit for this year to exceed forecasts as the industry remains in recovery mode.
Southwest Airlines (LUV) shares traded down after the carrier announced a $220 million loss in the fourth quarter due to its holiday meltdown last month that led to thousands of flight cancellations. Southwest slashed revenue projections for this year to $350 million as the company deals with ongoing cancellations and reduced bookings.
Shares of Comcast (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 struck the Southeast coast in September. However, the company was able to turn around, in part by increasing its share in ad spending on its networks during the World Cup soccer tournament and the U.S. elections in November.
BuzzFeed (BZFD) shares surged after the company said it will use AI tools provided by ChatGPT creator OpenAI to "enhance" and "personalize" its content.
Finally, the head of Toyota Akio Toyoda announced on Thursday he would be stepping down as CEO on April 1 to be replaced by current Chief Branding Officer Koji Sato. Toyoda will become the new chairman of the board.
Investors will continue to digest earnings season, with reports from names including Visa (V) and Intel (INTC) in the queue for Thursday.
Chevron (CVX) is set to report on Friday morning, but announced ahead of time that it will be buying back stock up to $75 billion of its shares in the future.
While earnings season is in full swing this week, 173 companies have reported as of Wednesday. Among those, six stocks have reported an earnings triple play, according to Bespoke Investments. A triple play occurs when a company posts earnings that beat the top and bottom line, while also raising guidance forecasts.
Looking ahead to the Federal Reserve’s decision next week, investors and economists got a decision from the Bank of Canada on Wednesday. The central bank hiked its benchmark by 25 basis points to 4.5% on Wednesday, the highest level in 15 years. It was an anticipated move that came with a clear signal the bank is prepared to press pause on its aggressive tightening cycle.
Bank of Canada Governor Tiff Macklem made it clear that “this a conditional pause,” but it does suggest that officials are convinced the current policy rate is restrictive enough to restore price stability.
Meanwhile, back at home, Fed officials are in their blackout period ahead of their next monetary policy meeting, which starts Jan. 31.
However, the Washington Post reported Wednesday that Federal Reserve Vice Chair Lael Brainard is considered as a top candidate to head the National Economic Council at the White House. As it stands, Brainard’s position as both a Governor and Vice Chair currently holds until 2026.
—
Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv
Click here for the latest stock market news and in-depth analysis, including events that move stocks
Read the latest financial and business news from Yahoo Finance
Download the Yahoo Finance app for Apple or Android
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube
Related Quotes
U.S. stocks closed higher on Thursday in a choppy trading session that saw investors weigh in an onslaught of economic data, as the fourth-quarter gross domestic product came in higher than expectations, and digested mixed corporate earnings.
United States Steel (X) closed at $28.83 in the latest trading session, marking a -1.47% move from the prior day.
STOCKSTOWATCHTODAY BLOG Lucid soared Friday, a move that is being attributed to unconfirmed rumors that the company could be acquired. Lucid (LCID) stock started moving just after noon Friday, and had nearly doubled, to $17.
This industry-leading company has been caught up in the bear market carnage, but it's setting the stage for a massive rebound.
While 2022 was a year for stock price corrections across the electric vehicle (EV) sector, 2023 looks to be a transition year for the businesses themselves. Europe and China are leading the way, with fully electric vehicles accounting for 11% and 19% of all new vehicles sold, respectively. With stock prices down and sales continuing to pick up, investors should look at investing in a diverse mix of EV makers in 2023.
Apple earnings and the Fed meeting loom, but don't sit out a possible "life-changing" market rally. Tesla rival BYD is an aggressive buy.
In 2022, investors grappled with the deepest bear market since the global financial crisis in 2008, and the technology sector took the brunt of the pessimism. Cathie Wood's Ark Invest is focused on the technology sector, so it experienced a steep decline in the value of its exchange-traded funds (ETFs). Its flagship Ark Innovation ETF fell a whopping 66% for 2022.
The stock market would likely move higher if inflation cools off, but these two stocks could be big winners.
Chip giant Intel (NASDAQ: INTC) is struggling as demand for PC and server chips tumbles. The company saw total revenue crash 32% year over year in the fourth quarter of 2022, and it expects a worse decline in the first quarter of 2023. Intel has already announced a broad cost-cutting initiative to help the company cope with lower demand this year.
Wall Street will be buzzing in the week ahead, as earnings from Big Tech, the Federal Reserve’s first meeting of the year, and the monthly jobs report for January set up the busiest week of the new year.
Costco has a very simple business model. It sells memberships in exchange for offering members a low-cost, no-frills shopping experience. People pay in order to access the chain's warehouses. Those membership fees provide a significant portion of the chain's profits, allowing Costco to sell its limited selection of merchandise at a lower markup than its rivals.
One of the hot rumors swirling around the stock market on Friday concerned a top U.S. electric vehicle (EV) stock, so many titles in the sector saw big lifts on the day. Nio (NYSE: NIO) and fellow Chinese next-generation car maker Xpeng (NYSE: XPEV) both closed more than 4% higher against the S&P 500 index's 0.3% bump. Shares of American EV company Rivian (NASDAQ: RIVN), meanwhile, booked an over 8% gain.
Merck & Co., Inc. ( NYSE:MRK ) will increase its dividend from last year's comparable payment on the 10th of April to…
It was a busy week for dividend announcements, with the fourth-quarter earnings season in full swing.
Chevron (NYSE: CVX) finished 2022 with a bit of a whimper. The oil company, which is one of the top holdings of Warren Buffett's Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B), faced headwinds from lower oil and gas prices and a write-down in its international operations. Chevron posted $6.35 billion, or $3.33 per share, of net income in the third quarter.
The Nasdaq Composite has surged over 11% so far this month as growth stocks retake center stage. Shopify (NYSE: SHOP), the Vanguard Growth ETF (NYSEMKT: VUG), Nio (NYSE: NIO), Beam Therapeutics (NASDAQ: BEAM), and Roku (NASDAQ: ROKU) have that kind of potential. Here's what makes each company a great buy now, according to five Motley Fool contributors.
Economic headwinds sent the S&P 500 into a bear market last year, and the benchmark index is still 16% off its high. Warren Buffett's Berkshire Hathaway treated the drawdown as a buying opportunity, investing $66 billion into the stock market through the first three quarters of 2022. Smart investors like Buffett know that a bear market offers investors a chance to buy good stocks at great prices.
Julius Baer of Zurich raised stakes in Intel, Walt Disney, and AT&T stock, and slashed its investment in Advanced Micro Devices in the fourth quarter.
A peak-to-trough decline of 38% for the Nasdaq Composite is an ideal time for opportunistic investors to pounce.
Highly shorted shares are racing past the S&P 500 this year, and short sellers are down by $81 billion.
