Stocks rally for a second day as investors look past recession worries, Dow jumps more than 300 points; European stocks close higher as investors digest Fed decision, U.S. GDP; Barclays down 5%
U.S. equities rallied Thursday for the second day in a row even after the latest GDP showed a second-straight contraction, as investors bet the economic downturn would soon cause the Federal Reserve to end its aggressive hiking campaign.
The Dow Jones Industrial Average jumped 332.04 points, or 1%, to 32,529.63. The blue-chip index added more than 400 points in the previous session. The S&P 500 rose 1.2% to 4,072.43, and the Nasdaq Composite added nearly 1.1% to 12,162.59. All of the major averages are on pace for a winning week as well as their best month of 2022.
After a brief dip following the GDP report, investors shook off fears that the Federal Reserve’s attempts to tame surging prices would push the economy into a recession. U.S. economic growth fell 0.9% in the second quarter, the Bureau of Economic Analysis reported Thursday. The Dow Jones estimate was for a gain of 0.3%. First-quarter GDP declined by 1.6%.
Ford Motor climbed 6.1% after it beat profit and revenue estimates and raised its dividend.
On the flip side, shares of Meta Platforms dipped 5.2% on the back of disappointing quarterly numbers. Shares of Comcast slid 9.1% after reporting it failed to add broadband subscribers for first time ever.
Apple reported fiscal third-quarter earnings on Thursday that beat Wall Street expectations for sales and profit but showed slowing growth for the iPhone maker.
The pan-European Stoxx 600 closed up 1% provisionally, with most sectors and major indexes pointing in positive territory. Financial services stocks led the gains, climbing 2.8%.
Barclays saw a 48% slump in second-quarter profit after taking a substantial provision relating to a costly trading error in the U.S. The British bank reported a £1.071 billion ($1.30 billion) net profit attributable to shareholders, meeting expectations of £1.085 billion expected by analysts, according to Refinitiv.
Barclays shares slid around 5% on the back of its disappointing numbers. Oil giants Shell and TotalEnergies extended their share buybacks on Thursday after reporting record-breaking profits once again on the back of soaring oil and gas prices. The two companies plan to repurchase a combined $8 billion in shares in the third quarter.
French pharmaceutical firm Ipsen after posting strong first-half sales, while life insurer Scor fell 19% after swinging to a net loss in the first half of the year.
Source: CNBC, Investing.com