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Last updated: 9:40am EST
The US economy ended 2023 on a strong note, overturning predictions of a recession. In fact, the Commerce Department reported that gross domestic product (GDP) expanded at an annualized rate of 3.3% in the fourth quarter, beating expectations of 2%. This strong performance follows his 4.9% growth rate in the third quarter and translates into a 2.5% annualized increase for the year as a whole, a notable improvement over his 1.9% increase in 2022. Masu. As a result, the stock index is in the green at the start of trading today.
The jump in GDP can be attributed to strong consumer spending, up 2.8%, and increased state and local government spending, up 3.7%. Federal government spending and private gross domestic investment also played important roles in boosting the economy.
Furthermore, inflation also showed signs of easing. The price index for personal consumption expenditure rose by 2.7% annually, down from 5.9% the previous year. The core inflation rate, which excludes food and energy, also slowed to an annual rate of 3.2%.
Despite these positive economic indicators, there are concerns about the future. The lagged effects of the Fed’s previous rate hike may still weigh on the economy, with questions remaining about the sustainability of consumer spending in the face of declining savings and rising debt. Furthermore, the important role of government deficit spending in promoting growth is frowned upon.
First published: 4:06am EST
U.S. futures were near flat on Thursday morning as investors awaited the release of the fourth quarter gross domestic product (GDP) report. Nasdaq 100 futures (NDX), S&P 500 (SPX), Dow Jones Industrial Average (DJIA) are up 0.01%, 0.02%, and 0.2%, respectively, as of 3:28 a.m. EST on January 25th.
Regarding GDP estimates, economists expect the U.S. economy to expand by 2% in the final quarter of 2023. In addition, semiconductor giant Intel’s earnings report (INTC) will be the focus. Other notable financial results to be announced today include American Airlines (AAL),visa(V), black stone (BX), NextEra Energy (knee), and Capital One (C.O.F.)Such.
Yesterday, Tesla (TSLA) stock price fell nearly 6% in extended trading after the company announced disappointing fourth-quarter fiscal 2023 results. Management’s prediction that volumes will decline in 2024 compared to the previous year remains a concern for investors. On the other hand, IBM stock (IBM) rose 8% yesterday after reporting strong fourth-quarter results.
On the other hand, as of this writing, crude oil prices were on an upward trend as US crude oil inventories decreased more than expected. At last check, WTI crude oil futures were hovering around $75.55 per barrel.
Elsewhere, European markets opened lower on Thursday morning as investors awaited the European Central Bank’s interest rate decision, expected later today. The central bank is expected to maintain current record high interest rates.
Asia-Pacific markets end higher on Thursday
The Asia-Pacific region index ended in the green on Thursday. The upside can be attributed to the People’s Bank of China’s plan to reduce banks’ reserve requirements next month to stimulate the economy.
Hong Kong’s Hang Seng Index and China’s Shanghai Composite Index and Shenzhen Composite Index finished up 1.96%, 3.03% and 2%, respectively. Similarly, Japan’s Nikkei Stock Average and TOPIX index ended down 0.03% and 0.11%, respectively.
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