28 C
Friday, March 31, 2023

US Stocks Jump on Upbeat GDP and Tesla Earnings

  • US stocks rose on Thursday as investors cheered Tesla’s strong GDP and earnings data.
  • GDP grew 2.9% during the fourth quarter, above estimates of 2.8%.
  • Tesla rallied nearly 11% after posting record results after the bell on Wednesday.

US stocks rose on Thursday as investors cheered a surprise rise in fourth-quarter GDP, countering some fears of an impending recession.

All three indices ended the day in the green, with a gain in the Tesla-led Nasdaq Composite, which rose nearly 11% on Thursday after beating earnings estimates and posting record revenue numbers.

GDP grew 2.9% annualized in the fourth quarter, according to the Commerce Department, above the 2.8% estimated by economists.

Meanwhile, Tesla reported a record revenue of $24.32 billion during the latest quarter, beating estimates of $24.16 billion.

Analysts at Goldman Sachs and Wedbush reiterated their “Buy” ratings for the electric vehicle maker, forecasting shares to rise 38% this year to $200. However, JPMorgan called Tesla “underweight”, citing disappointing profit margins. The bank forecast the shares would fall 24% to $120 this year.

Here’s how the US indices fared at the 4:00 pm closing bell on Thursday:

Despite the positive surprise in GDP, some economists warned that the US is not out of the woods when it comes to recession.

“The economy grew decently in 2022: fears of an ongoing recession in the first half of last year were misplaced. However, the picture is different looking ahead. Real GDP trend weakened late in the year and other economic indicators suggest the economy was on the verge of contracting at the start of the year,” Comercia Bank chief economist Bill Adams said in a statement on Thursday. “Financial indicators like the inverted yield curve also signal a strong probability of a recession in the future,” he added.

“Overall GDP was very strong, beating consensus suggesting robust economic activity and if the downturn materialized into a milder recession. However, the drivers behind this growth are far from ideal,” said Ash Alankar, head of Janus Henderson Investors Global Asset Allocation Statement in a statement.

Alankar noted that personal consumption was below expectations and the personal savings rate was above expectations, a sign that consumers are already spending out of caution.

This is what else is happening:

  • FTX is aiming to ask the parents and brother of Sam Bankman-Fried if they got any money from the crashed crypto exchange, lawyers said.
  • The New York Times, Stanford University, Coinbase and Netflix are among FTX’s creditors, according to a recent court document.
  • Chinese electric vehicle shares rose as Elon Musk says Tesla’s biggest rival comes from China.
  • Tesla may be able to weather an economic storm, but some of its guidance numbers don’t add up, Gene Munster said.
  • Tesla shares could rise 38% this year after its upbeat earnings report, Wedbush said.
  • Natural gas prices hit their lowest level since April 2021 and have plunged 70% from last year’s highs.
  • Chevron wowed investors with a massive $75 billion share buyback, which at current prices would retire about 20% of the company’s shares.

In commodities, bonds and cryptocurrencies:

Related Articles


Please enter your comment!
Please enter your name here

Latest Articles