© Reuters
Investing.com — U.S. stocks rose Thursday, boosted by stronger-than-expected economic growth while investors digested a deluge of corporate earnings.
By 09:45 ET (14:45 GMT), the was up 85 points, or 0.2%, the traded 17 points, or 0.4%, higher and the climbed 45 points, or 0.3%.
U.S. fourth quarter growth impresses
Economic data released earlier Thursday showed that the U.S. economy grew at a faster than anticipated rate in the fourth quarter, as activity remained robust even as it shows signs of slowing back down to a pre-pandemic pace.
Real gross domestic product in the world’s largest economy expanded at an annual rate of 3.3% in the three months to the end of December, decelerating from 4.9% in the third quarter, according to a key first reading from the Commerce Department. This was considerably above the 2.0% growth expected.
The recent rally in stocks has been partly fueled by expectations that the will shortly start cutting interest rates, judging that its rate-hiking campaign has had the desired impact cooling inflation. Although this sign of economic resilience may suggest that the Fed holds off cutting rates until the second quarter, it does suggest that a steep economic downturn is now unlikely.
Humana slumps on rising costs
The earnings season is now in full flow.
Humana (NYSE:) stock slumped 11% after the health insurer warned an “unprecedented” increase in medical costs will hit its earnings this year, and has also put its 2025 profit target out of reach.
American Airlines (NASDAQ:) stock rose over 6% after the carrier beat expectations with its forecast for full-year adjusted earnings per share, expecting that it would receive a boost from solid passenger booking trends and a decline in fuel prices.
After the close, Intel (NASDAQ:), T-Mobile (NASDAQ:) and Western Digital (NASDAQ:) will post their quarterly results.
Elsewhere, Tesla (NASDAQ:) stock fell 9% after CEO Elon Musk warned that the electric vehicle manufacturer expects to see “notably lower” sales growth in 2024 versus the prior year, as it faces intensifying competition, particularly from its Chinese rivals.
Boeing (NYSE:) stock fell 4% after the U.S. aviation regulator said that it will not let the planemaker expand production of its 737 MAX jet, in the wake of a dangerous mid-air breach on its MAX 9 model earlier this month.
IBM (NYSE:) stock rose over 9% after the tech giant forecast full-year revenue growth above expectations, banking on stable demand for its IT software and consultancy services from businesses looking to adopt artificial intelligence.
Crude helped by hefty U.S. inventories draw
Oil prices climbed higher Thursday, boosted by the string U.S. growth data as well as inventories falling more than expected last week.
By 09:45 ET, the U.S. crude futures traded 1.8% higher at $76.45 a barrel, while the contract climbed 1.6% to $81.33 a barrel, trading once more above the widely-watched $80 a barrel level.
U.S. crude stockpiles tumbled by a hefty 9.2 million barrels last week, according to the , but this figure was impacted by the harsh winter weather which shut in refineries and kept motorists off the road.
U.S. crude output fell from a record 13.3 million barrels per day two weeks ago to a five-month low of 12.3 barrels per day last week.
Elsewhere, the People’s Bank of China on Wednesday unexpectedly cut reserve requirements for local banks, freeing up more liquidity in another attempt to foster economic growth in the world’s largest oil importer.
Additionally, traded 0.3% higher at $2,022.35/oz, while traded 0.2% lower at 1.0859.
(Oliver Gray contributed to this article.)
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