Stocks were higher Thursday as market participants reacted to a series of mega-cap earnings reports and shook off the initial losses from the Federal Reserve's decision to hold interest rates. The Dow Jones Industrial Average rose nearly 170 points while the S&P 500 Index and the Nasdaq Composite added 0.5% and 0.3%, respectively.
Here's how the market settled on Thursday:
S&P 500 Index
Dow Jones Industrial Average
Nasdaq Composite Index
Investor sentiment was dampened Thursday as U.S. economic growth slowed at a faster-than-expected pace in the fourth quarter, the Commerce Department reported Thursday. GDP, which measures all goods and services produced by the U.S. economy, accelerated at a 2.3% annualized rate in the fourth-quarter, adjusted for inflation. For the full year, GDP grew by 2.8% compared with 2.9% in 2023.
"The U.S. consumer continued to power overall economic growth as employment and wage gains remain firm and massive wealth effects from sharp increases in equity and home values turbo charge spending especially among upper-income households," said Kathy Bostjancic, chief economist at Nationwide, quoted by Yahoo!Finance. "Holding back growth was a decline in business investment ... the drawdown in inventories, especially at the wholesale level indicates that retailers also scurried to stock up before possible tariffs. This could continue into early 2025."
On the Earnings Front:
Comcast
Executives told analysts during the company's earnings call on Thursday that they plan to shift their strategy to package mobile with broadband to attract more would-be subscribers.
"While we are incumbent in the $80 billion U.S. residential broadband market. We are the challenger in the far larger $200 billion U.S. wireless market," said CFO Jason Armstrong. "Wireless is an integral part of our broadband strategy."
Microsoft
For its fiscal third-quarter, Microsoft is calling for revenue between $67.7 billion to $68.7 billion, compared with the $69.78 billion consensus estimates from LSEG.
"In Azure, we expect Q3 revenue growth to be between 31% and 32% in constant currency driven by strong demand for our portfolio of services," CFO Amy Hood told analysts during the company's earnings call on Wednesday. "As we shared in October, the contribution from our AI services will grow from increased AI capacity coming online."
IBM
"We closed the year with double-digit revenue growth in Software for the quarter, led by further acceleration in Red Hat," CEO Arvind Krishna said in a statement. "Clients globally continue to turn to IBM to transform with AI."
Tesla
Tesla did not give specific guidance for the year ahead, but said, "we expect the vehicle business to return to growth in 2025," and reiterated plans to "unlock an unsupervised FSD option," and "begin launching" its Cybercab driverless ride-hailing business "later this year" in select U.S. cities.
Meta Platforms
CEO Mark Zuckerberg said he expects 2025 to redefine the company's relationships with governments. The company reportedly agreed to pay about $25 million to settle a 2021 lawsuit that President Donald Trump filed against Meta and Zuckerberg after its platform suspended his accounts following the U.S. Capitol Attack on Jan. 6, 2021, the Wall Street Journal reports.
"We now have a U.S. administration that is proud of our leading companies, prioritizes American technology winning and that will defend our values and interests abroad," Zuckerberg told analysts during the company's earnings call on Wednesday. "I am optimistic about the progress and innovation that this can unlock."
For Friday:
Market participants will turn their attention towards earnings reports from companies including Apple
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