In the dynamic landscape of Wall Street, Thursday witnessed a resilient surge in US stocks, exhibiting a robust defiance to Tesla’s lackluster earnings report and propelled by an unexpectedly sizzling economic growth reading.
The Dow Jones Industrial Average (^DJI) orchestrated an impressive ascent, gaining 0.6%, while the S&P 500 (^GSPC) exhibited its unwavering strength with a 0.5% rise, building on the momentum from its fourth consecutive record close the preceding day. Meanwhile, the Nasdaq Composite (^IXIC), a bastion of tech stocks, registered a more modest uptick of about 0.2%. The S&P 500 sealed the day with yet another record high, capping at 4,894.16.
The backdrop of this market exuberance was set by a revelation in the morning: an advance estimate of the fourth quarter US gross domestic product (GDP) painted a picture of economic resilience, growing at an annualized pace of 3.3%. This robust figure significantly outpaced the conservative expectation of a 2% annualized growth projected by economists, serving as a fuel to the market rally.
However, not all was rosy in the market panorama. Tesla (TSLA), the electric vehicle (EV) juggernaut, delivered a blow to investor expectations. The company’s quarterly results not only missed profit projections but also forewarned of a “notably” slower growth in EV production. Elon Musk, Tesla’s charismatic CEO, sounded the alarm about the potential decimation of rivals by Chinese carmakers in the absence of trade curbs. Consequently, Tesla shares plunged by a staggering 12%, further underperforming other members of the elite “Magnificent Seven,” the tech-centered stocks instrumental in propelling the S&P 500’s rally.
American Airlines (AAL) managed to soar above the tumult, with its stock surging over 10% after the company delivered better-than-expected guidance for the year 2024. Southwest Airlines (LUV) also contributed to the positive sentiment by surpassing Wall Street’s profit expectations for its latest quarter.
The aviation sector, however, faced a mixed bag of news. While the Federal Aviation Administration (FAA) granted clearance for the return of 737 Max 9 jets to service after safety checks, Boeing (BA) found itself navigating choppy waters. The FAA’s directive to freeze any planned increases in production for the 737 Max 9 model spelled disruption for the aviation giant’s customers and suppliers, resulting in a dip in Boeing’s shares.
As the trading day unfolded, the spotlight shifted to the after-hours scene, with investors eagerly anticipating results from Intel (INTC). The chipmaker, a key player in the technology domain, has Wall Street on high alert for a potential boost driven by advancements in artificial intelligence (AI).
In the complex tapestry of market dynamics, the day’s events culminated in a testament to resilience, as the resilient surge in US stocks prevailed against challenges, showcasing the enduring strength of the financial markets. As investors brace for the next revelation, the tension on Wall Street remains palpable, with every rise and fall etching a chapter in the ongoing saga of the market’s ebb and flow.
Source: Yahoo Finance
