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US stocks gave back gains to trade mixed on Thursday amid more tech weakness.
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GDP grew 2.8% last quarter, handily surpassing expectations.
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Meanwhile, the Fed’s preferred inflation gauge cooled in the quarter. June PCE is on tap for Friday.
US stocks ended mixed on Thursday, giving back their biggest gains in the day as traders struggled to bounce back from Wednesday’s sharp sell-off.
The Dow Jones Industrial Average ended more than 80 points higher after being up over 500 points earlier in the day. Long-dated bond yields slumped, with the 10-year Treasury yield falling three basis points to 4.255%.
GDP grew 2.8% in the second quarter, according to advanced estimates from the Commerce Department, well-above the 2.1% growth economists had expected.
Meanwhile, the personal consumption expenditures price index, the Fed’s preferred measure of inflation, continued to ease last quarter. PCE inflation rose 2.6%, down from the prior reading of 3.7%.
Cooling inflation and robust economic growth should bolster the case for rate cuts. Markets have raised their expectations for three rate cuts by the end of the year, according to the CME FedWatch tool, though the central bank has nodded to just one cut.
“The data today will reinforce the notion that the Fed has the benefit of time. There is no need to rush with private domestic demand growing at a solid pace over the second quarter,” Neil Dutta, the head of economic research at Renaissance Macro Research said in a note on Thursday. “July remains a set up meeting for September,” he added of the Fed’s upcoming policy meeting.
June PCE is due out on Friday morning, and is expected to show inflation eased to 2.5% last month, edging closer to the Fed’s 2% target.
Mega-cap tech stocks continued to slide after Tesla and Alphabet delivered disappointing results for the second quarter. Meta and Microsoft, which are on deck to report next week, both traded lower, losing 1.7% and 2.45% respectively. Alphabet was down for a second day, dropping another 3% on Thursday.
Here’s where US indexes stood at the 4:00 p.m. closing bell on Thursday:
Here’s what else happened today:
In commodities, bonds, and crypto:
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West Texas Intermediate crude ticked 1% higher to $78.42 a barrel. Brent crude, the international benchmark, dipped 0.12% to $81.49 a barrel.
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Gold slumped 1.7% to $2,362 per ounce.
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The 10-year Treasury yield dropped three basis points to 4.255%.
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Bitcoin slid 1.81% to $64,895.
Read the original article on Business Insider
