Stock Market Today: S&P 500 rides strong GDP data to fifth record close in a row

Investing.com -- The S&P 500 closed at record levels for the fifth-straight session Thursday as investors mulled mostly upbeat corporate earnings, while stronger-than-expected economic growth and slowing inflation bolstered expectations for a soft landing, pushing Treasury yields lower.

By 16:00 ET (21:00 GMT), the Dow Jones Industrial Average was up 242 points, or 0.6%, the S&P 500 traded 0.5% higher to close at record of 4,894.92. The Nasdaq Composite closed 0.2% higher.

U.S. fourth-quarter growth surprises to upside to bolster soft landing hopes/h2

Economic data released earlier Thursday showed that the U.S. economy grew at a faster than anticipated rate in the fourth quarter, with further signs that inflation pressures are receding supporting bets that the economy is likely to avoid a recession.

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, though well above economists' forecast for 2%, driven by stronger consumer spending. Core personal consumption expenditure prices, the Fed's preferred inflation measure, remained at 2% for the second-straight month.

"Bottom line, the consumer went nuts in Q3, spending tons of money on vacation, entertainment, and recreation experiences," Jefferies said in a Thursday note, though cautioned that "signs of broader weakness in the data should emerge soon."

Treasury yields fell following the data, with the yield on the 10-year down 4.5 basis points to 4.135%.

IBM , United Rentals , American Airlines impress/h2

International Business Machines (NYSE:IBM), up 9%, was the torchbearer for rising tech stocks after the tech company reported Q4 results that topped analyst estimates, with an upside surprise in free cash flow stoking bullish sentiment as 'big blue' artificial intelligent offering drummed up demand.

"Management highlighted that the book of business around generative AI and watsonx had doubled from the prior quarter," RBC said in a note, as it lifted its price target on the stock to $200 from $179.

United Rentals Inc (NYSE:URI), meanwhile, was one of the top gainers, surging nearly 13% to a new 52-week high following better-than-expected Q4 results that beat on both the top and bottom lines. The equipment rental also unveiled plans to buyback $1.5 billion of stock in 2024 and lifted its quarterly dividend.

American Airlines Group (NASDAQ:AAL), up 10%, was also a big winner on the earnings stage after flying in a better-than-expected quarterly report and annual guidance as strong travel demand is expected to boost performance.

Tesla in bearish squeeze on weaker Q4 results, 'trainwreck' conference call; Boeing dives/h2

Tesla Inc (NASDAQ:TSLA) fell more than 12% after reporting weaker-than-expected Q4 results, warning of "notably lower" volume growth this year and delivering a "trainwreck" of a conference call, Wedbush said.

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Many were expecting hoping for an update on price cuts, margin structure, and flucuating demand.... "instead we got a high level Tesla long term view with another train wreck conference call," Wedbush added.

Boeing (NYSE:BA) stock fell nearly 6% 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.

(Peter Nurse, Oliver Gray contributed to this article.)

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