U.S. stocks gain as market looks past GDP data; Dow gains 0.29%
Published Jun 25, 2014 04:39PM ET
Stocks shrug off GDP report and rise on hopes for more upbeat second quarter
Investing.com - U.S. stocks rose on Wednesday after investors took a dismal first-quarter GDP report in stride, betting that the second quarter will reveal a solid uptick in economic activity.
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At the close of U.S. trading, the Dow 30 rose 0.29%, the S&P 500 index rose 0.49%, while the NASDAQ Composite index rose 0.68%.
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The Volatility S&P 500 index, which measures the outlook for market volatility, was down 4.45% at 11.59.
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The Commerce Department reported earlier that U.S. gross domestic product contracted at an annual rate of 2.9% in the first quarter of the year, far surpassing consensus forecasts for a decline of 1.7%.
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U.S. first-quarter GDP was initially reported to have increased by 0.1%, but was subsequently revised to show a contraction of 1.0%.
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The difference between the second and third estimate was the largest since records began in 1976, the Commerce Department added.
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A separate report showed that U.S. durable goods orders fell 1.0% in May, while core durable goods orders fell 0.1%. Market expectations had been for an increase of 0.2% and 0.4%, respectively.
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Stocks rose anyway, as recent housing and other economic indicators have depicted a U.S. economy that is rebounding from a rough winter that seriously disrupted commerce.
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First-quarter earnings have given investors room to believe that the economy is gaining steam as well.
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Meanwhile in corporate news, drug maker Bristol-Myers Squibb Company (NYSE:BMY) saw its shares rise earlier on news of positive results of an experimental skin-cancer drug's trial.
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Cereal maker General Mills Inc (NYSE:GIS) shares fell on disappointing earnings, while agribusiness giant Monsanto Company (NYSE:MON) hiked its earnings outlook for the year.
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In other news, the Supreme Court ruled in favor of television broadcasters on their assertions that TV startup Aereo had violated copyright law.
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Leading Dow Jones Industrial Average performers included Nike Inc (NYSE:NKE), up 1.97%, Pfizer Inc (NYSE:PFE), up 1.69%, and Merck & Company Inc (NYSE:MRK), up 1.60%.
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The Dow Jones Industrial Average's worst performers included Boeing Company (NYSE:BA), down 1.63%, General Electric Company (NYSE:GE), down 0.58%, and Exxon Mobil Corporation (NYSE:XOM), down 0.56%.
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European indices, meanwhile, ended the day lower.
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After the close of European trade, the DJ Euro Stoxx 50 fell 0.85%, France's CAC 40 fell 1.28%, while Germany's DAX fell 0.71%. Meanwhile, in the U.K. the FTSE 100 fell 0.79%.
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On Thursday, the U.S. is to release data on personal income and expenditure, as well as data on inflation linked to personal spending.
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Written By: Investing.com
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