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US Stocks Rise Despite Strong Earnings and Indicators of a Slowing Economy

On Thursday, as market players absorbed strong profits despite indications of a slowing economy, U.S. equities rose and Treasury rates began their ascent.

All three of the main U.S. stock indices were moving strongly higher, with the Nasdaq on course to post its largest one-day percentage increase since mid-March thanks to megacap tech and tech-related businesses.

Since early January, the S&P 500 and the Dow have been on a trajectory for their biggest daily percentage gains.

The increase was fueled by Meta Platforms Inc.'s positive quarterly results, which came after Microsoft Corp. and Alphabet Inc.'s equally solid profits.

Portfolio manager at InfraCap in New York Jay Hatfield said, “The (earnings) beat from Meta was impressive. And with the announcements of Microsoft and Alphabet's results, the concern that earnings would be disastrous isn't materializing.

Earnings are taking precedence over worries about another Fed interest rate increase, Hatfield said.

Even if price growth came in hotter than predicted, according to economic statistics published before to the bell, the U.S. economy slowed down more than expected in the first quarter. Initial claims for unemployment benefits decreased at the same period, pointing to continued tightness in the labor market, a key contributor to inflation.

According to Thomas Martin, Senior Portfolio Manager at GLOBALT in Atlanta, “the economic reports continue to show a combination of decelerating and accelerating trends.” “When it comes to what the Fed needs to do, it's difficult to know how much good news is good news, and vice versa.”

The S&P 500 climbed 72.06 points, or 1.78 percent, to 4,128.05; the Dow Jones Industrial Average increased 479.55 points, or 1.44 percent; and the

The Nasdaq Composite rose 122.30%, or 268.95 points, to close at 12,123.30.

A number of positive earnings reports, including those from Deutsche Bank AG and Barclays Plc, helped European equities end the day higher.

The global MSCI stock market index increased 1.16 percent while the pan-European STOXX 600 index increased by 0.18 percent.

Stocks in emerging markets increased 0.49 percent. The Nikkei in Japan increased by 0.15 percent, while the MSCI's broadest index of Asia-Pacific equities outside of Japan finished 0.31 percent higher.

Treasury rates increased overall as investors took into account the impending debt limit standoff in Washington and indications that inflation may continue to rise persistently even as the economy contracts.

Standard 10-year note prices recently decreased by 25/32 to a yield of 3.5242 percent from their late-Wednesday 3.43 percent level.

The 30-year bond's price recently dropped 39/32 to a yield of 3.7579 percent from a late-Wednesday yield of 3.689 percent.

The weaker-than-expected GDP figure did nothing to change the financial markets' betting on another rate rise at the Fed's policy meeting next week, although the dollar did nudge higher versus a basket of other currencies.

The euro fell by 0.16 percent to $1.1022, while the dollar index increased by 0.07 percent.

Sterling was last trading at $1.2485, up 0.14 percent on the day, while the Japanese yen dropped 0.24 percent to 134.00 per dollar.

Following a sell-off on Wednesday, oil prices increased as Russia stated OPEC+ does not see the necessity for more supply restrictions.

U.S. crude increased by 0.62 percent to conclude at $74.76 a barrel, while Brent increased by 0.88 percent to close at $78.37 per barrel.

Gold prices gradually fell as the dollar became stronger.

Gold's spot price fell 0.1 percent to $1,988.52 per ounce.

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