Concerns about market woes were tamed by better than expected GDP and jobless claims reports. Major U.S. market indices end the day higher. Shartia Brantley reports.
Investors cheer strong economic data
Investors drove U.S. stocks higher on strong GDP data and falling jobless claims.
Gross domestic product expanded at a 3.7 percent annual pace instead of the 2.3 percent rate reported last month, and the number of Americans filing for first time unemployment benefits fell last week by 6,000 to a seasonally adjusted 271,000, indicating a strengthening labor market.
However, FAO Economics’ Robert Brusca says, headwinds remain:
(SOUNDBITE) ROBERT BRUSCA, CHIEF ECONOMIST, FAO ECONOMICS (ENGLISH) SAYING
“When I look at the economy, it did a lot better in the second quarter. I don’t think we are heading for that strong growth in the third quarter. We’ve got all this financial market turbulence to deal with, and stock market have fallen, that destroys wealth and when you destroy wealth, people spend less.”
Shares of Freeport-McMoran surged after the company announced it will cut its capital spending plans for 2016 by 29 percent and will reduce ten percent of its staff at U.S. mining operations.
Luxury electric car maker Tesla got a boost, after its Model S P85D sedan received the highest possible score in a test by Consumer Reports Magazine.
And shares of Amazon moved higher after an analyst upgrade citing Amazon’s strong start to the third quarter, helped by the success of Amazon Prime Day.
Overseas, European markets were higher, recouping all their losses of the week on upbeat U.S. economic news.