Closing summary: Wall Street gains as stronger GDP figures overshadow Nvidia
The US economy performed better than expected in the second quarter, helping GDP to grow faster than first thought.
The annualised rate of growth for the second quarter, at 3% rather than the 2.8% seen in the first reading, does not suggest an economy that is on the brink of recession. Share prices on Wall Street duly rose, with the S&P 500 rising by 0.5%.
2Q24 GDP was revised up to 3% (from 2.8%) in its second release. The consumer continues to be a key driver of growth as personal consumption expenditures were revised up to 2.9% for the quarter from 2.3%. pic.twitter.com/KwKi4Ixq9D
— Kathy Jones (@KathyJones) August 29, 2024
🇺🇸 Robust economic momentum in Q2🌞
— Gregory Daco (@GregDaco) August 29, 2024
📉Real #GDP in Q2 '24
✅+3.0% q/q: revised up 0.2pt
✅+3.1% y/y
🛒Consumer +2.9%
🏘️Resid -2.1%
👩💻Biz invest +4.6%
⬆️Inventories +0.8pt
📦Trade -0.8pt (strong M)
🏦Gov +2.7%
📉PCE #inflation
✅Headline 2.6% y/y (flat)
✅Core 2.6% (⤵️0.3pt) pic.twitter.com/7of50DX41g
That helped Wall Street stock market indices to weather the turbulence that had been expected last night and earlier this morning when Nvidia shares fell in pre-market trading.
The chip designer’s shares were down by 2% in early trading on New York’s Nasdaq, but that is quite a bit different from the 7% move in pre-market trading in the hours after it unveiled – don’t forget – a doubling in sales and strong profits.
Richard Flax, chief investment officer at Moneyfarm, a wealth manager, said:
The faster-than-expected growth in the second quarter should give a bit more comfort that the US economy remains in decent shape. This revision could also provide a slight boost to the Harris presidential ticket, given that the economy has been a key area of focus for both campaigns.
Today’s economic data may also draw some attention away from the intense focus on Nvidia’s results.
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Wall Street stock market indices have indeed risen at the opening bell, despite Nvidia shares dipping by 1%.
Here are the opening shaps from Reuters:
S&P 500 UP 15.06 POINTS, OR 0.27%, AT 5,607.24
NASDAQ UP 50.33 POINTS, OR 0.29%, AT 17,606.36
DOW JONES UP 281.43 POINTS, OR 0.68%, AT 41,372.85
