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By Nicholas
Jasinski | Thursday, April 29 Pedal
to the Metal. Stocks rose today
after a dose of strong economic data and amid a frenzy of corporate earnings
reports. The Bureau
of Economic Analysis reported this morning that
U.S. gross domestic product grew at a 6.4% annualized rate in the first
quarter, about matching economists' average estimate. The Labor
Department also reported a new low in the number of
Americans filing for unemployment insurance since the start of the pandemic,
at 553,000 in the latest week. Barron's Lisa
Beilfuss broke down the latest pair of data
points showing a healing U.S. economy today. She wrote: A massive
increase in personal income, largely due to stimulus checks issued by the
government, was behind the rise in first-quarter GDP. Personal income
increased $2.4 trillion—or 59%—after decreasing 6.9% in the fourth quarter.
The surge in income boosted personal consumption 10.7%, even as many
Americans continued to stockpile the extra cash. The savings rate during the
quarter jumped to 21% versus 13% in the fourth quarter. Aside from
consumer spending, which makes up about three-quarters of GDP, government
spending (federal spending was up 13.9%), business investment (up 9.9%) and
residential fixed investment (10.8%) helped boost overall output. Those
increases offset declines in private inventory investment and
exports. Economists
expect even faster GDP growth in the second quarter, as more parts of the
country emerge from their pandemic lockdowns and vaccinated Americans go out
again. Read the rest of Lisa's report here. Investors were
busy today sifting through the dozens of first-quarter earnings reports. So
far, about 50% of the S&P 500 has reported, and companies are reporting
earnings growth of 44% on average. That's a lot. Today's
highlights included Caterpillar, Kraft Heinz, Merck, Comcast, McDonald's, Mastercard, Western Digital, Bristol Myers Squibb, Twitter, and Amazon.com (more on that below). The S&P
500 closed up 0.7%, at a record high. The Dow
Jones Industrial Average also added 0.7%, and the Nasdaq
Composite ticked up 0.2%. |
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DJIA: +0.71% to 34,060.36 The Hot
Stock: Dish Network +8.3% Best Sector:
Communication Services +2.8% |
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