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Market Snapshot: U.S. stocks hold gains in choppy trade after Facebook parent’s results; GDP disappoints

U.S. stocks attempted to hold on to early gains Thursday, with the Nasdaq Composite briefly dipping into negative territory after a jump that followed results from Facebook parent Meta Platforms that weren’t as bad as feared.

Investors had also initially brushed off data that showed the U.S. economy contracted unexpectedly in the first quarter.

What’s happening
  • The Dow Jones Industrial Average DJIA, +0.47% was up 149 points, or 0.4%, at 33,451, after briefly dipping into negative territory at midmorning.
  • The S&P 500 SPX, +0.86% waas up up 34 points, or 0.8%, at 4,218.
  • The Nasdaq Composite COMP, +0.93% advanced 118 points, or 0.9%, at 12,607, after also briefly trading in negative territory.

On Wednesday, the Dow rose 62 points, or 0.2%, while the S&P 500 gained 0.2% and the Nasdaq Composite failed to hold a bounce, ending the day with a loss of less than 0.1%.

The S&P 500 is down 6.8% for April, heading for its biggest monthly decline since March 2020. The Nasdaq Composite has lost nearly 11% since the start of April and is on pace for its worst monthly performance since October 2008. The Dow has lost about 4% so far in April.

What’s driving markets

Major indexes opened with strong gains tied to results from Meta Platforms FB, +14.30%. Though they weren’t well ahead of consensus, as revenue actually came in weaker than forecast, expectations were low given the 48% decline this year in the stock. Shares remained up 11%.

Meta’s better-than-forecast subscriber numbers sets the stage for two other megacap tech stock results due after the close Thursday, Amazon.com AMZN, +2.73% and Apple AAPL, +3.05%. Though the stock-market decline for Amazon hasn’t been as severe as Meta’s, its stock is just 2% above its 52-week intraday low.

Investors were also weighing a first look at first-quarter economic growth, with gross domestic product showing a 1.4% annualized contraction after a 6.9% expansion in the final quarter of 2021. Economists surveyed by The Wall Street Journal had forecast 1% growth, but some had warned of the potential for a negative number.

“It’s likely that future adjustments will improve the number but it has taken some steam out of the enthusiasm of the positive earnings announcement this week,” said Louis Navellier, chairman of Navellier and Associates, in a note.

As economists had warned, the decline was mostly due to a record international trade deficit, lower government spending and declining inventories, but robust consumer spending and businesses investment signaled the economy was still expanding at a steady pace.

Chris Zaccarelli, chief investment officer for the Independent Advisor Alliance, said the data should still serve as a warning to investors.

“With the Fed beginning to aggressively raise interest rates, stock and bond markets have already been rattled. They’ve regained their footing and there is a lot to be optimistic about in terms of corporate earnings growth, corporate balance sheets and a resilient consumer, but all of that can change quickly, so it’s important to be prepared for a wider range of outcomes over the next 1-2 years,” he said, in emailed comments.

The yen USDJPY, +1.85% meanwhile slumped to a fresh 20-decade low after the Bank of Japan didn’t alter its easy monetary policy stance.

See: Dollar domination continues, as yen slumps to two-decade low

Which companies are in focus?
Other assets
  • The yield on the 10-year Treasury note TMUBMUSD10Y, 2.863% rose 4.7 basis points to 2.854%. Yields and debt prices move opposite each other.
  • Oil futures pushed higher, with the U.S. benchmark CL.1, +1.61% up 1.6% at $103.67 a barrel. Gold futures GC00, -0.09% edged own 0.2% to trade below $1,886 an ounce.
  • Bitcoin BTCUSD, +1.82% edged down 0.2% to trade above $39,100.
  • The Stoxx Europe 600 SXXP, +0.36% rose 0.2%, while London’s FTSE 100 UKX, +0.85% advanced 0.8%.
  • The Shanghai Composite SHCOMP, +0.58% rose 0.6%, while the Hang Seng Index HSI, +1.65% jumped in Hong Kong and Japan’s Nikkei 225 NIK, +1.75% each jumped 1.7%.

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