U.S. Stocks Struggle Amid Data Indicating Soft Landing for Economy
Investors Digesting Economic Data
U.S. stocks faced a lack of direction on Thursday as investors processed data suggesting the economy is heading towards a soft landing. Trading volumes remained light ahead of key inflation data expected over the long weekend.
Market Performance
As of 13:51 ET (17:52 GMT), the Dow Jones rose by just 24 points, the S&P 500 increased by 0.1%, while the Nasdaq fell by 0.2%.
Positive Q4 GDP Revision
The U.S. economy showed faster growth than previously estimated in the fourth quarter. Data released indicated a 3.4% annualized rate of growth, up from the previously reported 3.2%. The revision was driven by improvements in consumer spending, nonresidential fixed investment, and state and local government spending, supported by a strong labor market.
Unemployment Benefits Decline
Initial claims for state unemployment benefits decreased by 2,000 to 210,000 for the week ending March 23, according to a separate report.
Fed Governor’s Comments on Interest Rates
Fed Governor Waller’s remarks suggested no rush for interest rate cuts, citing higher-than-expected inflation readings in recent months. He acknowledged the potential for rate cuts later in the year but highlighted the current strength of the U.S. economy, providing room to maintain higher rates for longer.
Focus on Inflation Data
Investors are awaiting Friday’s release of the Fed’s preferred inflation gauge, the PCE data, which is expected to influence U.S. interest rate decisions. Additionally, addresses from prominent figures like Jerome Powell and Janet Yellen are scheduled for Friday.
Market Activity
RH stock surged 16% due to high demand for new products despite missing fourth-quarter expectations. Walgreens Boots saw a 3.4% increase following strong second-quarter sales. Take-Two Interactive agreed to acquire Gearbox Entertainment, while Home Depot announced a deal to purchase SRS Distribution.
Crypto Founder Sentenced
FTX founder Sam Bankman-Fried received a 25-year jail sentence for embezzling $8 billion. The crypto market rebounded with BTC trading at $70,964.
