In the early morning of the 29th Beijing time, US stocks closed higher on Thursday. The latest GDP data shows that the US economy shrank for the second consecutive quarter, confirming that the US economy has fallen into a "technical recession". However, investors bet that the data will force the Federal Reserve to end or even reverse its aggressive interest rate hike earlier. U. S. Treasury Secretary Yellen said that the two consecutive quarters of GDP contraction does not prove that the United States is currently in recession.
The Dow rose 332.04 points, or 1.03%, to 32529.63; The Nasdaq Composite Index rose 130.17 points, or 1.08%, to 12162.59; The S&P 500 index rose 48.82 points, or 1.21%, to 4072.43.
Data released on Thursday showed that US GDP fell 0.9% in the second quarter. GDP fell by 1.6% in the first quarter. The contraction of GDP for two consecutive quarters means that the US economy is in a "technical recession".
The US stock market fell once after the GDP report was released, but the stock market rebounded as investors considered the latest monetary policy decision of the Federal Reserve and digested the impact of economic recession risk on the Federal Reserve's policy.
After the GDP report was released, US President Biden said that the economic slowdown was not surprising as the Federal Reserve took action to reduce inflation. Biden said that the United States is still on the right path and will become stronger and safer through this transition period.
Biden said that the U.S. job market remained historically strong, with an unemployment rate of 3.6% and more than 1 million jobs created in the second quarter. In addition, consumer spending is continuing to grow.
Biden said that the focus of his economic plan is to reduce inflation without giving up the existing economic achievements. At present, Congress has a historic opportunity to do this, that is, to pass the Chip Act and the Inflation Reduction Act. The US House of Representatives approved the 52 billion dollar chip bill on Thursday afternoon, and is ready to submit it to Biden for signature.
US Treasury Secretary Janet Yellen said on Thursday that even if the US GDP shrank for two consecutive quarters, it does not prove that the US is currently in recession.
Yellen said at a news conference on Thursday that the real recession is "widespread economic weakness. That's not what we are seeing now."
Yellen said that the United States is currently creating jobs, with strong household finances, rising consumer spending and growing businesses. She said that the number of employees increased by 1.1 million in the second quarter, in sharp contrast to the average decline of 240000 in the first three months of the previous recession.
Yellen reiterated that inflation is still too high, reducing inflation is the government's top priority, and consumer price inflation may decline next.
Federal Reserve Chairman Powell also believes that the US economy is not in recession. He said at a news conference on Wednesday that the economy has not entered recession. He said: "I think the United States is not in recession at present, because there are too many economic sectors are performing too well."
Mike Loe, Managing Director of E-Trade Investment Strategy we Ngart said: "Today's GDP data confirms that the US economy has entered a recession. Even so, please remember that GDP fell by less than 1% in the second quarter, a relatively small decline, which supports the view of a mild recession."
The US stock earnings report remains the focus of the market. Meta Platforms shares fell after the company reported disappointing quarterly results. Deutsche Bank lowered its target price from $235 to $200.
Ford Motor The share price rose. The company reported that its revenue and earnings exceeded expectations and announced a dividend increase.
Teladoc's share price fell sharply, and the company announced that it suffered a large loss of goodwill impairment again.
After US Senator Manchin and Senate Majority Leader Schumer reached an agreement on the tax and energy policy bill, the solar and renewable energy sectors in the US stock market rose substantially.
JPMorgan Chase Analyst Mark Strouse said: "The details of the bill have not yet been released, but according to some senators' comments, we expect that it will include clean energy (including hydrogen, nuclear and renewable energy) and fossil fuel expenditures."
After Thursday, Amazon Company Apple Company and Intel The company will release the financial report and become the focus of special attention.
The Federal Reserve announced an interest rate hike of 75 basis points on Wednesday. Investors are still evaluating whether the Federal Reserve can prevent inflation from soaring without pushing the economy into recession.
After the Federal Reserve raised interest rates, Jeffrey Gundlach, the famous investor with the "king of bonds" and CEO of DoubleLine Capital, said that he believed that the Federal Reserve was no longer behind the inflation curve, and Powell had restored his credibility.
JPMorgan said: "Although central banks will continue to tighten monetary policies this year, it is increasingly likely that the fastest pace of interest rate increase may have passed. The fall in commodity prices (excluding European natural gas) should alleviate inflation to some extent."
In recent months, investors have become increasingly worried that the measures taken by the Federal Reserve to try to curb inflation will lead to economic recession.
On the economic data side on Thursday, the US Department of Commerce reported that the initial annualized quarterly rate of real GDP in the second quarter was - 0.9%, expected to be 0.5%, and the previous value was - 1.60%. The real GDP in the second quarter recorded a negative value for the second consecutive quarter, indicating that the US economy was in a "technical recession".
The Labor Department reported that the number of people applying for unemployment benefits for the first time in the week ended July 23 decreased by 5000 to 256000. The median forecast of economists surveyed is 250000. As of July 16, the number of people continuously applying for unemployment benefits fell to 1.36 million.
The number of Americans applying for unemployment benefits for the first time last week declined for the first time in four weeks, but remained near the highest level since November last year, indicating that the labor market continues to slow down.
The US government's monthly employment report is scheduled to be released next week, which is expected to show that the new jobs in July are stable, and the unemployment rate is expected to remain near a 50 year low.
Focus stocks
Pfizer The revenue in the second quarter was 27.7 billion US dollars, estimated at 26.31 billion US dollars; Adjusted earnings per share in the second quarter was $2.04, estimated at $1.81.
Maxeon Solar Technologies、 SunPower、Sunrun、 The first solar energy and other photovoltaic concept stocks strengthened. US senators have reached agreement on the 396 billion energy tax and expenditure bill, which will be used to address energy and climate change issues.
Gold concept stocks such as AngloGold Ashanti, Gold Fields and Barrick Gold rose.
high pass The fourth quarter revenue is expected to be between $11 billion and $11.8 billion. In contrast, analysts' average expectation is $11.9 billion.
Meta, the parent company of Facebook, reported that its revenue fell for the first time on a year-on-year basis, and the decline was higher than the market expectation. Its profit also fell sharply beyond the expectation. The digital advertising revenue of its core business, which was closely watched by the market, was also lower than the expectation.
Shopify's net loss in the second quarter was $1.2 billion. Credit Suisse Cut its target price from $41 to $34.
Ford Motor's second quarter results exceeded expectations.
Deutsche Bank's revenue in the second quarter exceeded expectations, making profits for the eighth consecutive quarter.
Teladoc Health suffered a net loss of $3.1 billion in the second quarter.
Spirit Airlines is about to reach an acquisition agreement with JetBlue.
Etsy's performance in the second quarter was better than expected.
The online education platform Coursera's second quarter performance was lower than the market's expectations, and issued weak performance guidance.
Equinor's revenue doubled to US $36.39 billion in the second quarter, exceeding market expectations.
Youxian plummeted every day. The company refuted the rumor that it had not been "dissolved".
In other markets, Brent crude oil futures rose 52 cents, or 0.49%, to close at US $107.14 per barrel. West Texas Intermediate Crude Oil (WTI) futures for September delivery on the New York Mercantile Exchange fell 84 cents, or 0.86%, to US $96.42 per barrel.
Gold futures for August delivery on the New York Mercantile Exchange rose $31.20, or 1.80%, to close at $1750.30 per ounce.
The price of silver futures in September rose by $1.27, or 6.8% - the biggest one-day increase since February 2, 2021, and closed at $19.868 per ounce.
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