By Amy Caren Daniel
(Reuters) – US stocks dropped closer to record levels on Friday, boosted by robust Google owner Alphabet and Intel earnings, and Data showing the domestic economy declined less than expected in the second quarter.
The Ministry of Commerce said GDP grew by a 2.1[ads1]% annual rate in the second quarter, higher than a 1.8% that economists asked from Reuters forecast.
Hope that the Federal Reserve will cut interest rates by at least 25 basis points at its political meeting at the end of this month has driven a solid stock race this month, which helped Wall Street record highs.
The S&P 500 () and Nasdaq () indices are now within striking distance from another recurring one.
"This is exactly what the market needed, not so soft that the economy slows down and not so strongly that the Fed is going to turn around," said Art Hogan, chief market strategist at National Securities in New York.
"We expected poor earnings and poor GDP numbers, but an upside on both is something markets are going to embrace today."
Alphabet Inc (O 🙂 jumped 11.3%, mostly on the S&P 500 index, after quarterly results hit, easing investor concerns about growth challenges facing Google's advertising business.
Twitter Inc (N 🙂 jumped 8.3% after giving better revenue than expected for the second quarter and an increase in daily users seeing ads on the site.
Their positive earnings pushed the communications services sector () up 3.22%, mostly among S&P sectors. At 9:45 am ET, the Dow Jones Industrial Average () was 33.77 points, or 0.12%, of 27,174.75, S&P 500 () was up 14.23 points, or 0.47%, at 3.017.90. The Nasdaq Composite () increased by 77.56 points, or 0.94%, by 8 316.11.
Two weeks into the revenue season for the second quarter, approximately 75% of the 185 S&P 500 companies that have so far reported profit estimates, according to Refinitiv data.
Among other stocks, McDonald's Corp (N 🙂 jumped as much as 2.1% to record highs after beating quarterly sales expectations on established American restaurants.
Intel Corp (O 🙂 rose 1% after the chip maker gave a positive forecast for the current quarter and lifted the revenue guidance for the whole year, and reduced concerns about a global brake shutdown and curbed US sales to China's Huawei Technologies Co
A decliner was Amazon.com Inc (O :), which fell 2.3% after the online store reported its first two year shortfall in profits and said revenue would fall in the current quarter.
Obtaining questions accounted for a number lower than the takers with 1.97-to-1 ratios on the NYSE and a 2.37-to-1 ratio on the Nasdaq
recorded 59 new heights and 33 new low targets.