Stock Markets Rise Due To Strong US GDP Growth

Stock markets rose as US data showed its gross domestic product (GDP) exceeded expectations and rose at an annual rate of 2.9% in the fourth quarter of 2022.

According to the Commerce Department, the overall growth of the US economy was at a slower pace in 2022 than last year and expanded by 2.1%.

“The weaker GDP print compared to the previous reading means the economy is slowing, but the above-forecast number will ease recession fears at the same time,” a market analyst at City Index and FOREX.com Fawad Razaqzada said.

“They call this the ‘goldilocks’ scenario,” he added.

Furthermore, the tech-heavy Nasdaq Composite Index increased by 1.8% due to Tesla’s strong results. Tesla shares rose by 11% after reporting the record of its quarterly earnings.

As such, American Airlines increased by 2.2% and offered a positive outlook on the 2023 travel demand.

The world’s top luxury LVMH said its sales and net profit both reached new heights last year due to strong demand in Europe, the United States, and Japan.

Oil rose in hopes of growing Chinese demand after the country eased its COVID-19 restrictions.

Meanwhile, investors are focused on the US Federal Reserve’s next moves, after the central bank increased rates rapidly to tame the surging inflation.

While there are speculations and concerns that the US could tip into recession, there is optimism that it can achieve a so-called soft landing. Traders are also waiting for the Fed’s preferred inflation gauge.

In Asia, Hong Kong led with another hit an 11-month high, aided by expectations for a strong recovery due to China’s reopening this year.

However, uneven earnings from tech giants will keep them on the watch. Despite this, Asia continued to outperform after a strong start to 2023.

Source: Philstar