Stocks rallied on Thursday afternoon despite the release of cooler-than-expected economic data as earnings results from Meta (META) built on a strong week of tech earnings.
The S&P 500 (^GSPC) was up 1.96%, while the Dow Jones Industrial Average (^DJI) added 524 points, or 1.58%. The technology-heavy Nasdaq Composite (^IXIC) rose 2.43%.
The Bureau of Economic Analysis advance estimate of first quarter U.S. gross domestic product (GDP) showed the U.S. economy grew at 1.1.% annual rate in the first quarter. Economists surveyed by Bloomberg had expected 1.9% growth.
Meta shares closed the day up nearly 14% on the heels of the company’s better-than-expected first-quarter earnings report following Wednesday’s close. Meta topped analyst expectations for revenue and earnings per share while also guiding for second-quarter revenue in a range of $29.5 billion to $32 billion. Analysts had been expecting $29.48 billion in second quarter revenue. The stock closed at its highest level in nearly 15 months.
Meta's results came after Microsoft (MSFT) and Alphabet (GOOGL) topped expectations with reports after the market closed on Tuesday.
“The common theme here is that tech is stronger than most people think,” Jefferies analyst Brent Thill told Yahoo Finance Live after Meta’s earnings release. “Yes, we’re fading, but things are a lot better than the bears have been expecting.”
Meanwhile in the financial sector, pressure on First Republic is mounting as the stock plunged 29.75% on Wednesday. The bank is pursuing "strategic options," it said on Monday, after losing more than $100 billion in deposits during the March banking turmoil. After losing more than half it's market cap over the last two trading sessions, First Republic stock rallied roughly 11% in intraday trading on Thursday.
Southwest Airlines (LUV) shares slumped 3.3% as the airline reported a wider-than-expected loss in the first quarter due to a one-time charge owed after a cancellation fiasco in December.
Shares of Caterpillar (CAT) dropped 0.86% despite topping Wall Street's estimates for sales and earnings per share. Crocs (CROX) stock also fell on earnings. Shares slumped nearly 16% on weaker than expected second quarter revenue and profit guidance.
Lyft shares rose more than 1.49% in midday trading as the company confirmed previously reported layoffs. The company is cutting 26% of its workforce.
Investors also digested more economic data on Thursday. The Core Personal Consumption Expenditures Price Index, which excludes food and energy, rose to 4.9%, 0.2% higher than analysts had been expecting, per Bloomberg. U.S. weekly jobless claims fell from the week prior to 230,000. Economists surveyed by Bloomberg had expected 248,000 claims.
Contracts to buy existing homes in the U.S. declined for the first time since November 2022. The National Association of Realtor's index of pending home sales declined 5.2% in March. Estimates had been for a gain of 0.8%, according to Bloomberg.
Josh is a reporter for Yahoo Finance.
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