The stock markets in the United States ended the trading session higher driven by better than expected economic growth, which ignited speculations that the economy will be able to endure higher interest rates.
Yesterday, the Federal Reserve confirmed its decision to end the bond-buying program and reiterated its commitment to maintain the low interest rates for a considerable time. Policy makers said the U.S. economic growth is on a stable direction and the labor market conditions “improved somewhat further.”
Today, the Department of Commerce Bureau of Economic Analysis reported that the U.S. gross domestic product (GDP) increased at annual rate of 3.5% for the third quarter.
According to the agency, the increase reflected positive contributions from personal consumption expenditures (PCE), exports, non-residential fixed investment, federal, state and local government spending that were partly offset by a negative contribution from private inventory investment.
Paul Nolte, a senior portfolio manager at Kingsview Asset Management commented, “Investors were looking at the GDP number as favorable and confirmation the economy is doing well, or well enough that the Fed should be stepping back.”
On the other hand, “Michael Block, chief equity strategist at Rhino Trading Partners LLC said, “The GDP number’s fine, not spectacular. The inflation data isn’t great and the quality of the GDP beat isn’t great as a lot of it is from government and defense spending. It adds to dovishness.”
A separate report from the Department of Labor showed that the number of Americans who filed for unemployment benefits over the past month were lesser than any period in more than 14 years, which is an indication that the labor market is improving amid the strengthening economic growth.
- Dow Jones Industrial Average (DJIA) – 17,195.42 (+1.30%)
- S&P 500- 1,994.65 (+0.62%)
- NASDAQ- 4,566.14 (+0.37%)
- Russell 2000- 1,155.71 (+0.81%)
- EURO STOXX 50 Price EUR- 3,035.90 (+0.45%)
- FTSE 100 Index- 6,463.55 (+0.15%)
- Deutsche Borse AG German Stock Index DAX- 9,114.84 (+0.35%)
- Nikkei 225- 15,658.20 (+0.67%)
- Hong Kong Hang Seng Index- 23,702.04 (-0.49%)
- Shanghai Shenzhen CSI 300 Index- 2,468.93 (+0.72%)
Stocks in Focus
The stock price of Lakeland Industries, Inc. (NASDAQ:LAKE) climbed more than 22% to $14.24 per share after the company revealed that it received almost one million orders for its hazmat suits after the Ebola outbreak.
The shares of Twitter Inc. (NYSE:TWTR) closed $41.80 per share, down by nearly 1%. The microblogging company suffered a significant decline after releasing its 3Q earnings due to overreaction among investors. Analysts said
ESB Financial Corporation (NASDAQ:ESB) gained more than 44% to $18.59 per share. The company accepted the $324.4 million offer from WesBanco Inc. (NASDAQ:WSBC ).