It was a busy day on Wall Street as investors sifted through an onslaught of high-profile earnings reports, including from Facebook parent Meta Platforms (META).
And despite data that showed slowing economic growth and stubbornly high inflation, all three major indexes jumped out of the gate – and ran higher into the close.
Meta delivered the most anticipated earnings report overnight. The Facebook parent said first-quarter revenue was up 3% year-over-year to $28.6 billion – its first annual top-line increase since Q1 2022 – thanks to solid ad revenue. Additionally, Facebook's daily active users were up 4% over the year prior to 2.04 billion.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
"Meta has seen its valuation receive another injection of goodwill as investors breathe a sigh of relief at the sight of a growing advertising revenue line," says Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown. "Growth is more sluggish than is ideal, but it's ultimately better than expected." META stock finished the day up 13.9%.
On the economic front, the initial reading for first-quarter gross domestic product (GDP) showed the economy grew by 1.1% from January to March. True, this was slower than the 2.6% increase seen in Q4 and came in below expectations, but it does show that the U.S. economy is still expanding.
Additionally, the data showed that personal consumption jumped to 3.7% in Q1 from 1% in Q4, and that personal consumption expenditures (PCE) price index, the Fed's preferred measure of inflation that tracks consumer spending, rose 4.2% year-over-year, more than economists were expecting.
"U.S. stocks are rallying on strong earnings and on optimism that the economy will gradually soften and bring down inflation," says Edward Moya, senior market strategist at currency data provider OANDA. "The consumer is still in too good of shape for the recession to start in the second quarter. The Fed will be able to move forward with one, perhaps two more rate hikes, but then that should be it."
At the close, the Nasdaq Composite was up 2.4% at 12,142, the S&P 500 was 2.0% higher at 4,135, and the Dow Jones Industrial Average had gained 1.6% to 33,826.
Marijuana stocks rally on SAFE Banking news
Cannabis stocks jumped today on news that both Republican and Democratic lawmakers from each chamber of Congress have reintroduced the SAFE Banking Act. The legislation, which helps improve cannabis companies' access to finance, has been passed by the House of Representatives seven times already, but has failed to make it through the Senate. The latest legislation will next head to the Senate Banking Committee.
The bipartisan support for the bill shows that, regardless of personal views, these lawmakers "are recognizing that change is needed and they are taking an historic step forward with the introduction of SAFE in the Senate," says Morgan Paxhia, co-founder of cannabis investment fund $PSDN ETF and managing director and co-founder of Poseidon Investment Management. "This is the first time a hearing in the Senate will have happened around cannabis banking reform."
What's more, "poll after poll show the majority of Americans believe that cannabis should be legal," Paxhia says. "As of April 2023, we have 22 adult-use legal states and 41 medical cannabis states. The industry generated an estimated $26 billion in legal sales last year, according to Headset. Further, the most recent Vangst jobs report notes there are 417,493 Americans employed in cannabis."
The news sent a number of marijuana stocks soaring, with Aurora Cannabis (ACB, +4.4%), Canopy Growth (CGC, +3.2%) and Cronos Group (CRON, +6.4%) among those closing higher.
-
Original Medicare vs Medicare Advantage Quiz: Which is Right for You?Quiz Take this quick quiz to discover your "Medicare Personality Type" and learn whether you are a Traditionalist, or a Bundler.
-
Ask the Editor: Capital Gains and Tax PlanningAsk the Editor In this week's Ask the Editor Q&A, Joy Taylor answers questions on capital gains tax rates and end-of-year tax planning
-
Time Is Running Out to Make the Best Tax Moves for 2025Don't wait until January — investors, including those with a high net worth, can snag big tax savings for 2025 (and 2026) with these strategies.
-
Small Caps Hit a New High on Rate-Cut Hope: Stock Market TodayOdds for a December rate cut remain high after the latest batch of jobs data, which helped the Russell 2000 outperform today.
-
UNH Sparks a 408-Point Surge for the Dow: Stock Market TodayThe best available data right now confirm both a slowing employment market and a December rate cut, a tension reflected at the equity index level.
-
If You'd Put $1,000 Into Coca-Cola Stock 20 Years Ago, Here's What You'd Have TodayEven with its reliable dividend growth and generous stock buybacks, Coca-Cola has underperformed the broad market in the long term.
-
If You Put $1,000 into Qualcomm Stock 20 Years Ago, Here's What You Would Have TodayQualcomm stock has been a big disappointment for truly long-term investors.
-
Dow Adds 314 Points to Thanksgiving Rally: Stock Market TodayInvestors, traders and speculators enjoy the best Thanksgiving Week gains for the major stock market indexes in more than a decade.
-
Dow Dives 797 Points as Government Opens: Stock Market TodayThe process of pricing and re-pricing realities old and new never stops, and next week promises to be at least as exciting as this week.
-
If You'd Put $1,000 Into Home Depot Stock 20 Years Ago, Here's What You'd Have TodayHome Depot stock has been a buy-and-hold banger for truly long-term investors.
-
Stocks Sink with Meta, Microsoft: Stock Market TodayAlphabet was a bright light among the Magnificent 7 stocks today after the Google parent's quarterly revenue topped $100 billion for the first time.
