comments_image Comments

US stocks rise on strong GDP report, Twitter earnings

Traders work on the floor of the New York Stock Exchange (NYSE) on July 14, 2014 in New York City
Traders work on the floor of the New York Stock Exchange (NYSE) on July 14, 2014 in New York City

Wall Street stocks Wednesday moved higher in early trade following a surprisingly strong report on second-quarter US growth and earnings results from Twitter that sent the social network's shares soaring.

About 25 minutes into trade, the Dow Jones Industrial Average gained 32.82 points (0.19 percent) to 16,944.93.

The broad-based S&P 500 rose 6.12 (0.31 percent) to 1,976.07, while the tech-rich Nasdaq Composite Index jumped 27.90 (0.63 percent) to 4,470.59.

The Commerce Department said US economic growth came in at 4.0 percent in the second quarter on the back of strong private investment and consumer spending.

Commerce also said the economy's first-quarter slowdown was not as bad as previously thought, reducing the estimated contraction from 2.9 percent to 2.1 percent.

In a separate report, payrolls company ADP said the US economy added 218,000 private-sector jobs in July, slightly above the 215,000 analyst estimate.

Markets are waiting for a policy decision from the US Federal Reserve at 1800 GMT. The US central bank is expected to continue to trim its bond-buying program and stick to its interest rate outlook.

Twitter bolted 22.6 percent higher after revenues more than doubled from a year ago to $312 million in the three months that ended June 30, with the number of monthly active users hitting 271 million, up 24 percent year-over-year.

Twitter still reported a $145 million loss, but analysts said the report restored confidence in the company's growth potential.

US oil company Hess advanced 4.7 percent as it announced plans to spin off some natural gas processing and petroleum storage assets into a master limited partnership. The company also reported second-quarter earnings that bested expectations.

Goodyear Tire & Rubber fell 4.6 percent as second-quarter earnings of 80 cents per share beat expectations by a penny but revenues came in at $4.7 billion, below the $4.75 billion projected by analysts.

Biotechnology company Amgen rose 6.0 percent as it announced it will cut between 2,400 and 2,900 jobs, mostly in the US. Earnings for the second quarter rose 23 percent to $1.5 billion.

Bond prices fell. The yield on the 10-year US Treasury rose to 2.52 percent from 2.46 percent Tuesday, while the 30-year advanced to 3.27 percent from 3.22 percent. Bond prices and yields move inversely.

Today's Top Stories