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29.04.2022 03:50 PM
US stock indices show significant growth

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US stock indices showed significant growth at the close of yesterday's trading. The technology index NASDAQ Composite was the top gainer, adding 3.1%. The S&P 500 rose by 2.5%, while the Dow Jones Industrial Average increased slightly less than others, by 1.8%. At the same time, the S&P 500 and Dow Jones indices demonstrated record growth over the last 2 months.

The growth of US indices takes place despite the negative statistical data regarding the country's GDP. Thus, in the first quarter of this year, GDP decreased by 1.4% year on year. Among the reasons for this reduction, experts call the growth of the country's trade deficit, which means that imports significantly exceed exports.At the same time, most analysts believe that this indicator is not a sign of recession. Consumer spending and business investment in the country continue to increase, indicating economic recovery and growth.

At the same time, the GDP decline may affect the Fed's decisions on monetary policy, namely interest rate increases. Notably, the May meeting of the Fed will be held next week.

According to the latest statistics, the unemployment rate in the US is decreasing. This is shown by a decrease in the number of claims for unemployment benefits by 5,000. The total number of claims has decreased to 185,000, although experts predicted a decrease in this reading to 180,000.

The main factor for the growth of US indices was the rise of companies in the technology sector in the country. They show good results in reports for the first quarter.Thus, Meta Platforms increased by 17.6% due to a significant increase in the number of users and even despite the weak results of the first quarter. The number of users grew to 1.96 billion from 1.93 billion.

Apple Inc. went up by 4.5% and Amazon.com Inc. increased by 4.7%.

McDonald's Corp. managed to increase income in the first quarter of this year by 11%, which was higher than analysts' expectations, its share price increased by 2.9%. At the same time, last quarter, the company incurred expenses totaling $127 million due to the suspension of operations in Russia and Ukraine.

Thanks to good reporting that exceeded experts' expectations, Pinterest Inc. gained 13.7% and Southwest Airlines Co. jumped by 2,1%.

Twitter Inc.'s 7.5-fold increase in net profits in the first quarter of this year boosted the value of its securities by 1.1%. At the same time, the company expects an acquisition by Elon Musk. Therefore, Twitter does not give any forecasts further for this year.

The yield on 10-year US government bonds rose to 2.862% from 2.817% the day before.

The increase in energy, in particular oil, had a positive impact on the quotations of energy sector companies. Thus, Brent added 2.2% and reached $107.59 per barrel.At the same time, other global stock exchange indicators are also showing growth. The composite European index STOXX Europe 600 added 0.6%, Asian indicators also increased: China's Shanghai Composite - by 0.6%, Hong Kong's Hang Seng, and Japan's Nikkei 225 - by 1.7% each.

Anastasia Kravtsova,
Analytical expert of InstaForex
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