U.S. stock futures are on the rise after the Commerce Department’s advance estimate of economic growth showed the U.S. economy grew more than expected in the last quarter.
The Bureau of Economic Analysis reported fourth quarter gross domestic product (GDP) rose at an annual rate of 2.9%. Economists expected it to grow at a slower rate of 2.5%, following a 3.2% increase for the third quarter.
Yesterday, the three major U.S. indexes rallied back from big early losses to finish flat after downbeat earnings revived worries about the impact of the Federal Reserve’s aggressive interest rate hikes on the economy. Treasury yields inched lower, with the yield on the 10-year Treasury at 3.48%.
Oil prices rose after data showed a smaller-than-expected increase in crude oil inventories. Light sweet crude is still over $80 per barrel.
In another sign of strength in the labor market, the Labor Department reported initial claims for state unemployment benefits decreased by 6,000 to 186,000 in the latest week ended Jan. 21. Economists had expected an increase. Separately, the Census Bureau released its latest report on durable goods for December. New orders for big ticket items jumped 5.6% to $286.9 billion, well above the 2.5% projected.
Later this morning, the Census Bureau will provide an update on new home sales that is anticipated to show sales dropped to 617,000 units in December from 640,000 in November. Companies reporting their latest quarterly results today include Intel, American Airlines, Blackstone, Comcast, KLA, Mastercard, Visa, Northrop Grumman, Sherwin-Williams, Southwest Airlines, and Valero Energy.