S&P 500 rises on strong GDP figures

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US stocks rose as investors shake off fears of a recession during Thursday’s trading period.

It was another strong day for investors.

The S&P 500 rose during Thursday’s trading with most notably Tesla showing strong signs of growth, even with fears that much of the western world could go into a recession.

Thursday’s trading saw the S&P 500 gain another 1.10% and is now up 3.87% during the last 5 days of trading.

Unsurprisingly the tech heavy Nasdaq composite outperformed, rising by 1.76%, largely thanks to the size of Tesla on the index.

Shares in the EV company rose by 11% during last night’s trading period as Elon Musk’s car company is set to produce 2 million vehicles for the year.

Markets shake off fears of a recession

Despite fears of a recession, official data by the US commerce department shows the US economy actually beating expectations.

During the fourth-quarter gross domestic product (GDP) or the sum of goods and services produced between October and December, rose 2.9% on an annualised basis.

This was slightly stronger than the market was expecting.

Consumer spending, which in the US accounts for nearly 70% of GDP was up 2.3% over the quarter, raising hopes for the US’s economy having a soft landing.

This improving result makes eToro’s US investment analyst Callie Cox believe the US could avoid a recession.

“Consumer spending is still strong, both domestically and globally,” she says.

“It’s hard to have a recession when demand is this resilient, and that’s good news for a market that’s worried about the future of the economy.”

But the investment analysis says the high price of houses and rising cost of debt is a stain on the economy.

“Housing demand declined for a seventh straight quarter, which isn’t a surprise given how aggressive the Fed has been,” Cox continues.

“Housing market weakness is a huge risk, but the pessimism in housing clearly hasn’t trickled into wallets yet.”

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