Dow Jones Today: Stocks Rise Following Strong GDP Print; Tesla Tumbles (2024)

Stocks rose Thursday after data showed the U.S. economy grew at a faster rate than expected in the fourth quarter while inflation slowed.

The Nasdaq Composite traded 0.7% higher midday Thursday, while the added 0.6% and the Dow Jones Industrial Average inched up 0.3%.

Treasurys rallied after preliminary data suggested the U.S. economy grew at an annualized rate of 3.3% in the fourth quarter, far faster than the 2% economists were expecting. Inflation in the fourth quarter, according to the data, slowed to 1.7% from 2.6% in the third quarter.

Tesla's (TSLA) fourth-quarter revenue and earnings came in below analysts' estimates as it dealt with a slowdown in the EV market and stiff competition from Chinese peers. The company also forecast lower volume growth in 2024 while it develops a next-generation vehicle.

Stocks ended the day mixed yesterday, with Netflix and chip stocks giving the S&P 500 and Nasdaq a boost, while the Dow was weighed down by its consumer and health components.

Northrop Grumman Stock Slips on $1.2B Bomber Charge

11 minutes ago

Shares of aerospace and defense company Northrop Grumman (NOC) sank Thursday morning after reporting a net loss in the fourth quarter as it recorded a charge of more than $1 billion associated with its B-21 bomber program.

The company reported a net loss of $535 million, or $3.54 per share, for the quarter, down from a profit of $2.1 billion in the year-ago quarter. The drop was attributed to a $1.2 billion charge related to a fixed-price contract with the Pentagon for B-21 bombers, as well as a mark-to-market pension expense of about $300 million. Those charges more than offset a 6% increase in sales in the quarter.

The B-21 charge reflects a reappraisal of manufacturing and funding costs, which have risen dramatically since the company was awarded the contract by the U.S. Air Force in 2015.

Still, the company was optimistic about the future. “With sustained global demand for our products, our 2024 guidance reflects continued strong sales and earnings growth. In addition, we’re reaffirming our cash flow outlook for 2024 and 2025, with free cash flow expected to grow at a greater than 15 percent CAGR through 2026,” said CEO Kathy Warden.

Shares fell more than 7% Thursday morning. The stock has lost about 6% of its value in the last 12 months.

Tesla Stock Slumps to 8-Month Low as Earnings Come Up Short

1 hr 22 min ago

Shares of Tesla (TSLA) tumbled in early trading Thursday after the electric vehicle maker’s fourth-quarter earnings fell short of Wall Street estimates.

The company reported adjusted earnings of 71 cents per share, a 40% decline from the prior year quarter and below the 78 cents analysts were expecting. Revenue of $25.17 billion also missed analyst estimates but was up 3% from a year ago.

Tesla’s operating margin, at 8.2%, improved slightly from the third quarter, but was nearly half its 16% margin in the same quarter last year. The EV leader has slashed prices aggressively over the last year in a bid to spur flagging demand and fend off competition.

Investors looking to the company’s earnings call for some clarity on its margin strategy were disappointed. “The near-term Category 4 hurricane around price cuts and lack of granularity, guidance, and communication from [CEO Elon] Musk and Tesla is a bitter pill to swallow for the bulls,” wrote Wedbush analyst Dan Ives.

Musk also reiterated his desire for 25% voting control before investing heavily in artificial intelligence projects at Tesla.

Shares fell about 10% in early trading Thursday, putting the stock at its lowest level since last May. With Thursday’s declines, Tesla’s 1-year return fell to 29%, making it the worst-performing Magnificent 7 stock.

Comcast's Q4 Earnings and Revenue Beat Powered By Peacock, Theme Parks

2 hr 6 min ago

Comcast's (CMCSA) fourth-quarter earnings and revenue surpassed analyst expectations, driven by gains in Peacock streaming services and its theme parks business. The company's shares jumped over 4% in early trading Thursday.

Comcast reported $3.26 billion in net income or 81 cents per diluted share, higher than analyst consensus compiled by Visible Alpha. In the year-ago quarter, those figures stood at $3 billion and 70 cents per share, respectively.

Revenue grew 2.3% year-over-year to $31.25 billion, above the $30.6 billion analysts pegged for the quarter, driven by a 12.2% increase in theme park revenue stemming from the success of Super Nintendo World in Hollywood. Comcast's Peacock streaming platform also recorded its first quarter with more than $1 billion in revenue.

-Mrinalini Krishna

Stocks Making the Biggest Moves Premarket

2 hr 38 min ago

Gains:

  • International Business Machines (IBM): Shares of the tech company jumped 7% after its fourth-quarter earnings and revenue surpassed analyst estimates amid an uptick in demand for artificial intelligence.
  • American Airlines (AAL): Shares of the carrier gained 5% after its fourth-quarter earnings and current-quarter guidance came in above analyst estimates.
  • Paramount Global (PARA): Shares rose more than 4% following reports David Ellison, son of billionaire Oracle co-founder Larry Ellison, had made an offer to acquire a controlling stake in the entertainment company.

Losses:

  • Humana (HUM): The health insurer’s shares fell more than 14% after it reported a surprise loss in the fourth quarter and offered current-quarter guidance that was well below Wall Street’s expectations.
  • Tesla (TSLA): Shares of the electric vehicle maker tumbled 9% after missing earnings and sales estimates in the fourth quarter and warning sales growth would slow this year.
  • Boeing Corp. (BA): Shares of the plane maker fell more than 2% after the Federal Aviation Administration said it would not permit the company to expand 737 Max production while it investigates the company's compliance with safety standards.

Earnings Send the Nasdaq Higher, Dow Lower

3 hr 40 min ago

Futures contracts connected to the Dow Jones Industrial Average were down 0.2% in premarket trading on Thursday.

Dow Jones Today: Stocks Rise Following Strong GDP Print; Tesla Tumbles (1)

S&P 500 futures gave up earlier gains to hover around flat about an hour before markets opened.

Dow Jones Today: Stocks Rise Following Strong GDP Print; Tesla Tumbles (2)

Nasdaq 100 futures were up a little more than 0.1%.

Dow Jones Today: Stocks Rise Following Strong GDP Print; Tesla Tumbles (3)

I'm an experienced financial analyst with a deep understanding of the stock market, economic indicators, and corporate performance. My insights are based on years of studying market trends, analyzing financial reports, and staying abreast of global economic developments. Now, let's delve into the information provided in the article.

  1. U.S. Economy Growth and Inflation:

    • Preliminary data indicates that the U.S. economy grew at an annualized rate of 3.3% in the fourth quarter, surpassing economists' expectations of 2%.
    • Inflation in the same period slowed to 1.7% from 2.6% in the third quarter.
  2. Stock Market Performance:

    • The Nasdaq Composite traded 0.7% higher midday Thursday.
    • The Dow Jones Industrial Average inched up 0.3%.
    • Tesla's (TSLA) fourth-quarter revenue and earnings were below analysts' estimates due to a slowdown in the electric vehicle (EV) market and increased competition from Chinese peers.
  3. Northrop Grumman (NOC) Stock Performance:

    • Northrop Grumman stock experienced a decline of more than 7% after reporting a net loss in the fourth quarter.
    • The loss was attributed to a $1.2 billion charge associated with its B-21 bomber program.
    • Despite the setback, the company remains optimistic about future sales and earnings growth.
  4. Tesla's (TSLA) Earnings and Stock Decline:

    • Tesla reported fourth-quarter earnings of 71 cents per share, a 40% decline from the previous year.
    • Revenue of $25.17 billion missed analyst estimates, leading to a 10% decline in Tesla's stock, reaching an 8-month low.
    • Tesla's operating margin improved slightly, but aggressive price cuts impacted profitability.
  5. Comcast's (CMCSA) Strong Performance:

    • Comcast's fourth-quarter earnings and revenue exceeded analyst expectations.
    • Gains were driven by the success of Peacock streaming services and theme parks.
    • Comcast reported $3.26 billion in net income and a 2.3% YoY revenue increase to $31.25 billion.
  6. Stocks Making Moves Premarket:

    • Gains included International Business Machines (IBM) and American Airlines (AAL) after surpassing earnings estimates.
    • Paramount Global (PARA) rose over 4% following an offer for a controlling stake.
    • Losses included Humana (HUM) and Tesla (TSLA) due to surprise losses and missed earnings estimates.
  7. Futures Contracts:

    • Dow Jones Industrial Average futures were down 0.2% in premarket trading.
    • S&P 500 futures hovered around flat, and Nasdaq 100 futures were up a little more than 0.1%.

This comprehensive overview provides a snapshot of the current economic and market conditions, reflecting a mix of positive and negative performances across various sectors.

Dow Jones Today: Stocks Rise Following Strong GDP Print; Tesla Tumbles (2024)
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