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Stocks are rising after strong economic data overcomes recession fears

AuthorLiz Moyer
Published 06/27/2023, 01:50 PM
© Reuters.

Investing.com -- U.S. stocks are rising after strong economic data and a surge in megacaps overcame fears about a possible recession ahead.

At 13:40 ET (17:40 GMT) the Dow Jones Industrial Average was up 208 points or 0.6%, while the S&P 500 rose 1.1% and the NASDAQ Composite rose 1.6%.

It's the Dow's first winning session after a six-day losing streak, though Walgreens Boots Alliance, Inc. (NASDAQ:WBA) shares fell 9.4% after the drugstore retailer cut its fiscal year profit outlook because demand for COVID vaccines and tests is waning.

Optimism boosted by better than expected economic data

Durable goods orders rose 1.7% in May, well more than the expected 1% drop. The data is a closely monitored measure of business spending. Core goods orders rose 0.6%, also beating expectations.

Consumer confidence was also a stronger than expected 109.7. Analysts had expected a reading of 104. And new home sales soared past forecasts, with an annualized 763,000 versus expectations of 675,000.

Stocks stalled on Monday as fears about a recession crept higher. The Federal Reserve paused on interest rate hikes at its meeting this month but signaled another rate hike is possible, perhaps as early as July, as it continues to battle inflation.

Fed watches data to make its next move

Investors are worried that more rate hikes could eventually tip the economy into a recession, though Wall Street economists have lowered their expectations in recent weeks. The Fed says it has been making its decisions on data, and one big report this week will be the inflation numbers for May. PCE is expected to rise 4.6%.

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Futures traders see a greater than 75% probability that the Fed will raise rates another quarter of a percentage point in July.

Investors will hear more from top policymakers this week when they meet in Portugal at the European Central Bank Forum, including a speech by Fed Chair Jerome Powell.

June is quickly coming to an end this week, and the second quarter with it, with the three major indexes poised to record gains for the period.

Lordstown Motors files for bankruptcy

Electric vehicle maker Lordstown Motors Corp. (NASDAQ:RIDE) shares sank 25% as it sought bankruptcy protection and put itself up for sale. It couldn’t resolve a dispute over an investment from Taiwan-based manufacturer Foxconn (TW:2354).

Shares of cloud analytics company Snowflake Inc. (NYSE:SNOW) rose 4.6% on an arrangement with Nvidia (NASDAQ:NVDA) allowing customers to build artificial intelligence models using their own data.

Latest comments

shipping from shanghai is not anywhere near the highs of precovid levels...
FEDex last three quarters results are all you need to know to discover the real state of the global economy - if the oil and copper prices don't do it for you - everything else is garbage hoodwinking to fool the retail investor to fomo in at the top!!!!
or the baltic dry index for that matter - there was one day last week when no ships arrived or left Shanghai port - that's a first - look at the real world current and forward looking data - not the rubbish published by the US Gov who constantly lie and their lamestream prop up ganda machine
FedEx has been committing odometer fraud.  But you trust FedEx numbers  and not US gov't economic numbers.
several AI models used by the large trading companies suggest the inflation rate is a lot lower than the government figures....
this market is signaling it wants to attempt a test it's 2020 highs... highs......
What a surprise...Another round of criminally manufactured "gains" holds right through the close.  Remarkable how the sellers vanish "in late trade," yet the buyers come out of the woodwork during every loss.  BIGGEST INVESTMENT JOKE IN THE WORLD.
another canned complaint from Mitch.....
2 hrs ago, you said "gains" evaporating ... so yes, surprise if one believed you.
investing article .. same bs.. raising on hope, economic data, ai hype .. not worth to read
If you guys think no one has money, try going outside. No one cares about prices because anyone that actually impacts the economy has money. Callously speaking, the people struggling don't really matter to the stock market.
that's why copper and oil prices are collapsing, even though OPEC keep cutting production - wakey wakey - US Gov figures are not to be relied upon!!!! the insiders are all selling their shares!!!!!
me ish, that's one reason why the Chinese economy is in trouble, their exports as market share in those countries is .collapsing. American and European manufacturing in China is leaving China..
the government figures from totalitarian China have proven over again to be unreliable,
All crying because don't know when and why to trade...trying to convince themselves and others (weak hands) what is happening. Really a w@$te of time. Keep going.
Strong economic data? Literally every single indicator is negatice 🤣
strong data in the lamestream media propaganda machine means, not quite as bad as expected - and it will be revised down next month anyway, just like last months - the figures are just a joke and can be seasonally adjusted to suit any narrative the market makers want -sending Jim Cramer out to hoodwink the retail crowd as the smart money is selling like no-one's business!
They doing manipulation data
That is totally fake, if economic data are bad then FED will cut rates soon, otherwise and are good then economy is strong...at last anyway stocks up...totally scam drive for a bunch of gansters
  Volume trending down as market goes up is normal.
Yes, thats right, and we could see some spike yet as usual this season, but in my opinion it is very odd nobody (bigger) take profit before holidays...i think it should happen sooner or later next days...
it's the FED's plan to crash the global economy - it's all part of the WEF plan - bringing in central bank digital currencies - they have to destroy the old financial system first - all the insders are selling out their shares at the pumped up prices of the last few weeks - smart money/ dumb money indicator is at extremes!!!!
Extremely confusing market. Mega money powers behind the scene may do whatever. Small chicken investors don't know what to do. Small guys cannot compete with AI-powered mega money powers.
Strong economic data means interest rate hikes. Invent stories to fit the algos.
all you have to do is research the revised data points, and you'll realise how large and recently mostly downward they are, they obviously do it as they know most people won't look past the most recent release, hints it been data manipulation and why the vast majority of people outside the US simply don't trust it. infact today's orders non defense ex Air( which is the consumer fosued datapoint) showed last months revised down from 1.4 to 0.6 losing more than half it gain and wiping out today gain
 shhhhhh = don't give the game away!!!! Export data out of china, Japan and South Korea are all showing the global economy is falling off a cliff - let the bulls get hoodwinked by the US CIA prop up ganda machine
  If you look at durable goods order since early 2020, you would see orders are up about 80% and the uptrend is intact.
It seem ws take some kind of vaccine against red days, with the FED bankers providing confidence to solve any problem ahead, no mater if papa Powell advance two more hikes, the show must go on! And the clash to the ground will be heavy in a couple of days, totally bizarre not to take profits at may, or ending june...but ws are totally out of control and in risk on mode
I couldnt imagine few hours before sp500 above 4350 as easily we see...impresive how long markets are far away from economic issues...
economy is great yet commodities continue to sell off. oil near multiyear lows, at multi year lows with inflation adjusted, and extending recent loses. doesn't scream strong economy to me but what do I know?
Read between the lines. If energy costs are dropping heading into the next FED meeting, Powell can pause again. Big money runs the market. Hold on! We're headed to the moon!
A lot of commodity prices peaked in mid 2022, around the time the market realized Russia wouldn't be able to steamroll over Ukraine and as himars became a battlefield factor.
copper and oil prices tell the real story - the US media just provides lies to hoodwink the retail investor - as the inside smart money is selling out - they need the dumb money to buy!!!
New cow 15121 to 17000 ??
An adult cow in China costs about 3000-9000 CNY.  A calf cost much less.
in other words: borrowing money is still not expensive enough. We need additional rate hikes
Amen.
Will the laughingstock of the financial world tank "in late trade," with all the criminally manufactured "gains" evaporating, similar to the way losses magically vanish into thin air?  BIGGEST INVESTMENT JOKE IN THE WORLD.
Get your grapes here !!
It did tank late yesterday after you said it wouldn't.
Happy Days are here again. Amazing how 24 hours ago it was recession fears. Now it's a brand new bull market. Time heals all.
exactly what I was thinking
Casador Del Oso. Have you been watching the action in the Nikkei 200 this year? Do you think we're 'gonna let Japan have all the fun. Hold on tight! We're lifting off!!
We have new economic data released
the stronger the economic data the more tightening will be required to lower inflation.....these two things, inflation and economic growth, at least in the eyes of the FED, are directly related.
'Making Brandon look good' has started.
lol ur so dum
Look at the big picture. GDP is at 26 trillion a year now. The American economy is massive!! Percentages will get smaller because numbers are so large. Combine that with Powell printing more money than we can spend. I see the DOW headed to 40,000 and beyond.
US money supply has been trending down since mid-2022.
No it hasn't.
tomorrow will be opposite headline......Wait for it........
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