An enhanced U.S. stock market is the outcome of faster-than-estimated growth boosted confidence in the world’s largest economy. Amidst the news that the country has received record and unexpected growth in GDP, the U.S. stocks rose to a great extent and that was visible in the Standard & Poor’s 500 Index capping its biggest weekly gain since October.
The largest gainer in U.S. stock trade was Red Hat Inc. which capped growth of 14 percent. The software company raised its full-year profit and was able to record higher sales forecasts, which culminated into better trading in the stock market. In asimilar pattern, Responsys Inc. jumped 40 percent as Oracle Corp. agreed to buy the marketing company for $1.5 billion in cash.
It was not that a large number of companies were faring better in the U.S. stock trading as whereas Red Hat Inc. was doing fabulous, on the other hand, the car seller CarMax Inc. could not maintain the momentum and lost to some extent. In day’s trading it declined 9.4 percent as the company could not meet the expectations from the investors.
The S&P500 Receives a Better Outlook
On the better and positive trading day, the S&P 500 added 0.5 percent to a record 1,818.32 at 4 p.m. in New York. Following the pattern, the Dow Jones Industrial Average rose 42.06 points, or 0.3 percent. Thus, the two largest indicators of the country were on the right track and received better than expected results on a positive trading day.
Positive GDP Expansion and Stimulus Tapering
From the data it looks that rate of expansion in the third quarter in the U.S. was faster than previously estimated. The negativity spread in the U.S. market was though obvious, the unexpected results in the growth are seeding positive waves among investors. Moreover, the major reason behind the growth according to experts is that there has been an increase in health care and companies investments.
With the gross domestic product growth of 4.1 percent annualized rate, the country has been able to mark its presence and showing that it is on the right track. Earlier the Federal Reserve of the country decided to taper its stimulus to some extent.
The central bank of the country realizes that the employment data is showing that the U.S. is doing fairly well and the need for it is decreasing.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org