US close: Stocks manage small gains despite GDP downgrade

(Sharecast News) - Wall Street managed to close with modest gains on Wednesday, even as investors weighed the implications of less-than-stellar economic indicators. Market participants were closely monitoring economic data to gauge its impact on the Federal Reserve's future monetary policy.

At the close, the Dow Jones Industrial Average was up 0.11% at 34,890.24, while the broader S&P 500 rose by 0.38% to end at 4,514.87 points.

The tech-heavy Nasdaq Composite increased 0.54% to close at 14,019.31 points.

On the currency front, the dollar was last up 0.03% on sterling at 78.63p, while it weakened 0.03% against the common currency to trade at 91.52 euro cents.

Meanwhile, the greenback dropped 0.07% against the yen, changing hands at JPY 146.14.

"August could well go out with a whimper, but investors won't be sad to see the month go," quipped IG chief market analyst Chris Beauchamp.

"The trouble is that September isn't often much better.

"After the solid gains of the year so far some more consolidation looks likely, especially in potentially-overstretched markets like the Nasdaq and the Nikkei, both of which have been among the big winners in 2023."

Slowing economic indicators mark concern for US economy

On the economic front, fresh data released earlier indicated that the US economy was losing steam, with economic growth and job creation falling short of expectations for the second quarter and August respectively.

Official revisions from the Bureau of Economic Analysis (BEA) suggested that US GDP grew at a rate of 2.1% from April to June, lower than the previously projected growth rate of 2.4%.

That was, however, a minor uptick compared to the revised growth of 2% in the first quarter of 2023.

"The updated estimates [for the second quarter] primarily reflected downward revisions to private inventory investment and non-residential fixed investment," a statement from the BEA said.

Current-dollar personal income increased $232.1bn in the second quarter, down $3.9bn from the initial estimate, while disposable personal income was revised up by $36.3bn to $284.5bn.

Elsewhere, job growth in the private sector also lagged behind expectations, signalling a potential cooling in labour market dynamics.

According to a report from the ADP Research Institute, only 177,000 new jobs were generated in August, a decline from 324,000 in July and 455,000 in June.

The job market underperformed against economists' anticipations, which had pegged expected job gains closer to the 200,000 mark.

A significant deceleration in the leisure and hospitality sector was noted, contributing to the reduced job growth.

That sector managed to add just 30,000 jobs in August, a steep drop from the 201,000 jobs created in July.

"This month's numbers are consistent with the pace of job creation before the pandemic," said ADP chief economist Nela Richardson.

"After two years of exceptional gains tied to the recovery, we're moving toward more sustainable growth in pay and employment as the economic effects of the pandemic recede."

Meanwhile, the annual increase in pay for people in the same job slowed from 6.2% in July to 5.9% - its lowest since October 2021 - while earnings growth for job-changers also decelerated from 10.2% to 9.5%.

"For the first time, all 50 states and Washington, D.C., experienced a slowdown in pay growth," the report said.

HP, Texas Instruments drop while Lyft soars

In equities, computing behemoth HP saw its shares tumble after revealing third-quarter revenue that disappointed the market.

The company posted revenue of $13.2bn, falling short of the $13.4bn that analysts had anticipated.

Texas Instruments did not fare much better, as its shares fell by 0.86%.

The decline came on the heels of a downgrade from analysts at Bernstein, who shifted their rating on the semiconductor company from 'market perform' to 'underperform.'

Cloud storage company Box saw one of the day's most significant declines, with its shares plummeting by 12.31%.

The freefall followed the company's less-than-stellar guidance for the entire fiscal year.

On the upside was Lyft, whose shares jumped 8.45% after Sean Aggarwal, an independent director, purchased $1m worth of shares.

That move came not long after CEO David Risher also invested a similar amount in the company earlier in the month.

Reporting by Josh White for Sharecast.com.

Dow Jones - Risers

Apple Inc. (AAPL) $187.65 1.92% Salesforce.Com Inc. (CRM) $215.04 1.45% Caterpillar Inc. (CAT) $282.33 0.82% Walmart Inc. (WMT) $161.20 0.72% Boeing Co. (BA) $228.85 0.70% Intel Corp. (INTC) $34.53 0.64% Cisco Systems Inc. (CSCO) $56.81 0.44% Home Depot Inc. (HD) $330.63 0.38% Visa Inc. (V) $246.23 0.36% Nike Inc. (NKE) $102.10 0.32%

Dow Jones - Fallers

Goldman Sachs Group Inc. (GS) $328.58 -1.19% 3M Co. (MMM) $104.45 -1.06% Dow Chemical Co. (DOW) $54.75 -0.89% Amgen Inc. (AMGN) $257.88 -0.68% JP Morgan Chase & Co. (JPM) $148.16 -0.40% Johnson & Johnson (JNJ) $163.73 -0.35% Unitedhealth Group Inc. (UNH) $491.53 -0.26% Verizon Communications Inc. (VZ) $34.64 -0.14% Walt Disney Co. (DIS) $84.28 -0.14% Coca-Cola Co. (KO) $60.47 -0.05%

S&P 500 - Risers

Hewlett Packard Enterprise (HPE) $17.36 3.09% Bath & Body Works, Inc. (BBWI) $38.11 2.78% Estee Lauder Co. Inc. (EL) $163.57 2.70% Seagate Technology Plc (STX) $68.17 2.67% Intuitive Surgical Inc. (ISRG) $318.58 2.64% Illumina Inc. (ILMN) $166.06 2.55% Allstate Corp (The) (ALL) $109.26 2.53% Western Digital Corp. (WDC) $42.52 2.33% Lennar Corp. Class A (LEN) $119.27 2.32% Deere & Co. (DE) $413.27 2.27%

S&P 500 - Fallers

HP Inc (HPQ) $29.29 -6.63% Brown Forman Corp. Class B (BF.B) $66.28 -3.98% Nektar Therapeutics (NKTR) $0.60 -3.47% Centene Corp. (CNC) $62.72 -2.67% Charter Communications Inc. (CHTR) $439.51 -2.57% Rockwell Automation Inc. (ROK) $309.57 -2.42% Norwegian Cruise Line Holdings Ltd (NCLH) $16.54 -2.19% Cardinal Health Inc. (CAH) $88.04 -1.99% Dish Network Corp. (DISH) $6.01 -1.64% TripAdvisor Inc. (TRIP) $15.15 -1.62%

Nasdaq 100 - Risers

Sirius XM Holdings Inc (SIRI) $4.58 7.01% Baidu Inc. (BIDU) $145.08 3.11% Mercadolibre Inc. (MELI) $1,343.13 2.95% Qurate Retail Inc. (QRTEA) $0.78 2.70% Seagate Technology Plc (STX) $68.17 2.67% Intuitive Surgical Inc. (ISRG) $318.58 2.64% Illumina Inc. (ILMN) $166.06 2.55% Western Digital Corp. (WDC) $42.52 2.33% Micron Technology Inc. (MU) $68.09 2.11% Apple Inc. (AAPL) $187.65 1.92%

Nasdaq 100 - Fallers

Charter Communications Inc. (CHTR) $439.51 -2.57% Dish Network Corp. (DISH) $6.01 -1.64% JD.com, Inc. (JD) $33.97 -1.54% Gen Digital Inc. (GEN) $20.26 -1.36% Liberty Global plc Series A (LBTYA) $18.04 -1.26% Liberty Global plc Series C (LBTYK) $19.40 -1.17% DENTSPLY Sirona Inc. (XRAY) $37.35 -1.16% Henry Schein Inc. (HSIC) $77.50 -1.06% Expedia Group Inc. (EXPE) $108.86 -0.99% Meta Platforms Inc. (META) $295.10 -0.97%