US benchmark equity indexes experienced gains on Thursday as traders carefully analyzed the latest macroeconomic data that emerged. The US economy demonstrated notable growth at an annualized rate of 3% in the second quarter, a figure that remained steady from a prior estimate released by the Bureau of Economic Analysis.
This growth rate surpassed the expectation set by analysts, who had anticipated a more conservative 2.9% mark according to a consensus compiled by Bloomberg. The previous quarter also showed positive movement, with a real gross domestic product increase of 1.6%. In light of this solid performance, experts at Stifel noted, 'A solid showing, at least in the rear-view mirror, of domestic activity reinforces the need for a tempered and patient approach to subsequent rate reductions' as articulated in their correspondence to clients. In a related development, pending home sales within the US saw a slight uptick of 0.6% last month, as reported by the National Association of Realtors.
NAR's Chief Economist Lawrence Yun explained, 'A slight upward turn reflects a modest improvement in housing affordability, primarily because mortgage rates descended to 6.5% in August.' Despite this positive trend, Yun cautioned that contract signings remain near cyclical lows, even as home prices continue to reach unprecedented levels. In the energy sector, November West Texas Intermediate crude oil saw a decrease of $2.02, settling at $67.67 per barrel, while November Brent crude, recognized as the global benchmark, was last noted down by $1.986 to $71.48.
This decline followed reports indicating that OPEC+ plans to add back 2.2 million barrels per day of voluntary production cuts to the market. The shift comes as Saudi Arabia, the leading nation within OPEC+, moves away from its previously set US$100 per barrel price target to reclaim market share. Furthermore, an agreement reached between the two rival governments in Libya promises to enhance the country's oil exports. On the corporate front, shares of Micron Technology ($MU) surged by 15% as the memory and storage technology company reported a fiscal Q4 profit that exceeded analyst expectations.
The rebound was driven by increasing demand in the artificial intelligence sector, propelling the company’s revenues beyond Wall Street's projections. In contrast, Super Micro Computer ($SMCI) shares fell by 12.5%. Reports from The Wall Street Journal revealed that the US Department of Justice is investigating the firm for alleged accounting violations previously reported by a former employee.
Overall, the equity markets are buoyed by positive economic signals and varying corporate performances, indicating a mixed but optimistic outlook for investors moving forward..