The S&P 500 continued its steady march higher last week amid a mixed bag of big tech earnings.
On Thursday, the Commerce Department reported U.S. GDP grew at just a 2% annualized pace in the third quarter, missing economist estimates of 2.8% growth. The 2% growth rate represents the lowest economic growth since the second quarter of 2020 as the Delta variant of COVID-19 and global supply chain disruptions weighed on the U.S. economic recovery.
On Friday, Treasury Secretary Janet Yellen said President Joe Biden’s $1 trillion infrastructure bill and companion $1.8 trillion climate and social spending bill will not contribute to inflation, which has recently been running at its highest rate in 30 years. Yellen said the spending package would expand the economy’s growth potential, “which tends to push inflation down, not up.”
Electric vehicle maker Tesla reached a $1 trillion valuation for the first time following news that car rental company Hertz is purchasing 100,000 Tesla Model 3s by the end of 2022. Tesla’s market capitalization is now roughly 18 times the size of Ford’s despite Ford reporting nearly double Tesla’s revenue in the third quarter.
Facebook announced Thursday it’s changing its corporate name to Meta in an effort to rebrand and shift its focus to building the “metaverse,” a virtual world in which users live, work and play online. Facebook will complete the rebranding on Dec. 1, and its stock will begin trading under the ticker MVRS.
Robinhood’s crypto problem
Shares of popular trading app Robinhood tumbled nearly 10% to below their initial public offering price after the company reported a large third-quarter revenue miss and a sharp decline in cryptocurrency trading.
Third-quarter earnings season rolls on this week with reports from Pfizer on Tuesday, Qualcomm on Wednesday, and Moderna and Uber on Thursday.
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U.S. companies earning at least 50% of their revenue from international sources have reported higher earnings growth than companies with domestic-focused business in the third quarter, according to FactSet.
Economic numbers
Following a disappointing third-quarter U.S. GDP report, Wall Street will get more economic updates on Wednesday when the Federal Reserve releases its latest interest rate decision and accompanying policy statement and on Friday when the U.S. Labor Department releases its October jobs report.
Benzinga is a financial news and data company headquartered in Detroit.
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