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Investing.com — U.S. stock markets opened higher again on Thursday as a big miss in second-quarter gross domestic product bolstered expectations of continued liquidity support from the Federal Reserve.
A rebound in Chinese stocks overnight also helped the tone, after Chinese market regulators held a call with major banks and investors in an effort to reassure them that the measures taken against online tutoring companies earlier this week are an exceptional case.
By 9:40 AM ET (1340 GMT), the Dow Jones Industrial Average was up 200 points, or 0.6%, at 35,131 points, while the S&P 500 was up 0.5% and the Nasdaq Composite was up by 0.2%
The Nasdaq’s underperformance was in part due to a 2.9% drop by Facebook (NASDAQ:FB) stock after it warned late on Wednesday of a slowdown in advertising revenue later this year. PayPal (NASDAQ:PYPL)and Uber (NYSE:UBER) stock also weighed, with the payments company falling 5.1% after reporting fewer new users than hoped for in the second quarter. Uber fell 3.9% after news that Softbank (OTC:SFTBY) is selling down its stake.
Earlier, the Bureau of Economic Analysis said the U.S. economy had grown at an annualized rate of ‘only’ 6.5% in the second quarter, well below expectations for a rise of 8.5% and only a slight acceleration from 6.4% in the first quarter. Additionally, there was fresh evidence of the labor market recovery struggling, with the total number of people claiming unemployment benefits rising by more than 500,000 to over 13.15 million. Initial jobless claims, which are one week fresher, stayed stuck at 400,000, instead of falling to 380,000 as expected.
