April 23, 2024
Economy

CNBC Daily Open: U.S. economy sparks optimism


A person shops at a supermarket in New York City on December 14, 2022.

Yuki Iwamura | AFP | Getty Images

This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

Markets tumble
Wall Street closed lower Monday as investors awaited inflation data due later this week. The Dow Jones Industrial Average fell around 62 points, or 0.16%. The S&P 500 and Nasdaq Composite dropped 0.38% and 0.13%, respectively. But bitcoin resumed its rally to rise past $54,000 after a week of tepid trading.

Zoom surges
Zoom shares spiked after the video-chat platform provider’s quarterly revenue and profit topped estimates. Revenue rose more than 2.5% from $1.12 billion a year earlier. Growth would have been faster in the fiscal fourth quarter if not for a sales reorganization, the company said.

Dimon AI’s ‘big optimist’
JPMorgan CEO Jamie Dimon said he doesn’t think AI is just a passing fad. “When we had the internet bubble the first time around … that was hype. This [AI] is not hype. It’s real,” Dimon told CNBC, calling himself a “big optimist” on the emerging technology.

U.S. to be a chips hub
U.S. Secretary of Commerce Gina Raimondo said the U.S. is set to become a major hub of state-of-the-art semiconductor chips before 2030 to compete on the global market. She added the country is on track to produce roughly 20% of the world’s leading-edge logic chips by the end of the decade.

[PRO] Hotter than Nvidia
There’s an even “hotter” artificial intelligence stock than Nvidia. That’s Super Micro Computer, a Nasdaq-listed company which makes AI systems and graphics processing unit servers, highlighted Louis Navellier, chairman and founder of Navellier & Associates.

Forecasters are getting increasingly upbeat about the state of the U.S. economy.

Last year, many economists predicted a recession but that never happened. Now, a growing chorus of analysts are sanguine about growth this year.

In its latest survey, the National Association for Business Economics “sharply revised upwards” its GDP forecast for 2024. NABE now expects the economy to grow by 2.2%, compared with the 1.3% it forecast in December.

“The stronger February growth forecasts for 2024 result from upward revisions to key sectors of the economy,” including consumer spending, said Ellen Zentner, chief economist at Morgan Stanley and NABE president.

Other experts share the optimism.

Bank of America’s annual survey of Merrill financial advisors indicated a significant decline in recessionary fears and an uptick in bullish sentiment.

Strategist Savita Subramanian wrote in a Friday note, just 4% of the survey’s 240 respondents expect a recession this year, compared with 85% of the respondents last year.

U.S. consumer spending and jobs growth has been holding up remarkably well despite higher borrowing costs and persistent inflation.

Still, the NABE noted 41% of respondents cited high rates as the most significant risk to the economy.

Investors have reset their expectations for rate cuts this year, given the Fed’s cautious tone on lowering rates. Earlier in the year, many had expected an aggressive series of rate cuts starting in March, they now see policy easing not beginning until June or July.

Markets are bracing for more key data slated for release in the coming days that will shed further insight into the health of the economy and the lingering inflation threat.

CNBC’s Jeff Cox contributed to this report

 



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