S&P 500 rises after strong GDP report, Nasdaq jumps nearly 1% on Tesla results

The oldest ETF celebrates its 30th anniversary this week, but the industry still has room to grow, according to a survey from State Street.

The firm, which operates the now $375 billion SPDR S&P 500 Trust ETF (SPY), found in a small survey that just 40% of U.S. investors currently hold ETFs.

One area of ETFs with significant growth ahead is fixed income, Sue Thompson, head of Americas distribution for State Street’s SPDR ETFs, said at a SPY anniversary event on Tuesday.

“I think it’s going to grow, and I’ll put a stake in the ground: It will surpass at some point the equities,” said Thompson.

“The fixed income market itself is larger than the equity market, and it is less liquid than the equity market. So the ETFs actually have more utility in the fixed income market,” she added.

— Jesse Pound

A mild winter has helped push natural gas prices down and helped futures for February notch a fresh low of 2.842, the lowest level since May 24, 2021.

So far this month, the commodity is down almost 36.5% and is on pace for the worst January performance since 2001. It’s also on pace for the worst monthly performance since March 2003.

This year, natural gas has shed nearly 36% to date.

—Carmen Reinicke, Gina Francolla

The U.S. economy expanded at an annualized pace of 2.9% in the fourth quarter, slightly outperforming a Dow Jones estimate of 2.8%. The Commerce Department’s report comes even as inflation persists and the Federal Reserve continues to raise rates.

Consumer spending rose 2.1% for the period, down slightly from 2.3% in the previous period but still positive.

— Jeff Cox

Here are some of the names making moves in the premarket:

• Tesla — The electric-vehicle maker soared nearly 8% after reporting record revenue and an earnings beat for the fourth quarter. CEO Elon Musk said the company might be able to produce 2 million cars this year.
• Las Vegas Sands — The hotel and casino operator rose about 4% despite the company reporting weaker-than-expected fourth-quarter. Wall Street analysts cited upbeat comments on the company’s earnings call about its reopening in Macao for their positive outlook on the stock.
• American Airlines — Strong holiday demand and high fares helped American Airlines’ fourth-quarter profits beat Wall Street’s expectations. The airline gained more than 1% in premarket trading.

— Michelle Fox

JPMorgan downgraded EVgo shares from neutral to overweight, citing headwinds to the company’s long-term growth. 

“We continue to like the company’s strategy with a core focus on urban/suburban charging at good site locations with notable partnerships with vehicle OEMs, rideshare and autonomous vehicle companies,” analyst Bill Peterson wrote. However, “we think its network throughput growth will likely be dampened as a result of slower site growth.”

Higher inflation and input costs, in addition to permitting delays and supply chain shortages mean that the company’s growth outlook remains tricky. 

The stock traded higher by 2.1% in the premarket despite the downgrade.

UBS downgraded shares of Pfizer to neutral from a buy rating as Covid-19 stabilizes and the company’s pipeline slows.

“While we see minimal downside from here, the lack of catalysts (see inside) and potential for further downside to COVID estimates drives our move to the sidelines,” wrote analyst Colin Bristow in a Thursday note.

CNBC Pro subscribers can read the full story here.

— Sarah Min

Shares of Southwest Airlines slipped more than 2% premarket after the company posted a $220 million loss for the recent quarter as it grappled with the fallout from its year-end holiday debacle.

The airline company reported an adjusted loss of 38 cents a share on revenues of $6.17 billion. Analysts had expected a 12-cent loss per share on $6.16 billion in revenue. Southwest said the winter storm meltdown contributed to an $800 million pre-tax hit to earnings.

European markets advanced on Thursday, building on positive momentum seen in the previous trading session.

The pan-European Stoxx 600 was up 0.6% in early trade, with financial services adding 1.3% to lead gains as most sectors and major bourses entered positive territory.

Markets have been buoyed by data this week showing improved business sentiment in Germany and an uptick in eurozone services and manufacturing activity, prompting optimism that a recession in the eurozone might be avoided.

Things are looking up for the electric vehicle industry, thanks to China’s reopening — particularly in the second half of the year, one analyst says.

Corinne Blanchard, vice president of lithium and clean tech equity research at Deutsche Bank, names one top stock pick.

CNBC Pro subscribers can read more here.

— Weizhen Tan

Stocks in certain key sectors that are directly related to China’s reopening, such as domestic consumption and travel, have done well in recent months.

Investors looking for entry into these stocks may find them unpalatable at current valuations. But there could be another way to play the reopening, with Bank of America and UBS having identified a raft of less obvious beneficiaries outside of China.

Pro subscribers can read more here.

— Zavier Ong

As stocks continue their rally, several major financial institutions are now predicting a significant downturn in global equity markets.

The S&P 500 index has risen by more than 10% since its lows in October last year. In Europe, the STOXX 600 has increased by more than 15% over the same period.

But, according to some investment banks, those gains are now at risk as they fear the lagged effects of monetary tightening are likely to hit earnings and cause compression in profit margins this year.

CNBC Pro subscribers can read about when the market is likely to bottom and by how much here.

— Ganesh Rao

Hightower Advisors chief investment strategist and portfolio manager Stephanie Link saw positives in IBM‘s fourth quarter, which saw earnings match expectations while revenues beat estimates.

“Software up 8%, consulting up 9%, infrastructure up 7%. All three beat. The software line certainly was a very important piece because of what we got from Microsoft last night. So I think they’re taking share. Red Hat is absolutely taking share,” Link said on “Closing Bell: Overtime.” Link owns shares of IBM.

Despite the results, IBM dipped about 2% in extended trading. Link said she might add to her position.

“The stock is very cheap with a good dividend yield. So if it is cheap for whatever reason, I’m a buyer,” Link said.

The company said Wednesday it would cut 3,900 jobs, which equates to about 1.5% of its workforce.

— Lora Kolodny, Alex Harring

Energy giant Chevron traded up 2.5% in after-hour trading after announcing a $75 billion stock buyback program and a dividend hike Wednesday night.

The buyback program will become effective on April 1, with no set expiration date, according to a press release. The dividend hike increases Chevron’s per share payout to $1.51 from $1.42. That will be distributed March 10.

Chevron’s market cap was roughly $350 billion as of Wednesday’s market close, meaning that the buyback would represent more than 20% of the company’s stock at current prices.

These are some of the stocks making the biggest moves after hours:

• ServiceNow — The software stock tumbled 4% after ServiceNow released its latest quarterly figures. ServiceNow posted earnings per share of $2.28, beating a Refinitiv forecast of $2.02 per share. Revenue, meanwhile, matched a consensus estimate of $1.94 billion.
• Levi Strauss — The denim company jumped 7% after its earnings and revenue for the fourth quarter came in above expectations. The company also shared full-year guidance showing per-share earnings between $1.30 and $1.40 compared with StreetAccount’s $1.35 estimate.
• Las Vegas Sands — Shares of the casino operator gained more than 4% after Las Vegas Sands released its latest quarterly results. The company lost 19 cents per share on revenue of $1.12 billion. Analysts expected a loss of 9 cents per share on revenue of $1.18 billion. However, the company’s adjusted property EBITDA of $329 million beat a StreetAccount forecast of $319 million.

See the full list here.

— Alex Harring

As futures trading kicked off, the major indexes were trading slightly down but near the flatline.

Futures tied to the Dow lost 0.08%. Meanwhile, S&P 500 and Nasdaq-100 futures dipped 0.09% and 0.04%, respectively.

— Alex Harring