US GDP Up 1.7% Shattering Economists Predictions

Online, August 1, 2013 (Newswire.com) - On Wednesday the US Commerce Department released its highly anticipated report on GDP, stating that in the second quarter the US economy grew 1.7% driven by an increase of 1.8% in consumer spending and 9% in business investment. New home construction was another important driver of growth, with investment rising 13.4%, the fourth consecutive increase. This gain beat expectations of a 1% gain in growth. Analysts at The Woo Group interrupt this as meaning growth is stable but moderate at this point in the year. They also believe that this report implies that growth will accelerate in the second half of the year, citing gains in business investment, global economic recovery and improving consumer spending.

The payroll processing giant Automatic Data Processing Inc. also released data today, stating that private sector jobs grew by 198,000 in June, 10,000 more than estimated.

Oil futures rose in early morning trading but an announcement from the Energy Information Administration negated the gains. It reported an increase of 400,000 barrels of crude oil reserves. Market analysts were predicting a 3 million barrel decline. Gasoline stockpiles also rose by 800,000 barrels, while analyst were expecting a 1.5 million barrel decline.

Among notable gainers on the US Markets were Facebook, whose shares on Tuesday rose 6% to $37.63,just below the $38 IPO price in May 2012. Facebook shares only posted a minimal gain on Wednesday. The cable operator Comcast Corp. shares jump more than 5% after reporting earnings that beat expectations.

Anti-virus software maker Symantec Corp. shares spiked more than 8%, after conversely reporting a 1.9% drop in profits. The decline in profits was caused by higher operating expense, which concealed revenue growth. Since the beginning of the year the stock is up 29%.