CNBC Daily Open: The Dow lost steam but the U.S. economy didn’t

Original Article:

Source: Link

This report is from today's CNBC Daily Open, our new, 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 . Streak shattered The Dow Jones Industrial Average finally ran out of steam and closed the day in the red, ending its 13-day winning streak. Other major U.S. indexes had a losing day as well. Europe's Stoxx 600 index advanced 1.35%, juiced by a 4.2% jump in media stocks and a 4.1% rise in the technology sector. What recession? The U.S. economy's showing no signs of stopping. Gross domestic product grew at an annualized 2.4% rate in the second quarter, according to the Commerce Department. That's higher than the 2% estimate from Dow Jones and the first quarter's 2% growth. In other good news, the personal consumption price index rose 2.6% in the second quarter, down from 4.1% in the first. Intel's unexpected profit Intel returned to profit in the second quarter after two straight quarters of losses, even as revenue fell year-on-year around 15% to $12.9 billion. That's because its gross margin was nearly 40% on an adjusted basis. Intel's forecast for its third-quarter earnings was higher than analyst expectations. In sum, investors appeared pleased, pushing shares up more than 7% in extended trading. New bank rules Banks with more than $100 billion in assets may need to set aside more money against possible losses by July 2028. U.S. regulators announced a set of proposed changes to regulations for the banking industry Thursday. And in response to Silicon Valley Bank's failure, regulators want more banks to include unrealized losses in their capital ratios under the new rules. Another much-anticipated hike The European Central Bank on Thursday raised interest rates by 25 basis points, bringing its main rate to 3.75%. The move was widely anticipated, but market watchers aren't sure if the ECB will pause or continue hiking at its September meeting. Like Federal Reserve Chair Jerome Powell yesterday, ECB President Christine Lagarde left the ECB's upcoming decision open. [PRO] Reasonably priced stocks Stock markets have undeniably been rallying, but most of the growth has been driven by Big Tech shares that are trading at expensive valuations, that is, at multiple times their projected earnings. In light of this, Goldman Sachs looked for stocks at a "reasonable" price that are still projected to experience healthy growth.