First Quarter 2024 GDP Results
The Bureau of Economic Analysis (BEA) released its real gross domestic product report yesterday, May 30th. There was a small 1.6% increase in the real GDP for Q1 2024. The GDP has had poor growth since Q3 2020 and has stalled since a decrease in Q1 2022. GDP measures the monetary value of goods and services produced in a certain period. The upward growth of the GDP shows the economy is doing well, and downward growth indicates negative economic conditions. With high inflation, high prices, high interest rates, and somewhat stalling American average income, the GDP may not recover until several of these factors improve.
A Slow Week for the Stock Market
The shortened trading week has been a slow one, particularly with the indexes. After hitting $40,000 last week, the DJI opened Tuesday morning at $39,028 and opened Friday at $38,140. The S&P 500 took a similar path, opening at $5,315 on Tuesday, but is currently down to $5,243 on Friday morning. However, NVIDIA Corp (NVDA) continues to see solid growth before its stock split. Closing last week at $1,069, NVDA opened at $1,102 Tuesday morning, and as of Friday morning, opened at $1,124.
Dell Tech Stumbles
After hitting an all-time high on May 29th at $179, Dell Tech (DELL) has dropped to $144 on open Friday morning. However, prices for DELL continued to decrease, after an earnings report announced Thursday night. While net revenue increased 6% from $20.9 billion in 2023 to $22.4 billion in 2024, the operating income for the company dipped 14% year-over-year. “We again demonstrated our ability to execute and deliver strong cash flow, with AI continuing to drive new growth,” said Yvonne McGill, chief financial officer, Dell Technologies. “Revenue was up 6% at $22.2 billion, servers and networking revenue was up 42%, and we generated $7.9 billion of cash flow from operations over the last 12 months.”
How Do We Understand It All?
There’s no doubt that the economic news over the last few months has been confusing. Market highs followed by quick dips, confusing inflation reports, a stagnant economy, and more reports are difficult to interpret for the average person. Do we invest now? Should you purchase a new home now or wait? If you’re trying to time the market or the economy, there is never going to be the perfect time to invest or make a big purchase. However, you can make decisions based on what is best for you, your family, and your budget. Understanding and building a quality budget is more important than looking through news regarding the economy every day and deciding when the right time to get in on any investments.
