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U.S. stocks waver narrowly after GDP report

Xinhua, October 30, 2015 Adjust font size:

U.S. stocks traded mildly lower in the morning session Thursday, as the country's economic growth in the third quarter came out weaker than expected.

By midday, the Dow Jones Industrial Average decreased 53.48 points, or 0.30 percent, to 17,726.04. The S&P 500 inched down 2.75 points, or 0.13 percent, to 2,087.60. The Nasdaq Composite Index lost 15.65 points, or 0.31 percent, to 5,080.04.

U.S. real gross domestic product (GDP) expanded at an annual rate of 1.5 percent in the third quarter, down from the revised 3.9 percent increase in the second quarter and missing market expectations of 1.7 percent, the Commerce Department reported Thursday.

On a year-on-year basis, the American economy increased 2 percent in the third quarter, which represents the slowest expansion since the first quarter of 2014.

According to the Commerce Department, the slower economic growth in the third quarter mainly reflected a downturn in private inventory investment and slowdown in exports, consumptions and government spending.

"Slow growth with a huge slowdown in inventory building and solid growth in final sales is good news. Demand grew at a solid pace. But the seeds of a slowdown in Q4 are already planted in the form of slowing consumption and weakness in durable orders," chief economist at FTN Financial Chris Low said in a note.

Initial claims for unemployment benefits indicate that the U.S. job market remains solid. In the week ending Oct. 24, the advance figure for seasonally adjusted initial jobless claims was 260,000, below market consensus of 265,000, said the U.S. Labor Department Thursday.

The four-week moving average was 259,250, a decrease of 4,000 from the previous week's unrevised average of 263,250. This is the lowest level for this average since Dec. 15, 1973 when it was 256,750.

Meanwhile, investors were still sifting through the Federal Reserve's statement released Wednesday afternoon following its two-day policy meeting. The U.S. central bank left the federal funds rate unchanged, but signaled option to tighten policy rate at its next meeting in December.

On Wednesday, U.S. stocks posted solid gains as Wall Street assessed the Fed's meeting announcement amid a positive earnings report from Apple Inc.. Endit