Nasdaq rallies after the open with Facebook in focus

Investing.com - U.S. stock markets were broadly higher after the open on Thursday, with the Nasdaq rallying sharply on the back of hefty gains in Facebook.

During early U.S. trade, the Dow Jones Industrial Average rose 0.55%, the S&P 500 advanced 0.85%, while the Nasdaq Composite index rallied 1.5%.

Ahead of the opening bell, the Commerce Department said U.S. gross domestic product grew at a seasonally adjusted annual rate of 3.2% in the fourth quarter, meeting expectations. The data showed personal consumption grew 3.3% in the three months ended December 31, the biggest increase in three years.

A separate report showed that the number of people who filed for unemployment assistance in the U.S. last week rose to a six-week high of 348,000, an increase of 19,000 from the previous week’s revised total of 329,000.

The Federal Reserve said Wednesday that it will keep a close eye on economic indicators before deciding to wind down its stimulus program even further, after reducing its monthly bond buying program by USD10 billion to a total of USD65 billion a month.

In earnings news, Facebook shares surged 15.5% after the company said its fourth quarter profit rose to USD523 million from USD64 million a year earlier.

Revenue increased to USD2.59 billion from USD1.59 billion, above forecasts for sales of USD2.42 billion. Half of the company’s advertising revenue came from mobile devices, brightening the outlook for full-year earnings.

The upbeat earnings boosted other shares in the sector, with Twitter jumping 8.6% and Yelp rising 5.6%.

Visa saw shares climb 2.5% after saying earnings per share came in at USD2.20 in the first quarter, above expectations for earnings of USD2.16 per share.

Shares of Qualcomm rose 1.45% after the company posted better-than-expected fiscal first quarter earnings after Wednesday’s closing bell.

Google shares picked up 3.5% after it agreed to sell its Motorola handset unit to Lenovo Group for approximately USD3 billion. After the close, Google is expected to report fourth quarter earnings of USD12.23 a share after Thursday’s closing bell.

Amazon increased 1.5% as investors positioned themselves in the stock ahead of the release of the company’s quarterly earnings report due after the bell.

On the downside, Exxon Mobil saw shares drop 1.4% after reporting weaker-than-expected fourth quarter earnings and revenue.

3M Company shares slid 1.5% after the company’s fourth quarter revenue totaled USD7.57 billion, below forecasts for revenue of USD7.71 billion.

Across the Atlantic, European stock markets were higher. The EURO STOXX 50 rose 0.7%, France’s CAC 40 added 0.75%, Germany's DAX increased 0.7%, while Britain's FTSE 100 inched up 0.2%.

Asian stock markets fell sharply on Thursday, with Hong Kong's Hang Seng Index falling 0.48%, China’s Shanghai Composite index declining 0.82%, while Japan’s Nikkei 225 Index tumbled 2.45%.

Data released earlier showed that China’s final HSBC Purchasing Managers Index fell to a six-month low of 49.5 in January from a preliminary reading of 49.6 and down from 50.5 in December.