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The Nasdaq edged higher on Thursday boosted by gains in electric automaker Tesla on its better-than-expected quarterly results, which helped offset a slide in telecom and energy shares.

The S&P 500 added 0.6% after an earlier dip, and the Dow Jones Industrial Average remained flat in the early afternoon.

Tesla surged 10.1%, while AT&T Inc tumbled to bring down telecom shares after the wireless carrier cut its cash flow forecast saying some subscribers were delaying bill payments. Energy stocks slipped on weak crude prices.

Tesla's profit benefited from a price hike of its cars, offsetting production challenges. Strong reports from the carmaker and streaming giant Netflix Inc have boosted megacap growth stocks that have been under pressure from rising interest rates.

“The earnings picture has been maybe a little better than investors feared," said J. Bryant Evans, investment adviser and portfolio manager at Cozad Asset Management.

"We investors are thinking that ..especially technology (sector) has come down too far, and maybe there's some valuation opportunities there.”

Seven of the 11 major sectors of the S&P 500 are in positive territory, with consumer discretionary, heath care and information technology posting the biggest gains adding over 1% each.

Falling oil prices hit the S&P 500 energy sector, which shed 2.8% to lead declines.

Hit by China shutdown, Tesla boosts auto prices and sells bitcoin

All eyes are on the Federal Reserve meeting next week where policymakers are expected to raise interest rates by 75 basis points.

Rising inflation also led the European Central Bank to belatedly join global peers in a rate-hike cycle with an aggressive 50-basis point increase.

The Fed rate decision next week will be followed by the crucial second-quarter U.S. gross domestic product data, which is likely to be negative again.

By one common rule of thumb, two quarters of negative GDP growth would mean the United States is in a recession.

In the latest signs the U.S. economy is slowing, the number of Americans enrolling for unemployment benefits rose to the highest in eight months and a closely watched gauge of factory activity slumped this month.

“Consumers are just beginning to react to less money in their pockets, either from reduced overall job market or from rising interest rates and inflation”, Evans added.

“Part of the strong earnings reflects the past strength of consumers, whereas a lot of this broader decline that we've seen .. over the past few months has priced in a slowing in broader economy that eventually would affect consumers.”

At 2:24PM ET, the Dow Jones Industrial Average rose 25.94 points, or 0.08%, to 31,900.78, the S&P 500 gained 24.59 points, or 0.62%, to 3,984.49 and the Nasdaq Composite added 127.19 points, or 1.07%, to 12,024.84.

Advancing issues outnumbered declining ones on the NYSE by a 1.15-to-1 ratio; on Nasdaq, a 1.20-to-1 ratio favored advancers.

The S&P 500 posted 1 new 52-week highs and 29 new lows; the Nasdaq Composite recorded 17 new highs and 38 new lows.

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