Second quarter GDP weaker than expected

All the headlines are stating that GDP of US economy accelerated in second quarter. Then why are we having a negative reaction in the markets. The reason being that the GDP was much lower than the expectations. Gross domestic product rose at a seasonally adjusted 1.9% annual rate April through June, the Commerce Department said Thursday in the first estimate of second-quarter GDP. The key price index for personal consumption expenditures rose by 4.2% after increasing 3.6% in the first quarter. For the second quarter of this year, economists surveyed by Dow Jones Newswires had forecast a 2.3% GDP growth rate during April through June. The PCE price gauge excluding food and energy grew 2.1%, after increasing 2.3% in the first quarter.

Also, it seems one of the main stimulus were the economic stimulus checks which amounted to $140 billion. But the main question is what will happen for the rest of the year as we won't have any more stimulus checks an this will eventually slow down the economy and GDP.

Another major negative is the revision of Q4 2007 GDP to a negative value.