US stocks rallied strongly today, but unfortunately on low volume. The S&P 500 (INDEXSP:.INX) only traded 49.5% of its 15-day average volume in today's session. The Nasdaq Composite (INDEXNASDAQ:.IXIC) rallied back to its April 9 close, led by lagging stocks such as FireEye (NASDAQ:FEYE). Because of the buyout of pharmaceutical developer Allergan (NYSE:AGN) for about $50 billion, health-care stocks led the major indices today. All 10 basic sectors of the S&P 500 finished positive. West Texas intermediate crude oil suffered 1.89% of losses.
March existing home sales declined 0.2% month-on-month to a 4.59 million annual rate, which was slightly ahead of the 4.56 million expected. The regional Philadelphia manufacturing index showed very strong growth in April, rising to 7 from -7 last month. The shipments, production, and new orders components all indicated that activity has significantly picked up over the past two months.
Tomorrow's Financial Outlook
The most important overnight event for risk assets tomorrow is the China HSBC flash manufacturing PMI for April, scheduled to be released at 9:45 p.m. ET tonight. Economists expect the index to rise to 48.3 from 48.0 last month. If this index beats expectations, copper, iron ore, and domestic Chinese stocks are all likely to experience substantial rallies. The inverse is true for most global risk assets if the report is poor.
In the US, March new home sales data is scheduled to be reported; economists are expecting a modest increase to a 450,000 annual rate from 440,000 in February. The other event of note is the preliminary April Markit US manufacturing PMI, which is expected to rise to 56.0 from 55.5 in the month prior. The Treasury will sell $35 billion of 5-year notes.
Fifty-one major US companies are scheduled to report earnings tomorrow. Notable reports include Boeing (NYSE:BA), Dow Chemical (NYSE:DOW), Procter & Gamble (NYSE:PG), Delta (NYSE:DAL), Qualcomm (NASDAQ:QCOM), Apple (NASDAQ:AAPL), E*Trade Financial (NYSE:ETFC), Facebook (NASDAQ:FB), Zynga (NASDAQ:ZNGA), and Norfolk Southern (NYSE:NSU).
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