Stock Market Update

[BRIEFING.COM] The stock market is in rally-mode, again. The upside moves are driven by momentum after a solid week for stocks, and boosted by strength in the mega caps and chipmakers. The Dow Jones Industrial Average is more than 400 points higher and the Nasdaq Composite shows a 2.3% gain. The S&P 500 trades 1.7% higher today, nearly 10% off its low close on April 8 (4,982.77).

Many names are participating in a broad advance. The Invesco S&P 500 Equal Weight ETF (RSP) trades 1.7% higher and ten of the 11 S&P 500 sectors are in the green. The technology sector leads the pack, reflecting leadership from mega caps and chip makers. Today's risk-on bias has the defensive-oriented consumer staples sector trading alone in the red, down 1.1% from yesterday. 

Earnings news since yesterday's close has been a mixed bag. Chipotle Mexican Grill (CMG 49.20, +0.41, +0.8%), Southwest Airlines (LUV 25.91, +0.39, +1.5%), IBM (IBM 229.20, -16.32, -6.7%), and Merck (MRK 78.67, -0.07, -0.1%) issued some cautious-sounding guidance.

Names like Texas Instruments (TXN 163.04, +10.89, +7.2%), ServiceNow (NOW 937.31, +124.64, +15.4%), Whirlpool (WHR 78.43, +0.69, +0.9%) reported pleasing earnings and/or guidance. 

The price action in Treasuries has also contributed to the buying interest in equities. The 10-yr yield is down eight basis points from yesterday at 4.31%. 

Reviewing today's economic data:

• March Durable Orders 9.2% (Briefing.com consensus 1.5%); Prior 0.9%, March Durable Goods -ex transportation 0.0% (Briefing.com consensus 0.3%); Prior 0.7%
  • The key takeaway from the report is that there was a rebound in nondefense capital goods, excluding aircraft, which rose 0.1% following a 0.3% decline in February. This is indicative of a modest pickup in business spending, albeit before the reciprocal tariff upset on Liberation Day. New orders for primary metals increased 0.7% following a 1.3% increase in February.
• Weekly Initial Claims 222K (Briefing.com consensus 220K); Prior was revised to 216K from 215K, Weekly Continuing Claims 1.841 mln; Prior was revised to 1.878 mln from 1.885 mln
  • The key takeaway continues to be found in the leading indicator of initial jobless claims, which continue to run at low levels that are nowhere close to being associated with a recession.
• March Existing Home Sales 4.02 mln (Briefing.com consensus 4.20 mln); Prior was revised to 4.27 mln from 4.26 mln
  • The key takeaway from the report is that existing home sales declined month-over-month in all regions, while the median selling price increased month-over-month in all regions, signaling the affordability constraints buyers are facing with higher prices and relatively higher mortgage rates.