May 1- A sigh of relief regarding the economy sent stocks rallying on Tuesday, lifting the Dow to its highest level since December of 2007. Bobbi Rebell reports.
A collective sigh of relief for Wall Street after new data showed the U.S. manufacturing sector expanded at a faster pace than expected in April- and at its best pace in 10 months. The news calmed fears of a slowdown in the economic recovery- and sent the Dow to a four-year high. Jim Glassman, senior economist, JPMorgan Chase: SOUNDBITE: JIM GLASSMAN, SENIOR ECONOMIST, JPMORGAN CHASE (ENGLISH) SAYING: "U.S. manufacturing is benefitting from a whole bunch of things. Not only are markets around Asia growing and there is lots of opportunities, the dollar is at very low levels relative to where it's ever been so it's more attractive for companies to locate some production here in the U.S. and I think the U.S. benefits from that." Auto sales took different directions. Chrysler stepped on the gas- driving sales up 20 percent last month. General Motors and Ford both posted declines- though smaller than expected in April. But they blamed their declines on a calendar quirk- there were three fewer selling days in the month compared to last year. Pfizer reported higher-than-expected quarterly earnings. The company says profit margins improved and there were strong sales of its Lyrica nerve-pain drug; that helped offset plunging demand for its Lipitor cholesterol fighter, which is facing generic rivals. In the U.S.: the Dow had its highest close in four years. The S&P 500 and the Nasdaq had winning days as well. In Europe a number of markets were closed for a public holiday. Britain's FTSE was open and gained more than one percent, lifted by the stronger U.S. manufacturing data. Bobbi Rebell, Reuters