Wells Fargo (WFC) led an overdo rally & BIG TIME! Dow was up 276, NAZ roared ahead 69, but advancers over decliners were a little under 3-1 (that ratio has been bigger on other rally days). Volume was 1.7B on the NYSE, good but not exceptional.
S&P Financials were up a whopping 12%,
the biggest daily gain since record keeping began. Now they are back to the levels of last Wed, yes we have been thru a lot. Adding fuel to the rally was a $4 decline in oil to the 134s, bringing the 2 day decline to almost 11. Most stocks joined in the gains including financial related (i.e. REITs). However, there were losers, generally oil related. Oils, stocks associated with oil & MLPs fell. The Alerian MLP index dropped 2 to 263, up a little from the 262s (its former 52 week low). Junk bond funds were down a little, not helped by the favorable thoughts for financial stocks.
An overdo rally was coming, just a matter of when & what would trigger it. Bargain hunting may have been what was demonstrated. The fundamentals remain gloomy. Inflation numbers (including today's) remain gloomy, retail sales are slow at best, oil is still very high priced not to mention the banking mess which has gotten worse in the last week. Initial reaction from Congress is they are not gong-ho behind the changes proposed by the FED. FNM has largely run by Democrats, their initial reaction is cautious to say the least. Asian markets open shortly & should follow thru with nice gains. But a continuation of the rally tomorrow is not clear.
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