Dow races ahead, 900 in 2 days

Early gains held pretty well as stocks had one of their biggest 2 day gains in history. Initial gains were followed by a fairly flat line near 8400 with a surge at day's end only to give back the extra froth in closing mins (shown in the Bigchart widget on the right). Dow ended up 397, advancers over decliners 7-1 NAZ rose 87. In the Dow, only Hewlett-Packard (HPQ), posted a decline.

S&P 500 FINANCIALS INDEX had what was probably their biggest gain in modern times as strong buying continued thru the close of trade. Of course, banks were coming off 10 or 20 year lows, but the news about bailing out Citigroup brought back buyers:

Value 153.38

Change 24.02

% Change 18.6%

Other groups participated in the broad rally. The Alerian MLP Index (shown in the Yahoo badge in my right column) popped 17 (11%) to 170, one of its biggest days ever. The Dow Jones REIT Index popped 19 (18%) from vastly oversold levels, again one its biggest days ever. Buyers even came out for junk bond funds, typically up 10% or so (but still offering 20+% yields).

Oil rose almost 10% off its 3 year lows. Buyers were encouraged by gains in the stock markets related to the rescue of Citigroup & talks of production cutbacks at next week's OPEC meeting:

CLF09.NYM

Crude Oil Jan 09

..54.54

.. 4.61 .......(9.2%)

• Oil leaps 10 percent as OPEC, equities offer support- Reuters

This rally was needed to flush out negative thinking which has been taking over the markets & dragging them down. Tomorrow a sense reality should return. The next major dark cloud to deal with will be the auto makers.