Markets up mildly on uncertainty

Markets drifted awaiting the vote on the auto bailout package. Stocks spent most of the day in the green, but couldn't get a good head of steam up. Dow gained 70, advancers over decliners 2-1 & NAZ was up 18. However, banks were weak. The S&P 500 FINANCIALS INDEX slipped 1 on the uncertainty over the outcome of the bailout package.

Oil had a good day bouncing off recent lows:

CLF09.NYM

..Crude Oil Jan 09

...43.82

.. 1.75 ......(4.2%)

After its fall below 8K, Dow Jones has been range-bound, pretty much kicking around in the 8Ks. 9½K is the ceiling it's shooting for. In all fairness, it has shown an amazing amount of strength lately in the face of very ugly news.


Dow Jones Industrials --- 2 months





The Alerian MLP Index has been fighting back from the lows set 3 weeks ago. Today was a very good day, up 8 to 182. If it can hang on to its gains, the next goal will be the 220s.


Alerian MLP Index --- 2 months




REITs have also had a nice bounce off their lows, but many still offer extraordinary yields well into double digits. Today, the index rose 11 to 146½.


Dow Jones REIT Index --- 2 months





The VIX or volatility index has been slipping in the last couple of weeks while the Dow has been rallying off the lows. Fear has been subsiding, but remains at extraordinarily high levels. Today it dropped 3 to 56:


VIX ---- 2 weeks





Meanwhile Lehman High Yield Bond ETF has been just plain flat. High yield (junk) bonds still can't get no respect, down pennies today, offering a 16+% yield. For them, tax loss selling continues to be a major drag:


Lehman High Yield Bond ETF - 2 weeks




Markets are awaiting word about the auto bailout package. It should get thru the House easily, that's why it started there. But there will be a tough fight in the Senate. Dick Cheney is talking with Rep senators, trying to persuade them to vote for it. The outcome is still fuzzy, probably why markets have been trading in an uneasy pattern.

•Automaker Rescue Plan Will Pass House, May Hit Senate Snag, Lawmakers Say


Even if/when the auto bailout bill passes, macro economic problems will continue to drone on. However, it looks like markets have been able to absorb tax loss selling quite well, at least so far.

Top level execs expect the recession to drag on for another year or so. I like to go against the grain, but feel uncomfortable fighting this kind of thinking:

Recession to Last Another Year - Duke Survey of CFOs- CNNMoney.com