Bond Market Not Worried About Inflation

The market continues to build on its gains, with the DOW up more than 200 points now. The SPX is up +1.8%, while the small and mid-cap indexes are up over 2%.

Bond yields continue to decline, with the 10-year yield falling further to 5.06%. The odds of an additional fed rate hike continue to fall also, and there is not one contract that is predicting anyting above 5.50% anymore.

Bill Gross from PIMCO just said that he thinks the Fed could be done, and that rather than it being a pause, he thinks it is more like a halt. He sees it more likely that the next move after a pause would be to lower rates, not raise them again.

Nearly every sector is up big today. GOOG is being held down by YHOO's poor report, but there aren't a lot of other stocks in the red today.

We have some big earnings reports after the close, so get ready.

long GOOG