The Bulls Are Back In Town
Finally a strong day in the market. The Dow had its biggest point gain (+286) since 2002, though we know its all about percentage moves, not points.
Nonetheless, the SPX led the way today, rising +2.4%. The Nasdaq gained +1.4%. But it was the financials that were really strong. The bank index vaulted +5.4%, followed by the brokers which rallied +3.8%.
Volume was very strong also. Some of this could have been short covering ahead of the FOMC meeting tomorrow. It's tough to gauge what the Fed could say in its statement, but if they make any dovish comments, it should help the market build on today's gains.
If I were Bernanke, I would lower the fed funds rate, but I have little confidence that Ben would do something that overtly market friendly.
The 10-day put/call ratio hit 1.31 today, only one point shy of its all-time record in March. We know how that correction played out. I am betting that the surge in bearish sentiment will have a similar effect on helping the markets bottom this time around as well.