Stocks stage major rally to finish up for the day
Image by epicharmus via Flickr
The Dow closed up just above water at 10,625.83, which counts as a major victory today.
The broader S&P 500 closed up one-tenth of one percent at 1,136.94.
The tech-heavy Nasdaq closed up three-tenths of one percent at 2,354.23
Even as our markets were tanking earlier today, the European markets were finishing surprisingly mixed on the day, which turned out to be a portent for our markets. Now, part of that is because Europe has been so chaotic over the past couple of weeks, our markets have tended to simmer down in our afternoon trading once Europe's markets close.
But the other factor may be an increasing amount of confidence on Wall Street that Europe is stabilizing, at least a little, despite the fact that the euro's plunge -- it's at a four-year low against the dollar -- is probably not over.
The European Central Bank undertook what it's calling a "sterilization" plan meant to add transparency to what's going on on the troubled Continent. I'll let Miller Tabak equity strategist Peter Boockvar explain what that is:
"The ECB on the tape is specifying exactly how much in bond purchases they've made and what they are doing to take the exact same amount out of the system. They bought 16.5b euros of bonds last week and on May 18th they plan to begin 1 week fixed term deposits to absorb the 16.5b euros. This full sterilization announcement is leading to a bounce in the euro which is now well off its worst levels of the early morning. I know everyone hates the euro, with much reason, but the short term direction, and possibly longer term, will depend on how much the ECB wants to act like the Fed or not in terms of money printing. With today's announcement, while expected, there is evidence that they want to be less like them."
And here's another factor: bargain-hunting. When the Dow is down 180 points, that's a good time to start buying stocks.
Also today, oil spent most of the day under $70 per barrel before closing right at $70. Crude is down 20 percent over the past month.
May 17, 2010; 4:05 PM ET
Categories: Wall Street | Tags: Business, Day Trading, Dow, Dow Jones Industrial Average, Investing, NASDAQ, S&P 500, Wall Street
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