It as an odd day, with the glaring weakness in financials that are obviously not acting like they are about to see relief from their lows. Nonethless market players were hungry for action and stirred up some momentum in groups like biotechnology, which are not as sensitive to earnings results.
Given the weakness today in Bank of America, American Express, General Motors, Citigroup, JPMorgan Chase and GE, we still managed some impressive point gains in the major indices. The strength was in biotechs, retail, steel, homebuilders, coal and some commodity-related names. Breadth on the Nasdaq was only about 1,550 to 1,150 and volume was just average.
The surge this afternoon may have corresponded with some headlines that Treasury Secretary Geithner plans to be "very aggressive" with fiscal policy. I don't think that is a particularly surprising revelation but the tendency of this market lately has to been to spike on any talk about potential governmental plans. It's only after they are on the table and more carefully scrutinized that the selling begins anew.
Technically, the market is in the middle of a trading range. There is some formidable resistance for the S&P 500 as it approaches the 860 area, which allows for a decent upside from here and there is also some good support at the lows we hit last month. However, it continues to be a market dominated by very short-term traders with plenty of landmines.