Much earlier today, when I was contemplating what I'd be writing later, the market was ugly and I was formulating in my mind the thoughts of "everything's on sale," etc. But then.....
More than a few traders described today's action as "crazy." It started off weak as the market fretted over the lack of any hint about further quantitative easing by the Fed, then got hit by a surprise announcement that the International Energy Agency was set to release 60 million barrels of oil from its strategic stockpile. That sent crude oil tumbling, drove up the U.S. dollar, slammed commodities and caused some panic selling.
After emotions calmed down, the dip buyers started buying retailers and some big-cap technology names that may benefit from lower gasoline prices. That helped the Nasdaq to outperform nicely when commodities, financials and other sectors struggled.
The bounce then started to fade and it looked like another ugly close when news hit that Greece had reached a deal on austerity measures. That doesn't seem very surprising, but the market suddenly leapt higher on the news. The sellers tried hard to fade the move but were unsuccessful and the market closed at the highs of the day.
I suspect the Greek news simply caught too many folks out of position, especially the bears, who were betting that the intraday bounce would fizzle. The spike up was very similar to what we saw Tuesday morning, when the market went straight up in vicious fashion.
At this point, many market players would probably welcome a market that is less macro-driven and more focused on individual stock picking. Tomorrow is likely to be another chaotic and hectic day, though, as the Russell indices are rebalanced. This always produces a big jump in volume and some crazy action in the stocks that are being added and dropped. Last year Nasdaq volume jumped to 3.5 billion shares on rebalancing day from around 2 billion the previous day.