With stocks having rallied nearly 5% from a low touched just eight days ago, the recent snapback in stocks doesn’t seem likely to continue at the same pace — especially now that the market has again found its trading range of nearly three weeks that it occupied before the earthquake in Japan brought about chaos in both human and financial terms.
But on Thursday, a bull could dream.
The Dow Jones Industrial Average gained 85 points to 12,171, the Nasdaq rose 38 points to 2736 and the S&P 500 added 12 points to 1310.
Crisis situations in the Middle East, Japan and Europe continued to provide a backdrop of risk for market players — as they likely will for the near term — but another day of avoiding another shoe dropping (or worse) has allowed investors to believe that it never will.
And on Thursday, what was an investor to think of the global situation when oil prices were at a relative standstill all day and investors in Europe took it upon themselves to bid stocks on the Continent to 10-day highs.
In the U.S., the rally was one of both magnitude and breadth, with tech, large-caps, and financials all providing a push.
With the overall mood brightening and oil prices held in check, it also was a good day for sectors that didn’t join in on Wednesday’s rise. Gambling stocks made a big move: Las Vegas Sands (NYSE:LVS) rose 7.5%, while International Game Technology (NYSE:IGT) added 5%.
Meanwhile, auto stocks probably had their best day of March. Ford (NYSE:F) was up 5%, while in Europe carmaker stocks such as Fiat, Daimler and Volkswagen were a big part of setting the early optimism.
One would expect that a broad-based rally would not be a good thing for bonds and precious metals. And one would be right, except for silver, which closed at another 30-or-so-year high, although even it showed some mortality by retreating from its intraday high.
Mining stocks, as it would follow, took a breather, after an impressive resurgence in the past 10 days. With both gold and silver still regularly hitting all or longtime highs, however, it would seem premature to look at Thursday’s action as a reversal.
