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Midweek Update: Stocks Continue to Show Their Resilience

 What a day in the markets! There was enough action to warrant a midweek update and another look at the charts of some key indexes. Equity shorts took a beating as risk asset markets bounced back sharply from the selling that has kept a lid on the markets since the early November breakout.

We had a >2% up day on all the major US equity indexes, as well as the FTSE, DAX and European 100. The small cap Russell 2000 reached a new 52 week high on a closing basis, and the Dow Transports made a 52 week high on intraday and closing basis:

(click on charts to enlarge)

Even the unloved S&P Bank index, a drag on the broader market, picked up nearly 2% and has put in a series higher lows over the last three months:

The long bond was off 3% and closed below the 200 day SMA:

Currencies did move with everything else; some would argue they moved everything else: US Dollar index up .6%, euro down 1.2%.

So where are we now? Markets have withstood some ugly news flow over the last few weeks, yet none of the major US equity indexes violated their 50 day SMAs on a closing basis. It remains a dangerous world, with plenty of cause for worry, but stocks' performance has been impressive nonetheless.



Disclosure: No stocks mentioned; Author is long a variety of equities and short bonds