Fed's Dudley and Bullard: One-Two Dovish Punch Fuels Rally

Adam Jeffery | CNBC

It's no secret most of the Street has been trying to anticipate--and trade ahead of--the anticipated Fed "tapering" of bond purchases.

Separate speeches today from the New York Fed's William Dudley and the St. Louis Fed's James Bullard have thrown some hot water on that thesis.

Mr. Dudley came right out and said that the Fed might adjust the pace of bond purchases up OR down; that the outlook was uncertain, and that he wasn't sure what way the Fed would be leaning.

(Read More: ECB Should Follow US: Fed's Bullard)

And St. Louis Fed President James Bullard also did not help the hawk cause, arguing that the Fed should continue its bond-buying program and that the recovery has been slower than expected.

Stocks rallied; bonds, which have been under pressure most of this month, also rallied; and the U.S. Dollar Index dropped.

Elsewhere: what's up with Saks (SKS)? Everyone is shocked it's up nine percent today, but it's a fairly straightforward story: they are getting revenue growth well above their peers. At 5.9 percent, that is growth about three times what was expected. Here's how it compares to its peers.

Department Store Sales Growth:

1. Saks: 5.9%
2. Macy's: 3.8%
3. Nordstrom: 2.7%

This blowout top line is causing a short-covering rally (all these retailers are heavily shorted because the perception is their stock prices are peaking, and that home improvement stocks like Home Depot (HD) are more attractive).

Another factor in the big rally: shares outstanding declined 13 percent, so there is an aggressive buyback program.

—By CNBC's Bob Pisani