Buyers came back to Wall Street in a big way Tuesday, igniting a sharp rally and new debate about whether stocks have bottomed.
But the afterglow from yesterday's rally faded as stocks head lower ahead of the open. Worries about new write downs at European banks are pressuring stocks in Europe after Asian markets rallied. The dollar is weaker after yesterday's gains.
One highlight today is Visa's $18 billion IPO, the biggest ever. Visa is exciting investors who saw one of the biggest bump ups in the financial sector in eight years Tuesday as S&P financials rose 8.5 percent.
The IPO priced at an aggressive $44 per share, well above the expected $37 to $42 per share range. The offering is seen as an important referendum for the market and a plus for the banks offering the shares. Otherwise on Wednesday, there is no economic data for the market to consider though Morgan Stanley earnings were reported ahead of the opening.
Morgan reported net of $1.55 billion, or $1.45 per share for the first quarter, compared to $2.31 billion ro $2.17 per share the year earlier. The results were better than the $1.03 per share expected by analysts.
Stocks had one of their best days in years Tuesday, with the S&P 500 gaining 4.2 percent, in its biggest percent gain since Oct. 15, 2002. The Dow chalked up 420 points to 12,392 in its second 400-plus point day in a week, while the Nasdaq scored 4.2 percent in its biggest gain in five years.
"I'm actually using the word bottom -- one that should hold us and let us go higher," said "Mad Money's" Jim Cramer on his show Tuesday night. He's not alone.
Tuesday's action doesn't mean the market won't be without its bumps and volatility, but it certainly was a day of encouragement for traders.
David Kotok of Cumberland Advisers said he is totally invested in stocks now and says the market has successfully retested January's lows three times. "You've got to be in the stock market now," he said. "You've got to own them. The one thing you don't want to own is cash."