Banks & Industrials Make a Comeback
Stocks rallied Monday as investors world-wide cheered a $1 trillion emergency-rescue package for Greece and other nations.
The Dow Jones Industrial Average held about a 400-point gain through Monday afternoon. The CBOE volatility index fell back below 30.
This comes after last week's nauseating selloff that sent the Dow below 10,400and the VIX above 40.
Financials, industrials and techs — the stocks that got hammered the most last week — led the pack today.
The 16 nations that use the euro and the IMF agreed to a $1 trillion emergency-rescue package to help prevent the sovereign debt crisis from spreading.
Markets world-wide cheered the move as it was much bigger than expected.
But will it be enough?
"Germany and other strong European states are chasing a dream," Peter Morici, a professor at the Robert H. Smith school of business, said of the bailout and its promise to hold the EU together.
"I think this is a short recovery," Jonathan Corpina of Meridien Equity Partners told CNBC. "It is nice to see that the market opened high and stayed high and we've got the volume to support it. But if you take a look at what happened this weekend, this is a short-term solution to a long term problem."
Bank of America , JPMorgan and Citigroup were all up more than 4 percent.
Goldman Sachs shares also rose despite a warning from the Wall Street giant warned that it faces more probes into its trading practices, particularly regarding Greece. Goldman shares rose 3.4 percent in premarket trading.
Boeing jumped more than 7 percent and Caterpillar soared over 6 percent.
Homebuilders also rallied, with Hovnanian , Beazer and Lennar all up more than 10 percent.
Commodity prices rose, with oil back above $76a barrel and bond prices fell.
But traders said muted reactions in the euro, which was up about 1 percent, and gold, which held above $1,200 an ounce, offer supporting evidence that the rally won't last.
McDonald's shares jumped after the fast-food chain reported same-store sales rose 4.9 percent last month.
Shares of Suntech Power surged after the solar-power company projected that first-quarter revenue would top expectations.
Berkshire Hathaway reported a quarterly profit of $2,272 per class A share during the fourth quarter, well above estimates.
Priceline.com jumped more thna 8 percent ahead of its earnings, due out after the bell.
Advancers outpaced decliners nearly 30 to 1 on the New York Stock Exchange.
The only decliner on the Dow was Walmart amid worries that the discount chain might not be able to retain all the middle-to-upper income families that shopped at its stores during the recession.
And BP skidded after a steel containment dome failed to contain the massive Gulf oil spill.
Dean Foods tumbled after the dairy producer missed its first-quarter earnings target and withdrew its full-year outlook.
MONDAY: Fed's Hoenig, Kocherlakota speak; earnings from Priceline after the bell
TUESDAY: Intel shareholder meeting; wholesale trade; Congressional hearing on market's freefall; Fed's Rosengren, Lockhart speak; 3-year auction; earnings from Toyota
WEDNESDAY: Weekly mortgage applications; trade balance; weekly crude inventories; 10-year auction; Fed's Bullard speaks; earnings from Macy's
THURSDAY: Ford, Google shareholder meetings; weekly jobless claims; import/export prices; Fed's Kocherlakota speaks; 30-year auction; earnings from Kohl's, Nordstrom, Nvidia
FRIDAY: Government's retail-sales report; industrial production; consumer sentiment; business inventories; earnings from JC Penney
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