The rally continues.
Bulls are arguing this morning that today's data supports the current rally:
1) The stress test indicates banks in the aggregate need to raise less capital than bears expected.
2) Retail sales are much better than expected.
3) The Bank of England left interest rates unchanged at .5% but increased the size of their asset purchases to $125 billion from $50 billion.
The S&P 500 is up about 5 percent this week, and futures are up again this morning.
April retail same-store salesare not only better than expected in aggregate, but many companies are raising guidance:
1) Wal-Mart up 4 percent pre-open, sales up 5 percent, vs. 2.9 percent Street was expecting. Wal-Mart stopped giving sales guidance several months ago; now they will no longer provide monthly same store sales results.
Talk about rotation: while Wal-Mart was a monster outperformer last year and most of this year, it has been the worst performer in the Dow since the March 9th bottom.
2) Target sales up 0.3 percent on fewer markdowns, but first quarter earnings will be well above expectations.
3) Gap reported a smaller than expected decline in sales and is guiding higher;
4) JC Penney's and Kohl's raised guidance
5) Macys had a slightly bigger than expected decline in sales but is saying they will have a smaller than expected loss than expected for the quarter;
6) Aeropostale reported much better than expected sales (up 20 percent vs. 9.7 percent expected) and is guiding higher;
7) Gymboree had a smaller than expected decline and is guiding higher for the quarter;
8) TJX reported a gain in sales, better than the loss expected, and is guiding much higher.
9) BJ's Wholesale reported loss slightly greater than expected but they too are guiding much higher.