The market slightly moved below the October 10th lows yesterday and appeared to be heading lower then suddenly we had a huge rally. We don't believe this is the beginning of the next big bull market. It looks like 20% of the rise was due to energy with Exxon and Chevron leading the way. However most industries participated in the excitement.
The best news was the downdraft in the beginning of the day provided opportunities to buy large liquid stocks with minimal debt requirements. Those moments will continue for awhile. Bad news will keep coming as we saw today with very weak retail sales numbers for October and Freddie Mac asking the government for another $13.8B.
We may open lower today but the market wants to ultimately move higher. We would expect investors to try to keep the rally going. Most stocks aren't going to zero (General Motors is worth zero.) but the bottoming process is taking its time. This will allow investors to keep accumulating quality stocks.
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