Well the US market went up with a hiss and a roar yesterday.  The S&P500 futures were up 40.1 points! This is the first 40+ point day since November when it all fell apart.  The DJIA futures were up by 359 points.  Even the FTSE managed a healthy 175.5 points. So what caused such a rapid turnaround?  My guess would be short covering.  Citi Bank revealed it had made a profit in the first two months of the year. I reckon even I could make a profit if the government gave me the money, took away all the bad assets, and said “start again”, and I would do it for a lot less than the CEO of Citi Bank.  Without being too sarky though, I would not put too much hope in a sustained rally.

In the article I wrote a few days ago “A Bounce at Last – Have we Found the Bottom?”, I gave the main resistance points for the 3 markets.  The DJIA at 7,000, the S&P500 at 800 and the FTSE at 4,000.  Once the resistance levels have been breached, and hold, then we have a rally.  On Thursday two market moving reports are out at 8:30 EST, Initial Claims (for unemployment) and Retail Sales.  It was the consumer that kept the good times going for so long, and it will be the consumer that makes the recovery sustainable.  With unemployment still rising it will be a while before the consumer feels confident in spending their meager savings.