Stocks were obviously in the mood to rally today since shares prices shot higher post-Fed despite the fact that the revered cabal gave no hint to a proximate rate cut. As expected, there was no change in Fed policy or language. Stocks donned their anti-gravity boots and sent the S&P 500 to a new multi-year high before settling for a close a few points lower. The NDX did not come close to a new high, but certainly busted some bearish hopes by decisively regaining its moving average.
The action in stocks has been deceptive of late for both bulls and bears, which is why my positions have been relatively light. While I have taken a couple of stabs at catching a swoon by selling NDX futures, I have been quick to cover them in this environment. There will be no shortage of pickings on the short side when the time is right. Home builders popped a juicy 3.6% and momo favorite, Research in Motion, tacked on about four bucks, for two examples.
Interestingly, mining shares rose right along with the general market today, so the mantra was pretty much "buy everything." In other words, the buying spree was not a reaction to anything in the FOMC release, but rather a relief of buying pressure that was stifled prior to the announcement. Precious metals, themselves, popped to new 2007 highs. In fact, spot gold achieved its highest close since July. The metals are looking quite attractive, and I sense we could see a $1 day for silver quite soon.
Glancing at the screens as I wrap up this post, I see that Google is getting hit for about 3% which is surprising since they tried to set the bar low coming into earnings. It will be interesting to see if this reaction carries over into morning and what kind of effect it may have on tomorrow's session. I'm off to read what they had to say.