After a ho-hum reaction on Tuesday to the Fed rate cut, the collective wisdom in the market went progressively bullish on Wednesday. Starting off, the overnight indexes were negative but, by Wednesday midday, the market was solidly positive and never looked back. The Dow Jones went over 11,000 easily passing right though an expected resistance point. What drove the market on Wednesday was a sense of investor well-being, a kind of complacency. The economy is soft but not collapsing.
Inflation is manageable despite rising gasoline prices.
All's right with the world. We're still in the energy camp. That's our investment focus. We think any breakout in oil stocks will lift Unocal. Marathon has already gone haywire.