Doug Short: The interim rally that began yesterday picked up steam today, assisted by 2 PM FOMC minutes, which the market saw as accommodative in removing “outdated” the 6.5 percent unemployment target for raising interest rates. The S&P 500 opened higher and traded up to a narrow mid-day range prior to release of the Fed minutes. Promptly at 2 PM the index roared higher and overcame a bit of 3 PM selling with a second advance. It closed with a 1.09% gain for the day, just fractionally off its 1.11% intraday high.
The yield on the 10-year note finished at 2.71%, up 2 bps from yesterday’s close. The interim high yield was 3.04% at the end of 2013.
Here is a snapshot of the past five sessions, which shows the downtrend from the record intraday high and subsequent two-day advance.
Here is a daily chart of the SPDR S&P 500 ETF Trust (NYSEARCA:SPY). If volume is a clue, then it appears that participation in today’s rally was limited.
The S&P 500 is now up 1.29% for 2014.