G-20 Relief

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It was a rally right from the start after yesterday’s opening with the S&P; 500 heading straight for the 1,200 level.

Support came from the G-20 meeting, which ended as all of those types of meetings end: long on talk, but short on results. I guess the positive twist was that nothing was really decided other than a call for more sustainable current-account deficits. That sent the dollar south but helped metals, gold and crude oil move higher.

After an initial jump, the major indexes slowly retreated for the remainder of the session, but managed to close up. It seemed like every attempt to higher levels was met with selling, which may have been a case of computer-generated trading as we were approaching the 1,200 milestone.

Existing home sales came in better than expected, although the median price was down from a year ago. Distressed sales, either via foreclosed homes or short sales, made up 35% of the market.

Bank stocks continued to weaken because of the continuing saga involving errors and omissions in the foreclosure paperwork. The Fed announced that it is investigating foreclosure practices, which means this ordeal is far from being over. If surprises are uncovered, there is bound to be some effect on stock market direction.

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