The market staged a nice rally today. The major averages opened slightly lower and then turned and rallied the rest of the session. All the major averages finished near their intraday trading highs. The Nasd averages were the strongest with the COMPQ and the NDX gaining 2.48% and 2.69% respectively. The SPX gained 1.76%. Volume was lower across the board, not what you want to see on a rally day. Leading stocks participated in the rally with the leaders index gaining 2.65% on the day. The index closed high in its trading range on lower but well above average volume. The market rallied today as the banking issues seem to be easing. The Swiss central bank will backstop Credit Suisse and First Republic got a cash infusion from a group of American banks. The COMPQ rose above its moving averages, while the New York averages remain below these resistance levels. The lower volume was the real concern today as it showed less buying pressure from large institutional players. This continued the recent pattern of declines on higher volume and rallies on lower volume. This is not a good volume signature. The market is trying to stage a rally now after recent weakness and there are some encouraging signs, but a lot more is needed to get much more bullish. The banking issues seem to be receding a bit and as long as no more banks get into trouble the worst of it may be behind us. We are set up for a follow through if there is a big enough gain on higher volume, but if one comes we will have to see how well confirmed it is. Jerry
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