"Well, well, well ... the bulls came back with a vengeance today," chuckled Schaeffer's Senior Technical Strategist Ryan Detrick, CMT, of a day which saw the Dow Jones Industrial Average (DJI) gain 323 points and retake the 15,000 level. "All it took was some hope that a short-term debt limit increase could be in the cards to allow more time to work through budget negotiations (which, incidentally, they've had two years to work on). Nonetheless, the market took this as great news. Sure, the government is closed, but that was never really the issue. The big concern the whole time has been the debt ceiling. The market hates uncertainty, and this 'kick the can' approach has removed some of that."
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The Dow Jones Industrial Average (DJI - 15,126.07) popped higher out of the gate and continued to gain ground all the way through the closing bell, where it settled at its intraday high. The blue-chip index added 323.1 points, or 2.2%, and moved back above the 15,000 mark following three consecutive closes below this key level. All 30 Dow names closed in the black, but Boeing (NYSE:BA) was the top performer, rallying 3.9% on the day. At the back of the pack was Chevron (NYSE:CVX), which logged a modest gain of 0.2%.
The S&P 500 Index (SPX - 1,692.56) also finished at its intraday high-water mark, adding 36.2 points, or 2.2%, to retake its 80-day moving average. The Nasdaq Composite (COMP - 3,760.75) ended the session just shy of its respective intraday peak, but still posted a gain of 83 points, or 2.3%.
Conversely, the CBOE Market Volatility Index (VIX - 16.48) tumbled sharply at the outset, closing with a loss of 3.1 points, or 15.9%. The market's fear gauge is solidly below its 10-day moving average for the first time since Sept. 20.
A Trader's Take:
"As dour as things looked these last few days, just like that ... the S&P 500 Index (SPX) has a real shot at closing in the black for the week," noted Detrick. "Now one thing to remember is that big up days historically happen in bear markets, so that is something to think about here. Any bad news tomorrow could change everything, and in a hurry, so be on your toes as we head into the weekend."
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