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Friday, June 11, 2010

Chinese Bulls Lead The Charge >>> Dow Soars 2.76%

Cocktail Data Elevated The Dow Above 10,000
Inspired by a one-two punch of bullish export data in China and a big rally for the euro, the Dow surged 273 points and recaptured the 10000 mark on Thursday as Wall Street cheered signs the global recovery may not be falling apart after all.
Much of the credit for the huge rally has to go to China, which reported a stronger-than-expected surge in May exports, allaying fears of a double-dip recession for a nation looked at as the global economic engine.
The bullish stars finally seemed to align today, with upbeat economic data – both domestic and from overseas – forming a potent cocktail of optimism. On the home front, the Labor Department said first-time jobless claims fell by 3,000 last week, with total claims depleting by the heftiest margin in nearly a year.
Elsewhere, optimists across the globe cheered China's solid surge in monthly exports, which also lent strength to the ailing euro – the currency of the Asian giant's most notable export recipient. What's more, even beleaguered black-gold giant BP plc (BP) managed to pare a portion of its recent slide today, rebounding from Wednesday's 14-year nadir.
"The bulls were encouraged by the Dow's retake of 10,000 and the important hold of support at 1,050 for the S&P 500 Index," note a Wall St senior analyst.
"In fact, the major market indexes finished at session highs, reversing the recent trend of buckling in the last hour of trading."

In the third-best session of the year, the Dow Jones Industrial Average (DJIA – 10,172.53) added an impressive 273.3 points, or 2.8%, by the closing bell. Cisco Systems was the only blue chip to buck the trend, with Caterpillar and American Express pacing the 29 advancing equities. Thanks to today's triple-digit surge, the Dow not only reclaimed a foothold atop the psychologically critical 10,000 level, but also finished the session north of its 20-day moving average for the first time in more than a month.

The S&P 500 Index (SPX – 1,086.84) also climbed until the closing bell, advancing 31.2 points, or 3%. However, the broad-market barometer failed to surpass its own 20-day trendline, which hasn't been breached on a daily closing basis since May 3.
Finally, the Nasdaq Composite (COMP – 2,218.71) followed suit, finishing with a gain of 59.9 points, or 2.8%. What's more, the tech-rich index barreled its way back atop the 2,200 level, but couldn't surmount its 10-day moving average, which is lingering in the 2,220 neighborhood.
Crude futures finished at a four-week peak today, as the commodity followed the broader equities market higher. Boosting black gold was the dollar's pullback against the euro, which staged a rebound amid encouraging export data from China and European Central Bank President Jean-Claude Trichet's vow to maintain bond-buying efforts to lift liquidity. Against this backdrop, crude oil for July delivery advanced $1.10, or 1.5%, to settle at $75.48 per barrel.

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