The Fear Trade Is in Full Retreat

Today was a great day for the stock market. Gold, bonds and the $VIX were down and stocks were way up. The S&P 500 opened higher and continued to rally throughout the day. We closed at 1,210.08 which is a gain of 2.83%, and it’s our highest close since August 3rd. The index is up more than 8% over the last three weeks.

Naturally, just after I did a post highlighting how weak Mondays have been, the market gave us a very good Monday. I’m happy to report that our Buy List was particularly strong today. The 20-stock portfolio gained 3.56% which is 73 basis points more than the rest of the market. Twelve of our 20 stocks gained more than 3% today.

Imagine if this statement turned out to be true: “The sell-off ended three weeks ago and we’ve already gained back close to 40% of what we lost.”

The financial sector was the big winner today. The Financial Sector ETF ($XLF) gained 4.15% today. The S&P 500 is now not that far from its 50-DMA (1,259) and its 200-DMA (1,283).

I also have a correction. Jos. A Bank ($JOSB) will reports its earnings later this week, not today as I originally wrote.

Posted by on August 29th, 2011 at 5:30 pm

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