S&P 500 Recap and A Look Inside the Markets

Hopes that Greece will get a second bailout boosted market sentiment around the world on Friday, a day after stocks and the euro plunged on fears over the pace of the global economic recovery.

Stocks, particularly in Europe, have recovered a large chunk of the losses posted on Thursday after EU leaders backed another bailout for Greece should the Parliament there approve euro28 billion in austerity measures in a vote next week.Japan's Nikkei 225 was 0.9 percent higher to close at 9,678.71, while South Korea's Kospi rose 1.7 percent to 2,090.81.

Hong Kong's Hang Seng added 1.9 percent at 22,171.95, with banking shares getting a boost after Chinese Premier Wen Jiabao wrote a newspaper commentary indicating China is getting its inflation problem under control.

Mainland Chinese shares also gained on Wen's comments. The Shanghai Composite Index rose 2.2 percent, the biggest gain in four months, to 2,746.21, while the Shenzhen Composite Index gained 2.3 percent to 1,136.39.

S&P futures are up three points this morning with the following reports pending

08:30 GDP – Third Estimate

08:30 GDP Deflator – Third Estimate

08:30 Durable Orders

08:30 Durable Orders –ex Transportation

German Retail Sales

08:00 German IFO – BusinessClimate, Current Assessment, Expectations

Thursday's session opened sharply lower, bounced several points around 10:00 am, then continued lower to put the low of the day on the chart just before 11:00 am. Breaking to new intraday lows after the first hour had the look and feel of a dismal trend day in the works. But the SPX began to claw back, in fits and starts. About 1:30 pm a dozen points had been recovered and then it looked like the index was going to rollover. Eight points were lost before news arrived of a new, latest and greatest Greece austerity plan. For whatever reason, traders loved what they saw in the news and the index rocketed skyward ten points in four minutes and then tacked on five more before the close. This was a powerful reversal day but the seeds were planted early in the session as technology and SOX were strong throughout the morning.

For the SPX Index there were 184 components advancing and 291 components declining. On the NYSE 3,153 issues were traded with 1,279 advancing issues and 1,761 retreating issues, a ratio of 1.38 to one declining. There were 28 new highs and 49 new lows. The five day moving average of New Highs is 44 while the five day moving average of New Lows is 40 and the ten day moving average of Net Advancing is 42.

 Thursday’s volume far exceeded Wednesday's volume. Late in the session the volume exploded upward along with the index. The MO and MSI look much more bullish tonight than might be expected after a session that the SPX lost almost four points.

This is nothing more than a short covering rally in the hope of the bailout for Europe and you know if Greece gets bailed out then help will be given to the other nations that make up the PIIGS. This is a form of QE, and will certainly add to inflation. The problem is that as the EUR portion of the EUR/USD weakness the dollar will strengthen keeping a lid on any rallies.