After taking a severe beating last week — in fact, the worst five-day session so far this year — the Dow Jones Industrials (INDEX: ^DJI) stormed back, finishing up 1.1%. The other two major indices even outperformed the Dow, with the S&P 500 finishing up 1.6% and the Nasdaq pulverising the market with a 2.5% gain. Also turning in a strong rally was the United States mid-continent oil benchmark, WTI oil futures, up 1.5%.
Today’s strong performance can be chalked up in part to encouraging dialogue among world leaders and reassuring support of eurozone stabilisation. The G-8 meeting taking place over the weekend reaffirmed those nations’ wishes to keep Greece in the eurozone, affirming that they maintained their support for the country, which will once again try to elect a political majority next month.
Also helping support the markets today was China’s reassurance that it’s determined to maintain economic expansion, possibly indicating that it could use fiscal measures as a way to add some fuel to its already growing industries. This news is a mixed bag, though, because although the promise to grow could encourage investment, extra investment doesn’t mean the outcome will lead to a stronger economy.
Today could also be partially a result of investors’ discovery of deals in what they consider oversold markets, with energy and technology witnessing an extended buying session. Google finished the day up 2.3%, with news that the giant plans on closing its US$12.5 billion purchase of Motorola Mobility Holdings (NYSE: MMI) by midweek. Google will possess more than 17,000 patents through this acquisition, giving it more firepower to contend with Apple (Nasdaq: AAPL) and Microsoft.
The entire energy industry seemed to enjoy the day, with the encouraging news of euro stabilisation and GDP growth. Chevron (NYSE: CVX) up 1.4%, further improved its liquefied natural gas business, announcing its Australian subsidiaries have an agreement with Tohoku Electric Power to deliver LNG to the island continent. Chevron is in a strong position, with an immense spread between cheap natural gas prices in Australia and expensive prices in Japan.
The broad markets had an exceptional day, outside of Facebook (Nasdaq: FB), whose second day was far from stellar, but I wouldn’t expect this to start a significant bull market. Today was sort of a reprieve from eurozone troubles, which will be increasingly disruptive as the next Greece election nears. Today really did seem more of a quick opportunity to buy oversold stocks for short-term-minded investors.
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A version of this article, written by Joel South, originally appeared on fool.com