It’s not like the news was suddenly that much better. In fact, I would argue that the news wasn’t all that great yesterday, but the rally marched onward. The Weekly Jobless Claims fell to 454,000 from 475,000, but there may be seasonal adjustments related to the auto mfgrs. not doing their usual 2-week layoffs this year. Overall, jobs aren’t the issue. We all know the data are worse than are being reported. June retail same-store sales were a mixed bag, with some companies offering guidance that only moved the company view to where the street already was. I would note that yesterday’s rally was mainly in the groups that lagged or missed out on the prior day’s strength. The Semis, Retail, and Banks were the heart and soul of Wednesday’s explosive rally. However, yesterday was Household Products, Food & Tobacco, Materials, Capital Goods, and Energy. If this were a “flight to safety” move, then we would have expected strength in the Dollar and in bonds, neither of which occurred. Therefore, this looked more like an evening out of the market rally to bring the laggards back in line with the idea that the bad news is already baked in the cake and that there is more room for the bulls to run, if properly prodded by earnings. The rally over the past two days was “the easy stuff”. 1040 was resistance, but not really overhead supply. That pretty much comes into play right here at 1070. The key resistance is the 200-day moving average at 1111, and we’ll need help from earnings to challenge that level.