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Trading curbs in after Dow jumps 150 points

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The major indexes are holding near their session highs with the Dow Industrials (INDU) 8,458 +1.8% holding a 152-point gain and just off its session high of 8,470.98. The more than 150-point gain as trading curbs in place and it would take a Dow decline back to 8,381.35 for today's curbs to be lifted.

Sector action remains broadly positive, with earlier weakness in the Gold/Silver Index (XAU.X) 65.36 -0.25% starting to abate after the group reached a session low of 65.02, while the Oil Service Index (OSX.X) 85.85 -0.93% has seen an early morning gain drift red as crude oil futures fall to monthly lows. June Light, Sweet Crude futures (cl03m) $25.63 -2.39 are off $0.63 and move below its March 21 relative low of $25.75, as the shorter-term 21-day SMA at $27.40 now threatens to break below the rounding flat and longer-term 200-day SMA of $27.43.

The broader S&P 500 Index (SPX.X) 913.53 +1.63% is just off its morning highs of 915.96. The morning high fell just short of the SPX's WEEKLY R1 of 916.80, and shows the Dow Industrials the only index within our nightly Index Trader Wraps at OptionInvestor.com to move above this WEEK's R1.

Both the S&P 500 (SPX.X) and S&P 100 Index (OEX.X) 464.17 +1.74% gains are being boosted by financials with the Insurance Index (IUX.X) 257.50 +2.30% looking to rebound from a two-day pullback after reaching a 3-month high on Wednesday. Despite a Wall Street settlement among major investment banks where investment banks are expected to settle a 1.4% civil lawsuit brought against them by the SEC, the KBW Bank Index (BKX.X) 787.76 +1.44% posts gains. Major names in the suit have Dow components Citigroup (NYSE:C) $39.02 +1.48% and JP Morgan (NYSE:JPM) $28.59 +2.25% just off their session highs. Merrill Lynch, also names as one of the major "wrongdoers," which is not a component of the BKX.X, but a member of the Securities Broker Dealer Index (XBD.X) 428 +1% shows a fractional $0.16 gain at $40.50.

The tech-heavy NASDAQ-100 Index (NDX.X) 1,105 +2% leads major index gainers with sector strength from the Networking Index (NWX.X) 157.35 +2.78%, Semiconductor Index (SOX.X) 157 +2.73% and Biotechnology (BTK.X) 2.10%.

Most actives at this hour have Cisco Systems (NASDAQ:CSCO) $15.02 +4.8% trading just over 54 million shares. Today's trade at $15.00 generates a double-top buy signal on the point and figure chart, and negates a prior bearish vertical count of $10. After testing its bullish support trend, the vertical count now turns bullish to $20.50. From previous bearish profile for 1/2 positions, I would look to hedge or close out positions at this profiled stop of $15.00 as the NASDAQ-100 Bullish % ($BPNDX) continues to show internal strength.

Other most actives have Microsoft (NASDAQ:MSFT) $25.78 +2.26% trading just over 35 million shares and giving a boost to the GSTI Software Index (GSO.X) 109.85 +1.6%, while Intel (NASDAQ:INTC) $18.73 +2.4% trades just over 31.8 million shares.

Treasuries have been either side of unchanged levels, starting the morning out higher, then reversing back to declines. Current trade has Treasuries relatively unchanged with the 10-year YIELD ($TNX.X) fractionally higher at 3.890%, with a session YIELD range of 3.852%-3.914%.

Jeff Bailey

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