The S&P 500 and the Dow Industrials have risen toward their 2009 highs following a worldwide rally in stocks. The falling dollar rising commodity trade is back and gold futures hit new all-time highs near $1,200 an ounce. Concerns are cooling fast on last week's Dubai World news, which fueled big gains overseas. Positive economic data here in the U.S. is adding to the bullish tone.

Asian markets were higher with the Japanese NIKKEI out performing. Investors were reacting to news that the Bank of Japan would launch their own "quantitative easing" program with a new plan to pump 10 trillion yen ($115 billion) into the system. The NIKKEI closed up 2.4%. In China investors were buying stocks on news that the Chinese manufacturing sector's growth was hitting five-year highs. The Shanghai index gained 1.25%. The Hong Kong Hang Seng rose 1.34%.

European markets produced their biggest one-day bounce in months. European banks held the lion's shares of Dubai World debt. It's not a surprise that the banking system saw a big bounce on news that Dubai was restructuring $26 billion of its $60 billion in liabilities. Commodities also led stocks higher thanks to a falling dollar. The English FTSE rose 2.34%. The French CAC-40 climbed 2.60%. The German DAX rallied 2.68%.

Here at home in the U.S. investors were digesting the national ISM data, which showed the manufacturing sector grew for the fourth month in a row. Economists were expecting the ISM data to come in at 55.0. This morning the Institute for Supply Management sais manufacturing activity fell from 55.7 in October to 53.6 in November. While not as strong as expected numbers above 50.0 indicate growth. Inside the headline numbers investors were happy to see improvement in the new orders and employment gauges.

In Chicago the National Association of Realtors announced that pending home sales in October surged to their highest reading since March 2006. Economists were expecting a 0.8% decline following a 6% rally in September. Markets were surprised to see the seasonally adjusted pace of pending sales rose 3.7% to 114.1 in October. Unfortunately these numbers are still skewed by the rush of home buyers trying to close a deal before the new home buyer tax credit was set to expire in November. In other news the Commerce Department said construction spending rose 0.04% in October from a downwardly revised September. The October gain was better than expected but the construction numbers are constantly being revised.

Retail stocks are in rally mode as investors react to positive expectations for improvement over last year. Just yesterday the National Retail Federation had some sobering comments with their forecast for a 1% decline in holiday sales. Today there were conflicting estimates for a 3-4% improvement over last year, which happened to be the worst year on record (since 2000). We will hear several retailers release their November same-store sales figures in the next 48 hours. Currently the RLX retail index is up 2.1% and poised to breakout over resistance.

Chart of the RLX retail index:

Commodities were back in the headlines this morning with the dollar sliding toward its 2009 lows. Oil was up 1.7% near $78.65 a barrel. Silver, platinum, and copper were all hitting new relative highs. While gold futures hit new all-time highs at $1,201.63 an ounce last night. At the moment gold is up about $17 near $1,199.

Currently the S&P 500 index and the Dow Industrials are inching closer to their 2009 highs. The NASDAQ and Russell 2000 are still lagging but they're seeing decent gains with both up more than 1.6%. The transportation index is up 1.6% and back to the 4,000 level. The SOX semiconductor index is showing lots of strength with a 3.0% rally and a breakout over its 50-dma.

Chart of the S&P 500: Chart of the S&P 500:

Chart of the NASDAQ:

Chart of the Dow Industrials:

Chart of the Russell 2000 index:

A quick scan of the play list reveals FDX hitting new 2009 highs this morning and our trigger to buy calls. The GLD is hitting new highs near $118. NSC is about to breakout to new highs with a 2.2% gain today. Drug maker VRTX is soaring 3.5% and breaking out past $40.00. VRTX is about to hit our trigger to buy calls at $40.25. With stocks in rally mode our put plays are not looking so hot. FISV is up 2.5%. The IBB has broken through its trendline of resistance and readers may want to exit any put positions. It is interesting to note that GMCR and GS are still under performing the market.