The real story, however, was the resilience of the equity market in the face of what seemed to be some significant selling pressure. From where the selling pressure came from was not clear but it was evident on Thursday that stocks were very uncomfortable as yields on Treasuries moved higher in the overnight and pre market session. Also a concern seemed to be who might succeed Ben Bernanke as the next Fed chairman. Larry Summers apparently is looked upon as a more hawkish selection that the Obama administration is considering. Nevertheless, stocks came back both on Thursday and Friday from significant deficits.
No index better represents the strength I alluded to above than the S&P 500 Index ($SPX). Below is a six month daily chart of $SPX: