What moves the stock market?

I don’t know what news people are seeing that encourages them to buy stocks.  I meant to post this last night but didn’t get the time, so here goes.

The DJIA went up over 500 points yesterday and I’ll be damned if I can figure out why.  I kept an eye on the news headlines during the day, and here’s what they looked like at 2:45pm ET – just before the market skyrocketed into the close.  Here are the top headlines on MarketWatch.com as displayed by my “My Yahoo” page yesterday:

· Intel, H-P, Dell lead tech-sector losses – 14 minutes ago

· Citigroup looks for a new fall guy – 14 minutes ago

· Economic clouds could thwart some Obama energy promises – 14 minutes ago

· Energy stocks flirt with gains in volatile session – 14 minutes ago

· Chrysler’s survival difficult without government aid: CEO – 14 minutes ago

· GE shares fall back to 1996 levels on financing-cost concerns – 14 minutes ago

· U.S. stocks bounce back some after hitting new lows – 14 minutes ago

· Shares of Citigroup, Bank of America sink to decade-plus lows – 14 minutes ago

· Treasurys steady after 30-year bond auction – 14 minutes ago

· Gold dips below $700 as traders take more money off the table – 14 minutes ago

And here’s what the topr Reuters Business news were at the same time:

Jobless claims hit 25-year high, imports plunge – 1 hour ago

    • The number of U.S. workers drawing jobless benefits hit a 25-year high this month and imports suffered a record fall in September, according to reports on Thursday that underscored a rapid drop-off in…

      · Stocks cut losses; energy offsets tech drag – 36 minutes ago

      Stocks cut losses on Thursday, sending the Dow and S&P 500 back briefly into positive territory, as investors scoured the market for beaten-down shares, including those of energy companies, offsetting…

      · Top hedge funds see more rules ahead for industry – 53 minutes ago

      Some of the world’s richest and most powerful hedge fund managers told U.S. lawmakers on Thursday that they support greater transparency for the secretive industry, but offered divergent views on …

      · GE shares tumble, company confirms 2009 dividend – 1 hour ago

      General Electric Co (GE.N) confirmed on Thursday it plans to pay a dividend through the end of 2009, but shares of the U.S. conglomerate remained down sharply.

      · Goldman suspends GM rating, Chrysler urges aid – 53 minutes ago

      Goldman Sachs suspended its rating on General Motors Corp on Thursday and said the automaker needs at least $22 billion in federal aid, while Chrysler said it would be “very difficult to survive&…

      · RIM co-CEO says market environment is “intense” – 50 minutes ago

      The current market environment is rife with challenges and requires careful planning of strategy, the co-CEO of Research In Motion (RIM.TO)(RIMM.O) said on Thursday as an analyst warned that sales of …

      · Citigroup board says supports its chairman – 39 minutes ago

      Citigroup Inc’s (C.N) board of directors said it supports its chairman and a newspaper report that said it was considering replacing him was “completely erroneous.”

      · Oil rises 4 percent on OPEC, equity market rebound – 9 minutes ago

      Oil jumped over 4 percent on Thursday as OPEC seemed poised to cut production again later this month and equity markets rebounded.

      · Lawmakers challenge big banks on bailout funds – 36 minutes ago

      Senators asked the nation’s biggest banks on Thursday to explain how they are using the billions of taxpayer dollars provided to them under a massive government bailout program. The answers were m…

      · Qualcomm halts UMB project, sees no major job cuts – 11 minutes ago

      Qualcomm Inc (QCOM.O), seeking to cut costs in the face of slowing demand for cell phones, has stopped developing a next-generation wireless technology called Ultra Mobile Broadband and is making smal…

There’s not a single bit of good news hitting the wires, but yet the market reverses course and ends up almost 1000 points higher than the low for the day.  Makes no sense to me, but I don’t see anyway investors can continue to ignore the news that says earnings are falling dramatically.  At some point the “P” needs to adjust to the dramatic drop we’re seeing in the “E” in order to bring the Price/Earnings ratio back in line.


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