Markets Back With A Strong Rally After Losses

What happened is that "Citigroup cooled some worries about its solvency and talk resurfaced that the SEC could reinstate a key trading rule," comments CNN. Earlier we published our take on Citigroup that it's one dollar stock will definitely keep staying in the news.

Currently at about 2:25 PM EST Dow is having in the range of 284 points up from yesterday at 6832 points and Nasdaq is up 72 points at 710.

Alfred E. Goldman, Chief Market Strategist at Wachovia Securities comments on the rally writing that the Dow and Nasdaq have reached new highs for the day at midsession as the market enjoys a powerful rally. The Dow gained as many as 333 points. The Nasdaq was up as many as 77 points. At 12:30 PM Eastern, the Dow was up 4.8%, the S&P 500 was up 5.5%, and the Nasdaq was up 6.0%.

Financials are leading the advance following reassuring words from Citigroup. The bank's chief executive reported the best quarter in progress since 2007, and shares rose 39 cents to 1.44. Bank of America was the most actively traded stock, and rose 1.02 to 4.77. The market was also enthused by comments from a key Congressman. House Financial Services Committee Chairman Barney Frank called for accounting and rules changes that could decrease market volatility and allow companies to value assets differently.

Texas Instruments rose 99 cents to 15.68. The company predicted sales that may beat analyst estimates as demand improves for wireless equipment chips. Apple gained 5.21 to 88.25 on a report that it may roll out a touch-screen netbook computer this year. Rohm & Haas advanced 3.80 to 77.80 after reaching a tentative deal to be bought by Dow Chemical. Shares of Dow were up 4 cents at 6.37. Dow component United Technologies was up 2.47 at 40.03 even as the firm announced over 11,000 job cuts worldwide. The company also lowered its sales forecast.

The NYSE was 13-1 positive on issues, over 60-1 positive on volume. The Nasdaq was 6-1 positive on issues, 19-1 positive on volume. Treasuries fell before the first of three auctions this week that will raise $63 billion. The 10-year Treasury note was down 25/32 to yield 2.95%.

S&P 500 was the best performer gaining about 5.4 percent and rising to 712.95 points.

FT writes on the market rally that "there were few concrete reasons to explain the rebound, but analysts and traders pointed to an internal staff memo circulated by the Citigroup chief executive, Vikram Pandit, claiming the bank had been profitable in the first two months of the year. Citi stock leapt more than 35 per cent on the news to $1.42.

Following this news, Ben Bernanke called for co-ordinated global action to overhaul the financial system in a speech to the Council on Foreign relations. He also repeated his view that if the banks can be stabilised, the recession should end this year."

Based on CNN and FT reports and mainly from Alfred Goldman's midday market commentray from Wachovia Securities.