STOCK INDEXES BREAK DAILY DOWNTREND

Stocks turned in a strong performance Thursday. The three major stock indexes shown below closed back over their 50-day moving averages. The S&P 500 (Chart 2) and the Nasdaq Composite (Chart 3) did so for the first time since early May. Another positive sign is the ability of all three indexes to close above the down trendline drawn over their April/June highs. The next hurdle to overcome is their July highs and 200-day moving averages. The short-term stock picture does appear to have improved with the growing possibility of a rebound to the mid-June peak. The rally in stocks was supported by a rally in most commodities, most notably copper prices which hit a three-month high.