WSJ: Dow Takes Record Leap As Bailout Snaps Gloom

From The Wall Street Journal:

Last week's gloom turned into euphoria as investors sent the Dow Jones Industrial Average up 11%, the biggest one-day gain since 1933. It was the fifth-largest percentage gain ever, and it came immediately after an 18% weekly decline, the worst such drop in the Dow's 112-year history.

Stocks rallied Monday, snapping a brutal losing streak after governments around the world took action to shore up the global financial system.

History tells a mixed story of historic rallies like Monday's. Of the five past one-day gains of 10% or more, two marked the end of bear markets, in 1987 and 1933. But three -- in 1929, 1931 and 1932 -- marked only temporary respites, and were followed by further declines. Because of that, market historians were reluctant to make definitive judgments about the one-day event.

"We don't know yet whether the bear market is over, but we do know about the medium term," says Phil Roth, chief technical market analyst at Wall Street brokerage firm Miller Tabak + Co. "This is a big clean-out, so we will get some recovery here now." Story...