Why the Dow Popped

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Markets surged today on initial claims data that was worse than expected and consumer prices that dropped the most in three years. Wait, what? Yes, bad news for the economy is good news for investors, as it looks like the Federal Reserve hand will be forced into starting another round of quantitative easing.

This comes amid reports that the global central banks are preparing a coordinated action should Sunday's Greek elections spook investors. Whether this planned stabilization is necessary remains to be seen, but a new round of quantitative easing would fuel another leap forward for stocks. While eurozone uncertainty has sent some investors to the sidelines, those who have stayed invested during this depressing news cycle may reap the most benefits, assuming world leaders don't stubbornly continue on the same failed path.

That said, let's take a closer look at how the three major indexes are fared and a couple of stocks making headlines.

Index

Gain / Loss

Gain / Loss %

Ending Value

Dow Jones Industrial Average (INDEX: ^DJI) 155.531.24%12,651.91
Nasdaq (INDEX: ^IXIC) 17.720.63%2,836.33
S&P 500 (INDEX: ^GSPC) 14.221.08%1,329.10

Source: Yahoo! Finance.

There were strong performances across the board, as both the Dow and S&P 500 both gained more than 1%. The best-performing sector, by a nose, was financials, and the Direxion Daily Financial Bull 3X Shares (NYS: FAS) jumped 3.6% correspondingly. Finally, the market's "fear index," the VIX (INDEX: ^VIX) , plunged 10% today, its largest move of the month. However, if the Greek elections go poorly, volatility could be set to return in a big way.

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At the time this article was published Fool contributorDavid Williamsonholds no position in any company mentioned. Check out hisholdings and a short bio. The Motley Fool has adisclosure policy. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.

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