For more on this skepticism please see:
For today's early rally:
"Stocks held gains Tuesday, with the S&P and Nasdaq crossing above key levels, amid ongoing optimism the ECB will act soon to ease the euro zone crisis."
"Most S&P sectors were trading in positive territory, led by energy and financials, while defensive sectors such as utilities and telecoms were in the red."
“We’ve got the carryover from the non-farm payroll and Europe down the road will see the ECB do something,” said Ira Epstein, managing director at the Linn Group. “However, we’re in the dog days of the summer and volume is light as can be…I think the expectations [for Fed action] are built in and you’re now starting to anticipate the presidential election. I think we’re starting to prepare for that bump.”
"Investors remained optimistic following ECB President Mario Draghi's comments last week in support of a bond-buying program to help lower borrowing costs in Spain and Italy. (Read More: Italy Recession Deepens, Adding to Monti's Problems)"
"German industrial orders fell more than expected in June, further supporting idea of more action from the ECB."
One question about the better than expected payroll numbers, Friday, is does it make it more unlikely that the Fed will act? No at least according Boston Fed President, Eric Rosengren:
"Meanwhile, Boston Fed President Eric Rosengren reiterated his call for the central bank to expand monetary policy and called for more quantitative easing. Rosengren also added he did not expect the economy to improve in the second half of the year and called for another bond buying program."
Right now I want to believe that the markets are a forward indicator. At least in the start of the bear market in 2007 and it's end in 2009, they were. The rising markets also bode well for President Obama.