Stocks bounced back from Thursday's loss to put the S&P 500 (^INX) back up to yet a new record at 1667.
While the major indices were only up modestly throughout the day, we saw a big acceleration in the last hour of trading, with the star of the day being the the small-cap Russell 2000 (INDEXRUSSELL:RUT), which nearly pierced the widely watched 1000 level. Additionally, US Treasuries pulled back following yesterday's pop, implying that there is still a possible rotation trade from bonds to stocks, which may be contributing to the market's astounding momentum in 2013.
[More from Minyanville.com: Commodity Volatility Drives a Downright Weird Day ]
In fact, according to Minyanville's technical analysis maven Jeff Cooper, the Dow Jones Industrial Average's (INDEXDJX:.DJI) current run is the longest one without a three-day pullback in over a hundred years.
Today's positive action was likely boosted by two pieces of economic data. The May University of Michigan Sentiment Survey came in at 83.7, which was ahead of the 77.9 consensus. And within that report, expectations regarding the economic conditions and outlook showed marked improvement.
However, it is worth noting that stocks and consumer sentiment readings tend to have a positive correlation, so if sentiment is peaking, stocks could be as well. This, of course, must be tempered with the aforementioned momentum, as we've seen stocks blow right through bad numbers this year, with just one example being the lackluster jobs numbers reported on April 5 .
And speaking of bad data, the market wasn't exactly set up for great things ahead of today's solid economic numbers, as we saw some pretty poor earnings numbers yesterday afternoon from Nordstrom (JWN), Autodesk (ADSK), and JC Penney (JCP).
Tomorrow's Financial Outlook
Looking forward to next week, the economic calendar is empty until May 22 , when we'll see the April Existing Home Sales numbers, not to mention FOMC minutes and testimony from Fed Chairman Ben Bernanke.
Until then, we should see some serious debate about the rumored tapering of the Fed's QE adventures, and whether the issue will be addressed on Wednesday . Additionally, the Fed has publicly expressed an increasing concern over asset bubbles this year, which some are regarding as a significant departure from the Fed's normal focus on its dual mandate of price stability and employment maximization.
As for the near-term outlook for equities, that's increasingly tough to gauge, and it is perhaps even fruitless to try, given that momentum has taken over, and it's incredibly tough to determine when it will end.
But whether this is the top or not, we're certainly going to have an interesting ride.