Last week I noted that there wasn’t much new to say about the stock market and its drivers lately, but like washing your car tends to attract rain, my comments were immediately followed by anger-driven election results in France and Greece. Both of these elections were about a rejection of austerity mandates placed upon a citizenry already feeling severe pain. The thought process is, “If the U.S.

Have you noticed that there hasn’t been much new to say about the stock market and its drivers lately? Bears are weary from calling tops that don’t follow through, and bulls are hesitant to inject more cash until they have a more inspiring catalyst. So, we’re pretty much left to wonder whether the overworked mantra “Sell in May and go away” will be a self-fulfilling prophecy…or a contrarian catalyst for the bulls to get busy again.

Apple. Need I say more?

For the first time in the 98-year history of the Federal Reserve, its chairman held a news conference after its FOMC policy meeting. So, what was the big news? QE2 will end in June as planned, but as I speculated last week, they will keep the balance sheet steady by continuing to reinvest maturing assets into the debt markets. They will also keep the Fed Feds Rate in the 0.00-0.25% range. Both of these are stimulative to the economy.

In my weekend analysis, I talked about the possibility of a bullish reverse head-and-shoulders formation for the stock market. And after allowing for a brief panic on Monday, the market has been quite strong this week and appears to be confirming the bullish pattern.

Last week I mentioned that a pullback was due, and indeed we’ve seen some market weakness this week. The 50-day simple moving average is trying to support the large, mid, and small caps at this point, but the Dow Industrials and MSCI Emerging Markets are holding up better as they are supported by their 20-day. Among the major sectors, Healthcare has actually displayed strength this week despite overall market weakness.

Although trading volume remains anemic, with NYSE volume below 900 million today, equity bulls continue to run the show as the global “wall of worry” seems to suit them just fine, thank you.

Bulls continue to shake off global challenges to keep the market in rally mode heading into the end of the first quarter, led by powerhouse sectors Basic Materials and Energy as well as Healthcare and upstart Telecom. In fact, the S&P 500 is on track to achieve its largest first quarter return since 1998. The SPY closed today at 132.77, up 5.6% on the quarter with one more trading day to go.

Market bulls found support at the right time and pulled another rabbit out of their hat. It’s good to have friends in high places, as the Fed’s POMO money continues to flow, including another $6+ billion today for the purchase of Treasuries (which tends to find its way into equities). Last Wednesday, I suggested that the extreme weakness might have been a selling climax, and it turns out that is was – at least for the short term.