Can someone explain why the stock market went up yesterday?

[Stuart G]

I haven't got a clue.

[NashVegas]

1. Job Reductions = Temporary Improved Profits

And these people only look at the short term.

[Jawja]

2. You are incorrect.

Some of "these people" are in for the long term with IRAs, 401(k)s and other vehicles for retirement savings.

Those of us looking at the long term are trying to ride this thing out without losing our shirts. Not all of "these people" are greedy bastards. Some of us are trying to retire and are watching our savings slowly disappear because if we get out now, we will have lost a lot; if we keep our holdings, we might lose it all or we might recover what we've lost.

on edit: and some of us did not have a lot to lose to begin with.

[NashVegas]

7. You Made a Point Of Buying Stock Yesterday?

If that's the case, perhaps you can offer your own reasoning instead of attacking mine.

[Jawja]

15. I did not buy stock yesterday.

But not everyone who did buy stock yesterday is doing it for profits in the short term as you said. Some people with IRAs bought stocks yesterday at lowered prices in an attempt to recoup their earlier losses.

That's what I am saying. Not everyone is in the market for profit; some of us folks are in the market investing for retirement.

I am not attacking your point. I am merely pointing out that your statement about people who bought stock yesterday is not entirely accurate.

[bentley]

3. Interest rate cut .

I think because interest rates will be cut to a lower rate, when the Fed meets on 12/16/08. Lower gas prices also acts as a stimulus, meaning more dollars will be spend for x-mas. I think it might be wishful thinking that we will spend more, it seems most still don't have the extra cash and are worried about their future. The reality is the job loss #'s are much higher, and when they adjust them in two months it could be closer to 700,000. IMO - This is a short term rally. As long as we keep our wallet closed, it will continue to spiral downward.

[HamdenRice]

4. Short sellers have to close out their positions

There is a lot of speculative short selling in the market. After a gigantic drop, short sellers close out their positions, which actually brings the prices up a bit.

[ThomWV]

5. Chrysler/Ford/GM returned to Congress and it became apprent that we will give loans to Detroit.

[rucky]

6. Because investors don't know what the hell they're doing.

There's no conventional strategy to account for this environment, so they're just churning the market.

[ThomWV]

9. My son and I bought stocks yesterday and we knew exactly what we were doing

The world is not coming to an end and there will be a tomorrow.

[ThomWV]

10. My son and I bought stocks yesterday and we knew exactly what we were doing

The world is not coming to an end and there will be a tomorrow.

[rucky]

14. I'm not saying people aren't buying or selling.

You have your own system, depending on how bullish or bearish you're feeling. But there's no conventional wisdom on the matter - just individual perceptions.

[RB TexLa]

8. Energy prices went down, causing people to believe there will be more money

for people to spend on other things. So retail stocks go up then banking stocks go up.

[BelgianMadCow]

11. Chec out the SMW thread. The official reason will make you queasy

Namely: the non-farming payroll decline, which was almost double the expectation, was so bad that investors deemed the chance of more government bailout / rescue packages to become bigger. And that's why it went up.
:crazy:

[robcon]

12. The question is bogus, IMO.

Claiming to know why the stock market goes one way or the other day-to-day is nonsense.

[marketcrazy1]

13. yesterday afternoon

the FED began buying agency paper, 5 billion dollars worth, the FED also appears to have embarked on a policy of quantitative easing ( buy Treasury notes on the open market ) and the Chinese blew into town, perhaps to to discuss how they will go about the financing of our debt going forward. there are MANY reasons the market is so volatile ( moving suddenly and dramatically up or down ) and none of these moves are based on market fundamentals!

[bentley]

16. It seems we all have different reasons why the market went up yesterday.

You are right - it's pure speculation.
The market is the biggest casino and it's a minus sum game.
Knowledge helps in making decisions and navigating the market, also understanding human behavior is very important. Understanding the game and who the players are, will likely lead to profits instead of losses.