FED COMMENTS AND GDP

Federal Reserve policymakers said at the end of a two-day meeting Wednesday that while the economy is still receding, the pace of decline "appears to be somewhat slower" than the last time they met in mid-March.

NEW YORK – The Fed confirmed what Wall Street has already concluded: The recession is starting to ease.

Gross domestic product contracted at an annual rate of 6.1 percent, much steeper than the 5 percent forecast by economists polled by Thomson Reuters.

Investors were encourage by a rebound in consumer spending (loss of 6M jobs really?), which accounts for more than two-thirds of U.S. economic activity, and a drop in business inventories. (BIZ adds inv when possitive about economy)

"BETTER THAN EXPECTED"
Better-than-expected earnings have been boosting the market as well. Media conglomerate Time Warner Inc. said its first-quarter profit fell 14 percent on deteriorating ad sales, but the results were better than expected.

Meanwhile, Citigroup, which has also received large amounts of federal aid, is trying to figure out how to retain workers. Citigroup CEO Vikram Pandit has talked with Treasury Secretary Timothy Geithner about the possibility of paying special bonuses to keep demoralized workers from getting scooped up by competitors, a person familiar with the matter said.

TNX (10 yr note) could be ready to explode its 200 EMA is 31.23 near high of the day....leading to higher int rates. (EOD 30.96)

SPX 200 EMA is 953.80 (EOD 873)
TRANS 200 EMA 3489

I note this rally is coming on declining volume.

UYG (long financials) has yet to really break out. April high is $3.90 (EOD $3.56)

http://financialsense.com/series2/perspectives2.html Perfect storm series