Bulls Hack Out of a Thicket

The stock market's favorite markers of robust growth were back on the field Thursday, too.

In merger and acquisition activity, Cisco(CSCO Quote) agreed to by WebEx(WEBX Quote) for $3.2 billion, or a 23% premium. Cisco slipped a fraction while WebEx jumped 22%.

Blackstone squashed rumors that the firm would launch a competing bid for Texas utility TXU(TXU Quote) but reportedly said it would join with current equity partners Kohlberg Kravis Roberts and Texas Pacific Group if they needed another equity partner on the $32 billion deal. TXU gained 0.7% on the day, even as regulators started to make noise about the potential deal.

Dow Chemical(DOW Quote) gained 5.6% on news the company plans a joint venture with an India-based petrochemical company. Caremark(CMX Quote) added 2.7% ahead of the company shareholder vote Friday on whether to accept a $26.5 billion buyout bid from CVS(CVS Quote) or to wait on a higher bid from Express Scripts(ESRX Quote), which gained 1.6% Thursday.

When copper breaks out, most traders roar, "strong economy." Today was no different. The price of an ounce of copper surged 5.7% to $2.99 -- breaking above its 200-day moving average. Copper miners Freeport McMoran Copper & Gold(FCX Quote), Southern Copper(PCU Quote), and Rio Tinto(RTP Quote)l gained 6.7%, 2.8% and 2.9%, respectively.

Oil fell 1% Thursday, to $57.55 per barrel -- weakness that suggests the typically slower spring and summer seasons may be kicking in. The lower oil price spurred a 0.9% rally in the Dow Jones Transportation Average.

This is hardly the stuff of a major economic crisis. Then again, the million-dollar question is whether the subprime problem could overtake the economy given the right climate. With that still unanswered, the market is likely to remain skittish. And, if subprime problems spread, the Fed, like any gardener, would have to chop the heads off a few flowers to kill the weed.