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Recession's Worse? Let's Buy Some Stocks

SAN FRANCISCO -- As compelling as the battle over recovering AIG (AIG - Get Report) executive bonuses might be, it clearly has nothing to do with investors' increasing willingness to pay higher prices for stocks.

While Wednesday's session may have received a little help from the Federal Reserve, the market's most bullish run of 2009 -- the S&P 500 is now up 20% since its March 6 intraday lows -- looks as intact as ever.

For the rest of the month, the watch is on to see how a relatively light corporate news flow and the end-of-quarter performance push will affect the momentum of stocks, which this day touched some nice, round numbers -- 800 on the S&P and Dow 7500.

And let's not forget 1500 for the Nasdaq. With a Wednesday close of 1488, the index is now down just 5.6% in 2009, giving tech investors hope that another push higher could actually have the Nasdaq above water in a matter of days.

The tech index was helped by IBM's (IBM - Get Report) purported plans to buy Sun Microsystems (JAVA), boosting the prey's market cap by nearly $3 billion.

But tech's outperformance of the broader market has been the standard this year, and the IBM-Sun news merely highlights the effect of the strength in tech stocks, rather than being the cause.

The major giants in the sector, IBM, Cisco (CSCO - Get Report), Apple (AAPL - Get Report), Microsoft (MSFT - Get Report) and Google (GOOG - Get Report), to name just a few, are awash in cash. This isn't a bad affliction for weathering a recession, and it certainly comes in handy when it's time to buy struggling companies that can open up new markets.
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AAPL $93.78 0.08%
AIG $53.01 4.90%
CSCO $25.22 2.20%
GOOG $684.78 0.24%
IBM $120.64 2.40%


Chart of I:DJI
DOW 15,920.01 +259.83 1.66%
S&P 500 1,856.92 +27.84 1.52%
NASDAQ 4,322.1020 +55.2650 1.30%

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