Market Preview: A Rally to Remember?

NEW YORK (TheStreet) -- Monday's nearly 3% surge in stocks, albeit on fairly low volume, has the Dow Jones Industrial Average back in positive territory for 2011, and suddenly the stage seems set for a strong finish to the year.

We're still waiting for the follow-through, but evidently those with money to put to work are taking Germany and France at their word when they say they're committed to finding a solution to the sovereign debt situation across the pond. The banks took off on the news with Bank of America(BAC), up 6.4%; and JPMorgan Chase(JPM), gaining 5.2%; leading the blue chips higher, although all 30 Dow components closed in positive territory. If third-quarter earnings season is better than expected -- by no means a done deal -- and the economic data picks up a bit, as it sort of did last week, the major U.S. equity indices could claw back a healthy portion of their gains from earlier in the year.

Scott Redler, chief strategic officer of T3Live, thinks stocks may have turned a corner, starting with the mid-session turnaround on Oct. 4, when the Dow closed up triple digits and ranged nearly 500 points.

"I guess, ultimately, this bounce just FEELS different, based on the price action," Redler wrote. "The late 'fake-lower-and-rip' into the close Monday is reminiscent of the old bull market. Expect the market to break out of this range to the upside within the next two weeks."

One stock that didn't participate was Netflix(NFLX). Reed Hastings & Co. made news on Monday by backpedaling on plans to separate its physical DVD and streaming content services less than a month after announcing the change. While the stock initially rallied, running as high as $128.50, the shares did a Qwikster-like about face late in the session and closed down 4.8% at $111.62 after running to a new intraday 52-week low of $107.31.

The summer of indecision has stretched into fall for Netflix as the company's management continues to baffle by repeatedly showing they haven't really thought out major changes before announcing them; subsequently apologizing (the 50% price hike, which remains in place) and now the flip-flop on Qwikster, which was widely panned when announced precisely because people would have to manage their accounts separately. Given the recent track record, this announcement has to be greeted with cynicism, and the question must be asked whether the move was driven by more than irate emails, meaning has Netflix seen another round of defections that may be significant enough to result in another lowering of subscriber growth expectations.