Real Story: Bears Eat Crow - TheStreet

"Expectations were not near what we got -- which was great earnings," New York Stock Exchange floor trader Doreen Mogavero tells Aaron Task on Friday's Real Story podcast. "People were anticipating earnings would not be so good -- so it was a good surprise and made people very enthusiastic."

The enthusiasm Friday was centered around earnings from

Google

(GOOG) - Get Report

,

Schlumberger

(SLB) - Get Report

and

Dow

components

Caterpillar

(CAT) - Get Report

,

Honeywell

(HON) - Get Report

and

American Express

(AXP) - Get Report

.

The latter three helped push the

Dow Jones Industrial Average

up 153 points to 12,962, the index's third-straight record and 15th advance in the past 16 trading days.

Returning to the theme of Wednesday's show, Task said the key to the rally Friday, this week and since the early March low is the action in the financials.

"For mega-caps broadly it's been a very good reporting season," Joe Capone of Smart Financial Partners and

RealMoney.com

contributor tells Task. "It was a rough February-March for banks so people were afraid of financials" and expectations were low ahead of earnings.

In addition to strong earnings from American Express, Friday brought news

H&R Block

(HRB) - Get Report

is selling its subprime mortgage business, Option One Mortgage, to private-equity giant Cerberus Capital Management.

The ability of H&R Block,

Accredited Lending

( LEND) and others to obtain capital and/or find buyers for their mortgage portfolios -- even at a steep discount -- is a key reason for the market rebounding so quickly and sharply from the February selloff, Task says. "This proves the fears of a 'credit crunch' were unfounded."

In addition to the contained "fallout" from the subprime selloff, Task discussed other lessons of the rally from the late February/early March lows, including:

  • A weak dollar isn't necessarily a negative for stocks;
  • Long-term investors need to always have some skin in the game
  • The stock market doesn't need a Fed rate cut to rally.

In the remainder of the podcast, Task discussed the day's corporate news, including earnings from

Countrywide Financial

( CFC),

Advanced Micro Devices

(AMD) - Get Report

and

Robert Half International

(RHI) - Get Report

, the latest entrant into "the Geoff Tate zone."

Click

here to listen to the entire podcast.