The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.



) -- Was last week's market rally a Halloween trick or a treat for investors? European leaders announced a deal last week that produced a sigh of relief felt around the world as markets welcomed the news of a breakthrough in what had been the biggest threat to the global economy and markets since the 2008 financial crisis.

In general, markets last week provided a treat to investors:

The S&P 500 climbed 4% putting the gain for the month of October on track for the best month for the index since October 1974.

Stocks rose sharply in Europe and Asia, led by the banks.

High Yield corporate bonds rose 2%.

Commodities surged with oil rising 7% and copper surging 15%.

Reflecting a mostly positive outlook for growth, the yield on the 10-year Treasury note rose 12 basis points and traded as high as 2.40% for the first time since early August.

We believe the deal is more treat than trick, but the devil is in the details -- many of which remain undisclosed in the statement released by European policymakers last week. There are three broad components of the rescue package:

Greece's debt burden is reduced by a 50% "haircut" on Greek bonds.

European banks will be required to raise 106 billion euros to temporarily maintain a higher buffer against additional losses on their bond holdings.

The rescue fund will provide guarantees against the first 20% to 25% of losses on about one trillion euros of European government debt.

Over the long-term, concerns remain about the tricky outlook for economic growth in Europe and the ability of some peripheral countries to meet budget targets. Reflecting these lingering concerns and fearing a trick, many investors in European government bonds sold their positions pushing Italian and Spanish bond yields higher for the week. Europe appears headed for a recession and last week's data included weak readings on employment, economic growth (as measured by GDP), and heavy truck sales in Europe.

The long-term success of the European rescue is dependent upon the members of the Eurozone taking additional steps to adhere to their plans for achieving financial stability and deficit reduction. Skepticism lingers that some nations will successfully hit the targets they have set especially in light of the recession that many European countries are likely to experience next year.

Despite the long-term concerns, the stock market may hang on to the gains it has achieved in the month of October which were supported by other positive news that continued last week:

The string of solid and better-than-expected economic data in recent weeks was capped by last week's third quarter GDP coming in at 2.5% and a new all-time high in real GDP.

Strong and better-than-expected corporate earnings reports are on track for a 16.3% year-over-year increase with revenues up 10%. Of the 315 companies in the S&P 500 that have reported earnings to date for the third quarter, 71% have reported earnings above analyst expectations.

Additional policy actions outside of Europe also helped lift markets. Japan boosted economic stimulus, Turkey cut reserve requirements, and China pushed lending support for small firms as they prepare to reverse efforts undertaken in the past couple of years to tighten credit.

We expect these trends to continue into November. As November gets underway, this week there are several potentially positive drivers for the markets:

Important economic data is due to be released including the October readings on jobs (employment report from the Department of Labor), business sentiment (ISM), and consumer spending (vehicle sales and retail chain-store sales). This data should be solid - certainly relative to investor and consumer confidence readings, but it is getting harder to surprise to the upside after so many weeks.

On Nov. 3, the European Central Bank (ECB) is set to meet. The next step in a successful plan to stabilize Europe is for the European Central Bank to cut rates soon to promote growth and lending and reverse the two rate hikes they made earlier this year. A rate cut by new ECB head Mario Draghi would be welcomed by markets. In addition, the Reserve Bank of Australia, Australia's central bank, may cut rates this week.

Small components of President Obama's jobs bill with a higher likelihood of passing Congress may be proposed this week.

However, there are some potential negatives on the calendar for November.

The government is funded through a continuing resolution that runs out Nov. 18 and will result in a government shutdown if not extended.

The Nov. 23 deadline is looming for the super-committee to vote on a plan with $1.5 trillion in deficit reduction.

So there are still a few scares coming in November that may spook the markets and reintroduce some familiar volatility.

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

Jeffrey is Chief Market Strategist and Executive Vice President at LPL Financial.