NEW YORK (TheStreet) -- The "Santa Claus Rally" still faces the headwinds of a blizzard: slow global economic growth, weak crude oil prices and the strong dollar. But after a pullback of 5% to 6% for the major equity averages by Wednesday, the Federal Reserve's Open Market Committee came to the rescue.
The Nasdaq (QQQ) set a multiyear intraday high at 4,810 on Nov. 28, with the Dow Transports (IYT) setting an all-time intraday high at 9,319. And the Dow Industrial Average (DIA) and S&P 500 (SPY) set all-time intraday highs at 17,991 and 2,079, respectively, on Dec. 5.
Stocks rebounded after the Fed statement maintained that it will take a "considerable time" to increase the 0.00% to 0.25% federal funds rate. New wording indicates that the Federal Reserve will be patient on the timing of a normalization of monetary policy. "Considerable time" looks like it means "for the next couple of FOMC meetings." So normalization can begin as early as the Fed's third meeting in 2015, on April 28 and 29. Most economists had been expecting the first rate increase to be as early as the April meeting and as late as the June 16 to 17 meeting.
Last week's close was 17,284 for the Dow Industrials, down 675 points. The S&P 500 lost 73 points to 2,002.4. The Nasdaq plunged 127 points to 4,654. Dow Transports ended last week at 8,837, down 315 points.
Last Friday's closes straddled their key moving averages at 17,467 for the Dow Industrials, 2,023.9 for the S&P 500, 4,652 for the Nasdaq and 8,880 for the Dow Transports. Technical momentum was still extremely overbought, with readings between 91.00 and 89.00, well above the 80.00 overbought threshold.
The huge post-FOMC rally still has the major averages below their Dec. 5 closes, though.
But the Dow Utility Average set an all-time high at 613.67 on Thursday, as investors continue to seek the safety of dividend stocks. Utilities are up 25% year to date vs. 7.2% for the Dow 30, 11% for the S&P 500, 14% for the Nasdaq and 21% for the Dow Transports.