It was a day of mixed data but the market chose to ignore all risks to the downside and continued with the risk-on rally.
The Dow stock index closed above the 13,000 level for the first time since the market turmoil of 2008.
German business confidence numbers were positive but the rest of Europe is fairly dismal.
In the U.S. durable goods order numbers were bad but consumer confidence came out much better than expected, helped no doubt by rising stock prices.
It is important to note, however, that there is a difference between economic growth and market liquidity.
What we are currently seeing is a market rally induced by a relaxing of monetary spigots, not by underlying economic or job growth.
The "reflation" trade if you will.
It is no surprise that JP Morgan's CEO Jamie Dimon expects investment banking and trading revenues for banks to recover from the slump endured last year.
He's probably right.
There was a heavy pipeline of new bond issuance in both the IG (investment grade) and the HY (high yield) spaces.
Both IG and HY new issue bond books built aggressively as investors demanded paper even as new deal concessions (the extra spread offered to entice buyers of new bonds) disappeared.
The next round of Europe's LTRO (long term refinancing operation) kicks off on Wednesday.
Results can be viewed at the following link: http://www.ecb.int/home/html/index.en.html
U.S. GDP numbers are out on Wednesday as well.