The major averages managed to extend their recent rallies today. Buy interest was broad based though a few Dow names neglected to participate. Today's move was especially impressive for the Nasdaq which posted a triple-digit, 4.85% daily gain. The index broke key resistance at 2255 and didn't look back after the break. Today's move was accomplished on strong total volume and very bullish market internals. Large cap names saw the most aggressive buying with the Nasdaq 100 rising 6.5% on the day... Sun Microsystems (SUNW +15.0%) was perhaps most impressive behind continued speculation that demand for its UltraSparc-3 may be improving. The company holds its mid-quarter update on May 29 and investors can expect to hear specifics on that call. Buy interest in Cisco Systems (CSCO) was also impressive with the networking giant tacking on 13.2% in today's session. Participation from key leaders in the semiconductor group was also evident despite cuts to earnings estimates on Intel (INTC +4.0%), Applied Micro Devices (AMD +5.9%) and Micron Tech (MU +6.3%) courtesy of Merrill Lynch... Importantly, the financial sector which had been lukewarm to the rally early on, turned around to post respectable gains by the end of the day. The S&P Financials rose 1.2% by the end of the regular session which will be viewed by many investors as a coincident indicator validating equity strength. It's worth mentioning that the major averages entered today's trading in an overbought condition. Today's activity has extended this condition which raises the question of how much upside remains at current levels. There isn't an easy answer to this one as when new trends are initiated overbought or oversold conditions tend to be prolonged. DJTA +0.9%... DJUA +0.7%... SOX +7.4%... XOI -0.5%... BTK +6.2%... Nasdaq 100 +6.5%... S&P Midcap 400 +2.8%... NYSE Adv/Dec 2073/1019... Nasdaq Adv/Dec 2584/1357.

15:30 ET Dow +34, Nasdaq +94, S&P +18.48: The Dow is tacking on a modest late gain behind broad-based buy interest in just about everything else. Nonetheless, the Dow's move may be important as it does constitute a break above resistance just below 11,300. Should today's break hold, watch for 11,400 to serve as the next near-term hurdle for blue chips. The Nasdaq is also working on what is primarily psychological resistance at 2300. Weak technical resistance exists around 2310 with more important overhead in the 2330 area. Chances are we're going to see just how many shorts have positions yet to unwind. While an extension of today's gains would be expected from a technical perspective, it's difficult to see natural or fundametally based buying going into this close. DJTA +0.6%... DJUA +0.5%... SOX +6.7%... XOI -0.4%... BTK +5.6%... Nasdaq 100 +5.6%... S&P Midcap 400 +2.1%... NYSE Adv/Dec 1925/1162... Nasdaq Adv/Dec 2438/1486.



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