The image says it all. I’d like to think that after 35 years of being involved with markets that I’d seen it all, but today is one for the record books.

We start out the day with “men at work” from Bernanke to Paulson. They’re an interesting pair that’s for sure. But, talk will only get you so far. Given the condition of FNM and FRE combined with Paulson’s breezy attitude you’d be right to assume that these firms will, for all practical purposes, be nationalized. Another bite in your wallet and a brush-off to Moral Hazard concerns.

Oil was up around a dollar while stocks were struggling higher most of the day. Then, out of the blue, oil shot up $3 and stocks started to cave. At their nadir indexes were sharply in the red as oil hit $5. But, in the end, that too got the brush-off as bulls stormed the futures market and got some buy programs going. Now, I know what many of you are thinking–the PPT [Plunge Protection Team, dba The President’s Working Group on Financial Markets] at work. And you know something? I wouldn’t be surprised since there wasn’t a reason for the rally and this government is determined to do whatever it takes to keep things rolling along. Let’s just say, it was a day for the professionals.

In the meantime, here’s how some prominent financial companies closed. And, as you view them ask yourself if overall stock indexes can rally with these prominent companies in the ICU.

FRE 7.95 -22.47%
LEH 17.23 -12.72%
FNM 13.02 -14.99%
WB 12.98 -9.17%
BAC 22.17 0.50%

Volume was again heavy due to program trading activity by [ahem] institutions. I don’t think there are many individuals tossing money over to their brokers in this environment. We also have two gifted blog readers assisting us with straightening out Yahoo/Finance’s reporting. It may be worse than dealing with a government bureaucracy but what the hell, it’s worth a shot.

Here’s YHOO’s data for today. You can see breadth was just so-so.

You can tell by watching the intraday action that institutions are dominating the action. I’m not referring to large registered investment advisors or your local bank trust department either. Nope, this is action from WS trading desks, hedge funds and perhaps even our “activist” government. So, remember when action becomes this chaotic and inexplicable it’s Da Boyz just doing their thing. They care not about fundamentals or anything else since they’re just living in the moment and can turn things on a dime.

I remain incredulous perhaps like you but impressed by the results of their actions.

Anytime you read a headline heralding a bear market you might as well expect things to go the other direction if only temporarily.

Have a pleasant weekend.

Disclaimer: Among other issues the ETF Digest maintains long or short positions in: SPY, SDS, MZZ, IWM, TWM, QQQQ, QLD, XLY, SCC, XLI, SIJ, IYR, SRS, GLD, DBP, DBA, DAG, EFA, EFU, EEM, EEV, IEV, EWZ, RSX, FXI and FXP.

Last 5 posts by David Fry

• MARKET COMMENT October 22, 2009 DRIVE-THRU SOUP KITCHEN 2009 So, what the hell was yesterday about anyway? - October 22nd, 2009
• MARKET COMMENT October 20, 2009 TAKING A BREAK It was a pretty strange day. - October 20th, 2009
• MARKET COMMENT October 13, 2009 EARNINGS WORRY WARTS I just have a spooky feeling but then I always do. - October 13th, 2009
• MARKET COMMENT October 8, 2009 GETTING SOME ALTITUDE SICKNESS YET? - October 8th, 2009
• MARKET COMMENT October 2, 2009 REALITY BITES BULLS Economic reality is meeting bullish enthusiasm and the results are disappointing and upsetting. - October 2nd, 2009