Big day for stocks

The Dow reached a 52-week high, closing up 203 points - and no, it doesn't make much sense. But here's the bullish view, as outlined by Neil Lipschutz, managing editor of Dow Jones Newswires:

-The world is awash in government provided liquidity and low interest rates. The Federal Reserve last week made clear it will keep rates extraordinarily low for an "extended period." A Wall Street Journal article today by E.S. Browning expands on these points.

-Since the stock markets in the U.S. are increasingly institutional markets, with participants basing investments to a degree on leverage, those low rates are meaningful.

-Those low rates also will fuel more mergers, generally a stock market plus.

-U.S. corporates generally have their acts together. Earnings are solid. Yes, they are generally based on cost cutting rather than revenue growth, but that means when new revenues eventually show up, a significant portion will flow to the bottom line.

-The rest of this economically interconnected world is alive and kicking, especially in economically important areas of Europe and Asia. So the U.S. consumer, hampered by unemployment and lower house values, won't have quite as much of the global growth burden as in previous recoveries.

-Market dynamics support the bull. Stocks are supposed to look forward and given our current situation, even at sub-par growth rates, it is not far-fetched to thing employment will start slowly increasing in the U.S. in the second half of 2010. Another market dynamic: the plethora of skeptics is a positive for further price gains. The majority view is typically a contrary indicator.