March 18: Dow 12,392 (up 420 points); trading range, 435 points
Just one day after the collapse of Bear Stearns, the market rallied on a 75-basis-point Fed rate cut and better-than-expected earnings reports from Goldman Sachs (NYSE: GS) and Lehman Brothers (OTC: LEHMQ).
Looks like someone wasn't paying attention.
The clear focus was on the much-anticipated Fed cut that dropped the fed funds and discount rate to 2.25% and 2.5%, respectively.
There was a slight pause during the session, as some hoped for a 100-basis-point cut, but traders pushed onward to finish strong and add another 100 points to the Dow before the close.
All sectors rallied into positive territory for the session and the S&P 500 posted its biggest one-day percentage move since October 2002.
Greg Tucker is the executive editor of OptionsZone.com.