But if volatility is the name of your game, then yesterday's "Fed Day" was your kind of day. We got a rally of nearly 150 points out of the gate then a dive after the Fed statement, a quick bounce back up of 90 points to the high of the day, and then a plunge of 125 into the close. And anyone other than those trading on a 15-minute bar chart was left shaking their heads.

The day got started off on the right foot on the back of rallies in Asia and Europe. The World Bank provided a boost to the bulls' cause by upping their 2010 GDP forecast in China. And the political types were out telling anyone that would listen that the gubernatorial victories by the republicans in New Jersey and Virginia were a big reason for the early rally. There was talk of a mandate lost by the administration and that the idea of a second economic stimulus bill was suddenly out the window.

Traders may have also been breathing a little easier in front of the Fed announcement as it was becoming clear that this Fed was not in the business of taking Wall Street by surprise. Thus, the worry that Bernanke and friends would drop the ball or do something silly seemed to fade as traders covered some shorts.

Everything seemed to be going along swimmingly through the Fed announcement and it looked like the bulls might have another "melt up" on their hands. The Fed had left rates alone and said that (a) the economy was looking a little better, (b) inflation was nonexistent, (c) they would continue with their current quantitative easing programs until the end of the first quarter, and (d) that they had no intentions of raising rates anytime soon.

In short, the Fed statement was little changed from last time and you had to hunt hard to find even single word changes, let alone any new messages or clues about the future. Thus, those traders looking for a sign as to when the Fed would begin to implement their "exit strategy" went home disappointed. 

Speaking of disappointment, the financials tanked hard in the last hour or so and took the rest of the market down with it. And while the dollar did rally a smidge during that timeframe, we really can't blame this move on the greenback. However, we did see a quick spike in interest rates after the Fed meeting as the yield on the 10-year moved up from 3.51 to 3.55 in short order. So, perhaps there were some sell programs tied to move as rising rates is also a bad thing for the dollar carry trade. But we're going to chalk it up to fun with computers on a Fed Day while everyone else was simply watching from the sidelines.

Turning to this morning, we had a good report from Cisco (CSCO) after the bell, which has helped improve the mood a bit. On the news front, both the BOE and the ECB left interest rates unchanged earlier this morning and we've got the nation's retailers reporting same-store sales comparisons this morning. For example, Target (TGT) just reported a October comps of -0.1%, which was below the StreetAccount estimate for +0.3%

On the economic calendar, we see that Initial Claims for Unemployment for the week ending October 31st were reported at 512K; below the consensus estimate for 522K. The prior week's numbers were revised higher to 532K from 530K. Continuing claims for Unemployment Insurance for came in at 5.749M; in line with consensus 5.75M.

In addition, Q3 Nonfarm Productivity was reported up 9.5%; well above the consensus of 6.5%. Unit Labor Costs (a measure of wage inflation) fell by -5.2%; more than the consensus estimate of -4.2%. Last quarter's Nonfarm Productivity was revised to 6.9% from 6.6% and Unit Labor Costs were revised to -6.1% from -5.9%.

Running through the rest of the pre-game indicators, the foreign markets are mixed with Europe fractionally lower. Crude futures are unchanged with the latest quote showing oil trading lower by $0.01 to $80.39. On the interest rate front, we've got the yield on the 10-yr trading at 3.55%, while the yield on the 3-month T-Bill is currently at 0.04%. Finally, with about 45 minutes before the bell, stock futures in the U.S. are pointing to a stronger open. The Dow futures are currently ahead by about 77 points; the S&P's are up by about 8 points, while the NASDAQ looks to be about 16 points above fair value at the moment.

Wall Street Research Summary

Upgrades: