This market rally isn't a sign that the tide is turning. It's a breather.
That's the message coming out of strategists and analysts in Europe, who have been following the Greek default talks very, very closely. Asked what exactly gave Europeans the confidence to start buying again today, which then propelled North American buying, they couldn't pinpoint anything.
This is a confidence play. People are just happy that European lawmakers are finally starting to take their crisis seriously. Rather than continuing to put together piecemeal packages to plug holes, they're finally ready to address the root of the problem. Not exactly a strong foundation for a rally, considering that a concrete plan to plug the holes hasn't been firmed up.
Keep in mind that the U.S. TARP was passed in the fall of 2008, yet it took about six months for the markets to rebound following the bank stress tests. If that plays out in Europe, there are still many things to work out, including exactly how a Greek default should unfold, if that's what lawmakers decide is the best option.
So stay tuned. Europeans don't have total confidence yet.