Markets surged upwards today after the Fed cut its discount rate, thanks to a flurry of short-covering aided by today's options expiration. The Dow was up for the first time in over a week, jumping 233.30 to close at 13079.08. But many experts warn that the rally could be short-lived, arguing that even big gains are the product of the volatility an uncertain credit market has bred.
The Nasdaq and S&P 500 also rose, up 53.96 and 34.76 respectively, as did many global markets. Financials led the charge—even embattled lender Countrywide was up 13%—but many still anticipate a key rate drop. “I don't think what the [Fed] did is really going to impact credit spreads,” said one analyst, “And it doesn't change existing problems.”