By Greg Peel

The Dow closed up 70 points or 0.5% while the S&P gained 0.8% to 1782 as the Nasdaq jumped 1.2%.

Bridge Street had been shaping for a fall, it has to be said, following two failed rallies on Monday and Tuesday. The mainstream press suggested a taper tantrum but realistically talk of December tapering has been lingering since last week's US jobs report and in the end, after a solid run, the local market just ran out of reasons to go up, and so dropped 1.4% instead. It was snowball session, with technical stop-losses triggered, and traders would have had their eyes firmly on the Shanghai market.

Shanghai fell 1.8% yesterday on disappointment following the release of a communique from the Chinese president. Markets had been looking for some vision from the Third Plenum but instead received only a vague set of promises, lacking in detail. Detail may follow eventually but in the meantime the only real point of debate was a change in wording, suggesting financial markets would play a "decisive role" in determining economic allocation of resources as opposed to the "basic role" previously suggested.

The news from China is neither good nor bad, and the subsequent sweep-out of nervous longs on Bridge Street is likely a healthy development. Banks in particular were hard hit, but they have also had a recent spike, and three have gone ex-div. Otherwise, aside from the information technology sector, selling was evenly spread. This was not one big order from offshore, this was a rolling sell-off. The selling belied a solid rise in monthly consumer confidence ? up 1.9% to be up 5.8% over twelve months to a three-year high. The Aussie did not fall, and indeed is slightly higher.

Wall Street also opened lower, to the tune of 78 Dow points, but immediately began to rally yet again. The news of the morning was a quarterly profit report from Macy's ? basically America's last remaining major department store chain ? which showed an earnings per share beat of 47c to 39c expectation. The result caught Wall Street by surprise, sent Macy's shares up 9.5%, and lifted the mood with regard to expectations for Christmas shopping.

Otherwise, Wall Street is focused on tonight's testimony from Fed chair nominee Janet Yellen. Traders indicated last night, through market strength, that they expect Yellen to say all the right things, which is to say, no rush to taper. Wall Street kicked to the closing bell on anticipation.

The US dollar index fell 0.3% to 80.93 in sympathy with such anticipation, and the Aussie is up 0.3% to US$0.9327. Gold recovered US$7.30 to US$1274.50/oz but silver fell another 1%.

The lack of oomph in the Chinese president's plenary communique sparked selling in copper last night. While many an analyst is currently pointing to a lack of new copper supply, China's stockpiles are significant and the copper price is hence highly sensitive to news from the east. Copper fell 1.6% in a session which saw smaller and mixed moves from the other base metals.

Oil rebounded after Tuesday night's steep fall. West Texas crude recovered US66c to US$93.70/bbl while the Brent front month contract will expire tonight and it rose US$1.03 to US$107.12/bbl.

Spot iron ore rose US20c to US$136.10/t.

The SPI Overnight rose 10 points or 0.2%.

Japan will release its September quarter GDP result today and the eurozone will follow suit tonight. Obviously Janet Yellen's testimony in Washington will be compulsory viewing.

On the local stock front, James Hardie ((JHX)) will release its interim result, SingTel ((SGT)) will post a quarterly and Bank of Queensland ((BOQ)) will offer a strategy update. There are several significant AGMs being held today, including Macquarie Group ((MQG)), Mirvac ((MGR)) and Ramsay Healthcare ((RHC)).

Rudi will appear on Sky Business at noon.