A little bit of verbal pixie dust from ECB member Coeure has the debt of Spain and Italy rallying and is in turn the reason for the equity market bounce. He hinted this morning that the ECB can always start buying the debt of Spain again in the open market as part of their still alive SMP program. Reflecting the recent stress in Europe, the ECB reported this morning that European banks deposited the most amount of money with them in a month overnight. Italy continues to rely mostly on short term debt issuance as they sold 11b euros of 3 month and 1 yr bills which was their target amount. The 3 month bill was sold at a yield of 1.25% vs .49% last month and the 1 yr issue was priced at a yield of 2.84% vs 1.41% in March. In the US, the MBA said refi apps fell 3.1% and purchases were down by .5%. II: Bulls 48.4 v 52.7 Bears 21.5 v 21.5 with balance measuring Correction (bulls that want to buy the dip).