Yesterday the Dow Jones Industrial Average (INDEX: ^DJI) completed its finest day of the year, increasing 2.4% after reports that the ECB is prepared to take further measures after the European Summit at the end of the month. The increase brought the Dow back to last Wednesday's level. However, is the situation in Europe less fickle now than before Mario Draghi's statements? Yesterday was the result of investors gaining confidence to purchase securities that were discounted lately on eurozone worries.

So far today the Dow is up 0.8% -- a third of yesterday's pop -- after the world's second-largest economy, China, actually took action to increase its growth by lowering interest rates by 0.25%. Also today, Ben Bernanke addressed Congress, giving the same boilerplate remarks as Draghi and stating that the Federal Reserve is ready to take action if needed. However, unlike yesterday's spike, the broad markets retreated slightly after the Fed chairman's remarks.

Today's action
Dow component Caterpillar (NYSE: CAT) received a significant boost after China suddenly decreased its benchmark lending rate, helping the heavy-machinery company's share price to a 1.7% gain. Also having a stellar day is Westport Innovations (Nasdaq: WPRT), up 10.83% on news that the natural-gas engine manufacturer joined powers with Caterpillar to create natural-gas-powered heavy machinery.

Basic materials is the leading sector today -- no surprise there, given the news of the day. Alcoa (NYSE: AA) jumped 0.8%, as its demand is tied to the Chinese expansion.

In the Internet information industry, Facebook is down as it takes a backseat to Yelp (NYSE: YELP), which is up 5.8%, having recently expanded into Finland, now the 17th country in which it operates.  

Takeaway
The good news is that the Dow Jones Industrials are once again performing well, making it three straight days in the green. Although this has not happened in more than a month, we must be aware that Europe is still in a perilous state. In order to stabilize the market for a long bull run, the central banks will need to take a page out of China's book and make a move. The problems are complex, and the treatment is supplied in small doses, so expect some turbulence on the way.

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