Crimea votes to secede and Russia immediately recognizes the new country (with 20k troops on the border). And the markets rallied this morning - a little surprising. SPX opened this morning and hit its high for the day ($1862) within just a few minutes, but it didn't trade off much, closing up $18 at $1859. RUT gained $7 to close at $1188. Putin will speak to the Duma early tomorrow morning our time; that may be a market-moving event - hard to predict.

Most market analysts attributed today's rally to short covering. But it didn't fade away in late trading, so that may not be the full explanation. It seems to me that both the bull and bear camps have good cases to make. The bulls have the Fed on their side and can point to reasonable market P/Es. The bears have the "too far, too fast" argument for a correction,  weak economic data, and, to counter the S&P P/E argument, the S&P 500 dividend yield is very low (average is 4.4% and we are at 1.9%). The Fed's stimulus programs may tip the scale for the bulls.

The Empire manufacturing survey reported 5.6 for March, up from February's 4.5. Industrial production increased in February from January's -0.2% to a positive 0.6%. Capacity utilization increased slightly in February to 78.8% from 78.5%.

Watch the S&P futures in the morning. I expect they will be moving, based on Putin's saber rattling or more conciliatory pose. Did you see the video of the Russian TV newscast with the anchor threatening to turn "the U.S. into radioactive ashes" with a photo of a mushroom cloud as a back drop? And you thought our right wingers were radical?