The market closed the session modestly higher. The Dow, which was up as much as 150 points earlier, finished the day with a 0.5% gain. The economic news of the day was on the positive side. The headline CPI reading for April rose 0.2% compared to 0.3% expected. Excluding food and energy prices, the Core CPI was also better than expected at 0.1%. A pullback in crude oil only helped to fuel the rally.

Transportations were among the noticeable winners for the day. In particular, the Dow Transportation Average closed at a new high for 2008. The Nasdaq became the second major index to challenge its 200-day moving average. Unfortunately, it faced similar fate as the Dow and retreated sharply late in the day amid profit taking. It seems there is strong resistance at this key technical level and the market may need some strong catalyst to break through. The CRB commodity index ended the day modestly lower. The US dollar, on the other hand, moved higher against most major currencies. Treasuries continued the recent slump as money moved out from the previously safe-haven sector and into risky areas. The VIX index, which is usually used as a fear indicator, touched the lowest level since last October before rebounding sharply during the final hour of today’s trading. Maybe it’s a good warning to those investors that became a little too complacent recently.