Yesterday’s rally saw global markets run 2-3% to the upside. The move in the US erased last week’s NFP driven losses.

Technically, the internals will tell whether this is a dead cat bounce or the start of something more lasting.

The rally clearly is not fundamentally driven — stocks are fairly valued, but have been so for many quarters.Earnings remain robust though this upcoming quarter may be a challenge.

What I find disconcerting is the underlying drivers of the rally. We were deeply oversold for sure, and that typically sets up the environment for a strong move upwards. However, yesterday’s screamer was lit by European central bankers suggesting they will eventually get around to dealing with Spain. The WSJ reported Ben Bernanke stands ready to help the US economy is needed. And this morning’s flat futures got a big pop move when China’s central bank announced a 1/4 point rate cut.

It’s interesting how these bankers manage to say these things at moments of markets being enormously oversold, raising the philosophical question: Is the sentiment or the headlines driving markets? I suspect its the former, not the latter.

The environment is especially challenging. You cannot merely close your eyes, hold your nose and buy ‘em, and you sure as hell don’t want to be short ‘em. But it is less than ideal for investors to be depending upon the kindness of global central bankers for their returns.

These are interesting times . . .

This post originally appeared at The Big Picture and is posted with permission.