Bubbling up near three–year highs European stocks are discounting future growth prospects in a low inflation and interest rate environment. 

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Here in the U.S. we await a break of the range, which has constrained euphoria. If the S&P 500 can trade above the March 2005 high of 1229 from its current 1220 traders will have in mind the May 2001 peak of 1315.93 as a target.

How solid is this rally?

Here at MoneyNews.com we think it may have lasting legs and are positioning our readers accordingly.

Shares in PepsiCo took off like a rocket following the announcement of a 13% second-quarter earnings rise. Sales of non-fizzy drinks in Asia and Europe helped boost revenues.

Financial online broker Ameritrade has seen its shares rally of late thanks in part to rumors of a takeover within the industry. Investors won't be disappointed with the 20% jump in revenues on a 6.5% rise in revenues amid static trading volume.

A 13% rise in profits at Dow member Alcoa helped steer its shares away from a six-month downswing. The news may also steady fears of a slowdown for basic materials.

Shares in Harley-Davidson responded positively to upward forecasts for rest of the year earnings.

Two aspects of the recent rally attract our attention in particular.

First, Dow theory is in bull mode. Investors who follow this mantra look for signs of strength in industrial type stocks and confirmation from transport type stocks. If demand for manufactured goods is firm, delivery must be buoyant too.

On April 15 we noted that a sharp stock market decline did not carry the hallmarks of a bear market according to Dow theory and augured instead for an upturn in stocks. Read that article here.

Second, we have noted bright prospects for financial stocks. Since we pinpointed shares in Lehman Brothers (LEH) as the likely outperformer of the investment banking group it's shares have beaten the S&P 500 by 2.3 times and have risen by 10.6% in three months. Read that analysis here.

In an issue to our exclusive SectorTrade members we recently argued that a specific sector of the technology market was set to take off. Those shares have risen by 4.5% in less than five weeks -- an annualized return of well over 35%!

Only last week did we make a case for a 'brick-wall' investment in a sector that is set to benefit in the event that the equity market remains rangebound.

Those shares, up 1.7% since our recommendation, include shares in beverage giant PepsiCo Inc.

We made the point in our SectorTrade analysis to clients that investors were over looking shares in PepsiCo and its peers, where earnings growth was likely to be strong rather than weak.

Another area that continues to show strength is the oil sector where the related sector fund has risen by more than 27% from low to high in the space of just seven weeks.

The money is out there. 

You just have to know where to look for it. That's what we aim to do at SectorTrade. Find out more by Going Here Now.

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• Stop George Soros in Ohio - Help Ken Blackwell - Go Here Now