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Thanks to Tuesday's steady gain in stocks, all three major averages are now in the black for 2010. The timing and pace of the recent rally also reinforce a major theme that Wall Street was betting on coming into the year, when most experts were saying any gains in the market would become much harder to come by.

Based on today's gain, the Dow is now up a sliver for 2010. It now joins the S&P 500 and Nasdaq Composite, which moved into positive territory on Monday. Based on their latest gains those two measures are now up more than 0.7% each for the year.

Coincidentally, the averages are hitting these milestones near the anniversary of their bear-market lows, induced by a historic financial crisis that rippled around the world. From their troughs set on March 9, 2009 through the end of last year, the Dow soared 59%, the S&P rose 65%, and the Nasdaq leapt 79% thanks to low borrowing costs from central banks, fiscal stimulus, and a resulting recovery in corporate profits.

For months, money managers have known–and tried to prepare clients for–the reality that such hand-over-fist gains couldn't continue forever. While the U.S. economy seems to be stabilizing in a way that could allow profits and the market to drift higher, it also still has big challenges left, some of which may be evident in widely anticipated payrolls data due Friday morning.

Technician Roger Volz, of BGC Partners in New York, pointed out one other challenge that may kick in soon for the stock market: Investors who bought shares at or soon after the market's lows last year may become more emboldened to sell and book profits now that they've held on for 12 months, since any income would be taxed at a lower rate on long-term capital gains.

“It's not anything we've seen yet but, intuitively, it makes sense as something to look out for,” said Volz.

Roger Volz Comments: As Anniversary of Market Lows Nears, Dow Turns Positive for 2010-The Wall Street Journal

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