Stocks were sharply higher across the board Friday as investors bought shares. The reasons were stocks were much oversold and plenty of “we might extend QE” and the “ECB might start QE next week” rumors were circulating.
The primary worries affecting markets weren’t resolved by this rally and markets still closed lower on the week.
One of the more remarkable comments on the week was uttered by Fed Chain Janet Yellen who complained in a Boston speech this morning that “Earnings inequality over the past several decades greatly concerned me.” This is a remarkable statement when the primary reason for earnings inequality can first be blamed on Fed policies for causing and enhancing income inequality. Others remarked about this here.
Leading market sectors higher included: S&P 500 (SPY), Tech (QQQ), Dow (DIA), Financials (XLF), Materials (XLB), Industrials (XLI), Transports (IYT), Energy (XLE), Healthcare (XLV), Consumer Discretionary (XLY), Biotech (IBB), Homebuilders (ITB), REITs (IYR), China (FXI), Brazil (EWZ), EAFE (EFA), Japan (EWJ), Europe (VGK), Germany (EWG), UK (EWU), Emerging Markets (EEM), The Dollar (UUP), Crude Oil (USO) and many more.
Leading market sectors lower included: Small Caps (IWM), Taiwan (EWT), Bonds (TLT), Euro (FXE), Yen (FXY), Gold Stocks (GDX), Natural Gas Producers (FCG), Coal (KOL), Silver (SLV) and Natural Gas (UNG).
The top 20 market movers by percentage change in volume whether rising or falling is available daily.
Depending on your point of view, we either are on the way to putting recent declines in the rear view mirror and starting the obligatory fourth quarter rally or Friday was just an oversold relief rally full of sound and fury, meaning nothing.
I have to post a short commentary today given other commitments.
For members, we’ll hash everything out over the weekend but my opinion is the market has a ways to go to prove itself, and so does the Fed.
Let’s see what happens.
Dave Fry is founder and publisher of ETF Digest and has been covering U.S. and global ETFs since 2001.
He is the author of "Create Your own ETF Hedge Fund: A Do-It-Yourself Strategy for Private Wealth Management" published by Wiley Finance and "The Best ETFs: U.S. Equities, A Companion Guide to Building Your ETF Portfolio".