Fed Chair's Comments Pops Financial ETFs

Market Wrap-Up

Fed Reserve chairman Ben Bernanke threw the financial services industry another life raft Tuesday after he said the government would consider extending its emergency loan program. "[The Fed is] currently monitoring developments in financial markets closely and considering several options, including extending the duration of our facilities for primary dealers beyond year-end," he said in a speech he gave in Arlington, Va. In other news, according to the National Association of Realtors, May existing home sales fell 4.7% and 14% from their levels in April and May 2007, respectively. Commodities, both energy and agricultural, pulled back over concerns about slowing global demand for oil and milder weather in the Midwest that could help improve the crop outlook. Oil closed down almost $6 a barrel to $136.

Winners

The prospect of the Fed extending its loan program gave investors renewed confidence in battered financial firms. SPDR KBW Bank (KBE), SPDR KBW Regional Banking (KRE) and iShares Dow Jones U.S. Regional Banks (IAT) ETFs, three of the most widely traded (and volatile) funds that track this industry, were up 8.1%, 7.7% and 7.6%, respectively, Tuesday.

Losers

Commodities of every stripe pulled back today. The United States Natural Gas ETF (UNG) dropped 4.7%. The SPDR S&P Metals and Mining fund (XME) decreased 2.3%. Solar stocks tend to move along with the price of oil. The thinking is that as oil rises or falls the immediacy for finding an alternative source of energy also loses of gains its immediacy. Market Vectors Solar Energy (KWT) lost 1.8%.

Tuesday's Industry Headlines

Change Order
Vanguard announced it is shifting the daily trading of 34 of its ETFs to the NYSE Arca platform from the American Stock Exchange.

Wednesday's Notebook

Earnings
Flow International, International Speedway, Intervoice, Material Sciences, Ruby Tuesday, Shaw Group, Wolverine

Quick Take

A look at how the industry's most popular ETFs did on Tuesday.

10 Largest ETFs
Symbol	Net Assets	Price	52 Week High	52 Week Low	Volume
SPY	77,056	127.2	156.39	126.05	363,848,696
EFA	47,565	67.05	85.64	67.18	13,919,181
EEM	27,269	130.25	165.39	117.49	30,050,907
GLD	NA	90.85	99.81	65.04	11,212,363
IVV	16,710	127.53	156.65	125.35	6,740,817
QQQQ	17,586	45.99	55.03	41.17	200,871,875
IWF	14,092	54.36	63.64	52.79	7,377,002
SHY	8,988	82.87	84.49	79.74	482,817
VTI	10,808	63.63	77.66	62.41	1,879,716
IWD	8,900	68.22	89.3	66.73	3,100,469

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