Weekly ETF Update

The Dow Jones industrial average and the ETF that tracks it managed to record its first weekly advance of 2008, even as it fell more than 170 points on Friday. The Dow (DIA) finished the week up 0.89%, the S&P 500 (SPY) ended the week up 0.41% while Nasdaq (QQQQ) lost 0.59%.

The week opened with a plunge in stock prices and the Federal Reserve cutting interest rates by 0.75%, the largest rate cut since 1990. President Bush also presented his economic stimulus package through Congress and it will go to the House floor for a vote early next week.

In overseas markets, Europe was down about 2%; Asia was down about 1% and Latin America was up about 1%. On Friday, Hong Kong (EWH) , Brazil (EWZ) and Australia (EWA) surged. The U.S. dollar was up marginally while gold prices hit record highs in part due to a shut down of major mines in South Africa.

The top-performing sector ETFs for the week was homebuilders, up 15.9%, and regional banks, up 10.7%. Markets are looking ahead to more 4th quarter company earnings releases, the President’s State of the Union address, new home sales reports, durable goods orders, fourth quarter GDP numbers, plus employment and home price reports. The Federal Reserve will also hold its scheduled meeting next Tuesday and it seems the markets expect another rate cut which should lead to a lower U.S. dollar.