Stock Markets Advance On QE3 Hopes
The markets are driving higher today on expectations of some major quantitative easing by the Federal Reserve. Tomorrow is the big day. Ben Bernanke and his fellow Federal Reserve cronies will release their policy statement. In his last few speeches, Ben Bernanke has eluded to more easing. Because of this, the markets have high expectations. Today, short covering and buying are taking hold on anticipation of major new measures. The Federal Reserve must now deliver or face a massive drop in the markets. The SPDR S&P 500 ETF (NYSE:SPY) is trading at $121.69, +1.38 (+1.15%).
Should the Federal Reserve dissapoint the markets tomorrow, the down side could be huge. A Dow Jones Industrial drop of 500 points would not be out of this realm. However, Ben Bernanke is well aware of this. It must be assumed he will do his best to deliver.
Apple Inc. (NASDAQ:AAPL) is surging sharply again. The stock is trading at new all time highs, hitting $422.00. The stock continue to be a major safe haven in an otherwise uncertain future. While the stock is strong, it is far to extended to be a buy. Wait for a pull back.