Reactions to Bernanke’s QE3

By The Sizemore Letter

Investor’s Business Daily contributor Trang Ho interviewed Charles Sizemore in his report on investor reactions to Bernanke’s QE3 announcement (See “Five Best ETF Buys After Fed Unleashes QE3“).

Exchange traded funds rallied across the board after the Federal Reserve fired off another round of economic stimulus.

The Fed said it would buy $40 billion per month of agency mortgage-backed securities, MBS, and it would hold interest rates “exceptionally low” to mid-2015…

Cyclical and high-volatility stocks such as technology, industrials and materials will benefit most, says Charles Lewis Sizemore, founder of Sizemore Capital in Dallas.

“While the economy is slowly improving, (Ben) Bernanke fears a relapse into deflation,” Sizemore said. “This means he’ll err on the side of dovishness.”

Industrial Select Sector SPDR (XLI) leapt 0.94%. It cleared a 37.49 buy point in a classic cup-with-handle pattern.

Technology Select Sector SPDR (XLK) flew 1.24% to an 11-year high.

 

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