One aspect of the Fed’s QE strategy is already paying dividends: The S&P is challenging its highest levels since April of this year.
We stalled last week at 1196 and are near that level now. A break targets the 1220 recent highs.
Stocks have performed strongly in the months since Bernanke signaled a new wave of Free money was in the offing. Perhaps we see some profit-taking on the news, but the easy money environment should keep financial assets of all stripes well supported.
The dollar has worked inversely to the S&P, and QE stills seems to trump European debt woes in the eyes on investors, at least for now. We’ll have to see how the market reacts once the months of talk turns into action in just under 24 hours.