The Dow: Financials Trailing

Before you go, we thought you'd like these...
Before you go close icon

After the Fed's announcement last Thursday of an open-ended bond-buying program (QE-infinity for a moniker, perhaps?), the Bank of Japan will vote on monetary policy this week. Will the BoJ follow the Fed down a similar path? Who knows? With the country now into its third "lost decade," the matter is hardly urgent, surely.

And speaking of QE-infinity, the Financial Times published an article on its website yesterday saying that the program, which will focus on mortgage-backed securities, is unlikely to have an impact on mortgage rates, as lenders struggle to process mortgage applications fast enough. The time between agreeing a loan and closing has now risen from one month to up to three months.

One area in which the Fed's action had an immediate impact, however, was in the trading of bank shares. Daily volume in JPMorgan Chase (NYS: JPM) and Wells Fargo (NYS: WFC) shares were substantially above their three-month average on Thursday and Friday. With strong grains across financials last week, banks are giving back some of those back this morning, pulling the Dow (INDEX: ^DJI) down with them. However, that won't matter to long-term investors who own The Only Big Bank Built to Last.

The article The Dow: Financials Trailing originally appeared on Fool.com.

Fool contributorAlex Dumortierholds no position in any company mentioned.Click hereto see his holdings and a short bio; you can follow him@longrunreturns. The Motley Fool owns shares of JPMorgan Chase and Wells Fargo.Motley Fool newsletter serviceshave recommended buying shares of Wells Fargo. The Motley Fool has adisclosure policy.We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners