Winners & Losers

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This Week's ETF Winners & Losers

Robert Holmes

Homebuilder exchange-traded funds were the best performers of the week following another interest rate cut by the Federal Reserve that dropped the fed funds rate to 3%.

The iShares Dow Jones U.S. Home Construction (ITB) ETF soared 19.8% to $21.56. The SPDR S&P Homebuilders (XHB) ETF jumped 17.7% to end the week at $23.33.

Citing the continued stress on financial markets and the downside risk to the economy, the Fed announced Wednesday that it had slashed interest rates by 50 basis points, just over a week after an emergency rate cut lopped 75 basis points off the fed funds rate. Homebuilders jumped on the news as the embattled sector hoped for more government assistance in finding a bottom to its long slide.

Financial stocks also benefitted from the Fed's move. For the week, the Ultra Financial ProShares (UYG) ETF surged 17% to $41.84. The Financial Select Sector SPDR (XLF) ETF rose 8.5% to $29.48. The iShares Dow Jones U.S. Broker-Dealers (IAI) ETF was higher by 6.6% to $49.20.

Bundled securities tracking Internet stocks powered higher after Microsoft (MSFT) said Friday it has made an unsolicited bid to acquire Yahoo! (YHOO) for $31 a share, roughly a 62% premium above Thursday's closing price.

The Internet HOLDRs (HHH) ETF added 9.8% to finish the week at $56.15. The First Trust Dow Jones Internet Index (FDN) climbed 7.2% to $23.84.

Energy-related ETFs were among the few losers of the week as crude finished with a 2% decline over the five sessions. The United States Oil (USO) declined 1.9% to $70.55. The iPath S&P GSCI Crude Oil Index (OIL) shed 1.9% to $52.10. The PowerShares DB Oil (DBO) lost 1.5% to $32.57.