Friday was a bad end to a bad week for the market and for financials in particular, in the wake of President Obama's statements on limiting the risk-taking of large American banks. Leading the downward march on Friday were shares of American Express ( AXP), which lost almost 9%, and Capital One ( COF), which fell more than 12%, highlighting how investors reacted wildly to negative information as the week came to a close. New credit card regulations were expected to affect the companies negatively. In comparison to AXP and COF, credit card company peer Visa ( V) shed only a modest 2% on Friday, and even the main target of populist anger against Wall Street, Goldman Sachs ( GS), was down only 5%. Stranger still is the fact that AXP's earnings were slightly better than the market expected. However, after this week, the pattern should no longer be surprising. Important companies have been beating expectations left and right since earnings season began, but even when earnings have been stellar, the market has not seen it as positive enough to placate concerns about the future of the economy. Macroeconomic issues such as China's tightening of lending and Obama's plans for banking regulation have made the market wary of a future slowdown in economic recovery to the point that the success of fourth-quarter earnings and even the whole of 2009 is barely relevant. The market's wariness, when given unsettling future information alongside positive past results, may not be an entirely bad thing. > > Bull or Bear? Vote in Our Poll
This is because, if investors had forgotten the fact that recovery into 2010 is not going to be a sprint, then this week may have been a healthy reminder, preventing exuberance that may have led to an even larger market letdown later in the year. As I have said in my outlook for 2010, the year will test the market's stamina. I think this week was the first but probably not the last example of why this will be true. With that in mind, here are this week's ETF winners and losers:
Market Vectors Gold Miners ( GDX) -7.7% Market Vectors Junior Gold Miners ( GDXJ) -11.6% A stronger U.S. dollar sent commodities broadly lower, and gold bullion ETFs lost about 3% on the week. Miners were hit hard by a trifecta of a fall in gold prices, the larger decline in commodities and the decline in stocks. Market Vectors Solar ( KWT) -13.2% Claymore/MAC Global Solar ( TAN) -11.7% In the previous week, France cut its subsidies to solar power makers, and Germany was expected to follow. This week, Germany delivered with the cuts and an already jittery market slammed solar shares. The news overshadowed a positive change for the solar industry in Ontario, where the government passed a $10 billion alternative energy deal with Samsung.