Bank stocks surged Wednesday, with the SPDR Financial Select Sector ETF running up 1% to the highest level seen in nearly a decade, as hawkish comments from Federal Reserve Chairwoman Janet Yellen and upbeat data fueled a rise in Treasury yields. Among the financial sector tracker’s (XLF) most heavily weighted components, shares of Goldman Sachs Group Inc. rallied $3.55, or 1.5%, and J.P. Morgan Chase & Co. rose 95 cents, or 1.0%, to pace the Dow Jones Industrial Average advancers. The shares’ gains were adding a combined 31 points to the Dow’s price, which was up 10 points. Elsewhere, shares of Bank of America Corp. climbed 2.1%, Citigroup Inc. tacked on 1.8% and Wells Fargo & Co. gained 0.6%. The XLF was on track to close at the highest level since Dec. 10, 2007.The yield on the 10-year Treasury note rose 7.4 basis points to a 2-month high of 2.303%. The higher yield can help boost bank profits, as it can increase the spread between what banks earn on longer-term assets like loans and the cost of shorter-term liabilities to fund those assets.
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