Banks and thrifts rallied alongside major indexes during Wednesday,April 13. The SNL U.S. Bank Index jumped 3.67% to 392.66 and the SNL U.S. ThriftIndex rose 1.90% to 793.55. The Dow Jones Industrial Average advanced 1.06% to 17,908.28,the S&P 500 increased 1.00% to 2,082.42 and the Nasdaq composite index wentup 1.55% to 4,947.42.
"A lot of positives are lining up to make investors feeloptimistic about the future," said Sam Stovall, U.S. equity strategist at S&PGlobal Market Intelligence. He noted that the expectations that the increase inoil prices will sustain, along with the prospect of companies reporting better earningsin subsequent quarters, are among the positive factors.
Among the largest U.S. banks, Bank of America Corp. gained 3.92% to $13.79, rose 4.23% to $61.79, Wells Fargo & Co. climbed 2.64% to $49.03 and hiked 5.61% to $44.25.
The Federal Reserve and the FDIC have determined that the 2015resolution plans of Bankof America, Bank of New York MellonCorp., JPMorgan Chase, StateStreet Corp. and Wells Fargo were "not credible or would not facilitatean orderly resolution under the U.S. Bankruptcy Code."
Citigroup Inc.'s resolutionplan was found to have shortcomings that the company must address, butneither regulator found the plan to be "not credible."
By the end of day, BNY Mellon climbed 4.57% to $37.78, and StateStreet increased 3.91% to $59.74.
JPMorgan on April 13 reported first-quarter net income applicable to common stockholdersof $4.99 billion, or $1.35 per share, compared to $5.45 billion, or $1.45 per share,for the same period in 2015. Stovall also thinks that the company's reported improvementof 6.6% in net interest income and an 11% loan growth "bodes very positivelyfor the entire banking sector." "Basically the earnings bar was set solow that most investors believed that the worst was already built into these estimates,"he added.
Among notable movers, New Orleans-based First NBC Bank Holding Co. jumped 9.37% to $21.24; rose 6.80%to $16.65; and Wilmington, Del.-based TheBancorp Inc. went up 6.63% to $5.79.
In the thrift space, Westbury, N.Y.-based New York Community Bancorp Inc. ticked up 2.44% to $15.52;San Diego-based BofI Holding Inc.advanced 4.90% to $23.12; Lake Success, N.Y.-based Astoria Financial Corp. rose 2.72% to $15.46; and Cleveland-basedTFS Financial Corp. (MHC)increased 2.31% to $17.74.
In economic news, mortgageapplications in the week ended April 8 climbed 10% from the previousweek on a seasonally adjusted basis, the Mortgage Bankers Association reported April13, citing the results of its weekly mortgage applications survey. On an unadjustedbasis, the market composite index, which measures mortgage loan application volume,also increased 10% week over week.
Market prices and indexvalues are current as of the time of publication and are subject to change.