JPMorgan launches a stock market rally
JPMorgan Chase blew away a cloud of concern hanging over the banking industry Friday and set off a rally in stocks. Relieved investors drove up bank stocks, ended a six-day losing streak for the market, and sent the Dow Jones industrial average up 204 points, the best day this month.
JPMorgan jumped 6 percent, the biggest gain in the Dow by far. The nation's No. 1 bank earned $5 billion in the most recent quarter, easily beating Wall Street's forecasts, even as it took a deeper loss from a complex trade that went wrong. The results brightened the outlook for other major banks. If JPMorgan could sustain such a hard hit and still post stronger earnings, the thinking went, maybe others could, too.
JPMorgan revealed that the loss from a derivative trade it first disclosed in May had grown to $5.8 billion, nearly triple the original estimate. Its stock shot up $2.03 to $36.07.
The Dow gained 203.82 points to close at 12,777.09.
Wells Fargo, the other major bank reporting results, said a pickup in lending lifted its net income 18 percent; its stock rose 3.23 percent, or $1.06, to $33.91.
The Standard & Poor's 500 index rose 1.65 percent to 1,356.78 and the Nasdaq composite index gained 1.48 percent to 2,908.47. -- AP