Magazine article American Banker

Banking Stocks Lead Broad-Based Recovery after Friday's Big Fall

Magazine article American Banker

Banking Stocks Lead Broad-Based Recovery after Friday's Big Fall

Article excerpt

Bank stocks staged a recovery Monday, with many of the top 50 banks ending the day on the upside.

Some of the best performers were Chemical Banking Corp., which closed at $39.125, up 75 cents; Chase Manhattan Corp., up $1.625, to $38.50; Bank of New York, up $1.50, to $29.50; and First Chicago Corp., up $1.75, to $49.

First Interstate Bancorp., which Lehman Brothers upgraded Friday to 'buy' from 'outperform', was up 87.50 cents, to $75.50.

"Bank stocks were hit fairly hard last week, but they should remain fairly unscathed" by the end of the quarter, said Moshe A. Orenbuch of Sanford C. Bernstein & Co.

Broader Market Follows

The banks appeared to lead the rest of the market out of the doldrums. By mid afternoon, the Dow Jones industrial average, which had scored a slight gain in listless morning trading, began to surge. The bellwether index closed at 3685.50, up 48.56 points.

Analysts said that after Friday's bloodbath, the market should cruise along at a steady if unspectacular pace. However, they all agree that any major announcement from the government - or international development - could spark a major recovery, or a downfall.

One such announcement, that the Clinton Administration would replace Chief of Staff Mack McClarty with Office of Management and Budget Director Leon Panetta, appeared to be a factor in the late rise.

'A Big Yawn'

Before that the market was

"essentially trading flat," Dean Witter Reynolds analyst Paul Mackey said Monday morning. …

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