Magazine article American Banker

Stocks: Banks Soar as Dow Rises near 9,900

Magazine article American Banker

Stocks: Banks Soar as Dow Rises near 9,900

Article excerpt

By KAREN TALLEY Bank shares rose as the Dow Jones industrial average neared the 9,900 level and came within striking distance of 10,000.

The Dow finished the day at a record 9,897.44, up 124.60 points, as part of a broad rally that included other major market barometers.

Stocks of the largest banking companies joined in the general advance. BankAmerica Corp. rose 62.5 cents, to $72.125; Citigroup $1.1875, to $65.1875; and J.P. Morgan & Co. 31.25 cents, to $119.1875.

Bank shares overall rose on investors' confidence that "inflation is virtually nonexistent" despite "the nation's strong economic growth," said Peter Green, chief technical strategist at Gruntal & Co.

The market was helped by an overnight market rally in Japan. The Asian nation, whose economy is the world's second-largest, may finally be "getting its house in order" after years of financial difficulties, Mr. Green said.

The Standard & Poor's bank index rose 0.54%, the Nasdaq bank index 0.48%, and the S&P 500 0.84%

Shares of Compass Bancshares rose 68.75 cents, to $38.375, as the Birmingham, Ala., company completed a round of visits with Wall Street analysts and investors.

Compass executives highlighted more aggressive financial targets and said they are focused on improving returns, according to analysts who attended the presentations.

"We like their story," said Michael Granger of Fox-Pitt, Kelton Inc. in New York. "We believe they can increase earnings at a double-digit rate over the longer term. …

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