B. of A., Citigroup rise on Fed meeting
SAN FRANCISCO (MarketWatch) -- U.S. financial stocks closed higher Tuesday, led by strong bank gains, as investors were optimistic about Federal Reserve officials discussing ways to stimulate the economy.
A better-than-expected Spanish debt auction and a jump in U.S. building permits reinforced bullish sentiment.
Leading banks higher were shares of
Shares of J.P. Morgan Chase & Co. (JPM) traded up 2.2% as Chief Executive Jamie Dimon returned to Capitol Hill to answer questions before a House committee about the bank's recent $2 billion-plus derivatives trading loss. Read more on Jamie Dimon's testimony.
The Financial Select Sector SPDR ETF (XLF) , which follows financial stocks in the S&P 500 Index (SPX) , rose 1.7%. The KBW Bank Index (BKX) , which tracks the 24 leading U.S. banks, advanced 2%.
Other banks showing strong gains of 3% or more included
The sector helped lead the broader market higher in anticipation of more stimulus measures as the Federal Open Market Committee kicked off its two-day meeting on monetary policy and the U.S.economy. Read more on Federal Reserve.
In Spain, a debt auction saw the sale of 3.039 billion euros ($3.844 billion) of short-term bills, exceeding a target range of €2 billion to €3 billion, although at sharply higher yields. Read more on Spanish bond auction.
Also Tuesday, the Commerce Department said building permits rose to a four-year high even though starts on new homes declined in May. Read more on housing data.
Notable financial stocks with gains of about 3% or more included
Shares of
Profit for the three months ended May 31 fell 11% after accounting for rising loan-loss provisions. Total loans rose 8.6% from the prior year to $57.06 billion, while Discover's credit-card loans grew 3.7% to $46.61 billion.
Provision for loan losses was $232 million, up from $176 million a year ago and $152 million in the prior quarter.
Shares of
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