Sat, July 14, 2012
Business > Markets

Wall Street up on bank earnings

2012-07-13 21:43:49 GMT2012-07-14 05:43:49(Beijing Time)  Xinhua English

NEW YORK, July 13 (Xinhua) -- U.S. stocks rallied on Friday, with major indexes gaining for the first time in the week, after earnings from JPMorgan Chase were stronger than expected.

Both the Dow Jones industrial average and the Standard & Poor's 500 snapped a six-day losing streak.

The blue-chip Dow gained 203.82 points, or 1.62 percent, to settle at 12,777.09 while the S&P 500 rallied 22.02 points, or 1. 65 percent, to end at 1,356.78.

The Nasdaq Composite Index rose 42.28 points, or 1.48 percent, to 2,908.47, the fist gain in six sessions.

All eyes were on JPMorgan Chase on Friday as it was the first bank to report second-quarter results, which is believed to set the tone for the market in the following days.

Investors were especially focused on the updated losses from the huge trading scandal which rattled the company's stock price and hurt its reputation in May.

According to the bank, the trading blunder had cost the bank 4. 4 billion dollars in the last three months, more than double its previous estimate.

However, the bank still earned 5 billion dollars in the second quarter, or 1.21 dollars per share, higher than market had expected.

Adding to the bank gains, Wells Fargo, the fourth-biggest U.S. bank, on Friday reported higher profit for the second quarter on strong mortgage banking income and expense declines.

Its net income was 4.6 billion U.S. dollars, or 82 cents a share, up from 3.9 billion dollars, or 70 cents a share, a year earlier, higher than analysts' average estimate.

Friday's rally also came after China reported that its gross domestic product (GDP) grew by 7.6 percent in the second quarter. Although the growth was the lowest in over three years, it's in line with Wall Street forecast and reflecting "steady growth."

With the day's rally, the Dow and S&P 500 managed to eke out small gains for the week, while the Nasdaq was still fractionally lower.

In other markets, the U.S. dollar retreated against major currencies in late New York trading on Friday as investors trimmed their long bets of the greenback after it touched 2-year high against the euro.

Crude prices rose for the third straight day as supplies tended to be tight on Iran sanctions and production problems in North Sea.

Light, sweet crude for August delivery rose 1.02 dollars, or 1. 18 percent to settle at 87.10 dollars a barrel on the New York Mercantile Exchange.

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