US stocks rebounded on Friday in an abbreviated session as the start of holiday shopping lifted retail stocks, while progress in a plan to relieve the credit market's strain aided bank shares.
Shares of J.P. Morgan Chase, Bank of America and Citigroup all rose more than 2 percent. The three banks, spearheading an effort to establish a superfund to ease problems in the credit market, are expected to seek support from others in the industry, The Wall Street Journal reported.
Discount chain Target led retailers higher as droves of shoppers turned out - in some cases before dawn - for Black Friday, the official beginning of the holiday shopping season. Trading volume was thin in the shortened session. US financial markets were closed on Thursday for Thanksgiving. On Wednesday stocks suffered heavy losses on credit market and housing sector worries.
"I think we're entitled to some sort of rebound. One piece of good news is that the banks are making progress with the rescue attempt," said Michael Metz, chief investment strategist at Oppenheimer & Co. "But I wouldn't read too much into it because it may be more a case of the sellers leaving early for the day."
The Dow Jones industrial average was up 181.84 points, or 1.42 percent, at 12,980.88. The Standard & Poor's 500 Index was up 23.93 points, or 1.69 percent, at 1,440.70. The Nasdaq Composite Index was up 34.45 points, or 1.34 percent, at 2,596.60.
About 669 million shares changed hands, well below the daily average of 1.84 billion, while on Nasdaq, about 786 million shares traded, below last year's daily average of 2.02 billion. Advancing stocks outnumbered declining ones by a ratio of nearly 5 to 1 on the NYSE and by more than 3 to 1 on Nasdaq.
Despite Friday's rally, the Dow finished the week down 1.5 percent. The S&P lost 1.2 percent on the week and the Nasdaq fell 1.5 percent. November is shaping up to be one of the worst months for stocks since late 2002.
J.P. Morgan shares rose 3 percent to $41.90. Bank of America stock was up 2.4 percent to $43.13 and Citigroup stock climbed 3.2 percent to $31.70. Consumers, many with the day off from work, visited stores and shopping centers in search of bargains. Chains refer to the day after Thanksgiving as "Black Friday" because it once marked the day many retailers turned a profit and went into the black for the year.
Shares of J.C. Penney, which last week cut its forecast for the holiday season, were up 3.1 percent to $41.30. Target's stock jumped 5.7 percent to $57.17. Boeing's stock rose after the chief executive of Airbus, Boeing's chief rival, said the weakness of the dollar is "life-threatening" for the European aircraft maker. Boeing shares were up 2.4 percent to $89.54.
Mortgage and bond insurers rose after two French financial institutions agreed to provide funds to bond insurer CIFG. Shares of bond insurer MBIA gained 6.1 percent to $34.14 and AMBAC Financial rose 5.8 percent to $25.55. Shares of No 1 US mortgage insurer MGIC Investment were up 5.7 percent to $20.63.
E-Trade Financial, which was recently the object of bankruptcy speculation, surged 25.1 percent to $5.33 on a CNBC report that the online brokerage may be in merger talks with Charles Schwab and TD Ameritrade Holding.
Comments
Comments are closed.