Several of America’s largest financial firms reported strong earnings and revenue Thursday thanks to solid demand for loans, better credit quality and a boom in mergers and initial public offerings.
Morgan Stanley ( MS), Citigroup ( C), Bank of America ( BAC) and even troubled Wells Fargo ( WFC) posted healthy results that surpassed analysts’ expectations. Shares of BofA rose nearly 4% in midday trading while Morgan Stanley was up about 2%. Citi’s stock was flat and Wells Fargo fell more than 1%. But the broader market enjoyed an earnings rally. The Dow rose more than 525 points, or 1.5%. The somewhat muted reaction from some bank investors might be due to the fact that their good news was already priced into the shares. Bank stocks have already surged this year on hopes of an economic rebound and rising long-term bond yields, which help to boost lending profits. Strong results from insurer UnitedHealth ( UNH), drugstore giant Walgreens ( WBA) and Taiwan Semiconductor ( TSM) also lifted sentiment.
