(By Salman - iStockAnalyst Writer)US stocks extended gains on Friday as investors welcomed economic data that fueled hopes of a strong recovery. Shares also rallied as stress test results boosted sentiment.
The Dow Jones Industrial Average jumped 164.80 points or 1.96% to finish at 8,574.65. The S&P 500 gained 21.84 points or 2.41% to end at 929.23. The Nasdaq Composite rose 22.76 points or 1.33% to 1,739.
Shares of financials rallied. JP Morgan (NYSE:
JPM) soared $3.70 or 10.50% to $38.94. Citigroup (NYSE:
C) soared 21 cents or 5.51% to $4.02. American Express (NYSE:
AXP) surged $2.43 or 9.36% to $28.40. Bank of America (NYSE:
BAC) gained 66 cents or 4.89% to $14.17. Shares of Wells Fargo & Co.(NYSE:
WFC) leaped $3.42 or 13.81% to $28.18.
A Labor Department release on Friday showed the economy shed 539,000 jobs in April. Economists expected payrolls to drop 600,000. The unemployment rate shot up to 25 year high of 8.9% in April from 8.5% in March. Economists had projected a reading of 8.9%.
Late on Thursday, federal regulators released the much anticipated result of stress tests on the health of the 19 largest US banks. According to the stress test results, 10 institutions have been asked to raise $74.6 billion in private capital. Meanwhile, Wells Fargo and Morgan Stanley (NYSE:
MS) - have already announced plans to raise capital. Bank of America Inc., on the other hand said that it intends to sell assets, issue $17 billion in common stock, and take other steps in order to meet the total capital shortfall of $33.9 billion. Also, Citigroup made it clear that seeking nothing further from the US government while American Express formally asked regulators for permission to repay the $3.4 billion (2.3 billion pounds) in TARP funds it received, after the U.S. government stress test showed the credit card firm does not need additional capital.
Energy stocks finished with gains. Exxon Mobil Corp.
