Better than expected results from Wells Fargo (NYSE: WFC) led to the biggest one-day gain ever for the KBX Bank Index (PHI: BKX) on Wednesday and sent the rest of the market soaring.
Wells Fargo’s results — coming ahead of earnings reports from JP Morgan (NYSE: JPM), Merrill Lynch (NYSE: MER) and Citigroup (NYSE: C) — eased financial fears for a day, sending the bank index higher by 17% and the major market indexes more than 2.5% higher. The gains came despite a higher than expected consumer inflation reading and were helped along by a steep drop in oil prices.
In the tech sector, Intel (NASDAQ: INTC) and Sun Microsystems (NASDAQ: JAVA) posted gains of 1% and 4%, respectively, on better than expected results, but it was clear that financial stocks were the stars of the day, with more than a third of S&P financial stocks posting double-digit percentage gains. E*Trade (NASDAQ: ETFC) gained 25% and Schwab (NASDAQ: SCHW) 14%.
Amazon (NASDAQ: AMZN) and AMD (NYSE: AMD) gained 7% each, and Intervoice (NASDAQ: INTV) soared 22% on a buyout deal with Convergys (NYSE: CVG).
Altera (NASDAQ: ALTR) surged 12% on its results, but Seagate (NYSE: STX) fell 15% after lowering guidance.
Microsoft (NASDAQ: MSFT), IBM (NYSE: IBM) and Google (NASDAQ: GOOG) rose ahead of their results due out after the close on Thursday, when AMD will report too. Nokia (NYSE: NOK) will release its quarterly results Thursday morning.
After the close, eBay (NASDAQ: EBAY) tumbled 7% after beating estimates but offering third-quarter guidance that was below analysts’ estimates.
The Nasdaq soared 69 to 2284, the S&P rose 30 to 1245, and the Dow soared 276 to 11,239. Volume declined to 6.7 billion shares on the NYSE, and 2.5 billion on the Nasdaq. Advancers led by a 26-8 margin on the NYSE, and 22-7 on the Nasdaq. Upside volume was 78% on the NYSE, and 90% on the Nasdaq. New highs-new lows were 23-366 on the NYSE, and 50-249 on the Nasdaq.