Updated from 3:19 p.m. EDT

Financial stocks traded in positive territory on Thursday, helping lift the overall market.

Bank of America

(BAC) - Get Report

closed up 8.3% at $12.97 after analysts at Keefe Bruyette and Woods upgraded the stock to outperform from market perform and boosted the price target from $12 to $16.50.

Meanwhile, BofA Chief Executive Ken Lewis testified before Congress. Lewis has faced harsh criticism over the bank's acquisition of Merrill Lynch, and he suggested he was under pressure from federal officials to complete the deal.

The NYSE Financial Sector Index rose 56.41 points, or 1.4%, to 4057.44, while the KBW Bank Index moved up 2.5% to 38.19.

Elsewhere, Goldman Sachs analysts were positive on several regional bank names, with

Regions Financial

(RF) - Get Report

and

Fifth Third

(FITB) - Get Report

both lifted from neutral ratings to buy ratings. Regions was given a $5 target price, and the stock popped 9.2% to $4.37. Fifth Third received a price target of $8.50, and the stock traded up 5.9% to $7.77.

BB&T

(BBT) - Get Report

,

Huntington Bancshares

(HBAN) - Get Report

and

SunTrust

(STI) - Get Report

were all upgraded from sell to neutral. BB&T ended the day up 1.5% to $22.56, Huntington Bancshares added 2.5% to close at $4.13, and SunTrust gained 1.6% to $16.78.

Barclays

(BCS) - Get Report

rose 6.7% to $19.90 after

The Wall Street Journal

reported that

BlackRock

(BLK) - Get Report

might announce a deal to buy Barclays Global Investors. Barclays has also been attempting to sell its iShares business.

E*Trade

(ETFC) - Get Report

saw its shares climb after the

Journal

reported that the online broker was working with Citadel to improve its financial stability. Citadel may be giving the company more cash, but it has to keep its stock ownership below 24%, the report said. The stock closed at $1.66, a gain of 7 cents.

On the losing side, Piper Jaffray initiated a buy rating on

Mastercard

(MA) - Get Report

and gave the credit card provider a $222 price target. Unfortunately, it wasn't enough to lift the stock as it fell 2.1% to finish at $169.95.

Separately,

Ameriprise Financial

(AMP) - Get Report

announced it was planning to offer $900 million of new common stock, and the shares pulled back 64 cents to $25.69. The company is planning on using the capital to fund potential mergers and acquisitions.

On the deal front,

JPMorgan Chase

(JPM) - Get Report

completed its acquisition of hedge fund Highbridge Capital Management. The banking giant had originally taken a 55% stake in the company in 2004 and has been slowly increasing its ownership over the years. The funds' performance struggled in 2008, but rebounded in 2009. JPMorgan closed out the day up slightly at $34.94, a gain of 10 cents.