Updated from 3:19 p.m. EDT
Financial stocks rallied Thursday, as exchanges benefitted from the Obama administration's plans to tighten regulation of derivatives trading.
each got boost from the plans to push for bringing trading of many over-the-counter
derivatives to centralized clearinghouses. JPMorgan upgraded CME to neutral from underweight. The stock closed up over $10.27 to $284.37, while ICE was lifted over $4.17 to $100.76.
PNC Financial Group
offered 15 million shares of common stock in an attempt to boost its Tier 1 capital by $653 million after recent stress tests performed by federal regulators determined the company needed more capital. The news pushed the stock down over 4% in the morning trading session, but then the stock recovered amid the financial sector rally. It closed up 2.2% to $43.12.
Bank of America
shares rose 2.7% to $11.31 after the Chinese government confirmed the company sold some of its stake in China Construction Bank for approximately $7.3 billion. BofA continues to own 11% of the Chinese lender. Regulators had also pressured BofA to generate more capital. Morgan Stanley upgraded the banking industry from in-line to attractive further lifting the banks.
issued $2.5 billion of five-year notes on Wednesday, only to see the appetite for the bonds weaken on Thursday. The huge supply of corporate debt is causing the corporate bond rally to fizzle. JPMorgan's common stock jumped 4.4% to $35.54 as it rallied with the rest of the group.
shares finished the day up three cents to at 83 cents. The mortgage company, which is in federal conservatorship, reported a $9.9 billion loss. Dropping home prices and a dismal economy combined to wreak havoc on the company's balance sheets and the company is seeking more money from the Treasury Department to cover its losses. The stock opened down, but then the Obama administration said it planned to expand the housing program to aid in mortgages reversing course in the stock price.
And finally, Genworth Financial
soared 20.2% to $4.99 after Raymond James analyst Steven Schwartz raised his price target to $5.50 from $3.00. The company has suffered from huge losses but guided for growth in the life insurance business for later in the year.
The KBW Bank Index enjoyed trading in positive territory as it moved up over 3.7% to close at 37.77, joined by the NYSE Financial Index which finished up 3.2% to close at 3,739.