Financial stocks overcame an uncertain start Thursday and bolted higher in the afternoon following a report that Treasury Secretary Henry Paulson is floating the idea of a government entity -- similar to the Resolution Trust Corp. of the late 1980s that solved the savings and loan crisis -- to stem the current market's credit mess.
, the government program would take over bad debts from a number of financial institutions. After the report aired, the overall stock market rocketed higher, and the financials were some of the biggest beneficiaries.
The Amex Securities Broker/Dealer index was up 4.9%, the NYSE Financial Sector index was soaring 8.3%, and the KBW Bank index was jumping 4.7%.
Among individual stocks,
Bank of America
were gaining more than 9%.
was higher by 10.4%, and
was up almost 13%.
, the investment bank that several reports have said is seeking a merger partner or investor, was slumping earlier but lately rose 5%. A day ago, the stock hit its lowest level in years.
, said to have held talks about a deal with
, was sharply higher, surging 54% to $14.
, which tumbled along with Morgan on Wednesday, remained weak, falling 10% to $102.94. Meanwhile,
, a lender that has been driven lower for months but is now believed to be up for auction, was rising 18%.
The New York Times
reported after the previous close that
has hired Goldman to begin the process of selling the company.
This article was written by a staff member of TheStreet.com.