surged more than 3%, fueled by another unsubstantiated takeover rumor in the financial services sector.
American Express, one of the few financial firms included in the Dow Jones Industrial Average, was the index's top gainer on Thursday. During the day, the New York charge card and travel services firm hit a 52-week high of $62, rising $1.97
Some traders attributed the surge in shares of AmEx to speculation that Citigroup, the nation's largest bank, might be eyeing it for a possible acquisition. Shares of Citi, another Dow component, rose 71 cents or 1.4%, to $53.03, following its annual meeting with analysts and investors.
There appeared to be little evidence to support a tie-up between Citi and AmEx. But the rumor comes just days after a
analyst suggested that
Bank of America
was on the verge of inking a deal for Britian's
. Officials with BofA have said there's nothing to the Barclay's rumor.
Both American Express and Citi declined to comment on market speculation.
Meanwhile, Citi CEO Chuck Prince, speaking at Thursday's investor conference, says the bank has no plans to make a major U.S. bank acquisition. Some Wall Street analysts says Prince may be playing coy and not wanting to cause a further sell-off in Citi's shares.
Frank Barkocy, the director of research at Keefe Managers, a fund manager that specializes in financial services firms, says there is no truth to the AmEx and Citi rumor.
Still the trading in shares of AmEx was impressive. On Thursday, the financial services firm traded nearly 8.5 million shares--well above its average daily trading volume of 5.4 million shares a day.
Moreover, this is not the first time that observers have speculated on merits of a combination of Citi, which has a presence in 100 countries, and American Express.
For years Wall Street has
endorsed the pairing of a retail and commercial banking giant with a brand name well respected by the business elite. Recently, some analysts and big investors have been clamoring for the $1.5 trillion-asset bank to boost its stock price by doing a large domestic banking deal.
AmEx is one of the last stand-alone credit card companies that is not hooked up with another bank. Just this month, card lender
closed on its deal to acquire New York's North Fork Bank.