Updated from 11:55 a.m. EDT

Financial stocks closed below their best levels of the session Wednesday, but the group on the whole was in the green by the time trading ended.

A number of widely held individual shares opened strong, weakened in the afternoon, then rebounded a bit to finish the day in positive territory. The KBW Bank index rose 3% to 23.34. Earlier it was higher by more than 7%.

Dow Jones Industrial Average components Citigroup ( C), Bank of America ( BAC) and JPMorgan Chase ( JPM) advanced.

In the case of JPMorgan, CEO Jamie Dimon was at a conference defending the Obama administration's handling of the financial crisis, and he emphasized that not all banks should be lumped into the same category just because some are struggling to survive.

Citi rose 9 cents to $1.54, and BofA was up 14 cents to $4.93. JPMorgan gained 90 cents, or 4.6%, to $20.40.

Additionally, analyst notes issued Wednesday morning upgraded Morgan Stanley ( MS), US Bancorp ( USB) and Wells Fargo ( WFC).

Goldman analysts advised clients to buy Morgan, up from an earlier neutral rating, citing fundamentals and a healthy capital position. They also upgraded US Bancorp to neutral from sell because of the stock's valuation.

NAB Research analyst Nancy Bush lifted her rating on Wells Fargo ( WFC) to buy from hold, citing a "very positive" meeting with management that gave her a more bullish outlook on the firm.

The bottom line, says Bush, is that Wells is a relatively healthy institution with a strong outlook. "No matter what the nature of the crisis, good banks will prosper while bad banks will fail," she writes. "Period."

Morgan Stanley was up $1.67, or 8%, at $22.51, and US Bancorp added $1.02, or 9%, to $12.42. Wells tacked on 7 cents to $11.88.

Among the bigger financial losers was Dow stock American Express ( AXP), which Goldman downgraded to a sell rating because of a weak outlook for consumers and credit-card debt. Its shares declined 24 cents, or 2%, to $11.93.