Banks Lead Dow to Another Positive Close

Updated from 4:12 p.m. EDT

Stocks in New York managed to stay in slightly positive territory for a second consecutive day Wednesday, the first time in roughly a month, with tech and financials leading the way.

The Dow Jones Industrial Average rose 3.91 points, or 0.06%, to 6930.40, and the S&P 500 to added 1.76 points, or 0.2%, to 721.36. The Nasdaq tacked on 13.36 points, or 1%, to 1371.64.

Hewlett Packard ( HPQ) and Citigroup ( C) rose 6.2% and 5.8%, respectively, leading advances on the Dow. Banks were again outperforming with the KBW Bank Index up 3%.

Late in the afternoon, JPMorgan ( JPM) CEO Jamie Dimon said in an interview with CNBC that the bank was profitable in January and February, reiterating a similar proclamation by Citi on Tuesday that helped to spark a rally. For the day, the bank added 4.6%.

While Tuesday's movement was "a breath of fresh air," it's too early to say this is a bottom, said Peter Cardillo, chief market economist at Avalon Partners.

Although it's nice, this is likely a short-term rally sparked by positive comments yesterday and there's a lot of short-covering, says Walter Gerasimowicz, chairman and CEO of Meditron Asset Management. "I believe we still remain in the throes of a very deep recession."

But, says Brett D'Arcy, CIO of CBIZ Financial Solutions, "Enough good news is trickling into the market that people are getting comfortable enough to invest in stocks." The rally is long overdue, says D'Arcy. "Stocks have gotten so oversold, they're cheap right now, and there are some very good companies that have gotten taken down with the rest of the market.

"Are we done? Absolutely not, this is not going to be a straight line forward," he says. "But there is value here, we're not going to zero on the stock market, it's a good starting point."

Has the U.S. stock market reached its bottom?


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