NEW YORK--A rebound by banks and health-care shares helped push the
blue chips higher--but not enough to help them avoid a losing week.
The Dow Jones Industrial Average rose 67.21 points, or 0.5%, to
12640.78, on Friday. The benchmark trimmed a weekly decline caused by
Thursday's sharp selloff, which was fueled by a cascade of bearish
global data.
J.P. Morgan Chase, up 1.4%, was among the Dow's biggest advancers.
Bank of America, Morgan Stanley and Wells Fargo also gained, up 1.5%,
1.3% and 1.5%, respectively.
The Standard & Poor's 500-stock index tacked on 9.51 points, or 0.7%,
to 1335.02. All 10 of the index's sectors traded higher, though
consumer staples and utilities lagged behind. The Nasdaq Composite
added 33.33 points, or 1.2%, to 2892.42.
Uri Landesman, president of New York hedge fund Platinum Partners,
called it a "relief rally" for stocks--"a little bit of buying on the
bad news."
Late Thursday, Moody's Investors Service downgraded numerous global
banks, citing significant exposure to volatility and the risk of large
losses from capital markets activities.
But analysts largely took a positive view, saying the decisions were
on the whole slightly less negative than many investors had feared.
Only one company, Credit Suisse Group, had its rating cut by three
notches. Two others, Morgan Stanley and UBS, had faced three-notch
reductions but were downgraded only two levels.
The immediate effect was to dispel concerns that had hung over the
market since February. "It appears that a headwind has been removed,"
Keefe, Bruyette & Woods analyst David Konrad wrote in a note to
clients.
The U.S.-listed shares of Credit Suisse rose 1.2%, and UBS's added 2.1%.
In Europe, markets were mostly lower, with the Stoxx Europe 600
falling 0.7%, as more downbeat economic data weighed on sentiment.
June data showed Germany's Ifo index of business confidence fell more
than expected. Benchmark indexes in the U.K., Germany and France all
rose for the third week in a row.
Meanwhile, Spain's IBEX 35 index bucked the trend by rallying 1.5%,
after an external audit said the country's banks will need to increase
capital by up to 62 billion euros ($77.75 billion) to survive a
worst-case scenario. That number was a lot lower than many had feared.
The European Central Bank said it would offer loans to euro-zone banks
in exchange for a wider range of collateral, accepting securities such
as car loans and certain mortgage-backed securities, in a move seen as
an attempt to provide liquidity to Spanish banks.
Asian markets were broadly lower on the back of U.S. weakness
Thursday, with Japan's Nikkei Stock Average losing 0.3% but rising
2.7% on the week, its third weekly gain in a row. Hong Kong's Hang
Seng Index slumped 1.4%, down 1.2% on the week and six of the past
seven.
Crude-oil futures added $1.56 a barrel, or 2%, to $79.76. Gold rose
$1.50 a troy ounce, or 0.1%, to $1,566.
The dollar rose against the yen but lost ground to the euro.
In corporate news, Ryder System slid 13%, the biggest decline among
the S&P 500 components. The truck-rental company lowered its
second-quarter and full-year earnings outlooks, citing
lower-than-expected demand.
Facebook rose 3.8%, extending its more-than-20% rally from its early
June lows, which followed concerns about the social network's
valuation and botched initial public offering.
Harvest Natural Resources soared 87% after the energy company agreed
to sell its Venezuela assets to Indonesia's PT Pertamina for $752
million.
Darden Restaurants declined 0.7% after the operator of Olive Garden
and Red Lobster projected continued weak growth for its major brands,
citing expectations of a "frustratingly slow" economic recovery.
Associated Estates Realty dropped 2.1% after the real-estate
investment trust said it planned a public offering of 5.5 million
shares of its common stock.
Write to Matt Jarzemsky at matt.jarzemsky@wsj.com
(END) Dow Jones Newswires
June 22, 2012 07:05 ET (11:05 GMT)
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