Courtesy of John Nyaradi.
Banks and the Financial Sector rally into the close to post solid gains and lead major indexes higher ahead of Friday’s European summit.
After an up and down day, major U.S. stock indexes ended higher with a late day rally led by financial giants JP Morgan (NYSE:JPM) gaining 2.3%, Bank of America (NYSE:BAC) adding 1.9% and Wells Fargo (NYSE:WFC) rising 1.5%.
Financial Sector ETFs participated in the rally with the Vanguard Financials ETF (NYSEARCA:VFH) climbing 1.2% and SPDR KBW Bank ETF (NYSEARCA:KBE) gaining +0.9%.
Banks and the financial sector are paying particularly close attention to the swirling events out of Europe as they stand on the front lines of the outcome of any positive or negative conclusion of Friday’s summit.
Rumors swirled hot and heavy again today as reports indicated that the International Monetary Fund was going to help out Europe with a financial rescue facility and that ECB President Mario Draghi is going to cut interest rates tomorrow and take steps to boost lending to encourage economic growth in Europe.
But the European bond market remains nervous with yields rising in both Spain and Italy.
At home, consumer credit rose to a 24 month high and tomorrow brings jobless claims, wholesale inventories and possible action from the Governing Council meeting of The European Central Bank to be held in Frankfurt starting at 9:00 a.m. Central European Time.
Bottom Line: The clock ticks towards Friday, and for today, the Financial Sector (NYSEARCA:VFH) placed its bet on a positive outcome.
Disclaimer: Wall Street Sector Selector actively trades a wide range of exchange traded funds (ETFs) and positions can change at any time.
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