Bank stocks push indexes higher; oil prices dip
NEW YORK (AP) — Financial companies pushed stock indexes higher today on hopes that large banks may soon raise their dividends.
Bank of America Corp. rose 4.4 percent, the most of the 30 stocks that make up the Dow Jones industrial average, after chief executive Brian Moynihan told an investor’s meeting that the bank could earn more money over the next two years as its business stabilizes. That led analysts to note that large consumer banks may raise their dividends. Banks slashed dividends during the 2008 financial crisis to cut costs.
Financial stocks in the S&P 500 index rose 2 percent, the most of any of the index’s 10 company groups. American Express Co. gained 4 percent, and JPMorgan Chase & Co. gained 3 percent.
Falling oil prices also helped stocks move higher. Oil prices dipped 0.5 percent to $105 a barrel after Kuwait’s oil minister said that OPEC members are in informal talks about raising oil output as the conflict in Libya continues.
“Rapidly higher moving oil prices can substantially impact demand,” said Oliver Pursche, president of Gary Goldberg Financial Services. It’s something OPEC members are “very, very much aware of and want to avoid.”
Oil prices have risen 9 percent so far this month. That has pushed stocks lower as investors worry that higher gas prices will dampen the economic recovery.
The Dow Jones industrial average gained 129 points, or 1.1 percent, to 12,218 in afternoon trading. The S&P 500 rose 12, or 0.9 percent, to 1,322. Energy companies were the only group among the S&P index to fall, losing 0.5 percent.
The Nasdaq composite rose 21, or 0.8 percent, to 2,767.