U.S. bank stocks up on Goldman note, investor hopes
CHARLOTTE, North Carolina
CHARLOTTE, North Carolina (Reuters) - U.S. bank stocks surged on Thursday with regional lender Marshall & Ilsley Corp's MI.N stock price spiking as much as 12 percent, after Goldman Sachs Group Inc (GS.N) released an optimistic research note on the industry.
Goldman said U.S. banks are on stronger footing due to an improving U.S. economy, higher equity prices and a favorable interest rate environment.
The gains are the latest in a series of rapid price increases and decreases for bank stocks in recent months.
"When you get a shop like Goldman out supporting the sector, it can't help but boost investor confidence," said Michael Nix, principal at Greenwood Capital Associates, adding that he expects bank stocks to continue to be volatile in the coming quarter.
The largest morning gains were posted by regional banks, whose shares have been battered in recent weeks as they continue to struggle with real estate-related loan losses.
The KBW Bank Index .BKX, a leading sector index, was up 3.5 percent in late morning trading, led by Marshal and Ilsley's 10.2 percent increase to $5.38.
Birmingham, Alabama-based Regions Financial Corp's (RF.N) shares increased 6.5 percent to $6.03. Atlanta-based SunTrust Banks Inc (STI.N) shares rose 5.3 percent to $25.26.
Larger U.S. money center banks' shares also showed gains.
Bank of America Corp (BAC.N) shares were up 2.8 percent at $11.61, just two days after closing at a new 52-week low of $10.91.
(Reporting by Joe Rauch; Editing by Tim Dobbyn)