March 7, 2012 / 12:22 AM / 7 years ago

Banks lift Wall Street, breaking 3-day skid

NEW YORK (Reuters) - Stocks broke a three-day losing streak on Wednesday, recovering some recent losses after a report showed the U.S. private sector added more jobs than expected last month.

After suffering their worst decline in three months on Tuesday, stocks received an early lift after payroll processor ADP said U.S. private employers picked up the pace of hiring in February.

A report from The Wall Street Journal saying the U.S. Federal Reserve is considering a new type of mortgage and Treasury bond-buying program boosted stocks, particularly the financials.

Banking stocks - Tuesday’s big losers - were the strongest sector on Wednesday. The KBW bank index .BKX advanced 1.9 percent. Morgan Stanley (MS.N) gained 3.2 percent to $17.88 following a 5.3 percent drop in the previous session.

“Earlier in the week, portfolio managers, advisors and institutional money managers were looking for some sort of pullback just because it’s good to buy on the dip, and we’ve had such a nice run,” said Mark Martiak,, senior wealth strategist at Premier Financial Advisors in New York.

“The right part of the economic good news, good data story was the private sector adding 216,000 jobs.”

The news comes after Fed Chairman Ben Bernanke stirred caution among many in financial markets last week by giving no clear indication that he plans to spur faster growth by pushing for another round of asset purchases, or quantitative easing.

Improving economic figures have helped push the S&P 500 up more than 20 percent from the October closing low.

Investors continued to eye signs of progress in negotiations between fiscally troubled Greece and private creditors that will result in a substantial write-down for Greece’s debt costs.

Tuesday’s tumble was prompted by renewed concerns about Greece and the outlook for the global economy. It was one of the worst performances since stocks began rallying in October and the third straight decline for the S&P 500.

Six Greek pension funds are still holding out against joining the deal while eight have agreed to take part.

The Dow Jones industrial average .DJI rose 78.18 points, or 0.61 percent, to 12,837.33 at the close. The Standard & Poor's 500 Index .SPX climbed 9.27 points, or 0.69 percent, to 1,352.63. The Nasdaq Composite Index .IXIC added 25.37 points, or 0.87 percent, to 2,935.69.

The PHLX housing sector index .HGX advanced 2.7 percent, with Hovnanian Enterprises (HOV.N) up 2.5 percent at $2.46 after posting results.

Apple shares were volatile as the company unveiled its latest iPad, which commands upwards of two-thirds of the growing tablet market.

Apple shares fluctuated between gains and losses after the reveal, closing up just 0.08 percent at $530.69. Earlier in the session, Apple’s stock had gained as much as 1.4 percent to reach an intraday high at $537.78.

Shares of Freeport McMoRan Copper & Gold Inc (FCX.N) fell 1.1 percent to $38.99 and Newmont Mining Corp (NEM.N) slipped 0.9 percent to $56.68 after Indonesia announced new rules to take more profits from vast mineral resources by limiting foreign ownership of mines.

The PHLX gold/silver index .XAU shed 0.1 percent.

Investors kept an eye on oil prices after France voiced skepticism that a planned revival of talks between six world powers and Iran over its nuclear program would succeed.

A board shows stock prices for Walmart, Linkedin, McDonald's and Coca-Cola at the booth they are traded on the floor of the New York Stock Exchange, March 6, 2012. REUTERS/Brendan McDermid

Rising geopolitical tensions could bring war to the region, raise oil prices, and harm the global economy.

Volume was light, with about 6 billion shares traded on the New York Stock Exchange, NYSE Amex and Nasdaq, below the daily average of 6.9 billion.

Advancing stocks outnumbered declining ones on the NYSE by a ratio of nearly 4 to 1, while on the Nasdaq, about three stocks rose for every one that fell.

Reporting By Chuck Mikolajczak; Editing by Jan Paschal

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