Financial ETF surges to a decade high as Fed, data help boost Treasury yields
Bank stocks surged Wednesday, with the SPDR Financial Select Sector ETF (XLF) running up 1% to the highest level seen in nearly a decade, as hawkish comments (http://www.marketwatch.com/story/yellen-says-fed-should-be-wary-of-raising-rates-too-gradually-2017-09-26) from Federal Reserve Chairwoman Janet Yellen and upbeat data (http://www.marketwatch.com/story/durable-goods-orders-jump-17-in-august-2017-09-27) fueled a rise in Treasury yields. Among the financial sector tracker's (XLF) most heavily weighted components, shares of Goldman Sachs Group Inc. (GS) rallied $3.55, or 1.5%, and J.P. Morgan Chase & Co. (JPM) rose 95 cents, or 1.0%, to pace the Dow Jones Industrial Average advancers. The shares' gains were adding a combined 31 points to the Dow's price, which was up 10 points. Elsewhere, shares of Bank of America Corp. (BAC) climbed 2.1%, Citigroup Inc. (C) tacked on 1.8% and Wells Fargo & Co. (WFC) gained 0.6%. The XLF was on track to close at the highest level since Dec. 10, 2007.The yield on the 10-year Treasury note (http://www.marketwatch.com/story/treasury-yields-jump-as-traders-position-for-higher-rates-2017-09-27) rose 7.4 basis points to a 2-month high of 2.303%. The higher yield can help boost bank profits, as it can increase the spread between what banks earn on longer-term assets like loans and the cost of shorter-term liabilities to fund those assets.
-Tomi Kilgore; 415-439-6400; AskNewswires@dowjones.com
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