Associated Press Stocks jump as fears ebb about bank 'stress tests'

NEW YORK (AP) -- Investors felt more confident putting their money into banks on the eve of a government report card on big financial companies.

Bank stocks pulled the market higher Wednesday as media reports trickled out that indicated balance sheets at major lenders might not be as frayed as some had feared.

The word came a day ahead of the formal release of results from government "stress tests" aimed at determining which banks need to raise more capital. Investors relieved to have assembled an initial scorecard scooped up shares of most banks, even those expected to have to come up with new money.

The Dow Jones industrial average jumped 100 points in heavy trading volume, while the technology-heavy Nasdaq composite index posted a more modest gain.

"To me, this rally has been more a recognition that maybe the end of the world is not at hand," said Philip S. Dow, managing director of equity strategy at RBC Wealth Management.

The news on banks and a surprise drop in a report on unemployment provided the latest shots of confidence to a market that has barreled higher in the past two months amid signs that the economy is stabilizing. Market indicators have surged more than 30 percent from the 12-year lows hit on March 9.

Financial stocks that had sent the market plunging from its peak in October 2007 led the advance again as worries about the government's report on banks eased. more...