Associated Press Wall Street storms higher on relief over jobs data, results of bank tests; Dow jumps 165

NEW YORK (AP) -- As far as Wall Street is concerned there is no bad news anymore. At least for now, traders are seeing news about longtime trouble spots like banking and unemployment in a strictly positive light.

Surging bank stocks have lifted the Standard & Poor's 500 index a dizzying 37.4 percent since early March, when the benchmark for many mutual funds and other investments skidded to a 12-year low. The index is still down 40.6 percent from its high in October 2007.

"We trust the rally," said Chris Hyzy, chief investment officer at US Trust. He said the rapid climb since March 9 is justified because investors are no longer running from worries about a possible depression.

On paper, U.S. stocks have gained nearly $2.9 trillion in value since the rally started.

The latest fuel for the ascent came from news that job losses slowed in April and that big banks don't need as much capital as some investors had feared.

The Labor Department said employers cut 539,000 jobs last month -- the fewest in six months and much fewer than analysts had expected.

Bank shares surged after the government released report cards on the nation's 19 largest financial institutions. With the "stress tests" results out and easing fears about the stability of banks, investors could check another item off their list of worries.

"Getting past the stress tests was a milestone," said Jim Dunigan, managing executive of investments for PNC Wealth Management. "That was a cloud hanging over our head for the past several months. The good news is there were no surprises."

The dissipating worries sent the Dow charging higher by 164.80 points, or 2 percent, to 8,574.65. The Standard & Poor's 500 index rose 21.84, or 2.4 percent, to 929.23, and the Nasdaq composite index rose 22.76, or 1.3 percent, to 1,739.00.

For the week, the Dow is up 4.4 percent, trimming its losses for 2009 to only 200 points, or 2.3 percent. It was the eighth gain for the index in nine weeks. The S&P 500 index jumped 5.9 percent, while the Nasdaq composite index rose 1.2 percent after logging bigger gains in recent weeks than other indicators. more...