US close: Stocks surge as banks shrug off downgrades

Date: Friday 22 Jun 2012

US equities rose strongly on Friday as banking stocks overcame downgrades from Moody's and the mood was lifted by the European Central Bank relaxing collateral rules from banks.

Moody's downgraded the credit ratings of 15 global banks last night, including US heavyweights Citigroup, Morgan Stanley, Goldman Sachs, Bank of America and JPMorgan Chase & Co.

However, banks rallied on the news with analysts suggesting that markets had already priced in the ratings cuts; also, some of the cuts were not as bad as feared.

Helping sentiment today was the news that the ECB has relaxed some of its collateral rules on banks in an effort "to further support the provision of credit to households and non-financial corporations."

The ECB said it had reduced the rating threshold and amended the eligibility requirements for certain asset-backed securities, thus broadening the scope of measures to increase collateral availability.

In other news, Spanish banks will need €51-62bn euros in additional capital in a worst case scenario, according to the independent consultants Oliver Wyman and Roland Berger hired by the government to perform a new round of stress tests on its financial sector.

In other company news, social media giant Facebook jumped after Nomura gave the stock a 'buy' rating.

Solar panel group First Solar surged after obtaining Los Angeles County approval to resume building a solar farm in California.


S&P 500 - Risers
First Solar Inc. (FSLR) $15.88 +9.22%
AK Steel Holding Corp. (AKS) $5.55 +5.92%
Supervalu Inc. (SVU) $4.88 +5.86%
Southwestern Energy Co. (SWN) $29.02 +5.76%
Life Technologies Corp. (LIFE) $44.46 +5.28%
Visa Inc. (V) $124.95 +4.58%
Cabot Oil & Gas Corp. (COG) $36.40 +4.48%
Range Resources Corp. (RRC) $59.23 +4.06%
Newfield Exploration Co (NFX) $26.54 +4.00%
F5 Networks Inc. (FFIV) $99.30 +3.99%

S&P 500 - Fallers
Ryder System Inc. (R) $35.44 -13.03%
Macy's Inc. (M) $33.78 -3.26%
Carnival Corp. (CCL) $33.66 -2.66%
Masco Corp. (MAS) $12.76 -2.52%
Whirlpool Corp. (WHR) $56.73 -2.46%
CSX Corp. (CSX) $21.63 -2.13%
Freeport-McMoRan Copper & Gold Inc. (FCX) $32.30 -2.09%
Halliburton Co. (HAL) $27.80 -1.94%
National Oilwell Varco Inc. (NOV) $63.09 -1.85%
Rockwell Automation Inc. (ROK) $65.58 -1.80%

Dow Jones I.A - Risers
Microsoft Corp. (MSFT) $30.70 +1.87%
Merck & Co. Inc. (MRK) $40.18 +1.85%
Bank of America Corp. (BAC) $7.94 +1.53%
Home Depot Inc. (HD) $52.02 +1.48%
General Electric Co. (GE) $19.81 +1.43%
Verizon Communications Inc. (VZ) $43.95 +1.43%
JP Morgan Chase & Co. (JPM) $35.99 +1.35%
Cisco Systems Inc. (CSCO) $17.13 +1.21%
Travelers Company Inc. (TRV) $63.33 +1.20%
E.I. du Pont de Nemours and Co. (DD) $49.96 +0.85%

Dow Jones I.A - Fallers
Wal-Mart Stores Inc. (WMT) $67.30 -0.59%
Caterpillar Inc. (CAT) $84.96 -0.02%
Exxon Mobil Corp. (XOM) $82.11 -0.00%

Nasdaq 100 - Risers
First Solar Inc. (FSLR) $15.88 +9.22%
Life Technologies Corp. (LIFE) $44.46 +5.28%
Vertex Pharmaceuticals Inc. (VRTX) $60.61 +5.23%
Illumina Inc. (ILMN) $40.58 +4.28%
Celgene Corp. (CELG) $61.63 +3.68%
Activision Blizzard Inc. (ATVI) $11.79 +3.06%
Seagate Technology Plc (STX) $23.34 +2.91%
Citrix Systems Inc. (CTXS) $80.15 +2.69%
Xilinx Inc. (XLNX) $32.66 +2.38%
Broadcom Corp. (BRCM) $34.38 +2.32%

Nasdaq 100 - Fallers
Research in Motion Ltd. (RIMM) $9.85 -2.09%
Garmin Ltd. (GRMN) $36.98 -1.12%
CH Robinson Worldwide Inc (CHRW) $57.37 -0.80%
J.B. Hunt Transport Services Inc. (JBHT) $57.25 -0.73%
Foster Wheeler AG (FWLT) $17.04 -0.70%
Urban Outfitters Inc. (URBN) $27.55 -0.49%
Stericycle Inc. (SRCL) $88.47 -0.24%

BC

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