U.S. Stocks Surge, Dow Easily Clears 13,000

Alcoa, Caterpillar and GE were among the top-performing blue-chip industrial stocks.

March 13, 2012

2 min read

U.S. stocks took off Tuesday and the Dow zoomed past the 13,000 mark, driven by soaring bank shares, which were sparked by JPMorgan Chase's announcement of a huge share buyback and dividend hike.

After a sharp surge higher in the final hour, the Dow Jones Industrial Average closed up 217.97 points (1.68%) to 13,177.68.

The broad-based S&P 500 gained 24.87 (1.81%) to 1,395.96, while the tech-heavy Nasdaq Composite added 56.22 points (1.88%) to 3,039.88.

Shares edged up in early trade, helped by a strong showing in February in retail sales data that showed growth picking up to 1.1% month-on-month.

The Federal Reserve kept its low interest-rate policy in place but acknowledged some improvement in the economy, further helping sentiment.

A final surge came after JPMorgan announced it cleared Fed stress tests and will boost its dividend by 20% and embark on a $15 billion share buyback program.

JPMorgan shares added 7.3%, dragging the other major banks with it ahead of the Fed's release of all the stress-test results.

Bank of America gained 6.3%, Citigroup 6.3%, Wells Fargo 5.8%, and Goldman Sachs 6.5%.
In other blue-chip action, Alcoa surged 4.5%, General Electric added 2.6%, Caterpillar 3.9%, Apple 2.9% and eBay 3%.

Bond prices dropped. The yield on the 10-year Treasury surged to 2.11% from 2.03% Monday, while the 30-year increased to 3.25% from 3.17%.