Markets Right Now: Banks lead stocks higher on Wall Street

NEW YORK – The latest on developments in financial markets (all times local):

11:45 a.m.

U.S. stocks are recovering nearly all of the ground they lost the day before as investors hope Italy might be able to avoid a new round of elections.

Banks are rising along with bond yields Wednesday after sustaining big losses a day ago. KeyCorp rose 2.2 per cent.

Energy companies are breaking out of a five-day losing streak as oil prices rise. Exxon Mobil surged 3.5 per cent.

Smaller companies are rising sharply. They suffered only modest losses the day before.

The S&P 500 index rose 30 points, or 1.1 per cent, to 2,720.

The Dow Jones industrial average rose 240 points, or 1 per cent, to 24,600. The Nasdaq climbed 64 points, or 0.9 per cent, to 7,461.

The yield on the 10-year Treasury rose to 2.86 per cent.

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9:35 a.m.

Hopes that new elections in Italy can be avoided helped send stocks broadly higher in the U.S. and Europe.

The gains early Wednesday on Wall Street erased about half of the market’s losses from a day earlier, when investors worried that an impasse in Italian politics could destabilize the euro.

Banks, which took heavy losses the day before, rebounded. JPMorgan Chase added 1.5 per cent. U.S. banks were benefiting from a turn higher in bond yields, which allows them to charge higher interest rates on loans.

The S&P 500 index rose 16 points, or 0.6 per cent, to 2,706.

The Dow Jones industrial average rose 162 points, or 0.6 per cent, to 24,517. The Nasdaq climbed 34 points, or 0.5 per cent, to 7,431.

The yield on the 10-year Treasury rose to 2.85 per cent.