Geithner Gives a Lift to These Big Bank Stocks: MS, GS, JPM, BAC, C, WFC, XLF
In remarks today to the Senate Banking and House Financial Services committees, Treasury Secretary Timothy Geithner said there is “absolutely” no chance that another U.S. financial institution would fail. This led to a rally in Morgan Stanley (NYSE:MS), Goldman Sachs (NYSE:GS) and other bank stocks (NYSE:KBE).
Geitner said to the committees:
“The direct exposure of the U.S. financial system to the countries under the most pressure in Europe is very modest. Europe as a whole, though, is a big deal. Our firms, and this is true across the largest institutions in the United States, again are in a much stronger position if you look at their capital levels, levels of leverage, how they’re funded.”
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The industry has been hit hard recently over concerns from its exposure to Europe. As the smallest of the today’s big banks, Morgan Stanley’s (NYSE:MS) stock has been very sensitive to the market’s volatile days.
Stocks affected by Geithner’s remarks included Bank of America (NYSE:BAC), Morgan Stanley (NYSE:MS), JP Morgan (NYSE:JPM), Citigroup (NYSE:C), Wells Fargo (NYSE:WFC), and Financial Select Sector SPDR ETF (NYSE:XLF).
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