By Laura Mandaro, MarketWatch
SAN FRANCISCO (MarketWatch) — U.S. stocks started slightly higher Wednesday, poised to extend gains to a sixth day, as investors’ relief about largely positive bank stress-tests and U.S. data spilled over from the prior session.
The Dow Jones Industrial Average DJIA +0.23% was up 24.48 points, or 0.2%, at 13,201.94, led by a 2.9% rise in American Express Co. AXP +3.16% and a 2.2% gain in Bank of America Corp. BAC +3.76% shares.
The S&P 500 SPX +0.16% edged up 1.5 points, or 0.1%, to 1,397.55, as the benchmark headed closer to 1,400 — a level it hasn’t hit since June 2008.
Tech and consumer-discretionary shares led the early gains gains; health-care and natural-resource stocks lagged among the S&P 500’s 10 industry groups.
A close higher for the S&P 500 and Dow would be the indexes’ sixth straight day of gains.
The Nasdaq Composite COMP +0.28% added 7.6 points, or 0.3%, to 3,047.55. On Tuesday, it ended above 3,000 for the first time in 11 years, boosted by a nearly 3% rise in Apple Inc. AAPL +2.26% shares.
Late in the prior session, an announcement from J.P. Morgan Chase & Co. JPM +0.83% that it was increasing its dividend and authorizing a new stock-buyback program — after receiving the green light from the Federal Reserve about its capital levels — gave stocks an added lift, as investors interpreted the move as signaling success for other large banks that recently underwent financial-crisis stress tests administered by the central bank.
After the close of trading, the Fed, which acts as a bank regulator as well as a central bank, released results of the stress tests.
Most banks had enough capital under a stress test designed to mimic the conditions of a 2008-type crisis, including an unemployment rate of 13% and the Dow average under 6,000. Ally Financial Inc., Citigroup Inc. C -1.29% , MetLife Inc. MET -4.92% and SunTrust Banks Inc. STI +5.62% did not make the grade, however. Read more on stress tests.
Several banks that passed the tests, such as U.S. Bancorp USB +0.90% , also announced plans to boost dividends or shareholder payouts. Read more on dividend hikes.
The Dow average ended Tuesday with a more than 200-point gain, at its highest closing level since Dec. 31, 2007, also helped by a report on strong retail sales and positive comments about the economy from the Fed’s monetary-policy committee, which kept its current easing programs in place. Read more on market snapshot.
