Sunday, August 5, 2012

Financial Stocks: Financial stocks rise on economic data

SAN FRANCISCO (MarketWatch) � Financial stocks led the broader market to close higher Thursday as U.S. jobless claims remained steady and housing prices rose slightly.

Leading the rise in the sector were shares of Federated Investors Inc. FII with closing up 5.9%. Shares of Principal Financial Group PFG �and Hartford Financial Services HIG �also rose, closing up 3.3% and 2.4%, respectively.

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Analysts at Sterne Agee raised their rating on Principal Financial to buy from neutral. Meanwhile, Macquarie Securities initiated coverage with an outperform rating.

Earlier, the Federal Housing Finance Agency said U.S. home prices rose 0.7% in December. Read more on housing prices.

Also, U.S. jobless claims remained steady at 351,000 with the four-week average falling to its lowest in four years. Read more on jobless claims.

The Financial Select Sector SPDR ETF XLF , which tracks financial stocks in the S&P 500 Index SPX , rose 0.9%, and the SPDR S&P Bank ETF KBE �advanced 1.1%.

Shares of Citigroup Inc. C rose 1.1% following a report that the bank intends to sell its roughly 10% stake in Indian mortgage group Housing Development Finance Corp. on Friday, a transaction that could garner up to $2.07 billion.

On the Dow Jones Industrial Index DJIA , Bank of America Corp. BAC shares rose 0.9%, J.P. Morgan Chase & Co. JPM �shares advanced 1.1%, Travelers Cos. TRV �shares closed up less than 0.1% and American Express Co. AXP �shares declined 0.2%.

Other notable gainers included Charles Schwab Corp. SCHW , State Street Corp. STT , IntercontinentalExchange Inc. ICE , and Leucadia National Corp. LUK , all of which closed up 3% or more.

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