Bank stocks rebounded strongly Tuesday following another significant decline in oil prices and statements by Federal Reserve Board Chairman Ben Bernanke designed to provide assurances about the financial system.
The KBW Bank Index rose 7.63%, with dozens of banking companies posting double-digit gains. The Standard & Poor's 500 rose 1.71% and the Dow Jones industrial average rose 1.36%.
Oil prices fell more than $5 a barrel Tuesday after declining by nearly $4 Monday.
Mr. Bernanke, meanwhile, provided some confidence for financial stocks, saying at a conference in Arlington, Va., that the central bank is "strongly committed to supporting the stability and improved funding of the financial system." Among other things, he said the Fed could allow emergency lending to broker-dealers that is set to expire in mid-September to continue into next year.