Takeover speculation flew fast and furious Friday, but most bank stock investors weren't biting until the end of the day.
Merger rumors tend to gather special momentum on Fridays, since many banking deals are sealed on weekends and unveiled on Mondays.
The recent megadeals between Citicorp and Travelers Group Inc., NationsBank Corp. and BankAmerica Corp., and Banc One Corp-First Chicago NBD Corp. were all announced on Mondays.
"These rumors are going to be with us until the summer," said Frank J. Barkocy of Josephthal & Co. "It's getting to the point where we have to check where all the bankers are on any given Friday because they may spring something on us on Monday."
Trading rooms were abuzz with new rumors, old rumors, and rumors that simply did not make sense. "There are so many rumors out there that the market doesn't know what to do with them," said bank analyst Raphael Soifer of Brown Brothers, Harriman & Co.
The Standard & Poor's bank index rose 1.35%, while the Dow Jones industrial average was up 1%. The Nasdaq Bank index actually fell 0.28%, and the S&P 500 was up 1.31%
"Bank stocks are taking a breather today, just like analysts," said industry analyst Michael L. Mayo of Credit Suisse First Boston.
The biggest losers of the day included some of the most often-mentioned takeout targets. Stocks of KeyCorp and PNC Corp., which have been rumored to merge with Fleet Financial Corp., fell or rose marginally. KeyCorp's shares advanced 12.5 cents to $41.50, while PNC's stock slid 81.25 cents to $62.1875.
Wells Fargo & Co. and U.S. Bancorp shares rose only slightly-despite scuttlebutt that the two would merge over the weekend.
The rumors were summarily dismissed by Steven Berman, a bank analyst at Stein Roe & Farnhan Inc. "First of all, real investors who manage large sums of money have to have a better basis to buy a stock than merger rumors," he said.
Shares of American Express & Co. rose more than 5% on rumors that American International Group Inc. was about to acquire it.
A rumor that Deutsche Bank was in talks with Paris-based insurance company Axa Group, which owns Donaldson, Lufkin & Jenrette through Equitable Cos., not only lifted Donaldson's stock 2.75% during the day, but boosted most other brokerage firms.