Financial stocks rallied Wednesday on news of UBS' deal to buy PaineWebber Group.

Brokerages and asset managers got the biggest boost as investors bet on which company in the sector would be the next to be bought. Shares of A.G. Edwards, the U.S. brokerage that analysts say most resembles PaineWebber, were particularly buoyant. They rose $3.8125, or 7.46%, to $45.9375.

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