Banks Rally and Lead Stocks Up

NEW YORK (AP) -- U.S. stocks are rising Friday morning as banks rally after the Federal Reserve approved their plans to increase their dividends and buy back more stock. Wells Fargo is leaping after it said it will repurchase $24.5 billion in stock. Nike is climbing after it reported strong results in its latest quarter including improved sales in North America. Stocks are down this week, but are on track to finish the second quarter with small gains.

KEEPING SCORE: The S&P 500 index jumped 18 points, or 0.7 percent, to 2,734 as of 10 a.m. Eastern time. The Dow Jones Industrial Average gained 218 points, or 0.9 percent, to 24,434. The Nasdaq composite rose 53 points, or 0.7 percent, to 7,557. The Russell 2000 index of smaller-company stocks gained 7 points, or 0.5 percent, to 1,652.

Throughout this quarter stocks have been buffeted by rising worries about trade disputes between the U.S. and China as well as the European Union, Canada and Mexico. As a result, stocks didn't make big gains after a very strong round of first-quarter corporate reports. The S&P 500 is up 3.6 percent since the beginning of April after it took a small loss in the first quarter and the Dow industrials are up 1.5 percent. However the Nasdaq has jumped 7 percent and the Russell is up 8 percent, and both recently hit record highs, as investors felt technology companies and smaller, U.S.-focused companies were safe picks during the trade tensions.

BANK ON IT: The Federal Reserve allowed 32 of the 35 largest banks in the U.S. to raise their quarterly dividends and buy back more stock. The central bank determined that the institutions are in good enough financial shape to weather a major downturn in the economy.

Wells Fargo soared 5.2 percent to $56.40 and Citigroup added 1.89 percent to $68.14. Banks that weren't allowed to boost their dividends and repurchases lagged behind. Goldman Sachs was unchanged at $223.43 and Morgan Stanley edged up 0.3 percent to $48.45.

JUST DID IT: Nike is on track for its biggest gain in more than four years after its fourth-quarter profit and sales blew past Wall Street forecasts. The company said revenue in North America grew after several quarters of declines, and the company said it will buy back $15 billion in stock over the next four years. It gained 11.6 percent to $80.03.

ENERGY: Energy companies and oil prices continued to climb. Benchmark U.S. crude gained 0.9 percent to $74.09 a barrel in New York. It's up 14 percent during the second quarter and trading at its highest price since late 2014. The S&P 500 index of energy companies has also gained 14 percent this quarter, far better than the rest of the market.

Brent crude, used to price international oils, rose 1.6 percent to $78.88 a barrel in London.

BONDS: Bond prices inched lower. The yield on the 10-year Treasury note rose to 2.85 percent from 2.84 percent.

CURRENCIES: The dollar rose to 110.76 yen from 110.64 yen. The euro rose to$1.1637 from $1.1555.

OVERSEAS: France's CAC 40 gained 1.4 percent and the German DAX rose 1.5 percent after a deal on migration that relieves pressure on the coalition government of Chancellor Angela Merkel. Britain's FTSE 100 added 0.7 percent.

Japan's benchmark Nikkei 225 edged 0.2 percent higher. South Korea's Kospi advanced 0.5 percent and Hong Kong's Hang Seng added 1.6 percent.

(BE)