Banking sector optimism boosts Dow

Banking sector optimism boosts Dow

Wall Street has closed out an impressive week with a mixed performance after disappointing high-tech earnings punctured some of investors' enthusiasm over better-than-expected bank earnings reports.

But the major indexes still ended the week with big gains, the result of rising optimism about the troubled financial sector.

The market was clearly pleased when Citigroup, while reporting a second-quarter loss on Friday morning, beat analysts forecasts and joined Wells Fargo and JPMorgan Chase in delivering stronger results than the market anticipated.

But investors who ecstatically sent the Dow Jones industrials soaring by more than 480 points over Wednesday and Thursday were brought back down to earth by results from Google, Microsoft and Advanced Micro Devices.

Google's results were lower than expected, the result of the weakening economy hurting advertising revenue, while Microsoft missed forecasts by a penny. Also, AMD's chief executive stepped down after the chip maker posted a wider-than-expected loss.

The market that has hungered for good news about financial companies after a year-long credit crisis got it from Citi. The banking company reported a 2.5 billion dollar second-quarter loss due to write-downs tied to deteriorating credit markets. The results surpassed projections, and helped to mitigate some of the market's concerns following a big loss from Merrill Lynch reported late on Thursday.

It was a good sign to some analysts that the market didn't sell off sharply after two straight days of hefty gains.

"If you look at the fundamentals, not a lot of changed in the fundamentals, but you had the financial crisis come to a head," said Philip Dow, managing director of equity strategy at RBC Dain Rauscher. "This was a pivotal week that we just went through, one that perhaps marked a bottom for the financial crisis. That doesn't mean we're about to have a bull market, but maybe a break in the pronounced selling that's been going on."

According to preliminary calculations, the Dow rose 49.91, or 0.44%, to 11,496.57.

Broader stock indicators were mixed. The Standard & Poor's 500 index rose 0.36, or 0.03%, to 1,260.68, and the technology-focused Nasdaq composite index dropped 29.52, or 1.28%, to 2,282.78.