US stocks rallied on Thursday as eurozone leaders clinched a deal to bail out Greece, boosting financial stocks that had been battered in recent weeks by fears of a European debt crisis.
The Dow Jones Industrial Average jumped 152.50 points (1.21 per cent) to close at 12,724.41.
The broader S&P 500 climbed 17.96 points (1.35 per cent) to 1,343.80, while the tech-heavy Nasdaq Composite rose 20.20 points (0.72 per cent) to close at 2,834.43.
Citigroup rallied 4.4 per cent, Bank of America rose 3.9 per cent and JPMorgan Chase was up 3.3 per cent in the rally, which came as eurozone leaders met in Brussels to agree the details of a new bailout package for Greece.
“Stocks blazed a steady path into the black today, as Wall Street celebrated encouraging earnings and economic reports, and some debt-related headway across the pond,” said Andrew Kramer, an analyst with Schaeffer’s Investment Research.
Morgan Stanley surged 11.4 per cent after it reported a second-quarter loss that was not as bad as analysts had expected.
Shares of online marketplace eBay climbed 0.8 per cent on its strong earnings report, but Intel’s solid quarter failed to help its stock, which ended the day down 0.8 per cent.
Another tech stock, Cisco, gained 3.4 per cent. Cisco shares have rallied this week since the networking-hardware maker announced 6,500 layoffs on Monday in a bid to slash costs.
The Greece bailout plan unveiled in Brussels totalled 159 billion euros ($A212 billion), including 109 billion euros ($A145 billion) in loans from the European Union and International Monetary Fund and 50 billion euros ($A67 billion) of funding from the private sector.
News from the United States was not as favourable, as jobless claims rose by 10,000 to 418,000 for the week ending July 16, and talks on raising the federal government’s debt ceiling made little visible progress in Washington.
Bond prices fell. The yield on the 10-year Treasury rose to 3.01 per cent from 2.93 per cent late Wednesday, while the 30-year bond climbed to 4.32 per cent from 4.26 per cent.
Bond prices and yields move in opposite directions.
