NEW YORK — Financial stocks surged Thursday, helping push the market to its biggest gain in almost two weeks.
Citigroup jumped after reporting that its earnings rose sharply in the third quarter as the bank continued to cut expenses and clean up its books in the wake of the financial crisis. KeyCorp also climbed after posting solid earnings.
The reports cheered investors, who have been looking for good news to boost stocks since a summer sell-off roiled the markets. However, the optimism might be short-lived. Third-quarter earnings are forecast to contract overall as falling energy prices and weak global demand start to eat into profits.
“Financials could be the bright spot of the whole earnings season, so let the market have its fun,” said Karyn Cavanaugh, senior market strategist at Voya Investment Management. “We’ll take any bright spot we can get in this earnings season because things really don’t look good.”
The Standard & Poor’s 500 index rose 29.62 points, or 1.5 percent, to 2,023.86. That was the biggest one-day gain for the index since Oct. 5.
The Dow Jones industrial average climbed 217 points, or 1.28 percent, to 17,141.75. The Nasdaq Composite rose 87.25 points, or 1.8 percent, to 4,870.10.
Earnings for companies in the S&P 500 are forecast to drop 5 percent in the third quarter, according to S&P Capital IQ. If earnings do end up lower, it would be the first time in six years they have contracted.
On Thursday, financial stocks climbed 2.3 percent, the most among the 10 sectors that make up the S&P 500. Citigroup climbed $2.25, or 4.4 percent, to $52.97, and KeyCorp rose 60 cents, or 4.7 percent, to $13.31.
Stocks have started October with a strong rally after closing out September with their worst quarterly performance in four years. Worries about the Chinese economy and the possibility of a Federal Reserve rate increase shook the market in August and September.
Netflix was among the day’s biggest losers. The stock slumped $9.14, or 8.3 percent, to $101.09 after the company reported late Wednesday that it is hooking fewer U.S. viewers than it hoped.
The price of oil fell on Thursday. Benchmark U.S. crude lost 26 cents to close at $46.38 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, declined 44 cents to $48.71 a barrel in London.
