Bank stocks lead rally ahead of Fed stress tests

The financial sector led a rally in U.S. stocks Wednesday ahead of final stress test results from the Federal Reserve.

Financials were up 1.5% in recent trading, the best performance among the 11 S&P sectors, as traders anticipate that banks will get a green light from the Fed to boost dividends or repurchase stock.

Bank of America (NYSE:BAC) climbed 2.5% to $23.86, while J.P. Morgan Chase (NYSE:JPM) rose 1.6% to $89.46. Prudential Financial (NYSE:PRU), Ameriprise Financial (NYSE:AMP), Lincoln National (NYSE:LNC) and MetLife (NYSE:MET) were also among the top gainers. All 66 stocks in the financial sector were higher.

Last week, the Fed said all 34 banks it monitors passed the central bank’s two stress-test scenarios. The Fed is set to release its Comprehensive Capital Analysis and Review at 4:30 p.m. ET on Wednesday, revealing whether the banks can return cash to shareholders through dividends and stock buybacks.

The stress tests are designed to gauge how financial institutions would fare in a financial crisis.

FOX Business Network’s Charlie Brady contributed to this report.

Ticker	Security	Last	Change	Change %
BAC	BANK OF AMERICA CORP.	47.73	+0.22	+0.46%
JPM	JPMORGAN CHASE & CO.	249.91	-0.34	-0.14%
PRU	PRUDENTIAL FINANCIAL INC.	129.10	+0.38	+0.30%
MET	METLIFE INC.	87.75	+0.39	+0.45%
C	CITIGROUP INC.	69.74	-0.99	-1.40%