Bank Stocks Surge After Jobs Data Lifts Treasury Yields

Financial stocks surged in premarket trade Friday, after a much stronger-than-expected June jobs report boosted Treasury yields. The SPDR Financial Select Sector ETF shot up 1.6%, after being up just 0.6% just before the jobs data was released. Among the ETF's most heavily-weighted banks, shares of Bank of America Corp. ran up 2.6%, after being up just 0.5% pre-jobs data. Shares of Citigroup Inc. climbed 2.2%, J.P. Morgan Chase jumped 1.9% and Wells Fargo & Co. rose 1.9%. The U.S. economy added 287,000 jobs in June, above expectations of an increase of 170,000. That helped push the yield on the 10-year Treasury note up to 1.41%, from 1.39% just prior to the release of the data. Higher long-term yields can act as a boon for bank profits, as they increase the spread between what banks earn by funding longer-term assets, such as loans, with shorter-term liabilities.