US STOCKS-Bank shares help keep alive year-end rally

* Financial stocks lead gains as M&A boosts regionals

* Walgreen jumps on earnings report

* Dow up 0.2 pct, S&P up 0.2 pct, Nasdaq up 0.1

* For up-to-the-minute market news see [STXNEWS/US]
(Updates to midafternoon, changes byline)

By Leah Schnurr

NEW YORK, Dec 22 (BestGrowthStock) – U.S. stocks (Read more about the stock market today. ) rose modestly on
Wednesday on strength in financials, putting the S&P 500 on the
path for a fifth-straight session of gains as investor optimism
kept the year-end rally afloat.

The recent rise in financial stocks has bolstered the
market’s rally after the sector had lagged during the bulk of
the year. Bank of America Corp (BAC.N: ) rose 2.7 percent to
$13.33 and JPMorgan Chase & Co (JPM.N: ) climbed 2.8 percent to
$42.14, giving the greatest boost to the Dow industrials.

Money managers, closing their books for the year, took
advantage of the underperformance in bank stocks, as well as
other categories, such as homebuilders.

Regional banks outpaced their larger counterparts after
recent merger activity in the sector boosted hopes for more M&A
to come. Hancock Holding Co (HBHC.O: ) agreed to buy Whitney
Holding Corp (WTNY.O: ) on the heels of last week’s takeover of
Marshall & Ilsley Corp (MI.N: ) by Bank of Montreal (BMO.TO: )
(BMO.N: ). For details, see [ID:nN2292846]

“Investors are looking at some areas that might be a little
more value-oriented rather than continuing to chase the
commodity and consumer discretionary sectors and other areas
that have outperformed so dramatically,” said Alan Lancz,
president of Alan B. Lancz & Associates Inc in Toledo, Ohio.

Regional shares also benefit from a higher beta, or greater
volatility compared to the broader market, said Lancz.

“You get just as much bang for your dollar because they’ll
definitely be more volatile. That might be (investors’) way to
play it without going 100 percent into an S&P weighting in the
financial sector,” said Lancz.

The KBW regional bank index (.KRX: ) was up 3.5 percent and
is now up nearly 20 percent for the month. Whitney Holding
surged 28.5 percent to $13.97. United Bankshares Inc (UBSI.O: )
jumped 4.6 percent to $29.82 after KBW raised its price target
to $28 from $23. [ID:nSGE6BL0AM] [RCH/US2]

The Dow Jones industrial average (.DJI: ) added 20.01 points,
or 0.17 percent, to 11,553.17. The Standard & Poor’s 500 Index
(.SPX: ) gained 2.76 points, or 0.22 percent, to 1,257.36. The
Nasdaq Composite Index (.IXIC: ) edged up 1.63 points, or 0.06
percent, at 2,669.24.

The S&P 500 climbed above 1,255.08, a level last seen in
September 2008 before investment bank Lehman collapsed and an
important psychological barrier.

Energy shares rose as crude oil futures (CLc1: ) topped $90
a barrel. Chevron Corp (CVX.N: ) added 0.8 percent to $89.93.

Strong bullishness and the S&P 500 relative strength index
are among indicators pointing to an overbought condition, but
that may be worked off after traders return from the holidays
in January.

Walgreen Co (WAG.N: ) rose after the drugstore chain posted
higher profit on increased prescription sales and a slower pace
of store openings that helped control costs. Its shares rose
6.2 percent, the best percentage gain on the S&P 500, to
$39.14.
(Reporting by Leah Schnurr; Editing by Kenneth Barry)

US STOCKS-Bank shares help keep alive year-end rally