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Today, bullish investors finally got some respite from the relentless selling that has hit the market over the past couple of weeks. Given the tunnel-vision that everyone seems to have about the imminent fiscal cliff, it's no surprise that most analysts are pointing to relatively benign rhetoric in discussions among lawmakers on both sides of the aisle as evidence that a deal will eventually get done. Meanwhile, though, the economy keeps moving forward regardless of the uncertainty, and that in the end will define whether today's bulls were right or whether more pessimistic investors will rule the day. For today, though, the Dow Jones Industrials (INDEX: ^DJI ) rose 208 points, and the broader market gained an even more impressive 2% or so on the session.
All 30 Dow stocks rose, but financials stood out with their gains. Bank of America (NYSE: BAC ) rose more than 4%, while JPMorgan Chase (NYSE: JPM ) gained better than 2.5%. According to a report on the progress of the settlement that B of A, JPMorgan, and several other banking peers agreed to earlier this year, big banks have cut mortgage balances by $6.3 billion, extending to relief to a total of 309,000 mortgage borrowers. With short sales, refinancing, and trial modifications also contributing to the moves, banks are doing their best to put the mortgage mess behind them. If they succeed, it will mark a huge step forward for the U.S. economy in general.
Hewlett-Packard (NYSE: HPQ ) also pushed ahead strongly, posting gains of 3.5%. As the last outstanding member of the Dow yet to give a quarterly report, HP releases earnings tomorrow morning, and analysts expect to see declines in both earnings per share and revenue. More important than the raw numbers, however, will be how CEO Meg Whitman discusses the company's progress toward a lasting recovery for the beaten-down stock. Given some downbeat results from its PC peers, HP likely has a low hurdle to overcome, especially if the market remains in a positive mood.
Finally, Verizon (NYSE: VZ ) picked up almost 3.5%. As Fool analyst Dan Dzombak observed earlier today, Verizon faces the prospect of more competition in its wireless segment. But investors realize that proposing a new wireless service and actually delivering on it are two very different things, and with a promising dividend yield, Verizon should continue delivering value to shareholders for years to come.
Within the overall stock market, big banks play an incredibly important role, and Bank of America has turned things around dramatically in the past four years. But is B of A a buy? Find out in the Fool's in-depth premium report on the bank, which details Bank of America's prospects, including three reasons to buy and three reasons to sell. Just click here to get access.