Reassuring comments from Federal Reserve Chairman Ben Bernanke triggered a big afternoon rally in banking shares and a big rally for the stock market. Bernanke downplayed the risk that banks will be nationalized anytime soon, stressing that their greatest value lies in their existing structure. Bank shares, the market's central area of weakness, jumped as much as 20 percent. The S&P 500 rose 4.0 percent to 773.14.
The rush back into risk hurt the dollar which fell more than 1 cent against the euro to end at $1.2850. Treasuries were little changed despite the movement into stocks. Demand was very strong for today's 4-week and especially 2-year auctions. Oil gained as stocks gained, up 3.9% for April WTI to $39.93. Gold fell back after failing to hold $1,000. February gold fell 2.5 percent to $970.50.