Wall St leaps on bank optimism, jobs data

By Ellis Mnyandu

NEW YORK (Reuters) - U.S. stocks rose on Friday, and the Nasdaq capped its longest stretch of weekly gains in a decade as stress test results and reassuring jobs data fueled hopes the worst is over for banks and the economy.

Financial shares led a broad run-up again, a day after regulators said most U.S. banks were sound. The KBW Bank index .BKX surged 12.1 percent.

Shares of No. 2 U.S. bank JPMorgan Chase Inc (JPM.N) climbed 10.5 percent to $38.94, making the stock the Dow's top gainer. A 3.4 percent gain in oil prices above $58 a barrel bolstered energy companies' shares, led by Chevron Corp (CVX.N), which rose 3.5 percent to $70.38.

The release of the stress test results "has given people a little bit of confidence that the government can help to solve this part of the financial crisis," said Richard Sparks, senior equities analyst and options trader at Schaeffer's Investment Research in Cincinnati.

"There's a sense that the government actually has a logical plan ... even if things got worse, these companies will be able to survive. That helps bolster confidence in the administration."

The Dow Jones industrial average .DJI gained 164.80 points, or 1.96 percent, to 8,574.65. The Standard & Poor's 500 Index .SPX rose 21.84 points, or 2.41 percent, to 929.23. The Nasdaq Composite Index .IXIC climbed 22.76 points, or 1.33 percent, to 1,739.00.

NASDAQ CLIMBS LIKE IT'S 1999

For the week, the Dow rose 4.4 percent and the S&P 500 gained 5.9 percent, while the Nasdaq jumped 1.2 percent.