US stocks recover as Geithner says many banks have enough funds

US stocks recover as Geithner says many banks have enough fundsWashington - US markets rallied Tuesday led by financial shares, after Treasury Secretary Timothy Geithner said the "vast majority" of banks now had enough capital to remain afloat and had begun to increase lending to consumers and businesses.

In testimony to a congressional panel, Geithner said that about 110 billion dollars from the initial 700-billion-dollar financial rescue package had yet to be used by the Treasury, while another 25 billion dollars was due to be repayed by banks already recovering.

Some of the remaining money could be used after a series of so- called "stress tests" on the country's largest banks are completed in the coming weeks, which will give the government a better gauge of the vulnerability of financial firms to the credit crisis.

Citigroup Inc, JP Morgan Chase & Co and Bank of America Corp all rallied more than 9.2 per cent.

Delta Air Lines Inc, the world's largest carrier, and United Airlines parent UAL Corp posted first-quarter net losses totalling more than 1 billion dollars despite a drop in fuel prices, because of a deepening travel slump.

Internet portal Yahoo reported quarterly income of 118 million dollars, down 78 per cent from a year ago but still above analysts' expectations. Sales fell 13 per cent to 1.6 billion dollars.

Heavy-equipment maker Caterpillar reported its first quarterly loss since 1992 - 112 million dollars - largely because the ongoing recession has reduced demand from builders and miners.

Pharmaceutical giant Merck reported that profits fell 57 per cent but said it hoped that growth would be driven by its purchase of Schering-Plough for about 44 billion dollars.

The blue-chip Dow Jones Industrial Average was up 127.83 points, or 1.63 per cent, to 7,969.56. The broader Standard & Poor's 500 Index gained 17.69 points, or 2.13 per cent, to 850.08. The technology-heavy Nasdaq Composite Index climbed 35.64 points, or 2.22 per cent, to 1,643.85.

The US currency fell against the euro to 77.29 euro cents from 77.42 euro cents on Monday. The dollar rose against the Japanese currency to 98.72 yen from 97.94 yen.

Business News: 
General: 
Regions: