Wall Street moves higher led by tech stocks

Stocks surged Wednesday with a rebound in the same financial shares that were pummeled Tuesday.

Upbeat comments from banks, stronger-than-expected results from a technology giant and hopes for effective action from Washington on the economy powered a rally that reversed most of the previous session’s losses.

A day after the Dow tumbled 332 points, the blue-chip gauge surged nearly 280 points, and all the major stock indexes rose more than 3.5%.

Many banks followed Tuesday’s double-digit drops with double-digit gains.

PNC Financial Services Group, which acquired National City Corp. on Dec. 31, jumped 37% after saying it was in the black last year. And Bank of New York Mellon rose 23% after reporting that it eked out a fourth-quarter profit.

Citigroup surged 31% after falling 20% on Tuesday. Bank of America jumped 31% after declining 29%. Word from BofA Chief Executive Ken Lewis that he bought 200,000 shares of common stock encouraged buyers of the stock.

JPMorgan Chase rose 25% as its CEO, Jamie Dimon, said he bought 500,000 of the firm’s shares.

Technology shares outperformed the broader market after IBM surprised investors late Tuesday with a forecast for the year that was well above what analysts had expected. The company’s shares rose 12%.

Apple climbed 5.9% before reporting better-than-expected results after the closing bell Wednesday.

Also giving the market a lift, Treasury Secretary-designate Timothy Geithner told the Senate Finance Committee that passing President Obama’s economic stimulus plan was essential and that the Senate’s move last week to release the second half of the government’s $700-billion financial industry rescue fund “will enable us to take the steps necessary to help get credit flowing.”

Wednesday’s corporate news shows that not all companies are in serious trouble, said Kim Caughey, equity research analyst at Fort Pitt Capital Group in Pittsburgh.

“It was a great reminder that businesses still have their lights on, their doors open and that they’re making money,” she said.

The Dow Jones industrial average rose 279.01 points, or 3.5%, to 8,228.10.

Broader stock indicators also gained. The Standard & Poor’s 500 index advanced 35.02 points, or 4.3%, to 840.24, and the technology-heavy Nasdaq composite index rose 66.21 points, or 4.6%, to 1,507.07.

The Russell 2,000 index of smaller companies shot up 5.3%. Investors often turn to small-cap stocks when placing bets on a market recovery.

Advancing issues outnumbered decliners by about 4 to 1 on the New York Stock Exchange.

Yields on Treasury bonds surged along with stocks. The benchmark 10-year Treasury note rose to 2.52% from 2.34% late Tuesday.