The markets clung tightly to Italy’s political situation on Tuesday, and when Italian Prime Minister Silvio Berlusconi announced he would resign following the approval of a new budget law, stocks took off. The Dow Jones Industrial average jumped almost 150 points in the afternoon and finished the day up about 100. It brought a slew of financials skyward with it.
Wells Fargo (NYSE:WFC) jumped more than 4% to finish Tuesday at $26.53, with Deutsche Bank (NYSE:DB, $40.55), Citigroup (NYSE:C, $31.42) and Goldman Sachs (NYSE:GS, $108.58) each climbing about 3%. The KBW Bank Index (BKX) of 24 major financial institutions finished the day about 2.5% higher. While Italy still faces massive budgetary problems, Berlusconi’s departure opens up the possibility of a new government that could make the large-scale changes necessary to further shore up the country’s fiscal mess.
Vertex Pharmaceuticals (NASDAQ:VRTX) had the bottom drop out for the second straight day, shedding more than 8% to end Tuesday at $30.45 — a day after it shed more than 9% on positive news from competing hepatitis C drugmakers. However, those rivals — Pharmasset (NASDAQ:VRUS) and Inhibitex (NASDAQ:INHX) — didn’t fare as well today, with VRUS shares sliding about 4% to $69.07, and INHX shares staying about flat at $9.65.Three Up
As of this writing, Kyle Woodley did not own a position in any of the aforementioned stocks. Check out recaps from previous trading days here.