By Walker Simon
NEW YORK (Reuters) - Stocks rose on Wednesday after a profit forecast by a major German bank helped return confidence in U.S. financial shares and data showed a stronger-than-expected increase in factory orders in May.
The news lifted spirits on Wall Street, where financial shares have been leading broader indexes lower for some weeks. A sub-index of U.S. bank shares <.BKX> jumped 2.5 percent for the biggest advance in more than a week. Shares of JPMorgan Chase & Co
"Deutsche's seeing a profit after a loss and saying it needs no capital has caused a bid in U.S. financials," said Art Hogan, chief market analyst at Jefferies & Co in Boston.
However, General Motors Corp
A GM spokeswoman said the company has sufficient liquidity to ride out the industry downturn in 2008 and could take more steps to cut costs if conditions worsened.
Shares of Yahoo Inc
New orders at U.S. factories rose by a sharper-than-expected 0.6 percent in May on a boost in orders for new aircraft, a Commerce Department report said.
"It's great every time you see something positive like this come out," said Edward Bretschger, director of equity sales and trading at Calyon Securities. "A positive data point like this may be what is needed to stave off the technical definition of a bear market."
The Dow Jones industrial average <.DJI> was up 41.11 points, or 0.36 percent, at 11,423.37. The Standard & Poor's 500 Index <.SPX> was up 6.56 points, or 0.51 percent, at 1,291.47. The Nasdaq Composite Index <.IXIC> was down 1.69 points, or 0.07 percent, at 2,303.28.
(Additional reporting by Deborah Jian Lee; Editing by Kenneth Barry)