Five Banks Post Losses -- and Their Stocks Soar

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Five of the largest U.S. financial institutions, led by Wachovia Corp. and Washington Mutual Inc., reported combined quarterly losses of more than $11 billion. But their shares jumped an average of 14% on rising hopes that battered bank stocks have fallen about as low as they can go.

The buying frenzy, also fueled by short sellers covering bearish bets, was at odds with the mostly somber assessment by bank executives Tuesday of the shaky loans and struggling economy bedeviling the industry.

In a sign of the loan woes likely to haunt them for years, ...