Why Shares of Wells Fargo Are Rising Today

Shares of Wells Fargo (NYSE: WFC) were nearly 8% higher as of 11:51 a.m. ET today after the Federal Reserve released results from its annual stress-testing exercise last night, which came out favorably for Wells Fargo. Every year, the Fed puts the largest U.S. banks through a hypothetical severely-adverse economic scenario to see how they would hold up, in order to ensure the safety and soundness of the banking system. The testing also helps the Fed set minimum capital requirements for banks, which plays a role in determining how much capital they can return to shareholders.