Bank of America, Wells Fargo shares hit 52-week highs for second day in a row

Bank of America's announcement Wednesday that it earned $3.6 billion for shareholders in the second quarter helped boost its share price, which hit a 52-week high.

Shares of Wells Fargo also reached a 52-week high Wednesday and climbed to their highest closing price ever, after the San Francisco-based company reported record second-quarter profit Friday.

Both banks had set 52-week highs Tuesday.

On Tuesday, shares of Charlotte-based Bank of America stock hit a 52-week high of $14.02, a sign that investors were optimistic ahead of the second-quarter earnings report. That was surpassed Wednesday morning after the bank said it earned 32 cents per share, which was higher than the 25 cents that analysts were forecasting.

Bank of America shares climbed to $14.44 early Wednesday afternoon, an increase of more than 3 percent from the day before and up 24 percent for the year. Its shares closed at $14.31, their highest closing price since March 2011.

Wells Fargo shares closed at $43.51 after rising to a 52-week high of $43.88 during the day. That eclipsed the high of $43.45 hit Tuesday.

The price of both banks' shares has been trending upward all year, although Wells Fargo's trajectory resembles more of a steady rise when compared with Bank of America's.

Still, the increase indicates growing investor confidence in Bank of America, which has been dogged by lawsuits since the financial crisis and its ill-fated purchase in 2008 of Countrywide Financial Corp. But the bank set aside $471 million for litigation in the second quarter, down from $2.2 billion in the first quarter and $963 million in the second quarter of last year.

Investors, though, are closely watching a proposed $8.5 billion Bank of America settlement with investors of bonds that were backed by Countrywide Financial Corp. home loans. The settlement, which awaits approval from New York Supreme Court, has been challenged by objectors, including American International Group. Bank of America bought Countrywide in 2008. A rejection of the settlement by the court would create uncertainty about what it might cost the bank to appease the investors, analysts say.

Unlike at the end of previous quarters, Bank of America did not announce any legal settlements Wednesday, making the earnings call about just that -- earnings. It was a fact not lost on investors.

"We've seen a relatively clean quarter from the company the first time in recent memory, quite frankly," Todd Hagerman, an analyst with Sterne Agee & Leach, said.