NEW YORK (CNNMoney.com) -- Shares of major U.S. banks rallied Friday after the Senate passed a sweeping overhaul of the financial system.
While the bill, passed late Thursday, imposes stricter regulations on Wall Street, major banks reacted positively to the reform's passage, and shares climbed on Friday.
Morgan Stanley (MS, Fortune 500) and JPMorgan Chase (JPM, Fortune 500) jumped nearly 6%, while Wells Fargo (WFC, Fortune 500) and Bank of America (BAC, Fortune 500) were up almost 5%. Goldman Sachs (GS, Fortune 500) and Citigroup (C, Fortune 500) rose significantly as well.
That's because, despite the tough regulations in the bill, including increased oversight of major banks and new rules for derivatives trading, the passage of the reform brought some clarity to the market, said Jeffrey Kleintop, chief market strategist at LPL Financial.
"Now that we've finally got a little more clarity about what [the reform] is going to look like, it alleviates concerns and brings some of the bargain hunters in," said Kleintop.
Standard & Poor's banking index (^BIX), which rose more than 4% Friday afternoon, has dropped about 14% from late April, making financial stocks attractive deals for investors.
And because banks have been aware of the general aims of the reform bill for some time, the Senate's ultimate decision to pass the reform didn't shake them, said Kleintop.
"It's been coming for a while and all the amendments have been vetted over the last three of four weeks, so people have had a good sense of what was going to show up in it," he said. "As optimism returns and increases, the market's fundamentals are outweighing most of the concerns about changes in regulatory conditions."
U.S. stocks ended higher across the board Friday, recovering from a rocky morning as buying interest picked up.
And banks followed the market's upswing, said Kleintop.
"Whenever the markets are up or down, financials always seem to be the leading sector," he said. "And they would likely be rallying even harder if more onerous amendments had been stripped from the bill." 
| Overnight Avg Rate | Latest | Change | Last Week |
|---|---|---|---|
| 30 yr fixed | 3.80% | 3.88% | |
| 15 yr fixed | 3.20% | 3.23% | |
| 5/1 ARM | 3.84% | 3.88% | |
| 30 yr refi | 3.82% | 3.93% | |
| 15 yr refi | 3.20% | 3.23% |
Today's featured rates:
| Index | Last | Change | % Change |
|---|---|---|---|
| Dow | 32,627.97 | -234.33 | -0.71% |
| Nasdaq | 13,215.24 | 99.07 | 0.76% |
| S&P 500 | 3,913.10 | -2.36 | -0.06% |
| Treasuries | 1.73 | 0.00 | 0.12% |
| Company | Price | Change | % Change |
|---|---|---|---|
| Ford Motor Co | 8.29 | 0.05 | 0.61% |
| Advanced Micro Devic... | 54.59 | 0.70 | 1.30% |
| Cisco Systems Inc | 47.49 | -2.44 | -4.89% |
| General Electric Co | 13.00 | -0.16 | -1.22% |
| Kraft Heinz Co | 27.84 | -2.20 | -7.32% |
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