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Goldman shares rise on false SEC settlement rumor

MARKETS-STOCKS/NEW YORK (Reuters) – Goldman Sachs Group Inc shares rose as much as 5.4 percent on Friday on rumors of a possible settlement with regulators and a feeling that the stock could be oversold.

The shares were up 3.5 percent at $140.80 in afternoon trading on the New York Stock Exchange, off an earlier high at $143.44. Goldman’s share rise came as bank stocks reversed losses and rose shortly after the open.

Goldman shares were further helped by a broader rally that sent the KBW Banks index up 2.6 percent. Goldman’s rival Morgan Stanley was also up, gaining 4.84 percent.

Goldman Sachs and the SEC declined to comment.

But Washington sources familiar with the matter said the SEC and Goldman Sachs have not reached a settlement.