U.S. stocks ripped higher Wednesday following a shot of adrenaline from an encouraging update on U.S. inflation. Strong profit reports from Wells Fargo and other big U.S. banks also helped launch indexes to their best day in two months.

Profits at some of the biggest U.S. lenders rose in the fourth quarter as dealmaking picked up and trading was boosted by strong equity markets, sparking a rally in banking stocks on Wednesday. The market environment has been favorable for banks.

Wall Street banks JPMorgan Chase, Goldman Sachs and Citigroup notched up strong rises in profits at the end of last year, powered by a boom in trading and dealmaking. JPMorgan’s net earnings rose 50 per cent per cent to $14bn,

Asian shares have advanced following a rally on Wall Street driven by encouraging update on U.S. inflation. Oil prices rose and U.S. futures were little changed.