On Friday, U.S. bank stocks experienced a rise due to the bipartisan legislation passed by the U.S. Senate on Thursday. This legislation successfully lifted the government’s $31.4 trillion debt ceiling, effectively averting a potentially historic default.

The shares of JPMorgan Chase & Co (NYSE: JPM), Goldman Sachs (NYSE: GS), Morgan Stanley (NYSE: MS), Citigroup (NYSE: C), Wells Fargo (NYSE: WFC), and Bank of America (NYSE: BAC) all experienced gains ranging from 2.2% to 3.8%.

Among their mid-sized counterparts, Charles Schwab (NYSE: SCHW), PNC Financial (NYSE: PNC), Regions Financial (NYSE: RF), US Bancorp (NYSE: USB), and PacWest Bancorp saw their stocks rise between 2.9% and 12%.

On Friday, significant jobs data revealed a slowdown in wage inflation, further strengthening the belief that the central bank will refrain from implementing a rate hike this month.

According to the trading activity in Fed funds futures, there was a probability of over 70%, indicating that the Federal Reserve would keep interest rates unchanged during its June 13-14 policy meeting.

When expectations of rate hikes are diminished, bank stocks usually lose favor as declining interest rates negatively impact their profits.