New York, July 19: Citigroup has become the latest big bank to quell Wall Street's worries about a financial sector implosion, posting a $2.5 billion second-quarter loss that was smaller than expected.

Citi rose nearly 8 per cent Friday and helped lift other financial stocks, having joined JPMorgan Chase & Co and Wells Fargo & Co in convincing investors that the prognosis for the sector, while gloomy, may not be as dire as the market feared.

But it's hard to get too enthusiastic about clearing a low bar. It was Citi's third straight quarterly loss and neither JPMorgan nor Wells Fargo managed to notch a profit gain compared to last year.

Meanwhile, the brokerage Merrill Lynch & Co reported a wider-than-expected quarterly loss. And next week, Wachovia Corp and Washington Mutual Inc are anticipated to reveal losses, too, with Bank of America Corp expected to report a steep profit decline.