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William Smith
Mar 14, 2023 9:57PM ET
Bank rally is classic Dead Cat Bounce.
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Stock market today: Dow adds 300 points as bank rally fueled bets on Fed move
© Reuters.
By Liz Moyer
Investing.com -- U.S. stocks ended higher as a rally in bank stocks put aside worries that the trouble in the banking sector would wind up becoming a contagion.
At 16:05 ET (20:05 GMT), the Dow Jones Industrial Average closed up 336 points or 1.1%, while the S&P 500 was up 1.7% and the NASDAQ Composite was up 2.1%.
Also lifting the mood in the markets: The Bureau of Labor Statistics reported a 0.4% rise in the consumer price index in February from the previous month, cooling slightly from January’s reading. On an annual basis, inflation rose 6%, also cooling from the prior reading. Core prices, which exclude food and fuel, rose 0.5% from the prior month, slightly more than expected.
That is leading traders to put more bets on a smaller rate hike by the Federal Reserve next week.
Most futures traders are expecting a quarter of a point rate hike next week, though 26% of traders are betting on the Fed to pause rate hikes, according to CME’s FedWatch tool.
The collapse of Silicon Valley Bank (NASDAQ:SIVB) over the weekend rippled through bank stocks on fears of a wider contagion. Regulators have stepped in to backstop depositors of SVB and Signature Bank (NASDAQ:SBNY), which also shut down.
Shares of large regional banks sank on Monday but were rebounding on Tuesday. KeyCorp (NYSE:KEY) closed up 7%. Comerica Inc (NYSE:CMA) was up almost 4%, while PacWest Bancorp (NASDAQ:PACW) was up almost 34%. First Republic Bank (NYSE:FRC) was up 27%.
Stocks’ afternoon climb was temporarily interrupted by reports a Russian fighter jet struck the propeller of an American surveillance drone over the Black Sea, causing U.S. forces to down the drone in international waters.
Meta Platforms Inc (NASDAQ:META) is cutting another 10,000 workers, incurring charges of as much as $5 billion, and warned about the possibility of economic uncertainty sticking around. Shares rose 7%.
Shares of AMC Entertainment Holdings Inc (NYSE:AMC) sank 15% after shareholders of the largest movie theater chain voted to approve a reverse stock split and the conversion of APE equity units into common shares. The matter is also before a Delaware Chancery Court judge.
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Comments (29)
Dari Kasten
Mar 14, 2023 9:12PM ET
consumer spending, in lower class consumers it's just trying to survive affording rent, food, lights, water, gas....and praying for a miracle if anything unexpected like car repair happens. spending every penny to do just the basics. so those consumers I would not count on because they sacrifice on smaller and necessary instead of quantity. example they buy a half gallon of milk to buy 1 dozen eggs when they used to buy 2 1/2 dozen eggs and a gallon of milk. its really hard even with side hustles friends.
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Bhagwan Dass
Mar 14, 2023 9:12PM ET
No inflation in india
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Michael Benson
Mar 14, 2023 8:16PM ET
Consumer spending is a key driver of economic growth.
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Adamo Nals
Mar 14, 2023 7:43PM ET
So let me get this straight. CPI comes in harder than expected. But if CPI came in .1 lower than expected, the market would be up 10%? This bubble must be burst. Nothing and I mean zero stocks are priced correctly. $200 a share times 15X is 3000 s&p. Econ 101. You raise the fed funds rate above the inflation rate. Until the federal reserve goes that we will never have lower inflation regions got rid of eliminated all of the work we did with QT. Back to 9 trillion on the books. It doesn’t even take a 10 year old to understand is the biggest bubble I’ve seen in my 40 years investing. Pop goes the weasel any day. The market should’ve been down 5% today. But it s gna come in one big shot.A circuit breaker day. Shut down 20% down one day. If the fed does not continue to do what is needed, then you can expect double digit inflation. Any time now which it really is. Real inflation in this country is 50% plus. So investing off of hope.and wishful thinking! Your gna loose all your money. GSM
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Brad Albright
Mar 14, 2023 7:43PM ET
"So let me get this straight. CPI comes in harder than expected..." No. You don't have that straight.
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Bill Windle
Mar 14, 2023 7:29PM ET
And the Robinhood and Reddit will shoot themselves tomorrow
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Chad Richer Than You
Mar 14, 2023 7:26PM ET
China is laughing at the USA right now
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Maximus Maximus
Mar 14, 2023 7:26PM ET
please don't laugh at us..
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Jimmy don Snyder
Mar 14, 2023 7:25PM ET
fluxation is stribbing world opp.
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Jimmy don Snyder
Mar 14, 2023 7:24PM ET
in they will grow !! home base is more important then fighting each other when ur not there I'm sure they got underctroll.
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Vikings Norway
Mar 14, 2023 7:14PM ET
who is pumping liquidity into the markets just now?
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Bill Windle
Mar 14, 2023 7:14PM ET
Robinhood and Algos
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