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U.S. stocks fall as bank sector comes under pressure

Published 03/10/2023, 09:49 AM
Updated 03/10/2023, 12:00 PM
© Reuters.

By Liz Moyer 

Investing.com -- U.S. stocks were falling as bank stocks come under pressure, while new data on jobs alleviated concerns about aggressive interest rate moves by the Federal Reserve.

At 11:58 ET (16:58 GMT), the Dow Jones Industrial Average was down 46 points or 0.1%, while the S&P 500 was down 0.3% and the NASDAQ Composite was down 0.4%.

The economy added 311,000 jobs last month, more than the 205,000 expected, but the unemployment rate rose to 3.6%. Analysts had expected it to remain at 3.4%. And average hourly earnings rose 0.2%, lower than expected.

Futures traders have lowered the chances of a half percentage point rate hike by the Fed this month. It was at 70% earlier this week and is now under 50%, according to the CME FedWatch tool. Traders give the odds of a quarter-point rate hike slightly higher than 50%.

SVB Financial Group (NASDAQ:SIVB) was closed today by California banking regulators after failing to raise capital. The shares were halted all morning on Friday after falling 60% on Thursday. The bank, which has a high profile in the venture capital world, was squeezed by rising interest rates. It announced a plan to reorganize its portfolio by selling securities at a loss and selling more shares to raise capital.

Its struggle was spilling over to other bank stocks though that has eased up about an hour into trading. The KBW Nasdaq Bank Index was down 1.9% on Friday.

Gap, Inc. (NYSE:GPS) shares were down 5.7% after reporting a quarterly loss on a drop in sales and weaker than expected guidance for the first quarter and year.

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Latest comments

but all the banks passrd the stresstest.....
The bank was squeezed by higher interest rates....get ready to rumble. Oh, I forgot; this time is different.
Banks have handled the gigantic pile of money that was printed the last couple of years in a very irresponsible way it seems
You can't expect inflation that was created in 2-3 years time, to drop to 2% in 1 year time. It's ver unhealthy/foolish to pursue this. Be realistic and try and let it go down gradually. Down to 3-4% this year, down to 2-3% next year, 2% and lower the year after
300 Billion Reasons Why SVB Contagion Is Spreading To The Broader Banking System.....ruh roh!
Bc interest rates are too high. Home mortgages are 7 - 9% interest. No one is buying homes. Banks can't make money at these criminal interest rates. JPow and the Fed wanted a recession. Be careful what you wish for, you just might get it. Enjoy your recession folks. Your taxpayer money going to pay for a terrorist pseudo government agency whose stated goal is to crash the US economy
  If the US "stop thinking others problems", the US would soon find it has no trading partners and Russia/China bordering it (other than at Bering Strait).
 At some point as the interest rates rise, USA govt will no longer be able to afford interest payments on its trillion dollar national debt, and will have to either declare bankruptcy or make serious spending cuts. Fed would do well to remember who pays their salaries
  The US can selectively default on China, esp. if the CCP invades Taiwan or Myanmar,  aids Russian aggression, nationalize US assets (of which not respecting US i.p. rights is an example), cuts all economic ties, etc.
just got news that SVB bank shut down by regulators ....Moneycontrol news
I guess the banking stress test didn't have a scenario whereby the Fed shoots itself in the foot.
Banks are failing and still stocks find a way to go up...peak absurdity
Game Over: FDIC Shutters Silicon Valley Bank, Appoints Receiver. No worries though...all 'insured' depositors will have access to their 'insured' deposits. Is this for real?
Perfect time to finish the QE
QE was finished about a year ago.
How can this not spill over into the whole system?
The criminal intervention is as flagrant as ever, and what better a day for it to occur than during FRAUDULENT Friday?  Laughingstock of the financial world.
Analysts keep AssUMe the interest rate hike when Feds have been consistently sending same statement........
Exaggerated reaction due to a small bank unable to pay interest to its savers while having few clients with credits and the other bank for working with the crypto garbage.
u.s market is foolish behave... how baiden the foolish president in amrica history....Ukraine, afganistan exampal..80 years old men nt get decigen properly....
you seem very articulate and well-informed..
2008 was nothing compared to what is coming
yeah, 2023 is like 2008+15!
Return of capital more important than return on capital.
Yoo many are facing mass liquidations... Scary times ahead for retail investors.
The job market is still very healthy. Higher rates for much longer.
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