Investing.com - Financial Markets Worldwide
Get 40% Off
Get 40% Off
These stocks are up over 10% post earnings. Did you spot the buying opportunity? Our AI did.Read how

U.S. stocks shake off earlier losses and turn higher despite bank contagion fears

AuthorLiz Moyer
Published 03/13/2023, 09:52 AM
Updated 03/13/2023, 11:49 AM
© Reuters.

By Liz Moyer

Investing.com -- U.S. stocks shook off earlier losses and climbed on Monday despite a sell-off in bank stocks amid fear of contagion from the collapse of SVB Financial Group (NASDAQ:SIVB).

At 11:46 ET (15:46 GMT), the Dow Jones Industrial Average was up 211 points or 0.7%, while the S&P 500 was up 0.7% and the NASDAQ Composite was up 1.3%.

Regulators shut down Silicon Valley Bank on Friday and New York-based Signature Bank (NASDAQ:SBNY) on Sunday. They also announced a number of steps to shore up confidence in the banking system, offering a new bank facility and relaxing access to the Federal Reserve’s discount window to help banks reposition after rapidly rising interest rates.

Depositors of both Silicon Valley Bank and Signature will get their money back, regardless of whether it was insured. Uninsured deposits in limbo could have rippled through the economy, especially the venture capital and startup world SVB catered to. Many small companies with deposits there spent the weekend worrying about making payroll.

Whether the actions will ease broader concerns about banks remains to be seen. Shares of First Republic Bank (NYSE:FRC) were down 75% and were halted, reaching a new 52-week low. First Republic over the weekend said it had added available funding through the Fed and JPMorgan.

Shares of PacWest Bancorp (NASDAQ:PACW) were down 44% and halted briefly. KeyCorp (NYSE:KEY) shares were down 19%, reclaiming some ground, while Comerica Inc (NYSE:CMA) fell 14%, also off its lows. Even shares of big banks were down, with JPMorgan Chase & Co (NYSE:JPM) falling 1% and Bank of America Corp (NYSE:BAC) down 2.2%.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

Tuesday brings the consumer price index reading for February, something the Fed is likely to take into consideration when it meets to discuss interest rates later this month. Before the weekend bank crisis erupted, expectations had risen that the Fed would raise interest rates by a half-percentage point. Now, futures traders are putting a 76% chance of no rate hike.

Those expectations were reinforced by Goldman Sachs analysts, who said they no longer expect the Fed to raise rates by a quarter of a percentage point this month.

Latest comments

GS, MS, Nomura, Barclays all forecasting Feds pause or cut interest hike but none mention anything about the liquidity of US stock market........seems the global market are paranoid except US market over a couple of US banks collapse......
Starting to hear the term mortgage back securities again. That's not good.
Todays surge is the exact reason for the inflation and the exact reason why FED can not stop rate hiking.
I am just about ready to put a 9 mm into every fed members s kull
Eventually if we do not stand up and revolt, we will all be enslaved to them
revolt over what?
We already are.
Contagion? Try to write responsibly.
Collapsing Banks will be a great catalyst and platform for the introduction of CBDCs
But closing may be flat...
Dow jumps on bank failures. There is something wrong with this headline.
Dow is barely green
There is nothing wrong with it. Because two banks failed the fed is going to pull back on rate hikes. This means stonks go up.
This system will never learn and change. Money talks. 2008, 2020, now 2023, same people, same rules, same outcome.
After deregulation under Trump, yes, rules became more same as before GFC.
Soooo...Bank contagions are also great for stock. Add that to the list of absurdities that cause markets to rise. The whole criminal charade needs to stop!
liberty and justice for all
Just fair markets and real price discovery will do!
Save the millionaires in NY and Silicon Valley.  Let East Palestine, Ohio burn and die.
East Palestine got bailed out already
"Multiple Federal Agencies Supporting East Palestine, Contrary to Partisan Claims", posted 2023 Feb 24th by factcheck.org
its probably about time we bring down this corrupt system by our own hands
americans never take any action. that is why america turned into an oligarchy
Fed have 2 options , big fast pain or big slow pain . I wonder witch 1 will pick
Maybe there is an Option 3, let banks crush inflation as I now see them vastly reducing their lending desire to ensure they stay liquid.
And why is all of this a positive for stocks with the outlook for inflation appearing like the 1970's.
lol.. shake off, as in massive manipulation
fed makes market unhealthy. seriously
the whole system is corrupt.
If the fed hikes into this it will be a huge mistake. I do not believe it will be a sign of strength. I believe it will be a sign of insanity.
But markets “surging” on the backs of three massive bank failures in the course of a week is SANE?
 The market is expecting a pivot. The Fed can save the day or continue the insanity of hiking rates too much too fast, with a high risk of breaking even more things. Let's see.
market expecting a pivot? ofc billionaires want more money. keep hiking the rates!
stocks pressured? to the upside? because nasdaq is up almost 2 whole percent!!!
They dropped by 2% earlier - only rising as 1) Another Fed bail out of banks 2) Now gambling this will mean Fed wont raise rates when meets next week (but chances are it still will so will be short lived uptick)
baby, you have not seen a collapse yet so this is going to be a fun ride for you
trust me I have. And I’ve come out on top every time.
under these financial situations, any further rate hike would be barain-dead ridiculous.
so you prefer hyperinflation?
How on earth with such a serious situation is the Dow Jones going up instead of down? Who actually owns the market?
billionaires and algos. wake up. free market is not free
Never a day in the laughingstock of the investing world where FRAUD and CRIMINAL MANIPULATION aren't pervasive.  It's one miracle after another, as Wall Street continues to financially defile America in broad daylight.
As I said earlier: nothing is more profitable than panic. Chicken littles are left behind 99% of the time.
15% CPI prints coming
The bank contagion only affect paranoid European and Asian market.....the US market are recovering.with analysts expected 76% no rate hike......... recession and inflation are contained with just 2 bank collapsed..... imagine how bullish US market if a couple more banks collapse.........
Recovering = no rate hikes because of fear of a total collapse?
Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.