Stock market news today: Stocks rise on SVB fall, bond yields, bank stocks fall

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US stock futures advanced ahead of the opening bell on Monday morning after federal banking regulators took aggressive over the failure of a Silicon Valley bank.

Futures tied to the S&P 500 (^GSPC) added 0.3% before the open, while futures on the Dow Jones Industrial Average (^DJI) hovered around the flatline. The contract on the technology-heavy Nasdaq Composite (^IXIC) rose nearly 1%.

Bond yields fell. The yield on the benchmark 10-year US Treasury note eased to 3.56% on Monday morning.

US stocks took a beating on Friday, posting their worst week so far this year. Federal regulators shut down tech-focused lender Silicon Valley Bank in the biggest US bank failure since the 2008 financial crisis.

On Sunday, Treasury Secretary Janet Yellen, Fed Chairman and FDIC Chairman Martin J. Gruenberg announced that depositors of the failed Silicon Valley bank would be able to access all their funds starting Monday.

The Silicon Valley bank saga has had an impact on another bank: Signature Bank (SBNY) closed on Sunday, the second bank failure in three days. Among the measures, the Fed said depositors would be made whole. It created a new “Bank Term Funding Program” (BTFP) facility that enables other banks to obtain quick cash in exchange for collateral.

Nicolas Colas said, “Today’s Fed/Treasury’s decision to make all Silicon Valley bank depositors whole is a good first step toward restoring market confidence.” the co-founder of Datatrack Research wrote in a statement.

“Still, we now know that the Fed’s stress test scenarios (which assume very low Treasury rates in a crisis) are insufficient in the current environment. At the same time, uncertainty remains in both interest rates and economic/corporate earnings, ” They said.

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Meanwhile, in the UK, British authorities worked throughout the weekend to find a buyer for the Silicon Valley bank’s UK subsidiary, with HSBC stepping in.

Turmoil on the banking front overshadowed a February jobs report that blew past expectations once again, as the US economy added 311,000 jobs, slower than January’s recession numbers, and 225,000 That compared to economists’ consensus estimates for job gains of . The unemployment rate rose to 3.6%, and wage growth rose 4.6% over the previous year, which was slower than expected.

This week, will be paying attention to two major economic headlines as the next Federal Reserve meeting fast approaches. At the same time, investors will be glued to the latest headlines on the collapse of SVB Financial Group and the implications for the banking sector.

Tuesday’s Consumer Price Index (CPI) resumes in data on Tuesday. Economists expect inflation to rise 6% over the past year on a headline basis, while calls for 5.5% on a “core” basis.

Meanwhile, retail sales for February began on Wednesday morning. The outcome of the reading of those reports will weigh on the Fed’s next policy move.

The KBW Bank Index (^BKX) fell 3% on Monday morning, while index members including Bank of America (BAC), JPMorgan Chase (JPM), Wells Fargo (WFC) and Citigroup (C) soured bank sentiment across the board. spread in the markets. ) all traded short.

Other regional bank stocks including First Republic Bank (FRC) plunged 70% after JP Morgan handed over the bank. -based bank receives funding from giant that gives it more $70 billion in unused liquidity. PacWest Bancorp (PACW) and Western Alliance Bancorporation (WAL) declined more than 30% on Monday.

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The destroyed SVB (Silicon Valley Bank) logo can be seen in this illustration taken on March 13, 2023. Reuters/Dado Ruvik/Illustration

In other single-stock moves, Roku (ROKU) traded near flatline on Monday morning after the company said SVB held 26% of its cash and cash equivalents, according to its filing Securities and Exchange Commission (seconds,

Shares in Swiss lender Credit Suisse (CS) hit a new record on Monday morning on fears European banks could hang on to capacity deposits amid the collapse of US lender SVB.

On the earnings front, FedEx (FDX), Adobe (ADBE), Dollar General (DG), and Lennar (LEN) will report quarterly results this week.


Dani Romero is a reporter for Yahoo Finance. follow him on twitter @daniromerotv

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