NEW YORK: Wall Street stocks climbed on Thursday (March 30) as markets calmed after recent banking sector turmoil.
The Dow Jones Industrial Average rose 141.43 points, or 0.43%, to 32,859.03, the S&P 500 gained 23.02 points, or 0.57%, to 4,050.83 and the Nasdaq Composite added 87.24 points, or 0.73%, to 12,013.47.
While investors have been wary since federal officials seized control of Silicon Valley Bank (SVB) earlier this month – marking the collapse of one of three midsized lenders -– there have not been more US casualties since then.
This raised hopes that the emergency steps taken by regulators and private lenders have staved off contagion.
On Thursday, Treasury Secretary Janet Yellen told a conference that recent events including the banking sector turmoil “remind us of the urgent need to complete unfinished business”.
This includes finalizing post-crisis reforms and considering “whether deregulation may have gone too far.”
President Joe Biden also called on banking regulators to reinstate tougher rules on midsized banks, saying that doing so would prevent future failures like that of SVB.
The KBW regional bank index ended down 2%, and the S&P 500 financial index fell 0.3%, the only S&P 500 sector in negative territory on the day.
“Tech is probably the furthest sector removed from financials,” so there has been a rotation away from financials, said Jack Ablin, chief investment officer at Cresset Capital in Chicago.
Meanwhile, weekly jobless claims figures released on Thursday edged slightly higher, fuelling hopes that the Federal Reserve could soon ease on interest rate hikes if the labour market cools further.
Fed funds futures traders are now pricing in a 55% chance of a 25-basis-point rate increase at the Fed’s May 2-3 meeting. – AFP, Reuters
