21 minutes
NEW YORK: Wall Street stocks powered higher on Wednesday (March 29) as markets cheered the apparent containment of a banking industry crisis that has rattled investors in recent weeks.
Worries are receding that the failure of Silicon Valley Bank and two other regional lenders would lead to other causalities.
“As the mini-bank crisis recedes a bit, equity investors look to what was oversold in the last few weeks,” said Art Hogan, an analyst at B. Riley Financial, adding that investors have also been encouraged at lower volatility in the bond market.
The Dow Jones Industrial Average rose 323.35 points, or 1%, to 32,717.6, the S&P 500 gained 56.54 points, or 1.42%, to 4,027.81 and the Nasdaq Composite added 210.16 points, or 1.79%, to 11,926.24.
While all 11 industrial sectors posted gains, semiconductor firms were especially strong following a forecast from Micron that pointed to improving demand in the second half of the year.
Micron jumped 7.2%, while Dow member Intel surged 7.6% and Nvidia advanced 2.2%.
Regional banks were another winner, with First Republic piling on 5.9%and PacWest Bancorp winning 5.1%.
“We had a couple of good reads into the economy from a couple of companies,” said King Lip, chief investment strategist at BakerAvenue Wealth Management in San Francisco.
“Micron is sort of a microcosm of the global economy because their chips go into so many different industries and sectors. If they are optimistic about things in terms of orders, that means the overall economy is doing well.”
In a sign of potential further strength, the S&P 500 also closed above its 50-day moving average for the first time since March 6, before the onset of the bank crisis, and the CBoe volatility index, Wall Street's fear gauge, ended at its lowest level since March 8.
“People are feeling a little more comfortable with each day that passes since we had the failures,” said Michael O’Rourke, chief market strategist at JonesTrading in Stamford, Connecticut.
Investors are awaiting Personal Consumption Expenditures data on Friday for further clues on inflation. – AFP, Reuters
