NEW YORK (dpa-AFX) – Investor concerns about the recent turbulence in the US banking sector continued to ease on Monday. The appetite for risk among investors on New York’s Wall Street increased again, which the market attributed to several causes.
Michael Barr, the Fed’s vice chairman for banking supervision, defended regulators’ actions, saying the banking system was “solid and resilient”. According to a report by the Bloomberg news agency, the US government is also considering expanding its support for troubled banks. And the First Citizen Bank wants to take over essential parts of the badly hit Silicon Valley Bank (SVB). Their collapse is considered one of the triggers for the recent banking turmoil.
The Dow Jones Industrial ended the day up 0.60 percent to 32,432.08 points. The market-wide S&P 500 rose by 0.16 percent to 3977.53 points. However, the technology-heavy Nasdaq 100, which had turned negative after the start of trading, ultimately fell by 0.74 percent to 12673.07 points. All three indices started to recover on Friday after initial losses and also posted gains over the course of the past week.
The fact that the SVB is being taken over by First Citizens Bank in significant parts caused the shares of the parent company First Citizens BancShares to jump by almost 54 percent. On March 10, the money house SVB, which specializes in start-up financing, came under state control because it got into trouble. Fed Vice Michael Barr called the collapse a “textbook case of mismanagement.”
First Republic Bank’s shares rose nearly 12 percent, after at times shooting up as much as 25 percent. According to Bloomberg, the US government is considering further support for this bank to give it more time to improve its balance sheet. Other regional banks such as Pacwest, Comerica and Western Alliance subsequently increased by three to a good five percent.
After the recent price losses of the industry giants, these were also among the winners again: JPMorgan’s shares rose by almost three percent and Goldman Sachs by almost two percent. In the S&P 100, shares in Morgan Stanley, Citigroup and Bank of America rallied up to five percent.
In contrast, papers were avoided by vaccine manufacturers. Biontech from Mainz disappointed with the presentation of the quarterly report with statements on expected Covid 19 vaccine sales. The Nasdaq then fell 3.6 percent, while shares in larger partner Pfizer fell 0.4 percent. Shares in Biontech competitor Moderna fell 1.7 percent in the Nasdaq 100 index.
The euro was last traded at $1.0799. The European Central Bank had fixed the reference rate at 1.0773 (Friday: 1.0745) dollars. The dollar had cost 0.9282 (0.9306) euros. Government bonds on the US bond market fell significantly. The futures contract for ten-year bonds (T-Note future) fell by 1.05 percent to 114.89 points. In return, the yield on ten-year government bonds rose to 3.54 percent./ck/he
— By Claudia Müller, dpa-AFX —
