Stock markets in New York closed with a profit on Monday, following the positives in Europe earlier in the day. Investors on Wall Street reacted positively to the takeover of ailing Credit Suisse by larger Swiss rival UBS on Sunday. As a result, the unrest in the banking sector eased somewhat. However, First Republic Bank was hit again after credit rating agency S&P Global downgraded the California bank’s credit rating for the second time in a week.
The Dow Jones index posted a gain of 1.2 percent at 32,244.58 points at the end. The broad S&P 500 gained 0.9 percent to 3951.57 points and the technology exchange Nasdaq rose 0.4 percent to 11,675.54 points.
The danger that Credit Suisse could collapse has passed, but investors remain concerned about the value of their investments in the banking sector. The European Central Bank (ECB), the Federal Reserve and four other major central banks have promised to offer banks extra lending options in the near future to ensure that they have sufficient money if customers want to withdraw large balances.
New York Community Bancorp rose nearly 32 percent. A part of the bank from New York has taken over almost all of Signature Bank’s bank balances and part of the loans. The collapse of Signature Bank and Silicon Valley Bank last week caused great unrest on the stock markets. Major banks JPMorgan Chase and Goldman Sachs rose to 2 percent. Other banks such as Bank of America and Citigroup did fall with negatives to 0.4 percent.
First Republic Bank plunged another 47 percent, following Friday’s nearly 33 percent tick. The shaky regional bank received $30 billion in its accounts last week from eleven major US banks to have enough money available to meet all customer requests for money. However, according to S&P, the bank’s problems have not yet been solved.
Amazon surrendered 1.3 percent. The web store and tech group will cut another 9,000 jobs in the near future to save costs. It is the second major round of layoffs at Amazon after 18,000 jobs were lost at the beginning of this year.
The euro was worth $1.0722 against $1.0695 at the close of trading in Europe. A barrel of US oil cost 1.2 percent more at $ 67.57. Brent oil became 1.1 percent more expensive at $ 73.78 per barrel.
