IN NEW YORK: As a result of a contract to acquire Silicon Valley Bank’s assets, bank shares rose on Monday, although the gains for the day were somewhat restrained by a dip in technology-related equities.
The KBW regional banking index increased by 0.6% while the S&P 500 banks index increased by 3.1%.
Shares of Bank of America increased by 5% while JPMorgan Chase & Co. rose 2.9%. These were among stocks handing the S&P 500 its greatest bump on Monday.
After announcing that it would buy the deposits and loans of Silicon Valley Bank, which failed earlier this month in the greatest bank failure since the 2008 financial crisis, First Citizens BancShares Inc. shares increased by more than 50%.
Meanwhile, First Republic Bank stock increased 11.8% after Bloomberg reported that US regulators were considering providing additional financial support. This development would offer the troubled First Republic Bank more time to strengthen its balance sheet.
Nonetheless, tech-related growth equities declined, and the Nasdaq finished the day down.
Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York, stated that there is still a lot happening in the banking industry and that it is actually positive news today.
There may be some profit-taking as we approach the conclusion of the quarter, but tech and growth stocks “had a really solid quarter.”
The Nasdaq Composite fell 55.12 points, or 0.47%, to 11,768.84, while the Dow Jones Industrial Average increased 194.55 points, or 0.6%, to 32,432.08. The S&P 500 increased 6.54 points, or 0.16%, to 3,977.53.
Apple’s stock dropped 1.2%. The S&P 500 technology index has increased by over 16% so far this quarter.
The Commodities Futures Trading Commission announced on Monday that it has filed a lawsuit against Binance and Changpeng Zhao, the CEO and founder of the exchange, for running a “illegal” exchange and a “false” compliance programme. This news also caused a decline in cryptocurrency shares.
Walt Disney shares rose 1.6%, among other stocks, as the corporation started the 7,000 layoffs it had previously announced.
On the NYSE, advancers outweighed decliners by a ratio of 2.57 to 1; on the Nasdaq, advancers were favoured by a ratio of 1.44 to 1.
The Nasdaq Composite registered 56 new highs and 128 new lows while the S&P 500 posted 6 new 52-week highs and no new lows.
10.32 billion shares were traded on American exchanges, which is lower than the 12.9 billion average for the entire session for the previous 20 trading days.