The New York Stock Exchange opened lower on Friday but eventually rose after US Federal Reserve officials eased investor fears about a possible liquidity crisis in the banking sector.
The New York Stock Exchange opened lower on Fridayagain uneasy about the earthquake that shakes the western banking sector, this time with the German Deutsche Bank in its sights. But he finally closed higher after US Federal Reserve officials eased investor fears about a possible liquidity crisis in the banking sector.
Although the three main US stock indices started the session sharply lower after a collapse in European banks, the losses were reversed at the close of the bell, repeating the intraday roller coaster of recent sessions.
According to preliminary data, the Dow Jones Industrial Average gained 137.48 points, or 0.4%, to 32,242.73, while the S&P 500 rose 22.63 points, or 0.6%, to 3,971.35. The Nasdaq Composite rose 36.76 points, or 0.3%, to 11,824.16.
“Stock markets rallied as concerns persisted about another bank bust in the United States or abroad,” said David Carter, managing director of JPMorgan Private Bank in New York, adding: “Wall Street is looking at Washington and other capitals when it comes to interest rates and banking regulations”.
In separate appearances, three regional Fed bank chairmen said their confidence that the banking system was not facing a liquidity crisis it’s what led to the decision to implement a 25 basis point rate hike on Wednesday.
Concerns about possible contagion beyond regional banks to larger competitors were sparked by a sell-off in European bank shares, a sell-off triggered by the rising cost of insuring Deutsche Bank’s debt.
Those doubts were dispelled by midafternoon with the S&P 500 banking index ending modestly lower, and the KBW regional banking index closing strongly higher.
Shares of big US banks such as JPMorgan Chase & Co, Wells Fargo pared losses but ended lower, and Bank of America closed in the green.
Shares of regional lenders PacWest Bancorp, Western Alliance Bank and Truist Financial Corp. also reversed falls, while First Republic Bank closed in the red.
Source: Ambito
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