U.S. stock futures moved higher ahead of the open on Monday, while bank stocks also rose after North Carolina-based First Citizens (FCNCA) bank agreed to buy most of Silicon Valley Bank.
Futures tied to the S&P 500 (^GSPC) and futures on the Dow Jones Industrial Average (^DJI) gained 0.6%. Contracts on the technology-heavy Nasdaq Composite (^IXIC) edged up by 0.3%.
Bond yields get a bounce. The yield on the benchmark 10-year U.S. Treasury note rose to 3.4% Monday morning. WTI crude oil was up near $70 a barrel.
Stocks ended a volatile week with gains on Friday, in a week that saw the Federal Reserve raise rates by 0.25%, while pressures in the U.S. and European banking sectors remained in focus for investors. Shares of Deutsche Bank (DB) came under heat Friday after the costs of insuring the bank against a credit default spiked overnight. The major stock market indexes all tallied a winning week in the end, with the Dow Jones average gaining 1.2%, the S&P 500 rising 1.4%, and the Nasdaq Composite closing up 1.7%.
Banks will dominate the headlines again this week with the earnings and economic calendars in light. The Senate Banking Committee will hold a hearing on bank failures on Tuesday, with the witness list including FDIC Chairman Martin Gruenberg, Federal Reserve Vice Chairman Michael Barr, and Treasury Undersecretary Nellie Liang.
“Looking forward, the banking sector will clearly set the scene this week as we approach the month-end on Thursday. The data will be a bit secondary as it’ll be too early to judge any impact from the mini crisis so far,” Jim Reid and colleagues at Deutsche Bank wrote in a note to clients.
Bank sentiment gained momentum Monday morning. Regional bank stocks trading higher Monday morning include First Republic Bank (FRC), PacWest Bancorp (PACW), Western Alliance Bancorporation (WAL) , Zions Bancorporation (ZION), and Regions Financial (RF).
Wall Street heavyweights led by JPMorgan (JPM) have been trying for more than a week to raise capital for First Republic, which included a $30 billion cash lifeline amid the failures of regional lenders Silicon Valley Bank and Signature Bank.
Meanwhile, First Citizens Bank entered into an agreement to buy all of Silicon Valley Bank’s loans and deposits, according to a Federal Deposit Insurance Corporation (FDIC) announcement. The North Carolina-based lender’s assets will nearly double following the acquisition. The 17 branches once belonging to Silicon Valley Bank will now open as First Citizens Bank branches beginning Monday. Shares of First Citizens Bank (FCNCA) rose more than 350% Monday morning.
An illustrative stock chart and First Citizens BancShares logo displayed on a phone screen are seen in this multiple exposure illustration photo taken in Krakow, Poland March 20, 2023. (Photo by Jakub Porzycki/NurPhoto via Getty Images)
Big bank stocks also gained, including Bank of America (BAC), JPMorgan Chase (JPM), Wells Fargo (WFC), and Citigroup (C).
On the economic front, a pulse check on the U.S. consumer will come from the Conference Board’s consumer confidence measure on Wednesday. Then, at the end of the week, the most important datapoint and the Fed’s preferred inflation gauge, the PCE, is set for release Friday. Economists expect personal income in February to come in at 0.3%, slightly lower than January’s read of 0.6%. Personal spending its expected to reach 0.3%, lower than 1.8% January’s reading.
On the earnings calendar, results from Micron Technology (MU), Lululemon (LULU), RH (RH) and Cal-Maine Foods (CALM) are out this week.
Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv
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