U.S. Stocks Mostly Higher Amid Efforts To Address Banking Turmoil
Stocks have moved mostly higher during trading on Monday, regaining ground following the sharp pullback seen in the previous session. The major averages have all moved to the upside, although the tech-heavy Nasdaq is posting only a modest gain.
Currently, the Dow is up 298.30 points or 0.9 percent at 32,160.28 and the S&P 500 is up 24.33 points or 0.6 percent at 3,940.97. The Nasdaq has been bouncing back and forth across the unchanged line but is currently up 10.90 points or 0.1 percent at 11,641.42.
The strength on Wall Street partly reflected a positive reaction to the latest efforts to address turmoil in the banking sector, including UBS Group’s (UBS) state-backed acquisition of Credit Suisse (CS).
U.S.-listed shares of UBS are up by 4.2 percent following news it will acquire its troubled rival for 3 billion Swiss francs, or $3.2 billion. However, Credit Suisse has plummeted by 53.7 percent.
The Federal Reserve also announced it has joined with other central banks around to world to take coordinated action to enhance the provision of liquidity via the standing U.S. dollar liquidity swap line arrangements.
The central banks currently offering U.S. dollar operations have agreed to increase the frequency of 7-day maturity operations from weekly to daily in order to improve the swap lines’ effectiveness in providing U.S. dollar funding.
Additionally, shares of New York Community Bank (NYCB) have soared by 38.1 percent on news its subsidiary Flagstar Bank will acquire substantially all of Signature Bank’s deposits and certain loan portfolios as well as all 40 of its branches.
Oil service stocks have shown a substantial move back to the upside, with the Philadelphia Oil Service Index surging by 3.2 percent after ending the previous session at a five-month closing low.
The rally by oil service stocks comes despite a continued decrease by the price of crude oil, as crude for April delivery is slumping $0.95 to $65.79 a barrel.
Significant strength is also visible among banking stocks, resulting in a 3.0 percent jump by the KBW Bank Index. The index is bouncing off its lowest closing level in over two years.
Tobacco, steel and telecom stocks are also seeing considerable strength on the day, while weakness in the software sector is weighing on the Nasdaq.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Monday. Japan’s Nikkei 225 Index dove by 1.4 percent, while Hong Kong’s Hang Seng Index plunged by 2.7 percent.
Meanwhile, the major European markets have moved to the upside over the course of the session. While the French CAC 40 Index has jumped by 1.4 percent, the German DAX Index is up by 1.1 percent and the U.K.’s FTSE 100 Index is up by 0.8 percent.
In the bond market, treasuries are giving back ground after moving sharply higher last Friday. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.5 basis points at 3.440 percent.
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