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Markets have scaled back expectations for an aggressive 50-basis-point interest rate hike from the Fed at its March 22 meeting, following the turmoil in the banking sector triggered by the collapse of Silicon Valley Bank and Signature Bank (SBNY.O) earlier this month. Over the weekend, UBS (UBS.N) agreed to buy rival Credit Suisse for $3.23 billion, in a merger engineered by Swiss authorities to avoid more market-shaking turmoil in global banking. While the deal helped calm jitters about the banking sector, U.S.-listed shares of Credit Suisse plummeted 54.9% to hit a fresh record low. PacWest Bancorp (PACW.O) jumped 11.5% after the bank said deposit outflows had stabilized, while New York Community Bancorp (NYCB.N) gained 32.1% after the bank's unit agreed to buy deposits and loans from Signature Bank. The S&P Banking index (.SPXBK) and the KBW Regional Banking index (.KRX), which on Friday had logged their sharpest two-week drop since March 2020, rose 1.4% and 2.6%, respectively.

☆ Wall Street ends sharply lower on bank contagion fears
▼ + stars: | 2023-03-17 | by ( Stephen Culp | ) www.reuters.com time to read: +3 min

For the week, while the benchmark S&P 500 ended higher than last Friday's close, the Nasdaq and the Dow posted weekly declines. "(The sell-off) is a bit of an overreaction," said Oliver Pursche, senior vice president at Wealthspire Advisors in New York. Those concerns have spread to Europe, as Credit Suisse (CSGN.S) shares stumbled over liquidity worries, prompting policymakers to scramble to reassure markets. First Republic Bank (FRC.N) plunged after the bank announced it was suspending its dividend, reversing Thursday's surge that was sparked by an unprecedented $30 billion rescue package from large financial institutions. First Republic's peers, PacWest Bancorp (PACW.O) and Western Alliance (WAL.N), both ended the session sharply lower.

The boost was shortlived and fears of a banking crisis gripped the market on Friday, with shares of First Republic Bank (FRC.N), which also suspended its dividend payout, dropping 24.5%. The KBW regional banking index (.KRX) and the S&P 500 banks index (.SPXBK) fell over 9% each in the week. Investors are now looking ahead to the Federal Reserve's interest rate decision, due next week, to gauge how it will tame inflation. Money market participants now see a 67% chance of the Fed raising rates by 25 basis points on March 22. . Declining issues outnumbered advancers by a 5.46-to-1 ratio on the NYSE by a 3.56-to-1 ratio on the Nasdaq.

Shares of First Republic fell 20.7% in early trading after the bank suspended its dividend payout. The KBW regional banking index (.KRX) and the S&P 500 banks index (.SPXBK) fell over 2% each. "Deposits have fled from regional banks like First Republic into the big banks who are now bailing them out by putting the deposits back in. "Until you stop the deposit flight from regional banks into the systemically important banks that are too big to fail, it doesn't matter how much money you pour into the bucket." The S&P index recorded two new 52-week highs and four new lows, while the Nasdaq recorded seven new highs and 75 new lows.

SummarySummary Companies First Republic Bank tumbles on suspending dividendFedEx jumps on full-year profit forecast raiseFutures mixed: Dow down 0.30%, S&P down 0.11%, Nasdaq up 0.10%March 17 (Reuters) - U.S. stock index futures were mixed on Friday as investors remained wary about a potential banking crisis despite the country's largest banks throwing troubled regional lender First Republic Bank a lifeline. Big U.S. banks were mixed, with JPMorgan and Citigroup (C.N) flat, while Wells Fargo (WFC.N) edged 0.1% higher. European Central Bank supervisors saw no contagion to euro zone banks from the recent market turmoil, a source said. Investors are now looking ahead to the Federal Reserve's interest rate decision, due next week, to gauge how it will tame inflation amid a banking crisis. Money market participants now see an 83% chance of the Fed raising rates by 25 basis points on March 22.

☆ Futures waver as banking crisis worries persist
▼ + stars: | 2023-03-17 | by ( ) www.reuters.com time to read: +3 min

Shares of First Republic Bank (FRC.N), however, fell 3.8% in premarket trading as the bank suspended its dividend payout. Concerns about a global banking crisis have dominated market sentiment this week after the collapse of SVB Financial (SIVB.O) and Signature Bank (SBNY.O). While the focus remains on the health of the banking sector, investors also looked ahead to U.S. central bank's policy meeting next week to gauge how it will tame inflation amid a banking crisis. Yield on the two-year Treasury note, which best reflects interest rate expectations, rose to 4.15% as some tensions about the banking sector abate. Shares of Fedex Corp (FDX.N) rose 11.1% premarket after the delivery giant raised full-year earnings forecast after cost cuts.

SummarySummary Companies Credit Suisse rebounds on lifeline from Swiss central bankHousing starts, jobless claims data due 8:30 am ETAdobe rises on upbeat profit forecastMeta, Snap climb as U.S. threatens TikTok banFutures mixed: Dow down 0.29%, S&P down 0.19%, Nasdaq up 0.16%March 16 (Reuters) - U.S. stock index futures were mixed on Thursday as the Swiss central bank's lifeline for embattled Credit Suisse did little to boost investor sentiment as they awaited economic data for clues on the outlook for U.S. interest rates. U.S.-listed shares of Credit Suisse rose 8.8% in premarket trading after the bank secured a credit line of up to $54 billion from the Swiss National Bank to shore up liquidity and investor confidence, which had nosedived after the lender's shares slumped on Wednesday. Troubles at Credit Suisse, coming on the heels of the collapse of SVB Financial (SIVB.O) and peer Signature Bank (SBNY.O) have sparked fresh worries about stress in the banking sector, dwarfing relief on expectations of less aggressive moves by the Federal Reserve. "Central banks are in a bit of a bind because they need to make sure that inflation is brought back under control. Shares of Adobe Inc (ADBE.O) supported Nasdaq futures, rising 5.8% in premarket trade after the Photoshop maker raised its 2023 profit target.

U.S.-listed shares of Credit Suisse slid 24.3% to hit a record low, after the Swiss bank's largest investor said it could not provide more financial assistance to the lender. Big U.S. banks including JPMorgan Chase & Co (JPM.N), Citigroup (C.N) and Bank of America Corp (BAC.N) fell between 5% and 1%. The KBW regional banking index (.KRX) slid 3.8% while the S&P 500 banking index (.SPXBK) dropped 4.2%%. "Given all the turmoil with Silicon Valley Bank and Signature Bank, expectations have dramatically risen come that the Fed will keep rates unchanged, or maybe raise them (by) 25 basis points." Shares of Charles Schwab Corp (SCHW.N) fell 1.9%, a day after its chief executive said the firm has enough liquidity.

However, regional banks pared early gains in premarket trading on Wednesday, with First Republic Bank (FRC.N) down 0.7%. Big U.S. banks such as JPMorgan Chase & Co (JPM.N), Citigroup (C.N) and Bank of America Corp (BAC.N) fell between 1.2% and 2.3%. ET, which is expected to show a moderation in producer price growth in February both on a monthly and annual basis. ET, Dow e-minis were down 517 points, or 1.61%, S&P 500 e-minis were down 63 points, or 1.61%, and Nasdaq 100 e-minis were down 162 points, or 1.33%. Reporting by Amruta Khandekar and Shubham Batra in Bengaluru; Editing by Dhanya Ann Thoppil and Vinay DwivediOur Standards: The Thomson Reuters Trust Principles.

☆ Futures fall as caution about banks lingers, economic data awaited
▼ + stars: | 2023-03-15 | by ( ) www.reuters.com time to read: +3 min

After the recent collapse of SVB Financial (SIVB.O) and Signature Bank (SBNY.O), assurances and emergency measures by U.S. authorities allayed worries about the health of other banks to some extent. Regional banks extended gains to premarket trading on Wednesday after a strong rebound in the previous session. First Republic Bank (FRC.N) jumped nearly 13%, with peers Western Alliance Bancorp (WAL.N) and PacWest Bancorp (PACW.O) up 8.3% and 6.5%, respectively. Big U.S. banks such as JPMorgan Chase & Co (JPM.N), Citigroup (C.N) and Bank of America Corp (BAC.N) edged lower between 0.2% and 0.8%. ET, Dow e-minis were down 171 points, or 0.53%, S&P 500 e-minis were down 19.25 points, or 0.49%, and Nasdaq 100 e-minis were down 51.75 points, or 0.42%.

☆ European shares sink as banks resume selloff, Credit Suisse hits new low
▼ + stars: | 2023-03-15 | by ( Shreyashi Sanyal | ) www.reuters.com time to read: +3 min

The pan-European STOXX 600 index (.STOXX) fell 2.5% by 1118 GMT, languishing at 10-week lows, as was the banks sector index (.SX7P) after plunging nearly 6%. The bank index is set to lose more than 120 billion euros ($127.26 billion) in market value since the close of March 8. Shares of Credit Suisse (CSGN.S) fell below 2 Swiss francs ($2.18) after the lender's biggest shareholder said it could not raise its 10% stake, citing regulatory issues. There was also a cooling of optimism that the U.S. Federal Reserve will tone down its rate-hiking spree next week in the aftermath of Silicon Valley Bank's (SVB) collapse. Retailers (.SXRP) shed 5.0% after shares of Zara-owner Inditex (ITX.MC), the world's biggest fashion retailer, fell 5.2% as it flagged higher investment spending.

☆ Wall Street ends green as inflation cools, bank jitters ebb
▼ + stars: | 2023-03-14 | by ( Stephen Culp | ) www.reuters.com time to read: +4 min

Financial stocks clawed back some losses, with the S&P 500 Banks index (.SPXBK) coming back from its steepest one-day sell-off since June 2020. Bank contagion fears were allayed on Tuesday as reassurances by U.S. President Joe Biden and other global policymakers vowed the crisis would be contained. Even so, inflation has a considerable way to go before approaching the central bank's average annual 2% target. [1/4] Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., March 14, 2023. The S&P 500 banking index (.SPXBK) reclaimed territory lost to Monday's plunge, its biggest one-day drop since June 2020.

Consumer Price Index (CPI) rose 0.4% in February from 0.5% in January as Americans faced persistently higher costs for rents and food. On a yearly basis, the CPI rose 6% in February, compared with 6.4% the previous month. The S&P 500 banking index (.SPXBK) rose 2.9% after recording its biggest one-day percentage drop since June 2020 in the previous session. Advancing issues outnumbered decliners by a 6.05-to-1 ratio on the NYSE and by a 3.52-to-1 ratio on the Nasdaq. The S&P index recorded two new 52-week highs and five new lows, while the Nasdaq recorded 18 new highs and 79 new lows.

Data showed that U.S. Consumer Price Index (CPI) rose 0.4% in February versus 0.5% a month ago. Traders held on to bets of a 25-basis-point rate hike at the Fed's next meeting in March, with odds of a pause in hikes slipping a bit to 17%. The S&P 500 banking index (.SPXBK) rose 3.9% after recording its biggest one-day percentage drop since June 2020 in the previous session. Advancing issues outnumbered decliners by a 7.92-to-1 ratio on the NYSE and by a 4.87-to-1 ratio on the Nasdaq. The S&P index recorded no new 52-week highs and no new lows, while the Nasdaq recorded 9 new highs and 36 new lows.

☆ Futures rise after bank rout, CPI data awaited
▼ + stars: | 2023-03-14 | by ( ) www.reuters.com time to read: +3 min

ET (1330 GMT) from the Labor Department, will feed into the U.S. Federal Reserve's policy decision at its March meeting. On a yearly basis, CPI grew 6.0% in February, moderating from a 6.4% in rise the previous month. SVB Financial's (SIVB.O) sudden shutdown and fears of risks to other banks hammered the sector and broader markets in the past few days. "The CPI figures out later will be watched super-closely as another hot reading will reinforce expectations that a rate rise, albeit smaller, will be on the cards next week." ET, Dow e-minis were up 117 points, or 0.37%, S&P 500 e-minis were up 16.25 points, or 0.42%, and Nasdaq 100 e-minis were up 56 points, or 0.47%.

But your second thought is, how big was that crisis, how big were the risks that this step had to be taken?" Trading in shares of SVB's peer Signature Bank (SBNY.O), which was shut down by regulators on Sunday, was halted. Shares of big U.S. banks including JPMorgan Chase & Co (JPM.N), Morgan Stanley (MS.N) and Bank of America (BAC.N) fell between 2.8% and 6.3%. The KBW regional banking index fell 11.2%, while the S&P 500 banks index (.SPXBK) dropped 7.7%. The S&P index recorded no new 52-week highs and 44 new lows, while the Nasdaq recorded 19 new highs and 321 new lows.

Helping futures for the tech-heavy Nasdaq gain nearly 1%, U.S. two-year Treasury yields tumbled to more than a month low, while futures for the cyclicals-heavy Dow Jones edged lower. Big Tech and growth companies such as Meta Platforms (META.O), Amazon (AMZN.O) and Microsoft (MSFT.O) rose between 1% and 2% premarket. Traders' bets are currently equally split between a pause and a 25-basis-point rate hike at the Fed's next meeting in March. The projections of a terminal rate have also receded to just under 5% by June from around 5.5% in September earlier. ET, Dow e-minis were down 48 points, or 0.15%, S&P 500 e-minis were up 5.5 points, or 0.14%, and Nasdaq 100 e-minis were up 99.25 points, or 0.84%.

Futures tracking the tech-heavy Nasdaq led the gains as U.S. Treasury yields dipped to one-month lows, but were off session highs. Money market bets have also changed dramatically, with participants now betting an 80.4% chance of a 25 basis points rate hike in March instead of a 50 bps increase, with the rest expecting a status quo. Goldman Sachs analysts said they no longer expect the Fed to raise rates by 25 basis points at its next policy meeting on March 21-22. SVB's failure followed sharp interest rate hikes that hurt its startup customers and a failed capital raise attempt by the bank, spurring deposit withdrawals. ET, Dow e-minis were up 82 points, or 0.26%, S&P 500 e-minis were up 21.25 points, or 0.55%, and Nasdaq 100 e-minis were up 90 points, or 0.76%.

☆ Futures rise on bets of likely rate hike pause after SVB collapse
▼ + stars: | 2023-03-13 | by ( ) www.reuters.com time to read: +2 min

Futures tracking the tech-heavy Nasdaq rose the most among Wall Street peers as U.S. Treasury yields dipped to one-month lows, with some investors now pricing in a pause in the Fed's rate hikes in March. The bank's closure had followed sharp interest rate hikes that hurt its startup customers and a failed capital raise attempt by the bank, spurring deposit withdrawals. Money market bets have also changed dramatically following SVB's collapse, with the participants now betting an 80.4% chance of a 25 basis points rate hike in March instead of a 50 bps increase, with the rest expecting a status quo. Along with the developments unfolding in the fallout of SVB, investors also await crucial inflation data due later in the week for more clues on Fed's monetary tightening plans. ET, Dow e-minis were up 365 points, or 1.14%, S&P 500 e-minis were up 60.25 points, or 1.56%, and Nasdaq 100 e-minis were up 200.25 points, or 1.69%.

Wall Street's main indexes recorded steep losses in the previous session after startups-focused lender SVB Financial Group's (SIVB.O) share sale to shore up its balance sheet wiped out more than $80 billion in value from bank shares. The bank is in talks to sell itself, the report added. All three major U.S. indexes were headed towards weekly losses as Fed Chair Jerome Powell earlier this week left open the possibility of a large rate hike at the Fed's March meeting, after the central bank dialed down the size of its rate hike last month. Declining issues outnumbered advancers by a 3.33-to-1 ratio on the NYSE and by a 3.88-to-1 ratio on the Nasdaq. Reporting by Amruta Khandekar and Shristi Achar in Bengaluru Editing by Vinay DwivediOur Standards: The Thomson Reuters Trust Principles.

☆ Futures dip as SVB Financial extends rout, payrolls data awaited
▼ + stars: | 2023-03-10 | by ( ) www.reuters.com time to read: +2 min

The reading is likely to show nonfarm payrolls grew by 205,000 jobs in February, less than half of the eye-popping 517,000 additions in January. The unemployment rate is forecast to stay unchanged at 3.4%, the lowest since May 1969. "The strength of the January jobs data came as a surprise to markets," said Mark Haefele Chief Investment Officer, UBS Global Wealth Management in a note. ET, Dow e-minis were down 127 points, or 0.39%, S&P 500 e-minis were down 11.75 points, or 0.3%, and Nasdaq 100 e-minis were down 4.5 points, or 0.04%. Among other stocks, Gap Inc (GPS.N) fell 6.7% in premarket trading after the apparel maker posted a bigger-than-expected fourth-quarter loss and forecast full-year sales below Wall Street estimates, signaling a slowdown in demand.

Initial claims for state unemployment benefits rose 21,000 to a seasonally adjusted 211,000 for the week ended March 4, the Labor Department said on Thursday. "This could be a game changer for today's market," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York. The gains pushed up the S&P 500 communication services (.SPLRCL), consumer discretionary (.SPLRCD) and information technology (.SPLRCT) sectors between 0.4% and 0.6%. Advancing issues outnumbered decliners by a 1.64-to-1 ratio on the NYSE and by a 1.06-to-1 ratio on the Nasdaq. The S&P index recorded four new 52-week highs and 11 new lows, while the Nasdaq recorded 28 new highs and 54 new lows.

☆ Futures slip on rate-hike worries ahead of payrolls data
▼ + stars: | 2023-03-09 | by ( ) www.reuters.com time to read: +2 min

With economic data so far suggesting the labor market remains hot despite the Fed's aggressive monetary tightening over the past year, investors are now focused on the February non-farm payrolls report due on Friday. The reading is expected to show payrolls increased by 205,000 last month, according to economists polled by Reuters, after January's blowout 517,000 figure, which had first led markets to reprice their expectations for U.S. interest rates. "Our US economists expect a positive surprise to payrolls on Friday," said Citi strategists in a note published late on Wednesday. Nasdaq futures led declines on Thursday, with shares of Tesla Inc (TSLA.O) down 3.1% in premarket trade and set to extend its losses from the previous session on news of a probe by the U.S. auto safety regulator. ET, Dow e-minis were down 62 points, or 0.19%, S&P 500 e-minis were down 14.75 points, or 0.37%, and Nasdaq 100 e-minis were down 83.75 points, or 0.68%.

☆ Frontier countries to suffer most if Fed rate gets to 6% - analysts
▼ + stars: | 2023-03-09 | by ( Rodrigo Campos | ) www.reuters.com time to read: +5 min

"This mix is generally a net negative for emerging markets." A recent Barclays analysis showed a 50 basis point Fed rate hike would increase interest rate volatility, which "would be more destabilizing initially, as it typically comes with EM FX underperformance, which could trigger a further leg up in EM rates." Analysts at JPMorgan expect the dollar to weaken once the terminal rate stabilizes, but a 50-basis point Fed hike "would be a regime-shift in favor of outsized USD-strength." A 6% Fed rate environment alongside still-hot inflation does make short-term rates in Chile and India as well as Poland, the Czech Republic and Hungary most vulnerable, UBS found. Chinese equities could provide a safe haven in a 6% fed funds rate scenario, UBS said.

Ahead of the crucial non-farm payrolls report on Friday, data showed U.S. private payrolls increased more than expected in February, pointing to continued labor market strength. BlackRock's chief investment officer of global fixed income, Rick Rieder, said the Fed could raise rates to 6% and keep them there for an extended period of time to fight inflation. "Unless we get some data over the course of the next two weeks, we really don't know which way we should be landing. Unfortunately the most important piece of the data doesn't come until Friday, that's why we've got a market that's meandering a bit." ET, Dow e-minis were up 33 points, or 0.1%, S&P 500 e-minis were up 4.25 points, or 0.11%, and Nasdaq 100 e-minis were up 19.75 points, or 0.16%.

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