On Tuesday, March 28rd a sharp increase in bond yields pushed the markets to open lower. The 2-year U.S. Treasury note rate breached 4% and investors became increasingly concerned that higher rates could send the economy into recessionary territory despite earlier efforts from policymakers attempting to limit potential damage due to regional banking issues within the United States .
Monday saw mixed performances on Wall Street with modest gains for both Dow Jones Industrial Average (194 points or 0.6%) and S&P 500(0.16%), however tech shares succumbed under pressure resulting in Nasdaq Composite falling by 047%.
Wall Street sentiment boosted by a string of encouraging headlines, such as First Citizens BancShares’ acquisition of certain Silicon Valley Bank assets and new data indicating that deposits into large financial institutions have tapered off.
The S&P 500’s energy sector experienced the most significant growth at 2.1%, while regional banking stocks like First Republic Corporation were buoyed alongside the SPDR S&P Regional Banking ETF (KRE).
On the other hand, communication services and information technology sectors – prominent players in this year’s market trends – posted small declines.
Investors remain cautiously optimistic as the markets pause from recent downturns, buoyed by news of First Citizens’ acquisition of SVB.
This week’s business calendar is packed with important releases including earnings reports from Micron Technology, Lululemon and Dave & Buster’s in addition to home price data and The Conference Board’s consumer confidence report.
To see a complete calendar of companies that are reporting earnings, click here.
With scrutiny on bank failures increasing daily, investors will also be looking closely at Vice Chair for Supervision Michael Barr’s upcoming testimony before the Senate Banking Committee.
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