U.S. stocks were rising after deal for SVB eases worries about banks

© Reuters.

By Liz Moyer

Investing.com -- U.S. stocks were rising as banking stocks regained ground after the weekend deal for deposits and assets of Silicon Valley Bank.

At 9:54 ET (13:54 GMT), the Dow Jones Industrial Average was up 275 points or 0.8%, while the S&P 500 was up 0.6% and the NASDAQ Composite was up 0.5%.

First Citizens BancShares Inc (NASDAQ:FCNCA), from Raleigh, N.C., is buying pieces of the failed Silicon Valley Bank weeks after its failure sparked bigger fears about a possible contagion in the banking system. Shares of First Citizens jumped 43% on Monday.

First Republic Bank (NYSE:FRC), another regional bank that has been under pressure, jumped 23%. Other banks including JPMorgan rose, too. JPMorgan Chase & Co (NYSE:JPM) shares are up 2.5%, and Wells Fargo & Company (NYSE:WFC) shares are up more than 3%.

Futures traders are split on where the Federal Reserve goes from here. The pressure on the banking system, which could spill over into tighter credit conditions, could put a squeeze on the broader economy as the Fed continues to fight inflation.

That leaves the Fed to consider how big of an interest rate hike to make when it next meets in May, if at all. More than half of futures traders are betting on a pause in rate hiking at the next meeting as of this morning. That’s despite the Fed signaling this week that there will be another rate hike this year.

Among this week’s economic data are reports on consumer confidence, the last print of the fourth quarter gross domestic product growth, and an inflation report that will help the Fed make its decision in May.

Novartis AG (SIX:NOVN) was up 7% after the pharmaceutical maker said it had a promising test of its breast cancer trial drug Kisqali. Meanwhile, BioNTech SE (NASDAQ:BNTX), which partnered with Pfizer (NYSE:PFE) on a COVID vaccine, was down 3.7% after it said it expects revenue to fall more than expected as demand for that vaccine fades.

Oil was rising. Crude Oil WTI Futures were up 1.7% to $70.52 a barrel while Brent Oil Futures were up 1.6% to $75.78 a barrel. Gold Futures were down 1.7% to $1,966.