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US Stocks Get Boost from Financial Shares as Tech Slumps: Banking Sector Continues to be Monitored


Financial stocks provided a much-needed boost to US stocks on Monday, with Treasuries retracting due to a decrease in concerns over banking turmoil. However, tech shares took a hit after experiencing a surge in the previous week. The purchase of Silicon Valley Bank by First Citizens BancShares Inc. caused a gauge of regional lenders to increase by approximately 2.5%, which, in turn, led to First Republic Bank experiencing a jump. The Bloomberg report about US authorities considering expanding an emergency lending facility also contributed to this surge. Despite the weekend bringing some relief to the banking sector, it will continue to be closely monitored, as a gauge of regional US banks has lost approximately 30% since early February.

The S&P 500 index saw a rise, with financial firms increasing by over 1%, and energy producers also making gains. On the other hand, the Nasdaq 100 ended 0.7% lower, capping a two-week advance. The two-year Treasury yield surpassed 4%. Eight out of eleven of the S&P500 stayed in positive territory, with the Energy and Financial sectors rallying by 2.1% and 1.4% respectively, on a daily basis.

Main Pairs Movement

On Monday, efforts by authorities to ease concerns about the global banking system helped calm investor nerves, resulting in the dollar reaching a five-day high against the Japanese yen. However, the DXY index remained within a narrow range against most major currencies as investors appeared hesitant to place big wagers in either direction. This hesitation was due to their need for clarity on the fallout from the recent collapse of two U.S. lenders and the rescue of Credit Suisse.

GBPUSD gained 0.44% for the day due to market positioning suggesting a 50% chance the Bank of England (BOE) will hold rates steady, and a 70% chance the US Federal Reserve will do the same at their respective next policy meetings. Meanwhile, EURUSD remained on an upside tendency all day and closed with a 0.35% daily gain on Monday.

Gold experienced a 1.09% daily loss due to investors moving away from safe-haven assets. Despite this, the sentiment was positive at the start of the week amid easing concerns related to a global banking crisis. XAUUSD faced heavy selling pressure during the UK trading session but managed to rebound from a daily low level of the $1944 mark to close at the $1956 mark.

Economic Data

CurrencyDataTime (GMT + 8)Forecast
GBPBoE Gov Bailey Speaks16:45 
BRLBCB Copom Meeting Minutes19:00 
EURECB President Lagarde Speaks21:15 
USDCB Consumer Confidence (Mar)22:00101.0