Good Monday morning traders and investors of the r/stocks sub! Welcome to the new trading week and a fresh start! Here are your pre-market stock movers & news on this Monday, March 20th, 2023-
U.S. stock futures are flat as traders assess banking system stress after UBS-Credit Suisse deal: Live updates
U.S. stock futures were flat on Monday as investors assessed the state of the global banking system after the Swiss government engineered a forced takeover of Credit Suisse by UBS, marking the latest effort by governments around the world to stifle a crisis threatening the banking sector.
Dow Jones Industrial Average futures were last down by 3 points, or 0.01%. S&P 500 futures fell 0.03%, while Nasdaq-100 futures declined 0.04%.
Regional banks were still under pressure to shore up their deposit bases in the wake of the collapse of Silicon Valley Bank earlier this month. Wall Street expects more actions may be needed to restore confidence in the banking system after U.S. regulators backstopped SVB’s uninsured deposits and offered new funding for troubled banks one week ago.
The instability in the financial sector over the past two weeks raised the stakes for the Federal Reserve’s interest rate decision on Wednesday. As of Monday morning, there is about a 57% chance of a quarter-point increase by the Fed, according to CME Group data using fed funds futures contracts as a guide. The other 38% is in the no-hike camp, anticipating that Chairman Jerome Powell may start to ease his aggressive tightening campaign that began in March 2022, in the face of the emerging financial contagion.
UBS agreed to buy Credit Suisse for 3 billion Swiss francs, or $3.2 billion, with the combined bank to have $5 trillion in assets. Credit Suisse shares were down 21% last week. Shortly after UBS announced its takeover deal, the Fed announced it had joined with other central banks in a joint liquidity operation. The group of central banks — including the Bank of Canada, Bank of England, Bank of Japan, European Central Bank and Swiss National Bank — agreed to increase the frequency of their U.S. dollar swap line arrangements from weekly to daily.
UBS’s takeover of its beleaguered rival is “unambiguously good for the overarching concerns about the stability of the global banking sector,” according to B. Riley Wealth Management chief market strategist Art Hogan.
But traders may be eager for more to be done by regulators to stem the slide in regional banks. First Republic shares fell 17% in the premarket Monday after losing 72% last week. The declines come even after a group of banks Thursday pledged to deposit $30 billion for at least 120 days in the embattled San Francisco institution. The SPDR Regional Banking ETF (KRE) tumbled 14% last week.
Despite the anxiety surrounding bank stocks, the S&P 500 and Nasdaq Composite closed higher for the week as investors rotated back into technology shares that could benefit from a lower interest rate environment. Meanwhile, the Dow declined 0.15% for the week.
“I think there’s there’s been an overreaction to the regional banks. … And that likely represents an opportunity,” said Hogan.
“As we enter a new week, we will likely see a bid for both the big money center banks, and for the energy complex writ large, because I think there’s been a couple of severe overreactions in the marketplace,” Hogan added.
STOCK FUTURES CURRENTLY:
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LAST WEEK'S MARKET MAP:
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TODAY'S MARKET MAP:
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LAST WEEK'S S&P SECTORS:
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TODAY'S S&P SECTORS:
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TODAY'S ECONOMIC CALENDAR:
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THIS WEEK'S ECONOMIC CALENDAR:
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THIS WEEK'S UPCOMING IPO'S:
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THIS WEEK'S EARNINGS CALENDAR:
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THIS MORNING'S PRE-MARKET EARNINGS CALENDAR:
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EARNINGS RELEASES BEFORE THE OPEN TODAY:
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EARNINGS RELEASES AFTER THE CLOSE TODAY:
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FRIDAY'S ANALYST UPGRADES/DOWNGRADES:
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FRIDAY'S INSIDER TRADING FILINGS:
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TODAY'S DIVIDEND CALENDAR:
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THIS MORNING'S STOCK NEWS MOVERS:
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FULL DISCLOSURE:
/u/bigbear0083 has no positions in any stocks mentioned. Reddit, moderators, and the author do not advise making investment decisions based on discussion in these posts. Analysis is not subject to validation and users take action at their own risk.
DISCUSS!
What's on everyone's radar for today's trading day ahead here at r/stocks?
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