Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious Outperformance
Find Stocks Now

U.S. stocks are falling as bank worries cloud over Fed optimism

Published 05/05/2023, 12:00 am
© Reuters.

Investing.com -- U.S. stocks were lower amid revived concerns about the U.S. banking system.

At 9:41 ET (13:41 GMT), the Dow Jones Industrial Average was down 200 points or 0.6%, while the S&P 500 is down 0.6% and the NASDAQ Composite is down 0.4%.

Concern about the health of the banking system is weighing on optimism that the Federal Reserve is nearing the end of its |interest rate hikes as economic data shows its actions to now have started to cool inflationary pressures.

Shares of PacWest Bancorp (NASDAQ:PACW) fell 47% on Thursday after the Los Angeles-area lender said it was exploring strategic options, including a sale. This comes just days after regulators seized First Republic Bank and JPMorgan (NYSE:JPM) agreed to buy its deposits and most of its assets.

Other regional bank stocks are feeling the pressure as KeyCorp (NYSE:KEY) shares fell 7%, while Zions Bancorporation (NASDAQ:ZION) fell 8%.

The Fed raised interest rates again on Wednesday, by a quarter of a percentage point, to the highest they have been since 2007. Chair Jerome Powell suggested the Fed could be nearing the end of the rate hiking cycle, though the ultimate decision would come down to the data.

Futures traders are anticipating that pause to come in June.

New jobless claims rose last week to 242,000, slightly more than expected. The bigger snapshot of the state of the labor market in the U.S. is coming out tomorrow in the form of the jobs report for April.

Apple Inc (NASDAQ:AAPL) shares fell 1.6% ahead of its quarterly earnings report after the closing bell tonight. Shares of Qualcomm Incorporated (NASDAQ:QCOM) fell 6.7% after the chip maker missed expectations in its most recent quarter.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

Oil was falling. Crude Oil WTI Futures were down 0.4% to $68.27 a barrel, while Brent Oil Futures were down 0.1% to $72.29 a barrel. Gold Futures were up 0.5% to $2,046.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.