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U.S. stocks fall as bank sector comes under pressure

Published 11/03/2023, 02:06 am
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By Liz Moyer 

Investing.com -- U.S. stocks were falling as bank stocks come under pressure, while new data on jobs alleviated concerns about aggressive interest rate moves by the Federal Reserve.

At 9:50 ET (13:50 GMT), the Dow Jones Industrial Average was down 165 points or 0.5%, while the S&P 500 was down 0.9% and the NASDAQ Composite was down 1.3%.

The economy added 311,000 jobs last month, more than the 205,000 expected, but the unemployment rate rose to 3.6%. Analysts had expected it to remain at 3.4%. And average hourly earnings rose 0.2%, lower than expected.

Futures traders have lowered the chances of a half percentage point rate hike by the Fed this month. It was at 70% earlier this week and is now under 50%, according to the CME FedWatch tool. Traders give the odds of a quarter-point rate hike slightly higher than 50%.

SVB Financial Group (NASDAQ:SIVB) shares were halted after falling 60% on Thursday. The bank, which has a high profile in the venture capital world, is being squeezed by rising interest rates. It announced a plan to reorganize its portfolio by selling securities at a loss and selling more shares to raise capital but is now reportedly exploring a sale. Its struggle is spilling over to other bank stocks, with the KBW Nasdaq Bank Index down 6% on Friday.

Gap, Inc. (NYSE:GPS) shares were down 6.8% after reporting a quarterly loss on a drop in sales and weaker than expected guidance for the first quarter and year.

Oil was mixed. Crude Oil WTI Futures was flat at $75.67 a barrel, while Brent Oil Futures crude was up 0.1% at $81.66 a barrel. Gold Futures was up 1.4% to $1860.

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