Stock market today: Dow rides tech higher but banks stumble to keep gains in check
Investing.com | Author Yasin Ebrahim
Published Mar 23, 2023 04:10PM ET
Updated Mar 23, 2023 04:47PM ET
By Yasin Ebrahim
Investing.com --The Dow closer higher Thursday, as tech gains were kept in check by renewed selling in regional banks worries about the banking system persist despite rising bets on the Fed pausing sooner rather than later.
The Dow Jones Industrial Average was up 0.2%, the Nasdaq gained 1%, and the S&P 500 rose 0.3%
Treasury yields fell again on bets that the Fed is likely to pause, and eventually pivot sooner rather than later as tighten lending conditions amid stresses in the banking system will help cool inflation.
The Fed hiked rates by quarter-point on Wednesday, forecast one more hike this year, and ruled out the possibility of cuts, but markets aren’t convinced. The odds of a pause at the next meeting jumped to 55% from 31.4% the prior week, according to Investing.com’s Fed Rate Monitor Tool.
Meta Platforms (NASDAQ:META), Apple (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT) and Google (NASDAQ:GOOGL) sparked bid in tech.
Social media stocks were also in focus amid a potential ban of rival TikTok in the U.S. TikTok chief executive Shou Zi Chew is on Capitol Hill to deliver testimony before Congress as lawmakers mull whether to ban the app amid concerns about the app's data privacy, and possible connection to the Chinese Communist Party.
“If TikTok and ByteDance decided to fight this and potentially get banned in the US, the clear beneficiaries of this would be Snapchat and Meta/Facebook,” Wedbush said in a note.
Banking stocks, however, resumed their selloff as First Republic Bank (NYSE:FRC) return to firing line despite Treasury Secretary Janet Yellen on Thursday saying the government would be willing to step in again if needed to bring stability to regional banks.
“We have used important tools to act quickly to prevent contagion. And they are tools we could use again,” Yellen said in written testimony before a House Appropriations subcommittee.
Energy also pressured the broader market, with Schlumberger NV (NYSE:SLB) leading to the downside as oil prices cut gains.
The slip in rates, meanwhile, didn’t provide relief for cryptocurrencies as sentiment was soured by of further legation action in the space after Coinbase (NASDAQ:COIN) received notice that the U.S. Securities & Exchange Commission plans on suing the popular crypto exchange for allegedly listing unregistered securities.
In other news, Block (NYSE:SQ) fell more than 14% after shorter-seller Heidenburg accused the digital payment company of facilitating fraud and misleading investors.
On the economic front, weekly jobless claims continued to show strength in the labor market, with economists flagging the ongoing lack of labor supply.
“[T]he bottom line is that labor supply is not increasing in any meaningful way, and there is no evidence that this will change any time soon,” Jefferies said in a note.
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