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- US stocks rose as investors digested the latest CPI data, which came in line with estimates.
- The Dow Jones Industrial Average is on track to break its five-day losing streak.
- Shares of regional banks are staging a comeback after cratering on SVB contagion concerns.
US stocks rallied Tuesday as traders digested the latest inflation data, with the Dow Jones Industrial Average on track to snap a five-day slump.
The consumer price index increased 0.4% in February from January, putting the annual rate at 6%. Both were in line with estimates and signaled continued cooling in inflation as the Federal Reserve weighs its next step on interest rates.
Regional bank stocks staged a comeback after getting demolished on Silicon Valley Bank and Signature Bank contagion concerns on Monday. Shares of First Republic, PacWest, and Western Alliance were up double-digit percentage points.
The collapse of both banks has fueled speculation the Fed will take a less hawkish stance. Goldman Sachs predicted the central bank will pause interest rate hikes at next week’s FOMC meeting, citing “considerable uncertainty.”
“In light of recent stress in the banking system, we no longer expect the FOMC to deliver a rate hike at its March 22 meeting with considerable uncertainty about the path beyond March,” analysts wrote in a Sunday note.
Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Tuesday:
- S&P 500: 3,911.03, up 1.43%
- Dow Jones Industrial Average: 32,136.72, up 1.00% (317.58 points)
- Nasdaq Composite: 11,366.08, up 1.58%
Here’s what else is happening this morning:
- The Fed will launch an investigation into its own oversight of SVB.
- Three of crypto’s most important banks have been closed. Industry experts weighed in on what’s next for the trillion-dollar market.
- Citadel boss Ken Griffin told the Financial Times that the government’s decision to rescue SVB depositors shows US capitalism “breaking down before our eyes.”
- First Republic and Western Alliance stock are under review for a possible downgrade by Moody’s.
In commodities, bonds and crypto:
- West Texas Intermediate crude oil fell 2.7% to $72.76 per barrel. Brent crude, oil’s international benchmark, dropped 2.2% to $79.00.
- Gold dipped 0.3% $1,911 per ounce.
- The yield on the 10-year Treasury fell 9.6 basis points to 3.61%.
- Bitcoin jumped 5.6% to $22,382.