US: Stocks close mixed as regional banks mount comeback
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US markets closed mixed on Monday (Mar 27), as US regional bank stocks responded positively to the announcement that First Citizens Bank had bought large chunks of failed lender Silicon Valley Bank (SVB).
Shares of First Citizens ended the day up more than 50 per cent after US regulators announced that it purchased about US$72 billion of SVB’s assets at a discount.
The Dow Jones Industrial Average closed up 0.6 per cent at 32,432.08.
The broad-based S&P 500 gained 0.2 per cent to 3,977.56, while the tech-rich Nasdaq Composite Index fell 0.47 per cent to 11,768.84.
“Investors appear to be getting over the banking turmoil that we’ve been living with over the last couple of weeks,” Cresset Capital’s chief investment officer, Jack Ablin, told AFP.
Regional lenders were buffeted by the collapse of SVB, as nervous investors dumped shares of smaller banks over concerns over their resilience in the face of depositor withdrawals.
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The Federal Deposit Insurance Corporation, which shuttered SVB and is now overseeing the sale of its assets, said the deal with First Citizens covers all of SVB’s deposits and loans but not its securities and other assets.
The announcement calmed under-fire regional lenders including First Republic Bank and KeyCorp, which both closed higher on Monday, reversing some recent losses. AFP
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