Dow futures rise 185 pts; First Citizens’ move boosts confidence

U.S. stocks opened slightly higher on Monday, helped by renewed confidence in the stability of the nation’s banking system. At 07:00 ET (11:00 GMT), Dow futures were up 185 points, or 0.6%, S&P 500 futures were up 22 points, or 0.6%, and Nasdaq 100 futures were up 38 points, or 0.3%. %. First Citizens Bank (NASDAQ:FNCCA) will buy most of the loan portfolio of the failed Silicon Valley bank, the Federal Deposit Insurance Corporation announced Monday, to provide immediate full banking services to SVB’s business customers. In addition, Bloomberg reports that US officials are said to be considering expanding an emergency lending facility for banks to help smaller regional banks strengthen their balance sheets. But pressure remains after the collapse of two US lenders earlier this month. Small bank deposits fell by $120 billion in the week to March 15, while lending rose by $253 billion, the data showed. Federal Reserve Chairman Jerome Powell said last week that banking stress could trigger a credit squeeze with “significant” consequences for a US economic slowdown, while Minneapolis Federal Reserve President Neel Kashkari said over the weekend that the banking turmoil had increased the risk of a US recession. . That changed the market’s perception of what the Fed will decide at its meeting next month. “Markets have become more skeptical about whether the Fed can tighten policy, amid speculation about an early start to the easing cycle,” ING analysts said. Several Fed officials are also scheduled to speak during the week, including Fed Governor Philip Jefferson later on Monday, while the main economic focus will be on Friday’s core price index, the central bank’s preferred gauge of inflation. In corporate news, investors continue to focus on the banking sector, but Chinese ADRs are also worth watching following Alibaba (NYSE: BABA ) founder Jack Ma’s return to China. Oil prices held steady on Monday, hovering just above a 15-month low, as traders looked for fresh clues about the ongoing banking crisis, given the importance of the banking sector to global oil trade. From 7:00 am ET, U.S. crude futures were trading 1.1% higher at $70.02 a barrel, while the Brent contract was up 1% at $75.36. Both crude benchmarks rose about 3% last week, recovering from last week’s nearly 13% drop, their biggest weekly declines in months, on fears that turmoil in the banking sector, combined with aggressive Federal Reserve hikes, would lead to a US recession. Gold futures also fell 1.6% to $1,969.10 an ounce, while EUR/USD was 0.1% higher at 1.0768.

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