(News Bulletin 247) – Wall Street starts the week up. The American place is supported by the takeover of the bank in difficulty Silicon Valley Bank by First Citizens, which for its part takes more than 40% on Monday.
The New York Stock Exchange opened higher on Monday, encouraged by the announcement of the acquisition of assets of the bankrupt bank Silicon Valley Bank by another American regional bank, First Citizens, seen as a new step out of the crisis. of the sector.
The Dow Jones gained 0.7%, the Nasdaq index took 0.4%, the S&P 500 index rose by 0.6%, and the action of First Citizens took off by more than 40%.
During the night of Sunday to Monday, the American Deposit Guarantee Agency (FDIC) indicated that this establishment, whose headquarters is located in Raleigh (North Carolina), would take over all of the deposits and the loan portfolio. of Silicon Valley Bank (SVB).
“During a banking crisis, you come into the weekend worried that another will fall,” Art Hogan of B. Riley Wealth Management said of banks. “There is the risk of a new name being added to the list or the possibility of a bank finding a buyer. It is the latter scenario that has materialized and it is seen as good news.”
Newfound confidence
The announcement propelled the price of the regional institution which, before the implosion of SVB, was a much smaller bank than the California establishment, and weighed only half of the assets of Silicon Valley Bank.
It is the whole sector that was sucked into the stock market, in particular the Californian First Republic (+ 23.50%), considered in recent days as the new weak link in the sector in the United States.
Another Californian brand, PacWest, sparked (+7.02%), as did KeyCorp (+8.47%) – parent company of KeyBank, based in Cleveland (Ohio) – or the regional network Zions ( +7.11%), headquartered in Salt Lake City (Utah). The takeover of almost all of what was left of SVB “instilled confidence in the banks which had been struggling for the past three weeks”, underlined Art Hogan.
The big names in the sector were also at the party, particularly Bank of America (+3.88%), Citigroup (+3.56%) and JPMorgan Chase (+2.59%).
The sigh of relief extended to the bond market, marked by a sharp rise in rates. The yield on 10-year US government bonds stood at 3.49%, against 3.37% at the close on Friday.
(With AFP)
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