(Reuters) – The New York Stock Exchange opened higher on Monday as news of First Citizens’ takeover of Silicon Valley Bank’s deposits and loans eased concerns about the banking sector after another tough session on Friday.
In early trading, the Dow Jones index gained 253.30 points, or 0.79%, to 32,490.83 points and the broader Standard & Poor’s 500 rose 0.61% to 3,995.20 points.
The Nasdaq Composite took 0.38%, or 44.73 points, to 11,868.69.
The takeover deal around SVB, whose bankruptcy rocked investors earlier this month, offers some respite from weeks of concern over a possible domino effect in the banking sector, particularly after setbacks in Europe by Credit Suisse and, on Friday, by Deutsche Bank.
Separately, reports over the weekend that U.S. authorities are considering expanding the Federal Reserve’s (Fed) emergency lending program, offering increased support to banks, and in particular First Republic Bank, whose the stock tumbled this month, also helping to calm fears.
The action First Citizens jumped Monday 47.2% while that of First Republic Bank takes 31.7%.
Regional banks Western Alliance Bancorp and PacWest Bancorp climbed 7% and 6.3% respectively.
Big US banks JPMorgan Chase & Co, Citigroup and Bank of America are also in positive territory on Monday.
Note that Fed Governor Philip Jefferson is expected to speak later today on US monetary policy.
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(Written by Diana Mandiá, edited by Blandine Hénault)
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