Markets Drop on Renewed Concerns About Banks

U.S. equities sank on renewed worries about the strength of banks as the fallout from the collapse of Silicon Valley Bank and Signature Bank continued to weigh on the markets. The Dow, S&P 500, and Nasdaq all finished down, although for the week, the S&P 500 added 1.4% and the Nasdaq jumped 4.4%, while the Dow slid fractionally.

Regional banks dominated the list of worst-performing stocks in the S&P 500. They were led lower by First Republic Bank (FRC), as shares cratered 33% after the board suspended its dividend, and said the bank is focusing on reducing its borrowings and evaluating the composition and size of its balance sheet. The moves followed yesterday’s bailout by 11 banks that pledged $30 billion to shore up the struggling firm. Shares of U.S. Bancorp (USB) plunged 9%, and Comerica (CMA) and Lincoln National (LNC) shares tumbled more than 8%. Large bank stocks stumbled as well, with shares of JPMorgan Chase (JPM), Goldman Sachs (GS), Citigroup (C), Bank of America (BAC), and Wells Fargo (WFC) dropping 3%.  

Shares of fossil fuel providers, including Chevron (CVX) and Exxon Mobil (XOM), declined as oil futures dipped almost 3%. Shares of solar power companies tumbled.

Gold Prices Gain

FedEx Corporation (FDX) shares gained 8% as the delivery company reported better-than-expected earnings and lifted its full-year outlook. Gold prices rose 3%, lifting shares of Newmont Corporation (NEM) and other gold miners. Nvidia (NVDA) shares were higher as an analyst upgraded the stock because of the expected explosion in demand for chips for artificial intelligence (AI) applications. Microsoft (MSFT) shares also increased on optimism about the software maker’s move into AI.

The yield on the 10-year Treasury note sank. The U.S. dollar lost ground to the euro, pound, and yen. Prices for major cryptocurrencies posted solid gains. 

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