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Futures up: Dow 1.14%, S&P 1.56%, Nasdaq 1.69%
March 13 (Reuters) - U.S. stock index futures jumped on
Monday after authorities stepped in to restore investor
confidence after the collapse of Silicon Valley Bank (SVB),
while investors wagered a rate hike by Federal Reserve in March
was no longer a certainty.
Futures tracking the tech-heavy Nasdaq rose the
most among Wall Street peers as U.S. Treasury yields dipped to
one-month lows, with some investors now pricing in a pause in
the Fed's rate hikes in March.
The benchmark S&P 500 lost 4.6% last week marking its
biggest weekly percentage decline since September, erasing
nearly all of its year-to-date gains.
After a dramatic sequence of events leading to U.S.
regulators shutting down SVB Financial , Wall Street's
main indexes fell over 1% on Friday, with the Nasdaq Composite
taking the biggest hit.
Following a tense weekend of board meetings and emergency
funding plans for SVB, banking regulators said Sunday evening
that depositors at Silicon Valley Bank, which was shuttered
Friday, would have access to their funds Monday.
The bank's closure had followed sharp interest rate hikes
that hurt its startup customers and a failed capital raise
attempt by the bank, spurring deposit withdrawals.
Investors now evaluate the possibility of the U.S. central
bank holding its interest rate hikes at its next policy meeting
on March 21-22, with Goldman Sachs' analysts no longer expecting
a rate hike in light of the recent stress in the banking sector.
Money market bets have also changed dramatically following
SVB's collapse, with the participants now betting an 80.4%
chance of a 25 basis points rate hike in March instead of a 50
bps increase, with the rest expecting a status quo.
The projections of a terminal rate have also receded to
5.06% by June from around 5.5% before. Along with the developments unfolding in the fallout of SVB,
investors also await crucial inflation data due later in the
week for more clues on Fed's monetary tightening plans.
At 3:46 a.m. ET, Dow e-minis were up 365 points, or
1.14%, S&P 500 e-minis were up 60.25 points, or 1.56%,
and Nasdaq 100 e-minis were up 200.25 points, or 1.69%.
(Reporting by Shubham Batra and Amruta Khandekar in Bengaluru;
Editing by Dhanya Ann Thoppil)
