*
Regional, major bank shares gain
*
Meta up on report of Morgan Stanley rating upgrade
*
Housing sales data for Feb due at 1000 ET
*
Futures up: Dow 0.81%, S&P 0.72%, Nasdaq 0.44%
(Adds comments, details; updates prices throughout)
By Amruta Khandekar and Ankika Biswas
March 21 (Reuters) - U.S. stock index futures gained on
Tuesday as the rescue of Credit Suisse allayed some concerns of
a bank contagion, while investors awaited the outcome of the
Federal Reserve's monetary policy meet.
Traders now largely expect a 25-basis-point rate hike after
the Fed's two-day meeting concludes on Wednesday, a dramatic
turnaround from expectations of a 50 bps increase before the
banking crisis triggered by the collapse of Silicon Valley Bank
and Signature Bank earlier this month.
While the state-backed takeover of Credit Suisse by
UBS as well as steps taken by central banks to boost
liquidity have eased fears of a contagion to the broader banking
sector, analysts still believe the crisis hasn't been fully
averted.
"While it's a plus that banks so far have been rescued in
the sense of deposits, I don't think we've seen the end of the
turmoil," said Peter Cardillo, chief market economist at Spartan
Capital Securities.
"The last thing the Fed wants to do is to create havoc in
the markets ... and the best thing that they could do is just
take a pause and then revisit it in May."
Shares of beaten-down regional lenders climbed in premarket trade, with First Republic Bank rebounding 22.7% after hitting a record low on Monday. JPMorgan Chase & Co CEO Jamie Dimon is leading talks with other big banks on fresh steps to stabilise First Republic with a possible investment into the lender, the Wall Street Journal reported on Monday. Peers PacWest Bancorp and Western Alliance Bancorp rose 4.0% and 3.4%, respectively. Major U.S. banks such as JPMorgan, Citigroup and Bank of America also advanced between 1.9% and 2.7% before the bell. U.S. Treasury yields rose for a second straight day, with yield on the two-year note, which best reflects interest rate expectations, last at 4.10%. Meanwhile, Meta Platforms Inc gained 2.6%, faring better than most growth companies, on reports of Morgan Stanley upgrading the stock to "overweight" from "equal weight". On the data front, investors will gauge existing home sales figures for February after the opening bell for clues on the strength of the economy.
At 6:38 a.m. ET, Dow e-minis were up 264 points, or 0.81%, S&P 500 e-minis were up 28.75 points, or 0.72%, and Nasdaq 100 e-minis were up 56 points, or 0.44%. Among other stocks, PDD Holdings Inc slipped 1.9% after Alphabet Inc's Google suspended the Play version of the Chinese e-commerce platform's Pinduoduo app after malware issues. (Reporting by Shubham Batra, Amruta Khandekar and Ankika Biswas in Bengaluru; Editing by Nivedita Bhattacharjee and Vinay Dwivedi)
