Wall Street ends down with tech; investors assess bank comments

The Dow started out up about a hundred points before starting a dive right around noon to reach a low point some 200 down before rising again around 2 pm to final close down just 37.  The Nasdaq and S&P followed a similar pattern excepting that both spent the entire session solidly in the red. Like yesterday, with the tech sector doing so well for Q1, the sell off of the last two days was likely triggered by profit-taking. Falling shares in Apple and Microsoft dragged the S&P down. 

The banking index continues to fall, though much less than in prior sessions, and ironically the tighter regulations for smaller banks has made investors more nervous when they should be doing the opposite by offering reassurances that the problems are being fixed. But all that really means is that, with Q1 nearing an end, the markets are keeping a sharp eye on upcoming bank results. Volume continues substantially below recent averages at just 9.6 billion. 

Tue  March 28, 2023  4:40 PM

Wall Street ends down with tech; investors assess bank comments

By Caroline Valetkevitch

DJ: 32,432.08  +194.55        NAS: 11,768.84  -55.12         S&P: 3,977.53  +6.54       3/27

DJ: 32,394.25  -37.83           NAS: 11,716.08  -52.76         S&P: 3,971.27  -6.26        3/28

March 28 (Reuters) - U.S. stocks ended slightly lower on Tuesday as investors weighed comments from a top U.S. regulator on struggling banks and sold shares of technology-related names after their recent strong run.  Michael Barr, the Federal Reserve's top banking regulator, told a Senate panel that Silicon Valley Bank did a "terrible" job of managing risk before its collapse.  Shares of Apple (AAPL.O) and Microsoft (MSFT.O) along with other technology-related shares ended down and were among the biggest drags on the S&P 500.

"It's a little bit of a follow-through from yesterday's pullback in tech stocks. You're seeing a little bit of profit-taking," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles. "Some of the enthusiasm is waning a little bit."  The S&P 500 technology index (.SPLRCT) was down 0.5% on Tuesday, extending this week's declines, but remains up sharply for the quarter.  The KBW regional banking index (.KRX) was down 0.2% on the day. Shares of First Citizens BancShares Inc (FCNCA.O) were up slightly, a day after the stock rose more than 50% after it said it would acquire the deposits and loans of Silicon Valley Bank.  Bank stocks have sold off sharply in the wake of problems at Silicon Valley and other banks.

The Dow Jones Industrial Average (.DJI) fell 37.83 points, or 0.12%, to 32,394.25, the S&P 500 (.SPX) lost 6.26 points, or 0.16%, to 3,971.27 and the Nasdaq Composite (.IXIC) dropped 52.76 points, or 0.45%, to 11,716.08.

"The prospect of stricter regulations for banks with deposits above $100 billion is raising the anxiety level for those that are perceived currently to be struggling," James said.  Treasury yields edged higher, also weighing on tech-focused shares. Yields have climbed from six-months lows hit Friday. Early in the day, a survey showed U.S. consumer confidence unexpectedly increased in March, but also that Americans are becoming a bit anxious about the labor market.

With the quarter end approaching, investors are looking forward to upcoming bank results, which may give them more details about the health of the sector following the collapse of Silicon Valley and Signature Bank.  Alibaba Group Holding jumped 14.3% after the company said it plans to split its business into six main units covering e-commerce, media and the cloud.  After the closing bell, shares of Micron Technology Inc (MU.O) were up about 1%. It forecast third-quarter revenue in line with Wall Street expectations. Micron closed down 0.9% in the regular session.

Advancing issues outnumbered declining ones on the NYSE by a 1.43-to-1 ratio; on Nasdaq, a 1.28-to-1 ratio favored decliners.  The S&P 500 posted 6 new 52-week highs and no new lows; the Nasdaq Composite recorded 40 new highs and 153 new lows.

Volume on U.S. exchanges was 9.66 billion shares, compared with the 12.75 billion average for the full session over the last 20 trading days.