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  • Dow futures flip higher after March jobs report in thin Good Friday trading

    Dow futures flip higher after March jobs report in thin Good Friday trading

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    U.S. stock-index futures turned higher in a holiday-shortened session after a solid March jobs report, though investors won’t fully digest the data until next week with cash trading in equities closed due to the Good Friday holiday.

    Trading in stock-index futures closed at 9:15 a.m. Eastern. Stock-index futures resume trading at their regular time, 6 p.m., on Sunday, as U.S. markets return to normal trading hours Monday.

    What stock-index futures are doing
    • Futures on the Dow Jones Industrial Average
      YM00,
      +0.19%
      rose 64 points, or 0.2%, to 33,723.

    • S&P 500 futures
      ES00,
      +0.24%
      gained 9.75 points, or 0.2%, to 4,141.75.

    • Nasdaq-100 futures
      NQ00,
      +0.10%
      ticked up 13.50 points, or 0.1%, to 13,184.25.

    With the exception of the Dow industrials, U.S. stocks finished the holiday-shortened week lower on Thursday after three consecutive weekly gains for the S&P 500 and the tech-heavy Nasdaq. The Dow
    DJIA,
    +0.01%
    rose 0.6% for the week, while the S&P 500
    SPX,
    +0.36%
    shed 0.1% and the Nasdaq
    COMP,
    +0.76%
    slumped 1.1%, after scoring its best quarter since 2020.

    Market drivers

    The U.S. added 236,000 new jobs in March, defying the Federal Reserve’s hopes for a big slowdown in hiring and possibly making it harder for the central bank to tame inflation. Economists polled by The Wall Street Journal had forecast 238,000 new jobs.

    The unemployment rate, meanwhile, slipped to 3.5% from 3.6%. Wages rose 0.3% last month.

    “This month’s report indicates that interest rate hikes have yet to impact tight unemployment conditions,” said Steve Rick, chief economist at CUNA Mutual Group, in emailed comments.

    Treasury yields popped higher and the dollar rose, though traders noted conditions were thin due to the holiday. Fed-funds futures showed traders pricing in a nearly 70% chance the Federal Reserve will lift interest rates by a quarter-point in May and a roughly 30% chance policy makers will leave rates unchanged. Traders had seen a roughly 50-50 split on Thursday.

    “Today’s jobs report is consistent with a slow-moving recession unfolding in the U.S. and one that does not point to immediate resolution of inflation concerns,” said Jason Pride, chief investment officer of private wealth at Glenmede, in a note. “As such, the odds of another quarter-point rate hike in May should go higher as the data does not appear to justify a Fed pause.”

    That said, policy makers and investors will see a raft of data before the next Fed meeting, including next week’s consumer-price index reading, Pride noted.

    See: Jobs report ‘likely tips the scales toward another rate hike in May’ — economists react to March release

    Good Friday is a market holiday but not a U.S. federal holiday. That means the U.S. Labor Department released its March jobs report, as usual. Bond traders will see a half day of trading, with Sifma recommending a noon ET close to allow a reaction to the data.

    Read: Why Good Friday complicates how stock-market traders will digest March jobs report

    Investors saw a stream of jobs-related data over the course of the past week. Data on Tuesday showed the number of U.S. job openings dropped below 10 million to a 21-month low, indicating a hot jobs market may be starting to lose some sizzle.

    ADP on Wednesday said the private sector added 145,000 jobs in March, well below the 210,000 expected by economists. Weekly jobless claims data on Thursday morning showed first-time applications for benefits last week came in higher than expected.

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  • Jobs report shows 236,000 gain in March — lifting 2023 total above 1 million — but U.S. labor market shows hints of cooling

    Jobs report shows 236,000 gain in March — lifting 2023 total above 1 million — but U.S. labor market shows hints of cooling

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    The numbers: The U.S. added a robust 236,000 new jobs in March, defying the Federal Reserve’s hopes for a big slowdown in hiring as the central bank struggles to tame inflation. The consensus economist forecast called for a nonfarm-payrolls expansion of 238,000.

    The solid increase in employment last month followed a revised 326,000 gain in February and a gain of 472,000 in January.

    While the increase in hiring was the smallest monthly rise in more than two years, the number of jobs created last month was much greater than is typical.

    The U.S. economy has shown recent signs of stress.

    The unemployment rate, meanwhile, slipped to 3.5% from 3.6% as more people searched for and found work. That’s another sign of labor-market vigor.

    There was some good news in the report for the Fed, though.

    Wage growth continued to moderate closer to level the Fed would prefer. Hourly wages increased a mild 0.3% last month, the government said Friday.

    The increase in pay over the past year also slowed again to a nearly two-year low of 4.2% from 4.6% in February.

    What’s more, the share of people working or looking for work rose a tick to 62.6%. That’s the highest labor-force participation rate since February 2020, the last month before the pandemic’s onset.

    When more people look for work, companies don’t have to compete as hard for workers via higher pay.

    Emerging evidence of slack in a muscular U.S. labor market could encourage the Fed to take a breather after a rapid series of interest-rate increases.

    Still, the U.S. has added a whopping 1 million–plus new jobs in the first three months of the year. The labor market is not cooling off as much as the Fed would like.

    “ The Black unemployment rate fell to 5% last month, the lowest level since records began being kept in the early 1970s. ”

    Stock-index futures rallied after the report, though the stock market itself is officially closed due to the Good Friday holiday.

    See: Why Good Friday complicates how stock-market traders will digest March jobs report

    Key details: About one-third of the new jobs created last month — 72,000 — were at service-sector companies such as bars and restaurants whose employment still has not returned to prepandemic levels.

    Americans are going out to eat a lot and spending relatively more on services than on goods.

    Government employment increased by 47,000. Hiring also rose at professional businesses and in healthcare. Retailers cut 15,000 jobs.

    Employment fell slightly in manufacturing and construction, or goods-producing industries, which are under more pressure from rising interest rates.

    The strong labor market has benefited all groups, but especially Black Americans. The Black unemployment rate fell to 5% last month, the lowest level since records began being kept in the early 1970s.

    Big picture: The ongoing tightness in the labor market could inflame inflation and even push the Fed to raise interest rates more than currently forecast to try to get prices under control.

    Higher borrowing costs reduce inflation by slowing the economy, but most Fed rate-hike cycles since World War II have been followed by recession.

    On the flip side, the U.S. economy is starting to show more signs of deterioration due to the series of rapid Fed interest-rate increases since last year.

    Manufacturers have cut production and are arguably already in recession and the much larger service side of the economy is under more stress lately.

    If these trends continue the economy — and inflation — are bound to slow.

    The U.S. is still growing for now, however, and the labor market remains an oasis of strength.

    Low unemployment and rising wages have allowed Americans to keep spending. And so far they’ve keep the economy out of a widely predicted recession.

    Looking ahead: “The U.S. labor market is losing some momentum, but remains far too vibrant for the Fed to pause [its rate-hike campaign] in May,” said senior economist Sal Guatieri at BMO Capital Markets

    “Although job growth is gradually slowing, it remains too strong for the Federal Reserve,” said Sal Guatieri of PNC Financial Services.

    See: Traders see little chance interest rates will end up where Fed thinks in 2023

    Market reaction:  Futures contracts on the Dow Jones Industrial Average
    YM00,
    +0.19%
    rose 64 points, or 0.2%, to 33,723. S&P 500 futures
    ES00,
    +0.24%
    gained 9.75 points, or 0.2%, to 4,141.75. Stock trading resumes again on Monday.

    The yield on the 10-year Treasury
    TMUBMUSD10Y,
    3.404%
    jumped to 3.36%.

    MarketWatch personal finance: U.S. economy added 236,000 jobs in March. Is this your last chance to jump ship?

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  • Jobs report shows 236,000 gain in March — lifting 2023 total above 1 million — but U.S. labor market shows hints of cooling

    Jobs report shows 236,000 gain in March — lifting 2023 total above 1 million — but U.S. labor market shows hints of cooling

    [ad_1]

    The numbers: The U.S. added a robust 236,000 new jobs in March, defying the Federal Reserve’s hopes for a big slowdown in hiring as the central bank struggles to tame inflation. The consensus economist forecast called for a nonfarm-payrolls expansion of 238,000.

    The solid increase in employment last month followed a revised 326,000 gain in February and a gain of 472,000 in January.

    While the increase in hiring was the smallest monthly rise in more than two years, the number of jobs created last month was much greater than is typical.

    The U.S. economy has shown recent signs of stress.

    The unemployment rate, meanwhile, slipped to 3.5% from 3.6% as more people searched for and found work. That’s another sign of labor-market vigor.

    There was some good news in the report for the Fed, though.

    Wage growth continued to moderate closer to level the Fed would prefer. Hourly wages increased a mild 0.3% last month, the government said Friday.

    The increase in pay over the past year also slowed again to a nearly two-year low of 4.2% from 4.6% in February.

    What’s more, the share of people working or looking for work rose a tick to 62.6%. That’s the highest labor-force participation rate since February 2020, the last month before the pandemic’s onset.

    When more people look for work, companies don’t have to compete as hard for workers via higher pay.

    Emerging evidence of slack in a muscular U.S. labor market could encourage the Fed to take a breather after a rapid series of interest-rate increases.

    Still, the U.S. has added a whopping 1 million–plus new jobs in the first three months of the year. The labor market is not cooling off as much as the Fed would like.

    “ The Black unemployment rate fell to 5% last month, the lowest level since records began being kept in the early 1970s. ”

    Stock-index futures rallied after the report, though the stock market itself is officially closed due to the Good Friday holiday.

    See: Why Good Friday complicates how stock-market traders will digest March jobs report

    Key details: About one-third of the new jobs created last month — 72,000 — were at service-sector companies such as bars and restaurants whose employment still has not returned to prepandemic levels.

    Americans are going out to eat a lot and spending relatively more on services than on goods.

    Government employment increased by 47,000. Hiring also rose at professional businesses and in healthcare. Retailers cut 15,000 jobs.

    Employment fell slightly in manufacturing and construction, or goods-producing industries, which are under more pressure from rising interest rates.

    The strong labor market has benefited all groups, but especially Black Americans. The Black unemployment rate fell to 5% last month, the lowest level since records began being kept in the early 1970s.

    Big picture: The ongoing tightness in the labor market could inflame inflation and even push the Fed to raise interest rates more than currently forecast to try to get prices under control.

    Higher borrowing costs reduce inflation by slowing the economy, but most Fed rate-hike cycles since World War II have been followed by recession.

    On the flip side, the U.S. economy is starting to show more signs of deterioration due to the series of rapid Fed interest-rate increases since last year.

    Manufacturers have cut production and are arguably already in recession and the much larger service side of the economy is under more stress lately.

    If these trends continue the economy — and inflation — are bound to slow.

    The U.S. is still growing for now, however, and the labor market remains an oasis of strength.

    Low unemployment and rising wages have allowed Americans to keep spending. And so far they’ve keep the economy out of a widely predicted recession.

    Looking ahead: “The U.S. labor market is losing some momentum, but remains far too vibrant for the Fed to pause [its rate-hike campaign] in May,” said senior economist Sal Guatieri at BMO Capital Markets

    “Although job growth is gradually slowing, it remains too strong for the Federal Reserve,” said Sal Guatieri of PNC Financial Services.

    See: Traders see little chance interest rates will end up where Fed thinks in 2023

    Market reaction:  Futures contracts on the Dow Jones Industrial Average
    YM00,
    +0.19%
    rose 64 points, or 0.2%, to 33,723. S&P 500 futures
    ES00,
    +0.24%
    gained 9.75 points, or 0.2%, to 4,141.75. Stock trading resumes again on Monday.

    The yield on the 10-year Treasury
    TMUBMUSD10Y,
    3.404%
    jumped to 3.36%.

    MarketWatch personal finance: U.S. economy added 236,000 jobs in March. Is this your last chance to jump ship?

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  • U.S. economy forecast to create 238,000 jobs in March. The Fed wouldn’t be happy.

    U.S. economy forecast to create 238,000 jobs in March. The Fed wouldn’t be happy.

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    Normally a big increase in new U.S. jobs is cause for celebration. Not right now.

    The Federal Reserve sees a tight labor market as a big obstacle in getting high inflation under control and wants hiring to slow as soon as possible, but it might not get its wish in March.

    …

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  • Jobless claims touch 228,000 and look worse after change in seasonal adjustments

    Jobless claims touch 228,000 and look worse after change in seasonal adjustments

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    The numbers: The number of Americans applying for jobless benefits has topped 200,000 for nine weeks in a row and looks worse than previously reported, based on a change in how the government adjusts for seasonal swings in employment.

    The newly revised data suggest the labor market has softened more than it had appeared.

    In the seven days…

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  • The commodity supercycle is still young, these strategists say. Here’s why.

    The commodity supercycle is still young, these strategists say. Here’s why.

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    Be careful what you wish for. U.S. job openings dropped below 10 million, a symbolic sign that the Federal Reserve’s efforts to combat inflation by sapping labor-market demand was working — and U.S. stocks promptly fell. Perhaps the bigger issue is that investors were not willing to push stocks out of the 3,800 to 4,200 range the S&P 500
    SPX,
    -0.48%
    has been trading in for months.

    It might not be the most obvious time to be discussing a commodity supercycle, with recession talk growing, but then that’s what makes this call more interesting. Strategists at Wells Fargo investment Institute argue it’s year three of a commodity supercycle, which they say has plenty more room to run.

    John LaForge, head of real asset strategy, and Mason Mendez, investment strategy analyst, say commodities are like black holes, in that escaping the gravity of a supercycle is difficult for any individual commodity. They point to this chart, looking at commodity momentum since 1800, plotted in 10-year moving averages, which shows that food, energy and the commodity complex as a whole tend to follow each other around.

    Right now nearly all the signs, both technical and fundamental, point to a commodity bull market, they say. The early signs are mostly shifting prices and technical indicators, and the latter signs are more fundamental in nature, like restrained supplies. “The bottom line is that the key early technical indicators are confirming to us that a new supercycle likely began in 2020.”

    The analysts went further into depth on what they call washed-out sentiment. They say the process goes something like this: near the end of a commodity bull supercycle, prices go so high that oversupplies become rampant and need to be worked off, which results in investment stopping to flow into production. They say that in both corn
    C00,
    +0.80%
    and gold
    GC00,
    -0.17%
    — not commodities with much in common — supply growth rates have turned negative in recent years. Both showed similar conditions at the start of the last supercycle, in 1999.

    They advise using commodities as portfolio diversifiers, which certainly would have helped last year, when both stocks and bonds fell but the Bloomberg commodity index rose nearly 16%. They highlight commodity prices typically move differently than stocks or bonds over the long run. And they say that supercycles have historically lasted a decade or longer, and the shortest commodity bull market on record was nine years.

    One caveat: the speed of technology advances. Sometimes technology can help fuel demand, but conversely, to the extent technology can make commodities easier to extract, it can also buoy supplies. The obvious example here, not pointed out in the note, is the shale-oil revolution. There’s an interesting article in The Economist (subscription required), how copper has yet to be the beneficiary of a technology boost.

    The market

    U.S. stock futures
    ES00,
    -0.36%

    NQ00,
    -1.08%
    edged lower. Oil prices
    CL.1,
    -0.62%
    fell but held over $80 per barrel. The yield on the 10-year Treasury
    TMUBMUSD10Y,
    3.295%
    turned lower after the latest jobs data.

    For more market updates plus actionable trade ideas for stocks, options and crypto, subscribe to MarketDiem by Investor’s Business Daily.

    The buzz

    ADP reported a slowdown in private-payrolls growth to 145,000 jobs in March, as well as a slowing pace of pay growth. Shortly after the open comes the the Institute for Supply Management’s services index. Cleveland Fed President Loretta Mester said interest rates would need to be increased “somewhat” from here.

    Overseas, New Zealand’s central bank made a larger-than-expected 50 basis point rate hike, while a joint forecast of Germany’s leading institutes upgraded its view on the eurozone’s largest economy, now expecting a 0.3% advance.

    Walmart
    WMT,
    +1.33%
    forecast earnings in a range of $5.90 to $6.05 per share for its fiscal year, below the FactSet-compiled analyst estimate of $6.11.

    Johnson & Johnson
    JNJ,
    +3.44%
    proposed to pay up to $8.9 billion over 25 years to settle claims connected with cosmetic-talc litigation.

    Alphabet’s
    GOOGL,
    -0.63%
    Google says its chips are faster and more power efficient than comparable chips from Nvidia
    NVDA,
    -3.41%    .

    Western Alliance Bancorp
    WAL,
    -16.47%
    shares fell in premarket trade after the regional lender detailed the latest losses in its portfolio of loans and securities.

    Brandon Johnson was elected mayor of Chicago, the country’s third-largest city. Former President Donald Trump was defiant in a speech to supporters after his indictment.

    Best of the web

    A popular Fed program is draining funds from the banking system.

    Instant videos could be the next leap in artificial-intelligence technology.

    OpenAI, the tech company backed by Microsoft
    MSFT,
    -1.14%    ,
    is facing what is believed to be its first defamation lawsuit over a claim by its ChatGPT chatbot that an Australian mayor served time in prison for bribery.

    Top tickers

    These were the most active stock-market tickers as of 6 a.m. Eastern.

    Ticker

    		 Security name
    TSLA,
    -3.01%         		Tesla
    AMC,
    +2.04%         		AMC Entertainment
    BBBY,
    -5.09%         		Bed Bath & Beyond
    GME,
    -3.44%         		GameStop
    BUD,
    +0.34%         		Anheuser-Busch InBev
    APE,
    -0.89%         		AMC Entertainment preferreds
    MULN,
    -4.85%         		Mullen Automotive
    NIO,
    -4.18%         		Nio
    AAPL,
    -1.13%         		Apple
    AI,
    -14.35%         		C3.ai
    The chart

    Sure, higher gasoline prices naturally drive demand for electric vehicles. But at what point do high electricity prices make it more cost-effective to buy old gas guzzlers? This chart from Barclays breaks it down — roughly, 10 cents per kilowatt hour equates to $1 per gallon. Right now it’s cheaper to fill a car at the pump than recharge at peak hours.

    Random reads

    Easter means the annual production of a 15,000-egg omelette.

    This man was successful in his marriage proposal, at the cost of a one-year ban from Dodger Stadium.

    Need to Know starts early and is updated until the opening bell, but sign up here to get it delivered once to your email box. The emailed version will be sent out at about 7:30 a.m. Eastern.

    Listen to the Best New Ideas in Money podcast with MarketWatch reporter Charles Passy and economist Stephanie Kelton.

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  • U.S. trade deficit hits 4-month high in sign of stress on the economy

    U.S. trade deficit hits 4-month high in sign of stress on the economy

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    The trade deficit widened 2.7% in February to a four-month high of $70.5 billion and pointed to more stress on the U.S. economy.

    The trade gap rose from $68.7 billion in January and was slightly above Wall Street forecasts.

    Both imports and exports fell in February, reflecting weaker growth in the U.S. and abroad.

    Key details: Imports fell 1.5% to $321.7 billion in February to extend a recent string of declines, the government’s trade report showed.

    Part of the drop reflects lower oil prices, but Americans have also trimmed spending in response to rising interest rates and a slower economy

    In February, imports of cell phones, consumer goods, clothing and drugs retreated.

    A further decline in imports would be a potential warning sign of worse to come. They have declined 8% since peaking in March 2021.

    Exports slid a sharper 2.7% to $251.2 billion and also continued a recent downtrend. Just seven months ago they touched a record high.

    A weaker global economy could further sap demand for American goods and services.

    In February, exports of industrial supplies, autos and parts, consumer goods and passenger planes all declined.

    Big picture:  The U.S. is on track to break a string of three straight years of rising and record deficits, but not for reasons conducive to a healthy economy.

    Looking ahead: “The sharp declines in both exports and imports in February add to the signs that economic growth is faltering,” said deputy chief U.S. economist Andrew Hunter of Capital Economics.

    Market reaction:  The Dow Jones Industrial Average
    DJIA,
    +0.24%
    and S&P 500
    SPX,
    -0.25%
    were set to open slightly lower in Wednesday trades.

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  • Nicola Sturgeon’s husband has been arrested in campaign-finance probe, reports say

    Nicola Sturgeon’s husband has been arrested in campaign-finance probe, reports say

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    Peter Murrell, the husband of former Scottish First Minister Nicola Sturgeon, has been arrested over campaign-finance allegations, BBC News and other media outlets reported.

    Police Scotland said in a statement that a 58-year-old man was arrested as a suspect in connection with the ongoing investigation into the funding and finances of the Scottish National Party.

    The statement said officers are also carrying out searches at a number of addresses as part of the investigation. Murrell was the former chief executive of the Scottish National Party, quitting in March.

    Sturgeon resigned in February after eight years in power. At the time, she did not cite a specific reason for doing so.

    Last month, the governing Scottish National Party elected Humza Yousaf as its new leader. 

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  • U.S. stocks have barely budged since last summer. Where will they go next?

    U.S. stocks have barely budged since last summer. Where will they go next?

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    U.S. stocks have shrugged off a number of threats since the start of the year, powering through the worst U.S. bank failures since the 2008 financial crisis, while resisting the pull of rising short-term Treasury yields.

    This helped all three main U.S. equity benchmarks finish the first quarter in the green on Friday, but that doesn’t change the fact that the S&P 500 index, the main U.S. equity benchmark, has barely budged since last summer.

    “The market has handled a lot of gut punches recently and it’s still standing in this range,” said JJ Kinahan, CEO of IG North America, owner of brokerage firm Tastytrade. “I think that’s a sign that the market is very healthy.”

    The S&P 500 index
    SPX,
    +1.44%
    traded at 4,110.41 on Sept. 12, 2022, according to FactSet data, just before aggressive Federal Reserve commentary on interest rates and worrisome inflation data triggered a sharp selloff. By comparison, the index finished Friday’s session at 4,109.31.

    Some equity analysts expect it to take months, or perhaps even longer, for U.S. stocks to break out of this range. Where they might go next also is anyone’s guess.

    Investors likely won’t know until some of the uncertainty that has been plaguing the market over the past year clears up.

    At the top of the market’s wish list is more information about how the Fed’s interest rate hikes are impacting the economy. This will be crucial in determining whether the central bank might need to keep raising interest rates in 2024, several analysts told MarketWatch.

    Stocks are volatile, but stuck in a circle

    The S&P 500 has vacillated in a roughly 600-point range since September, but at the same time, the number of outsize swings from day-to-day has become even more pronounced, making it more difficult to ascertain the health of the market, analysts said.

    The S&P 500 rose or fell by 1% or more in 29 trading sessions in the first quarter, including Friday, when the S&P 500 closed 1.4% higher on the last session of the month and quarter, according to Dow Jones Market Data.

    That’s nearly double the quarterly average of just 14.9 days going back to 1928, according to Dow Jones Market Data. The S&P 500 was created in 1957, and performance data taken from before then is based on a historical reconstruction of the index’s performance.

    Stocks also look almost placid in comparison with other assets. For example, Treasurys saw an explosion of volatility in the wake of the collapse of Silicon Valley Bank in March. The 2-year Treasury yield
    TMUBMUSD02Y,
    4.114%
    logged its largest monthly decline in 15 years in March as a result.

    “You can’t find any clues about where we’re going by watching the S&P 500,” said John Kosar, chief market strategist at Asbury Research, in a phone interview with MarketWatch. “Ten years ago, you could look at the movement of the S&P 500 and a simple indicator like volume and get a back-of-the-envelope idea of how healthy the market is. But you can’t do that anymore because of all this intraday volatility.”

    See: Stock-option traders are creating explosive volatility in the market. Here’s what that means for your portfolio.

    The S&P 500’s 7% advance in the first quarter of this year has helped to mask weakness underneath the surface. Specifically, only 33% of S&P 500 companies’ shares have managed to outperform the index since the start of the quarter, well below the long-term average, according to figures provided to MarketWatch by analysts at UBS Group UBS.

    Mega stocks, Fed to the rescue?

    If it weren’t for a flight-to-safety rally in large capitalization technology names like Apple Inc.
    AAPL,
    +1.56%    ,
    Microsoft Corp.
    MSFT,
    +1.50%
    and Nvidia Corp.
    NVDA,
    +1.44%    ,
    the S&P 500 and Nasdaq would likely be in much worse shape.

    Advancing megacap tech stocks have helped the Invesco QQQ
    QQQ,
    +1.66%
    Trust exchange-traded fund, which tracks the Nasdaq 100, enter a fresh bull market in the past week, as the closely watched market gauge closed more than 20% above its 52-week closing low from late December, according to FactSet data. That’s helped to offset weakness in cyclical sectors like financials and real estate.

    Tech behemoths have also benefited from the hype around artificial intelligence platforms like OpenAI’s ChatGPT.

    Confusion about the Fed’s quantitative tightening efforts to reduce the size of its balance sheet also helped muddle the outlook for markets.

    For example, the size of the Fed’s balance sheet has increased again in recent weeks as banks have tapped the central bank’s emergency lending programs in the wake of the failure of two regional banks, undoing some of the central bank’s efforts to shrink its balance sheet by allowing some of its Treasury and mortgage-backed bond holdings to mature without reinvesting the proceeds.

    Some analysts said this is akin to sending the market mixed signals.

    “It seems to be both tightening and loosening right now,” said Andrew Adams, an analyst with Saut Strategy, in a recent note to clients.

    What it takes for a break out

    U.S. stocks have remained rangebound for long stretches in the past.

    Beginning in late 2014, the S&P 500 traded in a tight range for roughly two years. Between Jan. 1, 2015 and Nov. 9, 2016, the day after former President Donald Trump defeated Hillary Clinton to become president of the U.S., the S&P 500 gained less than 100 points, according to FactSet data.

    At the time, equity analysts blamed signs of softening economic activity in China and weakness in the U.S. energy industry for the market’s lackluster performance.

    But after once it became clear that Trump would win the White House, stocks embarked on a steady ascent as investors bet that the Republican economic agenda, which included corporate tax cuts and deregulation, would likely bolster corporate profits.

    It wasn’t until the fourth quarter of 2018 that stocks turned volatile once again as the S&P 500 wiped out its gains from earlier in the year, before ultimately finishing 2018 with a 6.2% drop for the year, according to FactSet.

    As investors brace for a flood of first-quarter corporate earnings in the coming weeks, Kinahan said he expects stocks could remain range bound for at least a few more months.

    “There’s going to be a very cautious outlook still, which should keep us in this range,” he said.

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  • Sandbags

    Sandbags

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    A few months ago, I made these sandbags from Keramiplast (modelling putty).

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    Finally decided to make something with them. First I glueg them on some mdf bases.

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    4 layers should be high enough.

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    Then I used Vallejo Dark Earth texture paste for the ground.

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    When the glue and texture paste were dry, I primed them with black and white spraypaint.

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    After that, I painted them with a bunch of different washes and contrast paints.

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    The paints I used for the wash stage.

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    When the wash was dry the next day, I drybrushed them with a mix of various off-whites and grey.

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    Finally, I glued a bunch of grass tufts and rocks to the bases.

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    And here are the finished terrain pieces! These will come in handy for warhammer 40k, but they’re also very useful for historical wargames.

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    Sandbags. A few months ago, I made these sandbags from Keramiplast (modelling putty). Finally decided to make something with them. First I glueg them on some md

    How do you guys like them?

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  • IMF board approves $15.6 bln loan package for Ukraine

    IMF board approves $15.6 bln loan package for Ukraine

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    The executive board of the International Monetary Fund on Friday approved a four-year $15.6 billion loan program for Ukraine, part of a broader $115 billion international support package to help the country meet its funding needs in the wake of Russia’s invasion.

    The decision clears the way for an immediate payment of about $2.7 billion to Kyiv, the Fund said in a statement.

    The Extended Fund Facility (EFF) loan is the first major financing program approved by the IMF for a country involved in a war. Ukraine’s previous $5-billion IMF program expired last year.

    “Russia’s invasion of Ukraine continues to have a devastating economic and social impact,” IMF First Deputy Managing Director Gita Gopinath said in a statement.

    Ukrainian President Volodymyr Zelenskiy welcomed the new funding.

    “It is an important help in our fight against Russian aggression,” he said on Twitter. “Together we support the Ukrainian economy. And we are moving forward to victory!”

    The agreement is expected to help unlock financing for Ukraine from international donors and partners, including the World Bank and other lenders.

    The $115 billion package includes the IMF loan, $80 billion in pledges and loans from other countries and $20 billion worth of debt relief commitments.

    “I welcome the IMF approval of a $15.6 billion economic program for Ukraine,” U.S. Treasury Secretary Janet Yellen said in a statement late Friday. “I commend Ukraine’s efforts to pursue broad-based structural reforms under the program despite Russia’s brutal and immoral war and strongly support the program’s measures aimed at securing economic and financial stability. The program’s policies and reforms will support economic growth, strengthen good governance and anti-corruption efforts, and set the foundation for longer-term reconstruction.”

    Some of Ukraine’s creditors, such as Canada, France, Germany, Japan, the UK and the US, supported the deal which required the IMF to change its rules by giving assurances that they would extend a debt-repayment standstill for the duration of the program.

    The Russian invasion, launched over a year ago, has devastated Ukraine’s economy and infrastructure, killing thousands of people and driving more than a third of a pre-war population of 40 million from their homes. 

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  • Dow rises more than 300 points after inflation report as Nasdaq heads for best quarter since 2020

    Dow rises more than 300 points after inflation report as Nasdaq heads for best quarter since 2020

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    U.S. stocks were climbing Friday afternoon following a softer-than-expected inflation report for February, while the Nasdaq Composite was on pace for its largest quarterly advance since 2020.

    How stocks are trading
    • The Dow Jones Industrial Average
      DJIA,
      +1.26%
      rose 340 points, or 1%, to 33,199.

    • The S&P 500
      SPX,
      +1.44%
      gained almost 47 points, or 1.2%, to nearly 4,098.

    • The Nasdaq Composite
      COMP,
      +1.74%
      advanced almost 173 points, or 1.4%, to 12,186.

    For the week, the Dow is on track to gain 3% while the S&P was on pace to rise 3.2% and the Nasdaq Composite was heading for a 3.1% increase, according to FactSet data, at last check.

    What’s driving markets

    U.S. stocks were up sharply Friday afternoon as investors weighed data showing signs of moderating inflation.

    “Core price pressures” eased in February, Barclays said in an economics research note Friday. “On balance, the easing in February PCE inflation was fairly broad-based across goods and services, barring housing.”

    The personal-consumption-expenditures, or PCE, price index increased 0.3% in February, with inflation slowing to 5% year over year from 5.3% in January, according to a report Friday from the Bureau of Economic Analysis.

    Core PCE, the Federal Reserve’s preferred inflation gauge that excludes energy and food prices, rose 0.3% last month for a year-over-year rate of 4.6%. That’s slightly lower than forecasts from economists polled by the Wall Street Journal and softened from the 4.7% increase seen over the 12 months through January.

    Read: Inflation softens in February, PCE finds, and gives ammo for Fed rate-hike pause

    While the Federal Reserve has been battling high inflation with interest rate hikes, futures traders are betting that rates have already peaked and that the Fed will likely reverse course and cut rates at least a couple of times before the end of the year, according to the CME’s FedWatch tool.

    The market is pricing in a “coin flip” as to whether the Fed raises its benchmark rate by a quarter percentage point at its May policy meeting, said Matt Stucky, senior portfolio manager at Northwestern Mutual Wealth Management Co., in a phone interview Friday.

    “We think we’re getting pretty close to the end” of the rate-hiking cycle, he said. Stucky expects the Fed may stop hiking once “cracks” start to form in the labor market, with job losses in “nonfarm payrolls.”

    Meanwhile, consumer spending edged up 0.2% in February while personal incomes rose 0.3%, according to a Bureau of Economic Analysis report Friday.

    “Incomes and spending are hanging in there and inflation’s cooling,” said Mike Skordeles, head of U.S. economics at Truist, in a phone interview Friday. “That has positive implications for markets” and the economy, he said.

    Stocks traded higher following the release of the final reading on U.S. consumer sentiment for March from the University of Michigan. While confidence ticked lower compared with earlier estimates, inflation expectations moderated.

    U.S. stocks have held up relatively well this quarter, shrugging off the Fed rate hikes and renewed recession fears. Since hitting its highest level of the year in early February, the S&P 500 has been trading in an increasingly narrow range, leaving analysts divided about where the market might be heading next.

    “We need to see what the overall economy does,” said Kim Caughey Forrest, founder and chief investment officer of Bokeh Capital Partners. “I think GDP matters, and if GDP holds up while inflation comes down, that could be good for stocks.”

    The Nasdaq Composite has risen around 16% since the start of the year, putting it on track for its best quarterly gain since the three months through June 2020, according to FactSet data, at last check. The technology -heavy Nasdaq jumped more than 30% in the second quarter of 2020 as stocks rebounded from the global market rout tied to COVID-19 that year.

    The S&P 500 and Dow were also track for quarterly gains in late afternoon trading.

    “The bond market is definitely more concerned about recession risks than stocks are,” said Skordeles, who is expecting a recession in the second half of the year. “They couldn’t be sending more different signals.”

    Read: Two-year Treasury yields on pace for biggest monthly drop since 2008 after bank turmoil

    New York Fed President John Williams said Friday in a speech at Housatonic Community College that stress in the U.S banking system will cause banks to tighten credit and probably lead to lower consumer spending.

    Companies in focus

    —Steve Goldstein contributed to this article.

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  • Vatican says Pope Francis will be discharged on Saturday from a Rome hospital

    Vatican says Pope Francis will be discharged on Saturday from a Rome hospital

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    ROME (AP) — Pope Francis is expected to be discharged on Saturday from the Rome hospital where he is being treated for bronchitis, the Vatican said.

    Vatican spokesman Matteo Bruni said in a written statement on Friday that the pope’s recovery has been “normal” and that he ate a pizza Thursday for dinner.

    Francis, 86, was hospitalized on Wednesday at Gemelli Polyclinic, where doctors said the pontiff was receiving antibiotics intravenously to treat his bronchitis.

    The hospitalization came four days before Palm Sunday, the start of Holy Week.

    Due to a chronic knee problem, Francis had already largely stopped celebrating Mass at major Catholic Church holy days but had continued to preside at the ceremonies and deliver homilies.

    Italian Cardinal Giovanni Battista Re said Friday that Francis might be discharged Saturday and would thus be able to preside over — but not celebrate — Holy Week ceremonies.

    “On the basis of the information I have, he’ll leave Gemelli tomorrow, so he’ll be able to preside over all the Holy Week rituals,” Italian news agency Adnkronos quoted the cardinal as saying.

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  • Donald Trump has been indicted. Could he still run for president?

    Donald Trump has been indicted. Could he still run for president?

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    Donald Trump was indicted by a Manhattan grand jury Thursday in a case involving hush-money payments to a porn star who said she’d had a sexual encounter with the former president. What will this mean for Trump’s plans to again seek the White House? As Trump presses ahead with his 2024 campaign, here are a few questions and answers about possible criminal charges from the Manhattan district attorney, Democrat Alvin Bragg, and their effects.

    Question: Can an indicted person run for president?

    Answer: Yes. There’s nothing in the Constitution preventing it. Article II, Section 1, of the Constitution doesn’t mention criminal records. The only requirements to run are being a natural-born citizen at least 35 years old and resident in the U.S. for 14 years.

    “ Not only can an indicted person run for president, but a convicted one can, too, legal experts say. ”

    Not only can an indicted person run for president, but a convicted one can, too, legal experts say. “There’s nothing in the Constitution disqualifying individuals convicted of crimes from running for or serving as president,” ABC News legal analyst Kate Shaw told the network.

    Were Trump to be convicted of a felony, however, he likely could not vote for himself — 48 states ban people with felony convictions from voting, according to advocacy group the Sentencing Project.

    From the archives (July 2020): Supreme Court deals setback to Florida felon voting rights

    Also see (May 2021): Florida’s DeSantis signs Republican voting bill that Democrats and critics call un-American; bill signing staged as ‘Fox & Friends’ exclusive

    Q.: What has Trump said about a possible indictment’s effect on his campaign?

    A.: “I wouldn’t even think about leaving,” he told reporters ahead of his speech at this year’s Conservative Political Action Conference. “Probably it will enhance my numbers.” Trump has said he did nothing wrong.

    Trump in mid-March said he could be arrested in the coming days, encouraged his supporters to protest and wrote on social media, “TAKE OUR NATION BACK!”

    Bragg, in response, told his staff that the office won’t be intimidated or deterred as it nears a decision on charging the former president.

    Q.: What have Trump’s rivals for the GOP nomination, or other Republican politicians, said about an indictment?

    A.: In a tweet Thursday, Florida Gov. Ron DeSantis, who is expected to announce his bid for the GOP presidential nomination, called the indictment “un-American” and accused the Manhattan D.A. of having a political agenda. DeSantis added that Florida would not cooperate in an extradition request.

    House Speaker Kevin McCarthy said “the House of Representatives will hold [Manhattan D.A.] Alvin Bragg and his unprecedented abuse of power to account,” while Rep. Jim Jordan, R-Ohio, who has called for a probe into the Manhattan D.A.’s investigation, tweeted a single word Thursday: “Outrageous.”

    Q.: What would a Trump arrest actually look like?

    A.: It’s standard for defendants arrested on felony charges to be handcuffed — but it’s unclear whether an exception would be made for Trump due to his status, the New York Times reported. The former president would likely be released on his own recognizance, the Times said, because an indictment likely would contain only nonviolent felony charges. But he would be fingerprinted and photographed.

    Q.: Is Bragg’s the only investigation Trump is facing?

    A.: No. Besides the Manhattan district attorney’s case, Trump is facing another in Fulton County, Ga., and two federal probes led by special prosecutor Jack Smith. The Georgia probe centers on efforts by Trump and his allies to overturn that state’s 2020 election result. Smith’s investigations concern Trump’s handling of classified material after he left office, and the ex-president’s involvement in the Jan. 6 attack on the U.S. Capitol.

    So Trump could be in for more charges depending on the results of those investigations.

    Q.: Could something else prevent Trump from being president?

    A.: The 14th Amendment bars anyone from public office who, “having previously taken an oath” to support the Constitution, “engaged in insurrection or rebellion” or gave “aid or comfort” to enemies of the U.S. Late last year, a group of 40 House Democrats introduced legislation to bar Trump from holding office, and invoked the 14th Amendment, with Rep. David Cicilline saying the ex-president “very clearly” engaged in an insurrection on Jan. 6, 2021. Trump has denied wrongdoing.

    Now read: Who is Alvin Bragg, the Manhattan DA who may be set to bring charges against Donald Trump?

    Read more: Fulton County grand jury reported hearing a previously unknown Trump phone call with a top Georgia official

    Also see: Here are the Republicans running for president — or seen as potential 2024 candidates

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  • Trump grand jury reportedly taking break for most of April

    Trump grand jury reportedly taking break for most of April

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    The Manhattan grand jury probing former President Donald Trump’s alleged role in a hush money payment to a porn star is scheduled to break for about a month, reports said Wednesday.

    Politico said the break is largely due to a previously scheduled hiatus, citing a person familiar with the proceedings.

    CNN reported that the grand jury is scheduled…

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  • Pence ordered to testify before grand jury about alleged Trump effort to undo 2020 presidential election

    Pence ordered to testify before grand jury about alleged Trump effort to undo 2020 presidential election

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    WASHINGTON (AP) — A federal judge has ruled that former Vice President Mike Pence will have to testify before a grand jury after he was subpoenaed by the special counsel investigating efforts by former President Donald Trump and his allies to overturn the results of the 2020 election.

    That’s according to two people familiar with the ruling, who spoke on condition of anonymity because it remains under seal.

    The…

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  • Jobless claims dip to 3-week low of 191,000 — labor market still very strong

    Jobless claims dip to 3-week low of 191,000 — labor market still very strong

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    The numbers: The number of Americans who applied for unemployment benefits last week slipped to a three-week low of 191,000, signaling little erosion in a strong U.S. labor market even as the economy faced fresh strains.

    New U.S. applications for benefits fell by 1,000 from 192,000 in the prior week, the government said Thursday. .

    The number of people applying for jobless benefits is one of the best barometers of whether the economy is getting better or worse. New unemployment applications remain near historically low levels.

    Economists polled by The Wall Street Journal had forecast new claims to total 198,000 in the seven days ended March 18. The numbers are seasonally adjusted.

    Key details: Twenty-eight of the 53 U.S. states and territories that report jobless claims showed a decrease last week. Twenty-five posted an increase.

    Most of the changes were small except in Indiana.

    One potential red flag: The number of raw or actual claims — before seasonal adjustments — was much higher last week compared to the same week a year earlier. But so far there’s little sign of a trend.

    “Even the tens of thousands of recent [high-tech] layoffs have almost completely been absorbed by a powerful labor market that has plenty of expansion left in it,” contended Robert Frick, chief corporate economist at Navy Federal Credit Union.

    The number of people collecting unemployment benefits across the country, meanwhile, rose by 14,000 to 1.69 million in the week ended March 11. That number is reported with a one-week lag.

    These continuing claims are still low, but a gradual increase since last year suggests it’s taking longer for people who lose their jobs to find new ones.

    Big picture: Jobless benefit claims are one of the first indicators to emit danger signals when the U.S. is headed toward recession. It’s still not flashing a red-light, or even a yellow one, as the economy comes under more duress.

    The Federal Reserve, for instance, just raised interest rates to a nearly 16-year high. And the failure of Silicon Valley Bank has put more stress on the U.S. financial system.

    Both of these actions could constrain the economy in the months ahead, curb hiring and potentially boost a low unemployment rate. If so, watch the trend in new jobless claims.

    Looking ahead: “Most companies are either still hiring or are holding onto their employees and seeking other ways to cut costs,” said chief economist Joshua Shapiro of MFR Inc.

    “This is consistent with our view that layoffs will rise less dramatically than normally might occur as companies do all they can to avoid shedding workers who have been incredibly difficult to recruit and retain.”

    Market reaction: The Dow Jones Industrial Average
    DJIA,
    +0.23%
    and S&P 500
    SPX,
    +0.30%
    were set to open higher in Thursday trades. Stocks have been under pressure since the failure of SVB earlier this month.

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  • Turkey’s president says he will back Finland’s NATO bid

    Turkey’s president says he will back Finland’s NATO bid

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    President Recep Tayyip Erdoğan of Turkey said Friday that his government would move forward with ratifying Finland’s NATO application, paving the way for the country to join the military bloc ahead of Sweden.

    The breakthrough came as Finnish President Sauli Niinisto was in Ankara to meet with Erdoğan. Both Finland and Sweden applied to become NATO members 10 months ago in the wake of Russia’s invasion of Ukraine, abandoning decades of nonalignment.

    NATO requires the unanimous approval of its 30 existing members to expand, and Turkey and Hungary are the only countries that have not yet ratified the Nordic nations’ bids. The Turkish government accused both Sweden and Finland of being too soft on groups that it deems to be terror organizations, but it has more stridently expressed its reservations about Sweden.

    See: Nordic premiers sanguine about NATO membership despite threat to Sweden’s accession posed by Turkish leader Erdoğan

    Plus: Nordic premiers sanguine about NATO membership despite threat to Sweden’s accession posed by Turkish leader Erdoğan

    Also: Erdoğan suggests Turkey will not support Sweden’s bid to join NATO

    “When it comes to fulfilling its pledges in the trilateral memorandum of understanding, we have seen that Finland has taken authentic and concrete steps,” Erdoğan told a news conference in Ankara following his meeting with Niinisto.

    “This sensitivity for our country’s security and, based on the progress that has been made in the protocol for Finland’s accession to NATO, we have decided to initiate the ratification process in our parliament,” the Turkish president added.

    With Erdoğan’s agreement, Finland’s application can now go to the Turkish parliament, where the president’s party and its allies hold a majority. Ratification is expected before Turkey holds its presidential and parliamentary elections scheduled for May 14.

    Erdoğan suggested Wednesday that his country might take up Finland’s accession following Niinisto’s trip.

    Turkey, Finland and Sweden signed an agreement in June of last year to resolve differences over the Nordic states’ membership.

    The document included clauses addressing Ankara’s claims that Stockholm and Helsinki did not take seriously enough its concerns with those it considers terrorists, particularly supporters of Kurdish militants who have waged a 39-year insurgency in Turkey and people Ankara associates with a 2016 coup attempt.

    A series of separate demonstrations in Stockholm, including a protest by an anti-Islam activist who burned the Quran outside the Turkish Embassy, also angered Turkish officials.

    Hungarian Prime Minister Viktor Orbán and lawmakers have repeatedly promised to ratify the two countries’ NATO membership applications. But the country’s parliament has repeatedly postponed a ratification vote and hasn’t given a firm date on when the vote would take place.

    From the archives (March 2022): Hungary’s Orbán resists emotional appeal by Zelensky to provide weapons to Ukraine and enforce sanctions against Russia

    Also see (February 2022): Russian invasion of Ukraine appears to have alienated Putin’s few friends among the Western allies

    Plus (May 2022): ‘Orbánization’? CPAC convenes in Budapest as American right’s embrace of Hungarian autocrat Orbán’s ‘illiberal democracy’ model tightens

    Erdoğan on Wednesday suggested that his country may soon agree to Finland’s application to join NATO. Turkish officials previously said that Finland joining ahead of Sweden was a more likely outcome.

    Niinisto arrived in Turkey on Thursday and toured areas affected by a magnitude 7.8 earthquake that killed more than 52,000 people in Turkey and Syria last month.
    “I have known Erdogan for a long time. I am sure he has important messages,” Niinisto said Thursday while visiting Kahramanmaras, one of the provinces worst-hit by the Feb. 6 earthquake.

    See: Blinken tours devastation from Turkey quake, pledges $100 million more in aid

    Before leaving Helsinki, Niinisto said Turkish officials had requested his presence in Ankara to announce Turkey’s decision on the Finnish bid. He also stressed his support for Sweden’s swift admission and in a Twitter post said he had had a “good conversation” with Swedish Prime Minister Ulf Kristersson prior to his Turkey trip.
    Kristersson said Sweden hoped for “a rapid ratification process” after Turkey’s May 14 presidential and parliamentary elections.

    Read on: Senate panel in U.S. easily approves bids by Sweden, Finland to join NATO

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  • U.S. stocks end lower, Dow books back-to-back weekly losses as banking sector stress reemerges

    U.S. stocks end lower, Dow books back-to-back weekly losses as banking sector stress reemerges

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    U.S. stocks ended lower Friday as worries about banking-sector stability reemerged following a bankruptcy filing by SVB Financial Group and the release of data showing banks borrowed $165 billion from the Federal Reserve over the past week.

    How stocks traded
    • The Dow Jones Industrial Average
      DJIA,
      -1.19%
      fell 384.57 points, or 1.2%, to close at 31,861.98.

    • The S&P 500
      SPX,
      -1.10%
      dropped 43.64 points, or 1.1%, to finish at 3,916.64.

    • The Nasdaq Composite
      COMP,
      -0.74%
      slid 86.76 points, or 0.7%, to end at 11,630.51, snapping a four-day win streak.

    For the week, the Dow fell 0.1%, the S&P 500 gained 1.4% and the Nasdaq climbed 4.4%, according to Dow Jones Market Data. The Dow booked back-to-back weekly losses while the Nasdaq saw its biggest weekly percentage gain since January.

    What drove markets

    U.S. stocks fell Friday as worries about the banking sector persisted.

    “The markets are up and down all this week, and they’re moving typically in big amounts, because there really isn’t any consensus on how the strains in the banking system will play” into the economy, said Paul Christopher, head of global investment strategy at Wells Fargo Investment Institute, in a phone interview Friday. Investors are trying to get a sense for how quickly the economy may be slowing and whether the problems in the banking sector will lead to an “accelerated slowing,” he said.

    Concerns about the banking sector’s ability to withstand deposit flight reemerged Friday morning after SVB Financial Group
    SIVB,
    -60.41%
    announced it had filed for Chapter 11 bankruptcy protection. SVB is the holding company of Silicon Valley Bank , which was put into FDIC receivership last Friday.

    On Thursday, First Republic Bank announced that it would receive $30 billion of uninsured deposits from a group of large U.S. banks. JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp. and Wells Fargo & Co. were among the 11 banks that agreed to provide the deposits.

    Meanwhile, Federal Reserve data released Thursday afternoon in New York showed banks borrowed a combined $165 billion from the central bank. Most of the borrowing occurred via the Fed’s discount window. But a small amount was also tapped through the Fed’s new Bank Term Funding Program that allows bonds trading at a discount to be used as collateral, at par value. The fact that borrowing through the discount window has soared to a record high was adding to the market’s concerns about the banking sector, analysts said.

    See: Banks have borrowed $165 billion from the Fed in past week after SVB failure

    First Republic Bank
    FRC,
    -32.80%
    shares plunged 32.8% Friday, while Credit Suisse Group
    CS,
    -6.94%    ,
    which earlier this week got a lifeline from the Swiss National Bank, closed 6.9% lower, according to FactSet data.

    At least four major banks have put restrictions on trades that involve troubled Swiss lender Credit Suisse Group or its securities, Reuters reported Friday, citing people with direct knowledge of the matter.

    “I think there are still a lot of questions right now,” said Mark Luschini, chief investment strategist at Janney, during a phone interview with MarketWatch. “Investors can’t seem to hold their enthusiasm for equities for longer than a 24-hour news cycle.”

    It’s not hard to understand why investors are still so anxious about the banking sector given the surge in borrowing from the Fed, said Matt Maley, chief market strategist at Miller Tabak + Co.

    “Given that banks borrowed over $150bn at the Fed’s discount window on Wednesday, which compares to $4.4bn the week before, one can understand why investors are worried that the situation might be a bit more dire than the authorities are admitting to right now,” Maley said in emailed commentary.

    In economic news, the Conference Board said Friday that the U.S. leading economic index fell 0.3% in February, marking the 11th straight monthly decline. U.S. industrial production was flat in February, data released Friday by the Fed show.

    Meanwhile, the University of Michigan’s latest reading on consumer sentiment showed consumers were more downbeat in March than at ay time in the last four months.

    While stocks fell Friday, they finished the week mostly higher. The Dow Jones Industrial Average slipped 0.1% for the week, while the S&P 500 booked a 1.4% weekly gain and the technology-heavy Nasdaq Composite saw a weekly rise of 4.4%, according to Dow Jones Market Data.

    Companies in focus
    • FedEx Corp.’s stock 
      FDX,
      +7.97%
       jumped 8% after beating analyst estimates in its fiscal third-quarter earnings. The shipping firm also lifted its profit forecast for the full fiscal year.

    • Shares of PacWest Bancorp 
      PACW,
      -18.95%
      and Western Alliance Bancorp 
      WAL,
      -15.14%
      tumbled as regional banks continued to face pressure, with PacWest falling almost 19% and Western Alliance dropping 15.1%.

    • Shares of Microsoft Corp.
      MSFT,
      +1.17%
      rose 1.2% as analysts saw the latest iteration of Chat GPT giving the tech giant an even greater edge. In other megacap tech names, Alphabet Inc.’s Class A
      GOOGL,
      +1.30%
      shares gained 1.3% while semiconductor giant Nvidia Corp.
      NVDA,
      +0.72%
      advanced 0.7%.

    —Steve Goldstein contributed to this report.

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  • U.S. economy is headed for trouble, leading economic index signals

    U.S. economy is headed for trouble, leading economic index signals

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    The numbers: The U.S. leading economic index fell 0.3% in February — the 11th decline in a row — continuing to signal an upcoming recession.

    Economists polled by the Wall Street Journal had forecast a 0.4% drop.

    The leading economic index, also known as the LEI, is a gauge of 10 indicators designed to show whether the economy is getting better or worse. The report is published by the nonprofit Conference Board.

    Big picture: The economy has slowed due to the end of pandemic stimulus and the effects of high inflation, which has forced the Federal Reserve to raise interest rates.

    Higher borrowing costs typically tame inflation, but at the cost of weaker economic growth.

    Although the leading index has been signaling a recession for months, the economy is still expanding. A big question is whether the latest banking crisis ends up becoming a tipping point. So far, regulators appear to have contained the damage.

    Key details: Eight of the 10 indicators tracked by the Conference Board fell in February.

    A measure of current economic conditions, meanwhile, rose a scant 0.1% in February.

    The so-called lagging index — a look in the rearview mirror — also increased by 0.1%.

    Looking ahead: “The leading economic index still points to risk of recession in the U.S. economy,” said Justyna Zabinska-La Monica, senior manager of business cycle indicators at the board.

    “The most recent financial turmoil in the U.S. banking sector is not reflected in the LEI data but could have a negative impact on the outlook if it persists,” she said.

    Market reaction: The Dow Jones Industrial Average
    DJIA,
    -1.19%
    and S&P 500
    SPX,
    -1.10%
    fell in Friday trading amid nagging worries about the U.S. financial system after the failure of Silicon Valley Bank.

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