CNBC Daily Open: Markets rallied as nothing broke yesterday

Signage outside of the New York Stock Exchange (NYSE) in New York, USA on Thursday, March 23, 2023.

Angus Mordant | Bloomberg | Getty Images

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US stocks rallied on Wednesday as both banks and Big Tech rallied. For markets still reeling from the banking crisis, no news is good news.

What you need to know today

The final result

Yesterday was an excellent day for equities and the biggest bank news was positive (maybe not for outgoing UBS CEO Ralph Hamers, but definitely in terms of shareholder value). Could we finally turn a corner after three turbulent weeks?

First, the new (old) CEO of UBS. Both analysts and investors liked the choice of the Swiss bank. As Beat Wittmann, a partner at Porta Advisors in Zurich, told CNBC, Ermotti “is proven and trusted from the perspective of the general public as well as the industry.” Investors agreed – UBS shares skyrocketed in both Switzerland and the US

The appointment appeared to allay fears of further banking turmoil. In the US, banks rose on the news. Citigroup climbed 1.61%, Wells Fargo 2.12% and Morgan Stanley 1.6%. The SPDR S&P Regional Banking ETF (KRE) is up 1.07%.

After a two-day slide, Big Tech also recovered. The biggest gainers yesterday: Amazon was up 3.1%, Netflix was up 2.63% and Meta was up 2.33%. Investors may have been encouraged by Alibaba’s split into six entities that could serve as a model for other big tech companies.

Micron’s report that the company’s inventory problems are improving helped its shares soar 7.19% and led to a rally in semiconductor stocks — a performance that’s even more impressive considering the company is a larger than announced expected loss for the last quarter.

All major indices gained on these moves. The Dow Jones Industrial Average was up 1%, the S&P 500 was up 1.4% and the Nasdaq Composite was up 1.8%. Obviously, market sentiment was high yesterday, although there was no clear reason for it. Or maybe it was just the lack of a significant event that cheered up the markets. As Ed Yardeni, President of Yardeni Research, put it, “Any day that doesn’t break is a good day.”

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