S&P 500 gains as banks trim losses, tech climbs

By Yasin Ebrahim

Investing.com — The S&P 500 rose on Friday, as big tech climbed and bank stocks trimmed losses despite concerns about a wider backing crisis amid a selloff Deutsche Bank (ETR:).

The rose 0.1%, the rose 0.1% or 22 points, and the fell 0.3%.

Bank stocks moved moved off session lows as Morgan Stanley (NYSE:), State Street Corp (NYSE:), and Citigroup Inc (NYSE:) trimmed losses following a slump in German bank Deutsche bank. The German bank, however, recovered some gains after European Central Bank President Christine Lagarde pledged support to the European banking system and German Chancellor Olaf Scholz said there was “nothing to worry about” as the bank is very profitable.

The selloff in the bank sector has pushed it into “deeply oversold” territory, Janney Montgomery Scott said in a note, though flagged the risk of a broader banking crisis.

“[F]rom a macro standpoint, and based on our technical work in global money flows- what we believe may be unfolding here is not a localized regional banking crisis, but a broader central banking crisis,” it added.

Big tech traded mostly in the green, with Meta Platforms (NASDAQ:) and Microsoft Corporation (NASDAQ:) leading to the upside. 

Activision Blizzard Inc (NASDAQ:) shares jumped more than 5% as its $75 billion sale to Microsoft overcame a major hurdle after the UK competition regulator dropped a key concern about the deal.

The UK Competition and Markets Authority pointed to “new evidence” on Friday, and said it no longer believes the deal poses a risk of “substantial lessening of competition.”

Consumer discretionary stocks were also weighing on the broader market, paced by travel and leisure stocks, with Hilton (NYSE:) and Marriott International Inc (NASDAQ:) down more than 2%, while Carnival (NYSE:) fell more than 1%.

The drop in Carnival comes ahead of the cruise line’s quarterly results due Monday that are expected to “elicit a positive reaction from the stock, based primarily on weakening sentiment heading into the print,” Deutsche Bank said in a recent note.

Block (NYSE:), meanwhile, was down 1% following a more than 14% slump a day earlier as short seller Hindenburg Research’s allegations of fraud against the digital payment company continued to weigh.

But even as the stocks turned green and added to gains, jitters in the market persist as defensive sectors including consumer staples and utilities were in the ascendency.