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Stocks close lower for a fourth day on renewed bank worries, Dow goes negative for 2023: Live updates

Qualcomm shares fall after phone chip sales tumble. Here's what the experts have to say
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Qualcomm shares fall after phone chip sales tumble. Here's what the experts have to say

Stocks declined Thursday, as contagion fears in the regional bank space were reignited.

The Dow Jones Industrial Average fell 286.50 points, or 0.86%, to end at 33,127.74. The S&P 500 slid 0.72%, closing at 4,061.22. The Nasdaq Composite shed 0.49%, ending the day at 11,966.40. This was the fourth consecutive day of declines for the major indexes.

The Dow turned negative for the year on Thursday, pulling back 0.06% year to date. Declines in Boeing, Disney, Goldman Sachs and American Express shares dragged on the Dow.

CNBC

Shares of PacWest tanked by more than 50%. The decline came after news late Wednesday that the California bank has been assessing strategic options, including a possible sale, a person familiar told CNBC. Regional bank shares sold off hard, with the SPDR S&P Regional Bank ETF (KRE) dropping more than 5%. Western Alliance tumbled 38% and saw trading halted multiple times due to volatility. Meanwhile, Zions Bancorporation lost 12%.

Investors also digested the Federal Reserve's 25 basis point rate hike and commentary following its Wednesday meeting.

Keith Apton, managing director at UBS Wealth Management, said that the volatility in the banking sector will help the Fed's mission of cooling down the economy.

"I think it's going to take care of the Fed's job. ... Regional lenders are going to have to constrain capital. I don't think that money is going to be flowing through the system nearly as easily in the back half of this year and that indirectly is going to cool down the economy, which is ultimately going to do the Fed's job by bringing inflation down," said Apton.

"So, I do not think that the Fed will have to raise rates any further the rest of this year, although tomorrow's data on the jobs reading will be important to watch," he added.

April's nonfarm payrolls report is due Friday at 8:30 a.m. ET, as well as numbers on the unemployment rate.

Gensler warns SEC is 'particularly focused' on potential misconduct

Securities and Exchange Commission chairman Gary Gensler warned investors that the enforcement agency was paying extra close attention to any potential misconduct.

"As I've said, in times of increased volatility and uncertainty, the SEC is particularly focused on identifying and prosecuting any form of misconduct that might threaten investors, capital formation, or the markets more broadly," Gensler said in a statement.

He released a similar statement on March 12, following the rapid collapse of SVB and Signature Bank.

— Christina Wilkie

Stocks mark fourth negative trading session Thursday

U.S. stocks closed lower Thursday.

The Dow Jones Industrial Average lost 286.5 points, or 0.86%. The index turned negative year-to-date for the first time in 2023, down 0.06%.

The S&P 500 and Nasdaq Composite lost 0.72% and 0.49%, respectively.

— Hakyung Kim

S&P 500 could fall 5% from current level, says chart analyst David Keller

As the market enters the seasonally weakest part of the year, 4,200 remains the key resistance level to watch on the S&P 500, according to David Keller, Chief Market Strategist at StockCharts.com. He sees the stock index dipping about 5% from current levels, however.

"We expect the S&P 500 to retrace back to previous swing lows around 3,800 as we continue through a pivotal earnings season," he told CNBC.

"Outside of mega cap technology and communication services, we're seeing the strongest trends in more defensive sectors like health care and consumer staples," he added. "As long as defensive sectors are thriving, this suggests limited upside for the major market averages."

— Tanaya Macheel

Truist upgrades consumer staples sector to overweight

Truist raised its rating on the consumer staples sector to overweight from neutral, saying that it is one of the top sectors in terms of relative price and earnings basis.

"Several of the companies continue to have good pricing power. The sector should also do well on a comparative basis if the economy slows, as we anticipate, given many of their products are necessities as opposed to discretionary," the firm wrote in a Thursday note.

Meanwhile, the firm is underweight on the financials, real estate and health care sector.

— Hakyung Kim

The next Fed loan officer survey will be 'critical,' says Jefferies

Jefferies is keeping a close eye on the Federal Reserve's next Senior Loan Officer Opinion Survey scheduled to be released May 8.

"The ongoing risk at regional banks, with the US regional banks index down 38% year to date, means that the next Fed loan officer survey will be critical to monitor. ... It is likely to give the doves on the FOMC the rationale they are looking for for a pause," analyst Christopher Wood wrote in a Thursday note.

Wood noted that the central bank hinted at a pause in its rate hiking path in its post-meeting statement on Wednesday. "The Fed funds futures are now discounting a pause in June, followed by 75bp of rate cuts by the end of this year," Wood added.

— Hakyung Kim

DA Davidson says this software stock has ‘Buffett-esque’ qualities and can surge nearly 40%

DA Davidson analyst Gil Luria initiated coverage of this "Buffett-esque" stock with a buy rating, saying the software provider for corporate sales and marketing teams is a "rare" value pick in the sector. 

"[This stock has] a competitive moat, a track record of execution and substantial long-term opportunity," Luria wrote in a Wednesday note. 

— Sarah Min

Apple reaches record against S&P 500

Apple is handedly beating the broader market, with the tech stock's relative outperformance against the S&P 500 reaching an all-time high.

The iPhone maker is slated to report earnings after the bell Thursday. Apple shares dipped 0.8% on the day.

— Fred Imbert, Gabriel Cortés

AMD shares jump to session highs following report

AMD shares reached a session high on Thursday after Bloomberg reported that the chipmaker was working with Microsoft on a new artificial-intelligence processor.

Microsoft is helping AMD to fund the initiative, Bloomberg reported, citing anonymous sources.

AMD declined to comment. A Microsoft representative did not immediately respond to a request for comment.

AMD shares were last higher by 9.4%.

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— Jordan Novet

Goldman Sachs advises investors to be overweight in non-U.S. markets

In the case that markets avoid a recession, Goldman Sachs says interests rates will likely then rise, putting downward pressure on valuations. In this case, the bank tells investors to position themselves to position themselves in markets outside of the U.S.

"We continue to recommend an overweight in non-US markets which are cheap with a similar growth profile. Returns for dollar-based investors should also get a boost from a gradually lower dollar," several analysts wrote in a Thursday note.

The company added that it favors quality growth and stable margin businesses "together with some deep value – Energy, Natural Resources and European Banks." Our strategists in the US and Asia have a preference for quality and defensive equities as well.

— Hakyung Kim

Goldman Sachs advises investors to be overweight in non-U.S. markets

In the case that markets avoid a recession, Goldman Sachs says interests rates will likely then rise, putting downward pressure on valuations. In this case, the bank tells investors to position themselves to position themselves in markets outside of the U.S.

"We continue to recommend an overweight in non-US markets which are cheap with a similar growth profile. Returns for dollar-based investors should also get a boost from a gradually lower dollar," several analysts wrote in a Thursday note.

The company added that it favors quality growth and stable margin businesses "together with some deep value – Energy, Natural Resources and European Banks." Our strategists in the US and Asia have a preference for quality and defensive equities as well.

— Hakyung Kim

Is my money safe? Americans growing more concerned about bank deposits

A Gallup survey uncovered that consumers are growing increasingly fearful about the safety of their bank deposits. In a survey conducted from April 3-25, nearly half of those polled said they were "very worried" (19%) or "moderately worried" (29%) about their deposits, Gallup said.

The pollster said this latest reading is similiar to the findings it saw shortly after the collapse of Lehman Brothers on Sept. 15, 2008.

As a reminder, the Federal Deposit Insurance Corp. backs deposits of up to $250,000 per depositor at an insured bank. For those with accounts above the insured limit, there are steps one can take to protect their assets.

—Christina Cheddar Berk

J&J's consumer health spinoff Kenvue makes public market debut

Kenvue traded $25.53 per share during its market debut on the New York Stock Exchange Thursday, jumping 16% from its $22 IPO.

Kenvue's debut marks the largest U.S. IPO since 2021, when electric vehicle maker Rivian went public. The IPO is also the largest restructuring move in Johnson & Johnson's history. Johnson & Johnson will have a 90.9% stake in Kenvue after the IPO completes, and proceed reduce the rest of its stake later in 2023.

— Hakyung Kim

See the stocks making the biggest moves midday

These are the stocks making the biggest moves midday:

See the full list here.

— Alex Harring

First Horizon CEO says failed merger is unrelated to regional bank issues

First Horizon CEO Bryan Jordan said on "Squawk on the Street" that he takes it at "face value" that the failed merger with TD Bank was due to regulatory uncertainty and not a move by TD to backtrack on the deal given the decline in regional bank stocks. Jordan said he did not have insight into what the regulatory issues might have been.

"Any questions about the approval process, unfortunately, TD will have to answer," Jordan said.

The CEO of the Tennessee-based bank said that he believes the banking system is strong. Regulators should look at changes to the deposit insurance system, such as for large business accounts, to help stabilize the industry, Jordan said, but he added that short-term moves like banning short-selling might not be the best path.

"I don't think any spur of the moment decisions are usually good. I think it's probably time to take a breath and think through these things," Jordan said.

Shares of First Horizon are down 36% on the day.

— Jesse Pound

'Ripple effects of banking uncertainty will continue,' says Hirtle Callaghan

Mark Hamilton, chief investment officer at Hirtle Callaghan, says that the resurgence of instability in the banking sector are looking to continue for the foreseeable future.

"I think you are going to continue to see ripple effects. This is the nature of now had 475 basis points of tightening those effects are going to ripple through the economy over time.," Hamilton said. "And that is definitely one of the contributors to what's going on with with the regional banks." Hamilton added that the flare ups in bank stocks are likely to continue on an "episodic" basis over the next few quarters.

To be sure, he added that he hesitates "to even call this a crisis."

"This is not like 2008, where you had such a systemic series of risks where many, many banks had issues with capital adequacy, etc. This seems to be to be much more focused in certain types of banks with certain types of customer bases that are the most vulnerable."

— Hakyung Kim

Qualcomm shares fall on weak guidance, sales

Shares of Qualcomm</