The Stock Market At Close – Friday, March 17

The Toronto Market

The TSX index was down 152.83, or 0.77%, to close today’s market session at 19,387.72, marking a second straight week of losses.

The financial sector, which makes up the largest portion of the Canadian index declined 1.8%. The energy sectors declined 1.6%. The technology sector declined 0.2%. The utilities and materials (Resources) sectors gained 0.2% and 3.3% respectively. 

The TSX is now down for two consecutive weeks. The banking problem persists. Gold price gained 3.44% today. Volumes on both Nasdaq and NYSE were up substantially while the bank stock prices were down sharply. It is not a good short term picture for the direction of stock prices.

The US Markets

The Dow Jones Index declined 1.2% to close today’s market session at 31,861.98. The S&P 500 declined 1.1% to close at 3,916.64. The Nasdaq index declined 0.7% to close at 11,630.51. Financials plunged nearly 3.3% as all sectors posted losses. For the week, the Dow dropped almost 0.2%, while the S&P 500 and the Nasdaq advanced 1.4% and 4.4%, respectively.

Nasdaq, essentially technology stocks, appear to be trying to rally; but can a rally take off and endure when the banks are in turmoil?

All 11 major sectors of the S&P 500 ended the session in negative territory. Declining issues outnumbered advancing issues on the NYSE by a ratio of 4.07 to 1. The ratio declining to gaining stocks on the Nasdaq was a 2.94 to1. In layman’s language, for every investor who gained at the market today, four others lost money. It is easy to conclude that in the current market and the prevailing banking turmoil, the short term risks outweigh, by a good margin, the opportunities.

10 –year Treasury Yield: The US 10-year rate slid 16.8 basis points to 3.42%. The two-year yield crashed 74 basis points to 3.85%, the biggest weekly drop in thirty six years.

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Stocks In The News/ Stocks To Watch

We begin this section today with the current banking industry.

Will the dark clouds disappear soon?

• JP Morgan Chase (JPM) down today -3.78% or -$4.94 with a volume of 38.4M shares traded.
• Wells Fargo (WFC) down today -3.92% or -$1.54 with a volume of 47.4M shares traded.
• Goldman Sachs Group (GS) down today -3.67% with a volume of 6.4M shares traded.
• Bank of America (BAC) down today -3.97% with a volume of 130.4M shares traded

First Republic Bank (FRC) shares tumbled 33% during the regular session today and by another 13% in the after-hours market. It was the worst performer on the S&P 500. The company said late yesterday that its board suspended the company’s common stock dividend to support its goal of “reducing its borrowings and evaluating the composition and size of its balance sheet going forward.” The company, yesterday secured $30 billion in uninsured deposits from several large US banks.

Credit Suisse (CS) shares slumped 6.9% during the regular market today amid a Reuters report that the Swiss bank was sued by US shareholders claiming that it hid problems with its finances.

SVB Financial Group (SIVB) filed for Chapter 11 bankruptcy seeking a court-supervised reorganization, a week after its former Silicon Valley Bank unit was shut by regulators.

Early Rally Steps

The market is not all bad news for readers with a bit more tolerance for risk. A few technology stocks are trying to rally but can a really rally take hold in the current market climate?

Microsoft Corp (MSFT) has largely brushed aside the banking industry turmoil of the past week.

American Micro Devices Inc. (AMD) is surely a stock to keep an eye and so is Nvidia (NVDA).

It is not only the technology sector stocks that have bristled along while ignoring the current turmoil with the banking stocks. This particular stock is a familiar name to our readers. We often quote reports from the company. The name is Thomson Reuters (RTI). The stock has the same ticker symbol both on the TSX and on the NYSE providing the option to trade the stock either at the US market or at the Toronto market.

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Regular Market Day Features

Beginner Investor’s (Canadian stocks) Watchlist

The bank stocks are not doing well at the moment. The good news is that they pay dividends. Most people do not trade bank stocks as bank stocks are more suited to investment portfolios . A trader is not an investor. As long as the dividend figures are not cut drastically and depending on one’s investment time frame, the Canadian big banks remain good value in our opinion.

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The Canadian Vanguard Chinese Stocks Watchlist

Baidu (BIDU) today, gained 6.3% after the company said it received a permit to deploy 10 of its driverless Apollo Go ride-hailing vehicles in the Beijing Yizhuang Economic Development Zone in China. Pinduoduo parent PDD Holdings (PDD) will report earnings Monday before the open.

EV, Energy and Resource Stocks Watchlist at Today’s Market

Tesla (TSLA) continues to consolidate, holding support and facing resistance at several key levels.

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