US stocks finish higher, though regional bank shares fall
STORY: U.S. stocks ended higher on Thursday as technology-related shares extended their recent strong run, while regional bank shares fell after the Biden administration proposed stronger measures to help reduce risk.
The Dow rose 4-tenths of a percent, the S&P 500 added about half a percent and the Nasdaq climbed about three-quarters of a percent.
The Biden administration recommended imposing a limited list of new measures to strengthen mid-sized banks that it said could be pushed through without having to go to Congress.
That pushed down regional bank shares – with the S&P 500 financial index the only S&P 500 sector in negative territory on the day.
But fears of contagion in the sector are easing, says Stephen Lee, principal and portfolio manager at Logan Capital.
“It seems like some of the concerns about bank deposits and some of the other regional banks have abated a little, which is giving us a little bit of a cushion here on a slightly upmarket as we are. So we're kind of back to fundamentals, back to companies that are able to produce good results.”
Data earlier on Thursday showed jobless claims last week rose more than expected from the week before, indicating a cooling labor market. Separately, fourth-quarter GDP growth was slightly lower than earlier estimates, both supporting the case for a softer Fed policy.
Market movers included U.S.-listed shares of Alibaba Group Holding which advanced 3-percent on a report that its logistics arm had started preparations with banks for its Hong Kong initial public offering.
While those of JD.Com jumped nearly 8-percent on plans to spin off its real estate arm.