Wall St set for higher open as regional banks bounce, debt talks grind on
Reuters
Published May 17, 2023 20:14
Updated May 17, 2023 23:09
By Shreyashi Sanyal and Shristi Achar A
(Reuters) - U.S. stock indexes were set to open higher on Wednesday after Western Alliance led a bounce among regional banks amid cautious optimism about a potential breakthrough in the deadlock in Washington over the nation's debt limit.
Shares of U.S. regional banks rose, led by a 11.6% premarket rise in Western Alliance Bancorp as the lender's deposit growth exceeded $2 billion and brokerage Bank of America (NYSE:BAC) Global Research resumed coverage of the bank with a "buy" rating.
PacWest Bancorp and Zions Bancorporation (NASDAQ:ZION) NA added 12.3% and 4.2% respectively.
U.S. President Joe Biden will continue talks with congressional leaders on the debt ceiling later this week, the White House said one day after an hour-long meeting seen as productive.
"Cautious optimism expressed from both President (Joe) Biden and Speaker (Kevin) McCarthy about the progress of the debt talks has made people feel a little bit better," said Michael James, managing director of equity trading at Wedbush Securities.
Target Corp (NYSE:TGT) edged 0.4% higher in choppy trading after the retailer beat first-quarter profit expectations but forecast current-quarter profit below expectations.
TJX Companies Inc (NYSE:TJX) lost 0.3% after the T.J. Maxx parent missed its first-quarter revenue estimates.
"Both (results) could be construed as a not great, but certainly it could have been worse and not as negative as we saw from Home Depot (NYSE:HD) yesterday," James added.
Home Depot and a reading on U.S. April retail sales that missed expectations highlighted the impact of higher prices and interest rates on consumers, weighing on Wall Street on Tuesday.
Investors will now await retail behemoth Walmart (NYSE:WMT)'s earnings on Thursday. Its shares edged 0.4% higher.
At 8:41 a.m. ET, Dow e-minis were up 129 points, or 0.39%, S&P 500 e-minis were up 13 points, or 0.32%, and Nasdaq 100 e-minis were up 18.5 points, or 0.14%.
Shares of Tesla (NASDAQ:TSLA) Inc rose 1.3% after its annual shareholder meeting.
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Top boss Elon Musk played down market rumors that he may step down as CEO of Tesla, touched upon two new mass-market models it is developing, and reaffirmed that deliveries of its long-delayed Cybertruck pickup would start this year.
Meanwhile, U.S. single-family homebuilding increased in April, but data for the prior month was revised sharply lower, suggesting that the embattled housing market was struggling to find a floor, despite a retreat in mortgage rates.
Written By: Reuters
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