The VIX index measuring fear and volatility climbed to the highest level in a month. Investors dispelled fears about contagion in the banking sector. Despite tranquility in the market, we should not forget about the second day of hearings in the Senate and a fresh batch of macroeconomic data.

The US benchmark stock indices closed yesterday with a modest decline. Investors assessed comments from the US main regulator on bank woes and sold shares of high-tech companies following their recent rally.
The major stock indices dipped yesterday. The Dow Jones shed 37 points or 0.12%. The Nasdaq lost 0.45% or 52 points. The S&P 500 slipped by 0.16% to close at 3,971.
The pre-market today was more optimistic. All three indices went up in confidence. Futures on the US stock indices rose by 0.7-1.1% before the opening bell. The S&P 500 is expected to trade in the intraday corridor between 3,940 and 4,040.
The hearings in the Senate soothed investors’ worries about a full-blown banking crisis. Fed Vice Chair for Supervision Michael Barr said that Silicon Valley Bank did a dismal job on risk management which entailed its crash.  
The regional banking sub-index dipped by 0.2% intraday in sync with the shares of regional banks in response to the prospects of tightening rules for banks with deposits worth more than 10 billion dollars.
Apple and Microsoft shares as well as stocks of other high-tech giants dropped yesterday which put a lid on the S&P 500’s performance. The reason is profit-taking after a strong quarter.
Besides, the Conference Board survey revealed that consumer confidence in the US unexpectedly improved in March but Americans voiced concern about the labor market.
As a result, the high-tech sector in the S&P 500 slipped by 0.5% yesterday, extending its decline this week. Still, the index is on track to close the first quarter with solid gains.
Yields of US Treasuries went up which put pressure on high-tech stocks.
Alibaba shares surged by 14.3% in light of the news. The company plans to split its business into six main divisions dealing with e-commerce, media, and cloud technology.
Micron Technology shares grew by almost 1%. The company’s revenue forecast for the third quarter matches Wall Street consensus.
Futures on the US stock indices rallied in the New York pre-market. The sale of assets of the failed Silicon Valley Bank subdued market jitters.
Stocks of US domestic banks traded mixed. Western Alliance rose by 0.6%. First Republic fell by 0.7%. Shares of Bank of America, Goldman Sachs, and JPMorgan climbed by 0.7-1.6% in the pre-market.
A pullback in yields of US Treasuries unfolding amid waning banking fears encouraged growth of high-tech stocks. Shares of Microsoft, Alphabet, and meta added 0.8-1%.
Today is the second day of Michael Barr’s testimony in front of lawmakers.
JPMorgan estimates that vulnerable banks have lost almost 1 trillion in deposits since the Federal Reserve embarked on monetary tightening. Half of the losses occurred after the crash of Silicon Valley Bank. JPMorgan discovered that nearly 7 trillion dollars in bank deposits remain uninsured.
Analysts reckon that the banking shock will hardly spread across the whole sector. The ailing Silicon Valley Bank went bankrupt due to low liquidity and a high share of uninsured deposits.
From 42 publicly traded lending institutions insured by the FDIC, only 7 banks have the same problems: more than 60% of uninsured deposits and less than 80% of liquid capital to deposit ratio. To sum up, such snags pop up at some small-sized banks. Thus, the risk of a broader crisis is limited.
Today investors are keeping tabs on pending home sales, oil inventories, and the second testimony on Capitol Hill.
Alibaba shares are the culprit of the market optimism. Investors welcomed the news on the company’s overhaul which could be the sign that a corporate crackdown in Beijing is coming to an end. The company’s shares jumped by 16.3% in Hong Kong. Previously, Alibaba shares rallied by 14% in the US.

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