Back to top

View the PFP Archive

Plus 5 Just-Added Strong Buys
Kevin Matras   
Profit from the Pros
By Kevin Matras
Executive Vice President
Zacks Investment Research

Stocks Soared Yesterday, On Pace To Close Higher For The Week

Stocks closed sharply higher yesterday led by the Nasdaq with 2.48%, followed by the S&P with 1.76%, and the Dow with 1.17%.

The markets are on pace for solid weekly gains.

Last week's sharp sell-off following SVB's collapse, and fears of contagion, have so far proven to be overdone.

For one, the big banks are in strong financial shape. And the number of smaller and mid-sized banks flagged for trouble seem relatively few compared to the size and depth of the financial system. The common theme to the current situation seems to be a lack of liquidity for some due to overly large investments into long-dated Treasuries. Arguably, the safest investment on the planet.

Granted, the people running those banks made poor decisions as they did not adequately plan for what they would do if/when interest rates went up, business activity slowed, and depositors needed access to their funds. But that's quite different than the sub-prime mortgage crisis and S&L crisis where banks were saddled with risky assets.

On Wednesday, Swiss bank Credit Suisse fell to all-time lows after reports that their largest investor could not provide any additional funding (due to regulatory complications). But Switzerland's central bank said they would provide support via added liquidity. And on Thursday, CS took them up on their offer and tapped into a $54 billion loan, relieving their liquidity issue.

Here in the states, First Republic Bank (one of the banks on Moody's 'review' list), got some liquidity relief as well after a group of some of the country's biggest banks (including JPMorgan Chase, Citigroup, and Bank of America, to name a few -- there were 11 in all), provided $30 billion in funding to help them out.

This is not the last of the banking story. But it's looking like we are past the worst of it.

Wednesday's better than expected PPI report, which showed inflation moderating much more than expected, was muted, as banking concerns dominated trading. But yesterday's sharp rally appears to be not just relief over the banking situation, but big relief that inflation continues to ease, which is lending hope that the Fed might soon be done raising interest rates.
The Fed is still expected to raise rates by another 25 basis points next week. But expectations for how high the terminal rate may go have recently come down. Either way, it's clear we are nearing the end of the rate hike cycle, and that's bullish for stocks.

In other news, yesterday's Housing Starts and Permits report showed Starts at 1.450 million units (annualized) vs. last month's upwardly revised 1.321M and views for 1.315M. Permits came in at 1.524M vs. last month's 1.339M and views for 1.340M.

The Philadelphia Fed Manufacturing Index improved to -23.2 from last month's -24.3. Although, it missed expectations for an even larger improvement of -15.8.

And Weekly Jobless Claims fell more than expected, declining by -20,000 to 192K vs. the consensus for 205M.

Today we'll get another look at the economy with Industrial Production, Leading Indicators, and the Consumer Sentiment report.

It's also Quadruple Witching, which means it's expiration day for index futures, stock futures, index options, and stock options.

It's been a wild week so far. But if all goes well, the week should end on a positive note with a degree of optimism. A night and day difference from last week.


Kevin Matras

Executive Vice President, Zacks Investment Research


Time's almost up! Get your FREE copy of Finding #1 Stocks - A $49.95 Value

The Executive Vice President of Zacks Investment Research, Kevin Matras, continues to feel optimistic about our country's financial future. Stocks are currently rallying, but volatility remains.

So what's the key to being successful in today's market conditions? Knowing the right strategies and where to find stocks that will lead the market.

For a limited time, Kevin is offering his hardcover book, Finding #1 Stocks, absolutely free. In the book, he shares exclusive secrets to picking stocks, including the exact formulas of strategies that produced gains up to +15.6%, +38.9%, and even +39.7% while the market dropped -18.2% in 2022.

This brief opportunity will end at midnight Saturday, March 18 or when inventory is depleted. Don't miss your chance to get an edge in the game.

Get your free book now »

Most Popular Articles from

Image: Bigstock

Have Inflation and Interest Rates Peaked? If So, Buy These Stocks

Following the Silicon Valley Bank debacle, and other potential risks in the regional banking sector, traders have flipped and are now expecting no raise in rates at all. Read More »

Image: Bigstock

Weathering the Economic Storm: This Highly-Ranked Stock Has Flourished

Bullish price action is a sign of strength as this company looks to continue its momentum. Read More »

Image: Bigstock

3 Big Tech Stocks are Holding Up the Entire Market

The area of the market that has performed well YTD, and held up over the last month, is Tech. Read More »

Image: Bigstock

3 Major Regional Banks Worth a Look Despite SVB, SBNY Collapse

Bank runs, worsening asset quality and recession expectations will hurt Regional Bank near-term performance, yet these industry players are worth a closer look. Read More »

Image: Bigstock

5 Cheap Energy Stocks to Buy Now

Forget the oil producers. Look for deals in services and refining. Read More »


Increase Investment Returns with Free Zacks' Portfolio Tracker

Catch breaking news on your stocks and funds at a glance, including timely recommendation changes ... Zacks Ranks ... Industry Ranks ... earnings announcements ... earnings estimate revisions ... and more. And now you can screen for new stocks to improve portfolio performance.

Click for Free Tracker & Screener »

Image: Bigstock

Bull of the Day: Everbridge (EVBG)

Beat-and-raise quarter for secure messaging provider boosts EPS estimates to 124% growth this year. Read More »

New Zacks Strong Buys for March 17th

Here are 5 stocks added to the Zacks Rank #1 (Strong Buy) List today. Read More »


Download our app for convenient on-the-go access to even more—daily and weekly newsletters published by Zacks experts, proprietary research and tools, and Portfolio Tracker on

Download our Zacks App for Apple iOS
Download our Zacks App for Android

Visit Success Stories to hear how Zacks research, tools and portfolios help our members outperform the market.