WAL - Relief rally for regional bank shares - Will it continue?

2023-05-16 05:16:42 ET

Regional bank stocks got some rare love on Monday as traders gave some confidence to a sector that has been under a shadow since March.

PacWest ( NASDAQ: PACW ) rose 18% after falling 21% last week, while other regionals like Zions Bancorporation ( NASDAQ: ZION ) and Comerica ( NYSE: CMA ) were among the biggest gainers in the S&P 500, climbing 8% and 7% , respectively. Western Alliance ( WAL ), KeyCorp ( KEY ) and Fifth Third Bancorp ( FITB ) also rose significantly, while the SPDR S&P Regional Banking ETF ( NYSEARCA: KRE ) finished the session up 3.2% .

Some pressure may be dissipating as market participants shift their focus towards the debt ceiling debate , which has "already seen Treasury's borrowing costs increase substantially for securities maturing in early June," according to Treasury Secretary Janet Yellen.

Former Silicon Valley Bank ( OTC:SIVBQ ) CEO Greg Becker will also apologize before the Senate Banking Committee later on Tuesday, but will reiterate that any bank could not have "survived a run of that velocity and magnitude."

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