2023-03-24 17:52:49 ET
The S&P 500 ( SP500 ) on Friday ended the week 1.4% higher, posting gains in four out of five sessions, as fears over the banking sector and hopes of the Federal Reserve pausing rate hikes lingered.
The benchmark index's accompanying SPDR S&P 500 Trust ETF ( NYSEARCA: SPY ) gained 1.5% for the week.
The Federal Reserve on Wednesday hiked its key lending rate by 25 basis points, as expected, and ruled out rate cuts this year. However, fed funds futures data showed a 31.2% chance of a quarter-point rate cut in June and 48.1% chance in July.
"We expect the FOMC to hike another 25bp to 5%-5.25% in May, then expect it to pause and maintain this range through the rest of the year," Barclays said. "Powell made clear that a tightening in lending standards, which causes GDP growth to slow and labor demand to weaken, stands in for additional rate hikes."
The week saw new developments in the banking space that fanned uncertainty over the stability of lenders, both big and small. Deutsche Bank's ( DB ) cost of default insurance spiked, while struggling Credit Suisse ( CS ) was forced to merge with larger rival UBS ( UBS ) for $3.25B. Meanwhile, concerns about U.S. regional banks lingered.
Turning to this week's economic data, initial jobless claims unexpectedly fell and new home sales increased less than expected, but existing home sales blew past estimates. Durable goods figures dropped and the U.S. Flash Composite PMI unexpectedly strengthened this month.
Of the 11 S&P 500 ( SP500 ) sectors, nine ended the week in the green. Communication services stocks were the top performers, driven by Netflix's ( NFLX ) 8.2% weekly gain. Meanwhile, the rate-sensitive real estate sector was the top loser for the week. See below a breakdown of the weekly performance of the sectors as well as their accompanying SPDR Select Sector ETFs from March 17 close to March 24 close:
#1: Communication Services +3.4% , and the Communication Services Select Sector SPDR Fund ( XLC ) +2.98% .
#2: Energy +2.29% , and the Energy Select Sector SPDR ETF ( XLE ) +1.20% .
#3: Materials +2.12% , and the Materials Select Sector SPDR ETF ( XLB ) +1.72% .
#4: Information Technology +2.04% , and the Technology Select Sector SPDR ETF ( XLK ) +1.74% .
#5: Health Care +1.49% , and the Health Care Select Sector SPDR ETF ( XLV ) +1.14% .
#6: Consumer Staples +1.43% , and the Consumer Staples Select Sector SPDR ETF ( XLP ) +1.19% .
#7: Industrials +0.67% , and the Industrial Select Sector SPDR ETF ( XLI ) +0.25% .
#8: Financials +0.58% , and the Financial Select Sector SPDR ETF ( XLF ) +0.03% .
#9: Consumer Discretionary +0.44% , and the Consumer Discretionary Select Sector SPDR ETF ( XLY ) +0.17% .
#10: Utilities -1.20% , and the Utilities Select Sector SPDR ETF ( XLU ) -1.91% .
#11: Real Estate -1.38% , and the Real Estate Select Sector SPDR ETF ( XLRE ) -1.99% .
Below is a chart of the 11 sectors' YTD performance and how they fared against the S&P 500. For investors looking into the future of what's happening, take a look at the Seeking Alpha Catalyst Watch to see next week's breakdown of actionable events that stand out .
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S&P 500 ekes out 1.4% weekly gain as bank fears, hopes of Fed pause linger