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Written by Charles-Henry Monchau | Mar 19, 2023 10:04:14 AM

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WEEKLY SUMMARY: Bonds, Bitcoin & Bullion soared as Banks tumbled

US stocks closed mixed for the week, reflecting the crosscurrents of stresses in the banking sector, worries that a steeper slowdown in the economy would follow, and hopes that the Fed would now be forced to pause its rate-hiking cycle. Sector returns within the S&P 500 Index varied widely: mega-cap tech stocks recorded strong gains while financials and energy shares suffered significant losses. Worries that the failure of SVB would set off a wave of new collapses eased over the weekend, as the FDIC and the Treasury Department announced on Sunday, March 12, that all SVB depositors would have full access to funds on Monday morning. Hopes that the Fed might also adjust its monetary policy in response to events seemed to drive a rally on Tuesday. By the end of the week, futures markets were pricing in zero likelihood of a 50-basis-point hike by the Fed in March compared with a 40% chance of one the week before. The US 10-year yield touched an intraday low of 3.37% on Thursday while Investment-grade credit spreads widened to a four-month high. Shares in Europe tumbled  as the pan-European STOXX Europe 600 Index ended the week 3.8% lower. News that Credit Suisse (CS) was also experiencing problems sent markets sharply lower again. ECB sticks to half-point rate hike despite stress on European banks as they said that inflation is expected to stay above target. Oil tumbled while Gold and cryptocurrencies soared as Bitcoin recorded its best week since January 2021.