Stock market today: Dow adds 300 points as bank rally fueled bets on Fed move By

By Liz Moyer

-- U.S. stocks ended higher as a rally in bank stocks put aside worries that the trouble in the banking sector would wind up becoming a contagion. 

At 16:05 ET (20:05 GMT),fx foreign exchange the closed up 336 points or 1.1%, while the was up 1.7% and the was up 2.1%.

Also lifting the mood in the markets: The Bureau of Labor Statistics reported a 0.4% rise in the in February from the previous month, cooling slightly from January’s reading. On an , inflation rose 6%, also cooling from the prior reading. , which exclude food and fuel, rose 0.5% from the prior month, slightly more than expected.

That is leading traders to put more bets on a smaller rate hike by the Federal Reserve next week.

Most futures traders are expecting a quarter of a point rate hike next week, though 26% of traders are betting on the Fed to pause rate hikes, according to CME’s FedWatch tool. 

The collapse of Silicon Valley Bank (NASDAQ:) over the weekend rippled through bank stocks on fears of a wider contagion. Regulators have stepped in to backstop depositors of SVB and (NASDAQ:), which also shut down.

Shares of large regional banks sank on Monday but were rebounding on Tuesday. KeyCorp (NYSE:) closed up 7%. (NYSE:) was up almost 4%, while (NASDAQ:) was up almost 34%. (NYSE:) was up 27%.

Stocks’ afternoon climb was temporarily interrupted by reports a Russian fighter jet struck the propeller of an American surveillance drone over the Black Sea, causing U.S. forces to down the drone in international waters.

Meta Platforms Inc (NASDAQ:) is cutting another 10,000 workers, incurring charges of as much as $5 billion, and warned about the possibility of economic uncertainty sticking around. Shares rose 7%.

Shares of AMC Entertainment Holdings Inc (NYSE:) sank 15% after shareholders of the largest movie theater chain voted to approve a reverse stock split and the conversion of APE equity units into common shares. The matter is also before a Delaware Chancery Court judge.

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