Today: May 30, 2024
Today: May 30, 2024

US regional banks shares surge after Bill Gross says they have hit bottom

Share This
US regional banks shares surge after Bill Gross says they have hit bottom
November 02, 2023
David Randall - Reuters

By David Randall

NEW YORK (Reuters) - Shares of a handful of U.S. regional banks popped on Thursday after famed bond investor Bill Gross said the danger in investing in them had passed.

Gross, a billionaire once known as the "Bond King" after founding fixed income giant PIMCO, said he was buying shares of Truist Financial, Citizens Financial Group, KeyCorp, and First Horizon. Shares of each company jumped by 6% or more, outpacing the 3.5% gain in the S&P 500 Banks index.

"Regional bank falling knife has hit bottom," Gross wrote on a message on X, the platform formerly known as Twitter.

Regional banks have been under pressure from the steep selloff in Treasuries, which pushed yields near 16-year highs and dampened the demand for mortgages and other forms of consumer credit. Benchmark 10-year Treasuries rallied Thursday, with yields falling to three-week lows, following smaller than expected Treasury issuance and signals from the Federal Reserve that it is done with its hiking cycle.

Gross wrote on Oct. 23 that he was "seriously considering regional banks again" but cautioned that "it hurts if done too early." He followed up on Oct. 30 and said that some shares offered "extraordinary long term value."

Along with regional bank shares, Gross wrote he expects the yield curve to turn positive over the next six months, making 2-year Treasuries more attractive than 10-year Treasuries. The yield curve has been inverted for more than a year, with short duration bonds yielding more than long-duration. Historically, yield curve inversions signal an upcoming recession, and tend to once again turn positive slightly before or at the moment of a recession.

(Reporting by David Randall; Editing by David Gregorio)

Popular

IRS makes free tax return program permanent and is asking all states to join in 2025

The IRS will make permanent the free electronic tax return filing system that it experimented with this year

IRS makes free tax return program permanent and is asking all states to join in 2025

Mortgage rates snap three-week pullback, pushing average rate on a 30-year home loan back above 7%

The average rate on a 30-year mortgage moved back above 7% this week, a setback for home shoppers at a time when the U.S. housing market is already slowing under the strain of elevated home loan borrowing costs and rising prices

Mortgage rates snap three-week pullback, pushing average rate on a 30-year home loan back above 7%

Supreme Court gives homeowners another chance in escrow dispute with Bank of America

The Supreme Court has given homeowners another chance to force Bank of America and other large banks to pay interest on mortgage escrow accounts

Supreme Court gives homeowners another chance in escrow dispute with Bank of America

Fidelity won't levy proposed fees on purchases from boutique ETF firms, sources say

Fidelity Investments will not impose new fees on investors buying exchange-traded funds (ETFs) issued by a group of smaller asset management firms, having made progress on

Fidelity won't levy proposed fees on purchases from boutique ETF firms, sources say

Tesla makes push to roll out advanced FSD self-driving in China

Tesla is preparing to register its 'Full Self-Driving' software with authorities in China in the run up to its planned rollout of the technologically advanced feature this year, three

Tesla makes push to roll out advanced FSD self-driving in China

Related

Boeing to detail quality, training improvements in FAA meeting, sources say

Boeing to detail quality, training improvements in FAA meeting, sources say

Volkswagen distributor D'Ieteren flags softer auto glass repair demand in N America

Volkswagen distributor D'Ieteren flags softer auto glass repair demand in N America

SK Group chief ordered to pay $1 billion in divorce case; shares in SK Inc soar

SK Group chief ordered to pay $1 billion in divorce case; shares in SK Inc soar

US Steel, Nippon Steel receive all non-US approvals for merger

US Steel, Nippon Steel receive all non-US approvals for merger
- Advertisement -
Advertisement: Limited Time Offer