Wall St climbs as bank fears ease, rate-hike pause hopes grow
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Micron rises on upbeat 2025 sales forecast
Lululemon leaps on strong annual outlook
Indexes up: Dow 0.60%, S&P 0.97%, Nasdaq 1.26%
Updates prices, details
By Amruta Khandekar and Ankika Biswas
March 29 (Reuters) - Wall Street indexes rose on Wednesday as worries about stress in the banking sector eased, with some upbeat earnings reports and rising expectations about the Federal Reserve pausing interest rate hikes boosting sentiment further.
Micron Technology Inc MU.Oadvanced 5.8% to the top of the S&P 500 after the chipmakerforecast artificial intelligence will boost its 2025 sales, lifting the Philadelphia semiconductor indexup 2.3%.
Lululemon Athletica Inc LULU.O jumped12.9% after an upbeat annualresults forecast, giving a big boost to the Nasdaq .IXIC and helping it outperform peers.
Meanwhile, marketworries about the banking system have ebbed following a U.S. regulator-backed sale of failed lender Silicon Valley Bank's assets as well as lack of fresh signs of trouble in the sector since the buyout deal.
"Markets have been hit by waves of bad news, and we have hit a small pocket of stability with a few decent earnings and the bank crisis seeming closer to being over," said Rick Meckler, partner at Cherry Lane Investments.
Regional U.S. bank stocks including Truist Financial Corp TFC.N, Western Alliance Bancorp WAL.N and First Republic Bank FRC.N rose between 2% and 5%.
Larger peers Bank of America BAC.N, Goldman Sachs GS.N and JPMorgan Chase & Co JPM.N climbed 0.2% to 1.3%.
The banking turmoil, which started earlier in March with the collapse of Silicon Valley Bank, has led markets to reprice expectations of future monetary tightening by the Federal Reserve.
The Fed will make its interest rate decisions from here on a meeting-to-meeting basis, taking into account the existing financial conditions, Fed Vice Chair for Supervision Michael Barr said in the second day of congressional hearings into the collapse of Silicon Valley Bank.
A key inflation reading expected at the end of the week will provide more clues on the Fed's monetary tightening plans.
Traders' bets for norate hike by the Fed in May rose to 59.5% from 52.8% a day earlier, with the remaining bets for a25-basis-point increase, accordingto CME Group's Fedwatch tool.
Rate-sensitive growth names such as Amazon.com Inc AMZN.O and Tesla Inc TSLA rose2.6% and 1.4%, respectively, lifting consumer discretionary stocks.SPLRCD up about1.3%. Techmajors Apple Inc AAPL.O, Microsoft Corp MSFT.O and Nvidia Crop NVDA.O rose more than 1%, boostingthe information technology .SPLRCT index.
Real estate stocks .SPLRCR also advanced 1.7% to lead sectoral gains.
The CBOE volatility index .VIX, known as Wall Street's fear gauge, fell to its lowest since March 9, reflecting easing investor anxiety.
At 11:42 a.m. ET, the Dow Jones Industrial Average .DJI was up 192.99 points, or 0.60%, at 32,587.24, the S&P 500 .SPX was up 38.38 points, or 0.97%, at 4,009.65, and the Nasdaq Composite .IXIC was up 147.75 points, or 1.26%, at 11,863.83.
Among other major stock moves, U.S.-listed shares of Alibaba Group Holding Ltd BABA.N rose 1.7% to a fresh six-week high, aday after rallying onthe internet giant's revamp and listing plans.
Advancing issues outnumbered decliners by a 3.67-to-1 ratio on the NYSE andby a 1.87-to-1 ratio on the Nasdaq.
The S&P index recorded eight new 52-week highs and no new low, while the Nasdaq recorded 46 new highs and 88 new lows.
Reporting by Amruta Khandekar and Ankika Biswas; Editing by Dhanya Ann Thoppil and Vinay Dwivedi
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