The Federal Reserve huffed and puffed, and yet the stock market didn't fall down even as fears of more bank failures remained top of mind with lawmakers and investors.
The Fed lifted the target range for its benchmark interest rate by 25 basis points on Wednesday. Chairman Jerome Powell suggested to reporters that rates could have been hiked by 50 basis points if not for pressures in the banking system.
Powell also ruled out rate cuts this year in response to a question from Yahoo Finance's Jennifer Schonberger at the Fed's press conference.
Federal Reserve Board Chair Jerome Powell holds a news conference after the Fed raised interest rates by a quarter of a percentage point following a two-day meeting of the Federal Open Market Committee (FOMC) on interest rate policy in Washington, U.S., March 22, 2023. REUTERS/Leah Millis
And while the Dow Jones Industrial Average fell 530 points by the close of trading on Wednesday, the market stabilized on Thursday as Treasury Secretary Janet Yellen and other top businesspeople did everything they could publicly and behind the scenes to tamp down concerns of a full-blown bank crisis.
"This isn't a crisis," one prominent CEO told me over dinner this week, adding the situation is far less dire than the subprime mortgage crisis that led to the Great Recession. The exec blasted leaders at Silicon Valley Bank but also voiced concern about the outcome of First Republic (FRC).
A person familiar with the Treasury Secretary's thinking told me the department is closely watching deposit inflows at the banks — and that suggests the financial system isn't in crisis mode.
By Friday, however, market stress was back in focus as all eyes turned to Deutsche Bank (DB) and its various struggles and now dwindling stock price.
In other words, another wild week!
Here are five things you may have missed during another very busy week for markets.
1. Nvidia's AI push
The Street gushed over Nvidia's (NVDA) various projects and exposure to the new artificial intelligence movement at its annual GTC conference. But we also heard from Nvidia CEO Jensen Huang on the impact of higher interest rates — well-timed considering this was Fed meeting week.
"This is the time when we all have to do more with less," Jensen told Yahoo Finance Live (video above), "and accelerated computing is really the best path forward to do so."
Nvidia shares are up a sizzling 18% in March.
2. Speaking of AI...
Microsoft (MSFT) founder Bill Gates made his first substantive comments on AI, coming on the heels of the company he launched that is pushing deeper into the ChatGPT realm.
"Superintelligent AIs are in our future," Gates said in a new post on his blog. Gates believes people will see AI on par with the capabilities of a human brain 10 to 100 years from now.
Scary or cool, it could prove lucrative to Microsoft's bottom line over the next decade — and Gates's net worth.
Microsoft founder Bill Gates reacts during a visit with Britain's Prime Minister Rishi Sunak of the Imperial College University, in central London, on February 15, 2023. (Photo by JUSTIN TALLIS/POOL/AFP via Getty Images)
3. Ford, refounded
Ford execs made a pitch to Wall Street at a teach-in held at the New York Exchange: We will make money on EVs by 2026.
Crunching the numbers, Ford is on pace to lose more than $5 billion on an operating basis in its EV business for the combined 2022 and 2023 period. CEO Jim Farley told me he's ready to go after Tesla's lucrative profit margins in the EV business.
4. GameStop plays with investors
Hardcore fans of GameStop (GME) — of which there are many — rejoiced when the company posted its first profitable quarter in over two years.
CEO Matt Furlong promised more cost-cutting, too, in another short earnings call.
But these same folks appear to have forgotten that GameStop continues to have issues growing its sales, and that could catch up to the retailer over time, as Yahoo Finance reported. Power to the fundamental analysts.
5. People chow down at the movies
Staying with the meme stocks, AMC (AMC) stock caught a bid mid-week in the wake of GameStop's better-than-expected quarter.
The company's performance also caught a shout-out from CEO Adam Aron.
"Learned at my weekly staff meeting that AMC set an all-time record last week for the highest-ever in our history 'Food and Beverage Revenue Per Patron,'" Aron tweeted to his 293,000 followers.