PNC stock headed for lowest close in 2 years amid SVB contagion fears

Yahoo Finance Live discusses PNC shares as the financial service company’s stock remains on pace for it’s lowest close in over two years.

Video transcript

SEANA SMITH: The PNC regional banks are a trending story today, a number of them getting hit hard with PNC headed for its lowest close in over two years. You're looking at losses of just about 4 and 1/2%. Investors dumping regional banks as the fallout spreads from the failure of Silicon Valley Bank and Signature Bank. Some fears there spreading to the other players in this space.

But with today's drop, not everyone is running for the hills. Citi out with a new note saying to buy the stock. The bank upgraded PNC today, calling for shares to rally more than 30% from current levels. Analyst Keith Horowitz writing, quote, "PNC is a high quality franchise with a strong management team. And given the recent pullback, we view this as an attractive entry point."

Now, PNC was in the news over the weekend. There were reports out there that they were among the suitors for SVB. The bank, though, saying in a statement that it's, quote, "not in talks to acquire SVB Financial or Silicon Valley Bank." Shares today under a tremendous amount of pressure. And Allie, if you go to our trending ticker page, a majority of them are the bank stocks, and more specifically, the regional banks, just some of the worry out there about what the collapse of Silicon Valley Bank, what the collapse of Signature Bank, what that could signal here, at least in the medium term-- or short term, I should say, for the sector.

ALLIE CANAL: Yeah, and if you take a look at some of the other stocks, like First Republic Bank, for example, that is down more than 50% today. I will say that the Street does seem fairly optimistic that what's happening at SVB will not lead to contagion. Oxford Economics out with a new note this morning saying that these bank failures, quote, "should not have significant broader implications for the economy and are not a sign of systemic risks to the banking sector."

However, I do think that the market reaction to financial sector instability, that could lead to a softening in the Fed's rate hike announcement next week. It seems like markets are pricing in a 25 basis point hike today, as opposed to a 50 basis point increase, which was the general consensus that we saw last week. So a lot to track here, both within the regional banking sector, financial sector at large, but also with the Fed and potentially their play moving forward.