Shares of banks and other financial institutions rose alongside Treasury yields.
The yield on the 30-year Treasury bond closed at the highest level since 2007. A steady increase in yields can be a positive for the banking sector because it generally makes loans benchmarked to Treasurys more profitable.
The persistent closure of the Strait of Hormuz has increased expectations for a hawkish Federal Reserve policy, said one strategist. "If you had to decide if the next move by the Fed is going to be a hike or a cut, it seems that more and more folks are beginning to think the next move is going to be a hike," said J.D. Joyce, president of Houston financial advisory Joyce Wealth Management. "Right now the job numbers are still stable. It seems like where the problem is is on the inflation side."
German lender Commerzbank's management and supervisory boards recommended shareholders against accepting UniCredit's roughly $27.91 billion offer for the shares it doesn't already own, saying the bid undervalues the German bank and entails risks.
Write to Rob Curran at rob.curran@dowjones.com
