S&P 500 futures fall, but are well off lows as investors try to shake credit concerns: Live updates

U.S. stock futures fell on Friday, but were well off their lows as traders tried to move past credit concerns sparked by a sell-off in regional banks.

Futures tied to the Dow Jones Industrial Average dropped 45 points, or 0.1%. S&P 500 futures and Nasdaq 100 futures were down by 0.3% and 0.5%, respectively. Earlier in the day, Dow futures were down more than 300 points.

Stocks that led Thursday’s bank sell off were up higher in premarket trading.

Zions Bancorp climbed more than 4% after receiving an upgrade from Baird. Investment bank Jefferies was last up 3% after Oppenheimer raised its rating to outperform. Better-than-expected earnings from Fifth Third Bancorp also assuaged worries, sending the stock higher by 2.8%.

Big banks also bounced back, with J.P. Morgan ticking up less than 1% and Bank of America regaining some of its losses from the previous session.

Each of the major U.S. stock indexes closed in the red on Thursday, fueled by a significant decline in bank stocks late in the session.

Shares of several financial heavyweights and regional banking names fell after Zions and Western Alliance disclosed bad loans, which sparked worries about loose lending practices and fears that similar issues could arise. The SPDR S&P Regional Banking ETF (KRE), which has been down for four straight weeks, lost more than 6% during the session. Uneasiness in the banking sector has grown after the recent bankruptcies of two auto industry-related companies.

Thursday also saw a jump in the Cboe Volatility Index, commonly referred to as Wall Street’s fear gauge, alongside moves lower in Treasury yields and the U.S. dollar. Gold prices rose to fresh records, on the other hand, suggesting continued interest in the safe-haven asset amid widespread uncertainty. On Friday, the Vix added to its run, climbing above 27 and reaching its highest level since April.

Liz Ann Sonders, chief investment strategist at Charles Schwab, said on CNBC’s “Closing Bell” Thursday that the banking concerns come as there’s is a lot of “speculative froth” that has developed in the public market, with investors chasing stocks with riskier profiles like quantum computing, drones and unprofitable tech stocks.

“When you have that speculative froth and then you have sort of a bigger picture potential issue, those two can sometimes collide and cause an increase in volatility,” she said, noting that most of the so-called froth is not in the megacap names anymore, but rather in smaller pockets of the market such as the Russell 2000 index, which hit a fresh high this week.

Investors on Friday sold shares of high-flying AI companies Nvidia and Oracle, which were down 1.3% and 2.6%, respectively, while adding to gold positions in a risk-off move. Futures linked to the metal were up about 0.4% and traded above $4,300 per ounce. Treasury yields fell slightly.

Stocks remain on track for weekly gains despite Thursday’s decline. The S&P 500 is up nearly 1.2% after a strong start to the third-quarter earnings. The Dow has added about 1% week to date, while the Nasdaq has gained 1.6%.