First Republic has been in the spotlight for nearly two months on worries it could be next to topple following March’s failures of Silicon Valley Bank and Signature Bank. The worry was that runs on smaller- and mid-sized banks could take down the economy, like the financial industry’s woes during the 2008 crisis did.

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But analysts and economists have said they see big differences between then and now, including how the biggest US banks are feeling less pressure this time around. Plus, several banks that have been under scrutiny for weakness recently have said their deposit levels have strengthened since late March.

The difference between the stock market’s reactions to them and First Republic Bank, which plunged 75 per cent last week, indicates investors may see it as an isolated event rather than a problem with the deeper system, analysts said.

Shares of JPMorgan Chase, which is buying much of First Republic’s assets, rose by 2.1 per cent. It’s becoming even bigger following the deal.

Still, many other questions continue to hang over Wall Street that could shake things up. They include worries about corporate profits and the US government’s latest squabble over the country’s debt limit.

Above all is what the Federal Reserve will do with interest rates. At its next meeting, which concludes on Wednesday, most traders expect the Fed to raise short-term rate by another quarter of a percentage point, up to a range of 5 to 5.25 per cent from virtually zero early last year.

The hope is that may be the final increase for a while, which would give the economy and financial markets more breathing room.

The Fed has been raising rates sharply in hopes of getting high inflation under control. But high rates are a notoriously blunt tool that slow the entire economy, raise the risk of a recession and hurt prices for investments. The economy has already begun to slow, and many investors are preparing for a downturn later this year.

While the job market has remained remarkably resilient, other areas of the economy have shown more weakness recently. The housing and manufacturing industries have been among the harder hit.

A report on Monday from the Institute for Supply Management said manufacturing activity shrank again in April, though not as badly as most economists expected. Other reports this week will give the latest updates on US services industries and hiring across the economy.

One lever that’s propped up Wall Street in recent weeks has been a stream of companies reporting better profits for the first three months of the year than expected.

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That would mark a second straight quarter of falling earnings, something that Wall Street calls a profit recession. But it would not be as bad as the 6.7 per cent drop that analysts forecasted a month ago.

Big Tech companies have largely reported better profits than expected, which has helped stabilise the market because their immense size gives them outsized sway on indexes. Apple will follow with its own report this week, along with such big names as Pfizer and Ford.

In the bond market, Treasury yields rose as expectations firmed on Wall Street for at least one more rate hike. The yield on the 10-year Treasury rose to 3.55 per cent from 3.43 per cent late Friday. It helps set rates for mortgages and other important loans.

The yield on the two-year Treasury, which moves more on expectations for Fed action, rose to 4.11 per cent from 4.02 per cent.

In markets abroad, many exchanges were closed in observance of holidays.

With AP