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Regional banks rise, avoiding a larger collapse in the banking sector.

What you need to know today

• U.S. stocks had a good day as regional bank stocks bounced back. All major indexes added at least 1% on Tuesday. Asia-Pacific markets tracked Wall Street's rebound, rising on Wednesday. South Korea's Kospi climbed 1.1%, buoyed by an increase in banks like KB Kookmin Bank and Shinhan Financial.

• Moody's Investors Service wasn't convinced by regulators' attempts to protect the banks. The firm downgraded its outlook on the U.S. banking system to negative from stable, saying its rating reflects "the rapid deterioration in the operating environment following deposit runs" on various banks.

• Traders seem not to agree with the ratings firm, and neither does the CEO of Charles Schwab. Walt Bettinger told CNBC people are still depositing money in his bank and, putting his money where his mouth is, revealed he bought 50,000 shares on Tuesday for his personal account.

• The price of goods and services in February rose 0.4% for the month — which works out to an annual inflation rate of 6% — according to the consumer price index. Estimates for both readings were right on target. 

• China's reopening is off to a disappointing start. The country's industrial output in January and February rose by 2.4%, less than analysts' expectations of 2.6%. Investment in real estate fell by an annualized 5.7%, suggesting that the property sector hasn't fully recovered.

• PRO There's a chance that U.S.-China tensions might continue to rise this year and drag down stocks reliant on good trading relations. UBS has identified four stocks that remain resilient even amid geopolitical conflict.

The bottom line

How important are banks? Important enough that the CPI — the single most scrutinized and anticipated economic data over the past year — seemed like nothing more than background noise yesterday.

Of course, the muted reaction to the CPI might be because the numbers were exactly in line with estimates. And after the chaotic few days following Silicon Valley Bank's collapse, unsurprising is what markets needed. Stripping out food and energy prices, which tend to fluctuate wildly, core CPI increased 5.5% on a 12-month basis. That is to say, prices are still rising uncomfortably, but at a slower rate than in previous months.

The bigger news of the day was banks' — and investors' — reaction to U.S. financial regulators' measures to protect the financial industry. The SPDR S&P Regional Banking ETF rose 2%. Monday's biggest losers tried to regain lost ground on Tuesday — and even if they didn't manage to do so completely, they at least stopped the slide. First Republic Bank jumped 26.98%, Western Alliance Bancorp added 14.36%, and Keycorp rose 6.95%.

More importantly, the major indexes rallied. The Dow Jones Industrial Average snapped a five-day losing streak with its gain of 1.06%, the S&P 500 increased 1.65% and the Nasdaq Composite climbed 2.14%.

"It's a sigh-of-relief rally, we'll call it, given the lack of any major surprises in CPI and then just the lack of any surprises overnight in the banking space," said Adam Turnquist, chief technical strategist at LPL Financial. "The market's welcoming that."

Let's hope the Federal Reserve doesn't deliver a surprise at its meeting next week, either.

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