Global Banks: Crisis of confidence sparks market turmoil

The collapse of Silicon Valley Bank sparked extreme volatility as frenzied selling of US bank stocks spread to wider markets. SVB is the third US bank to collapse this year as depositors grew concerned about its solvency and a rapid outflow of deposits meant the bank was faced with crystalising short-term losses by selling assets for less than their value if held to maturity. The US Fed and regulators managed to calm US markets, but investors turned their attention to global banks, including Credit Suisse.

Credit Suisse’s share price has fallen steeply in the last few years, following a string of scandals. Despite reassurance from the bank and Swiss regulators, sustained selling saw its share price tumble, adding pressure to global bank stocks. Investors moved money into government bonds, driving up prices and sending bond yields down sharply. Markets have calmed considerably but global equities were down this week, with bank shares experiencing big losses. Safe-haven assets like government bonds, gold and the dollar gained.

For the following stories, please click on this link*

  • UK – The Chancellor takes first small steps to address UK growth as bank crisis rattles markets
  • Interest Rates – CECB hikes as inflation causes headache for US Fed
  • UK – Economy set to improve as Hunt looks to address jobs market

(*Please note, The contents of this e-shot been prepared for general information only. It does not contain all of the information which an investor may require in order to make an investment decision. If you are unsure whether this is a suitable investment you should speak to your financial adviser. This information is not guaranteed to be correct, complete, or accurate. FE Research is a division of Financial Express Investments Ltd, registration number 03110696, which is authorised and regulated by the Financial Conduct Authority (FRN 209967). For our full disclaimer please visit Data Sourced from FE Analytics, and Bloomberg Finance LP.)

Recommended Posts

No comment yet, add your voice below!

Add a Comment

Your email address will not be published. Required fields are marked *