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Tuesday, March 21, 2023

Credit Suisse rocks markets and Wall Street falls as much as 2%

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Wall Street operates with sharp falls this Wednesday, March 15, after the rebound on Tuesday, in the midst of the collapse of the Credit Suisse that fills investors with fear.

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The main indices of the New York stock market operate with falls of up to 2% led by the Dow Jones at 31,504.58 points, followed by the S&P500 at 1.7% to 3,847.20 points. For its part, the Nasdaq Composite lost 1.18% to 3,847.20 points.

Fueling hopes of a less-tough monetary policy from the Fed, data showed retail sales fell 0.4% last month, compared with 3.2% growth in January, while economists polled by Reuters expected a contraction of 0.3%.

A separate report showed that US producer prices fell unexpectedly in February and that the price increase in January was not as large as initially thought, offering some hopeful signs in the fight against inflation.

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The data comes at a time when the bankruptcy of SVB Financial and its peer Signature Bank had already fueled fears about the health of other banks, fueling hopes that the Fed would steer clear of sharp rate hikes at its next meeting to ensure financial stability.

Traders now see the same chance of a 25 basis point rate hike and pause at the March Federal Reserve meeting.

First Republic Bank plunged 13.1% and its peers Western Alliance Bancorp and PacWest Bancorp lost 7.1% and 18.4%, respectively, before their shares were halted on volatility.

Big US banks like JPMorgan Chase & Co, Citigroup and Bank of America Corp were losing between 5% and 1%. The KBW regional banking index was down 3.8%, while the S&P 500 banking index was down 4.2%.

Source: Ambito

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