- March 16, 2023
- By: Admin1_blog
- US Market
Futures tied to the Dow Jones Industrial Averages fell Thursday as regional banks slid once again on growing fears of a banking crisis within the U.S. and Europe.
Futures tied to the 30-stock index were down 158 points, or 0.5%. S&P 500 futures lost 0.5%, while Nasdaq-100 futures slipped 0.2%.
Credit Suisse announced overnight it will borrow up to nearly $54 billion to Swiss National Bank to assure short-term liquidity. That offered some relief to the embattled bank in extended hours after it fell to a record low Wednesday following reports that the Saudi National Bank, Credit Suisse’s largest investor, said it would not provide additional assistance. U.S.-listed shares gained 5% in extended trading after falling just under 14% in the prior session.
But the news was not enough to quell fears on Wall Street of an impending crisis, leading regional banks to take another leg down in Thursday’s premarket. The S&P SDPR Regional Banking ETF (KRE) lid 1.6% in extended trading, led down by a drop of more than 31% in First Republic Bank.
“What’s also similar to ’08 is the hunting in the market for who’s the most weak next,” said Greg Fleming, CEO of Rockefeller Capital Management and former president of Morgan Stanley Wealth Management, on CNBC’s “Squawk Box.” “And the proxy’s been uninsured deposits.”
Growing concern over Credit Suisse sent other European banking stocks lower and reverberated in U.S. markets beginning Wednesday. The Dow at one point Wednesday fell 725 points before ending the day down by 280.83 points, or 0.87% lower. The S&P 500 dropped 0.7%.
“It’s no doubt changing the landscape of how we as investors look at the investability of financial institutions that fit in the banking sector,” said Keith Buchanan, portfolio manager at Globalt Investments. “It also makes us ponder just how the sector would navigate with, in the future, more forms of regulatory pressure on these corporations.”
Source: CNBC
