Amid the collapse of Silicon Valley Bank and its impact on the stock market over the week, Switzerland is facing pressure from at least one major government to intervene on Credit Suisse, citing the systemic nature of the bank, news agency Reuters reported on 15 March.
Over fears of of contagion from the collapse of two US banks and its annual report citing 'material weaknesses' in internal controls, Credit Suisse's market value had already taken a heavy blow this week, reported news agency AFP.
As per the latest report, Credit Suisse shares closed down by over 30 percent. The US Treasury monitoring Credit Suisse and in touch with global peers, added the agency.
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Bank fears return to haunt global stock markets
Stocks markets tumbled again on Friday as fears of a banking crisis resurfaced despite massive financial lifelines thrown at embattled lenders to prevent contagion across the sector.
Markets had rallied on Thursday after Wall Street titans including JP Morgan, Bank of America and Citigroup pledged to inject $30 billion into First Republic Bank.
Joe Biden says pressures on US banks have eased after turbulent week
US President Joe Biden expressed confidence that the turmoil roiling the US banking system is easing after a week that saw markets shaken by bank failures.
Asked if the crisis had calmed down, Biden told reporters “Yes," on Friday as he departed the White House for Wilmington, Delaware.
The failures of Silvergate Capital Corp., Silicon Valley Bank and Signature Bank raised concerns about the health of the US financial system, compounded by troubles for Credit Suisse Group AG in Europe.
Credit Suisse faces crucial weekend with its future in balance
Credit Suisse Group AG headed into a make-or-break weekend after some rivals grew cautious in their dealings with the struggling Swiss lender and its regulators urged it to pursue a deal with UBS AG.
Credit Suisse Chief Financial Officer Dixit Joshi and his teams will hold meetings over the weekend to assess strategic scenarios for the bank, people with knowledge of the matter said on Friday.
Swiss regulators are encouraging UBS and Credit Suisse to merge, one source with knowledge of the matter said, but added that both banks did not want to do so. The regulators do not have the power to force the merger, the person said.
Wall Street ends sharply lower on bank contagion fears
Wall Street closed lower on Friday, marking the end of a tumultuous week dominated by an unfolding crisis in the banking sector and the gathering storm clouds of possible recession.
All three indexes ended the session deep in negative territory, with financial stocks down the most among the major sectors of the S&P 500.
For the week, while the benchmark S&P 500 ended higher than last Friday's close, the Nasdaq and the Dow posted weekly declines. Read More
Oil posts worst weekly loss since April 2020 amid bank chaos
Oil posted the worst weekly loss since the early months of the coronavirus pandemic as banking turmoil poisoned investor sentiment, Bloomberg reported on Friday.
West Texas Intermediate lost nearly 13% this week, the largest drop in almost three years. The failure of Silicon Valley Bank and troubles at Credit Suisse Group AG drove investors from risk assets, with oil-options covering accelerating the selloff.
“Crude action this week reminded many of how quickly the commodity can be decimated by macro economic events," said Rebecca Babin, senior energy trader at CIBC Private Wealth. “The commodity broke a significant level of support as the market tries to quantify the economic ramifications of banking turmoil."
Bank turmoil poses $600 billion question for battered investors
Markets are grappling with a $600 billion question right now. Are the half-dozen banks in the spotlight outliers or a warning sign of a wider malaise in the financial sector?
Bank investors have largely been selling first and leaving that question for later. Around $600 billion dollars of market value has evaporated from the 70 biggest US and European banks since March 6, a period that’s seen the collapse of Silicon Valley Bank, Credit Suisse Group AG receive a $54 billion lifeline from the Swiss National Bank and a $30 billion Wall Street whip-round for First Republic Bank, Bloomberg reported on Friday.
A months-long bank rally is now a rout. Bank executives and analysts say that is an overreaction given the system is much better equipped to handle stress and central banks have stepped in with more than $200 billion of assistance.
Dollar slips as banking turmoil snares markets
The dollar fell on Friday as further declines in the shares of Credit Suisse and First Republic Bank rattled markets fearful of contagion and increased concerns that a recession lies ahead because of the impact of tighter monetary policy, Reuters reported on Friday.
An early recovery in European stocks ran out of steam as investor sentiment remained fragile after a week of turbulence following the failure of Silicon Valley Bank on March 10.
U.S. banks have sought a record $153 billion in emergency liquidity from the Federal Reserve in recent days, while the $54 billion loan for Credit Suisse and $30 billion lifeline for First Republic failed to halt their stock declines. Credit Suisse fell 8% in Europe and First Republic tumbled 30%.
The dollar index, a measure of the dollar against six other currencies, slid 0.604% as traders waited for the Fed's two-day policy meeting that is expected to end with a one-quarter percentage point hike in interest rates on March 22.
Credit Suisse faces crunch weekend
Credit Suisse executives will hold meetings over the weekend to chart a path forward for the ailing Swiss bank, people familiar with the matter said, after an emergency lifeline only offered temporary relief and its shares took another beating on Friday.
The 167-year-old Swiss bank is the biggest name ensnared by market turmoil unleashed by the collapse of U.S. lenders Silicon Valley Bank and Signature Bank over the past week, forcing it to tap $54 billion in central bank funding, Reuters reported on Friday.
In the latest sign of its mounting troubles, at least four major banks including Societe Generale SA and Deutsche Bank AG have put restrictions on their trades involving the Swiss lender or its securities, according to five sources with direct knowledge of the matter.
Stocks trim losses, stay on track for weekly gain
US major indexes pulled back from over 1% intraday losses in subdued afternoon trading while Treasuries gained, capping a tumultuous week for global markets as concern mounted that the turmoil rocking the banking sector will tip the global economy into recession, Bloomberg reported
The financial sector was the biggest drag on the S&P 500 Friday even after larger banks threw a lifeline to First Republic Bank, the latest US lender to signal stress. A rout in First Republic dragged on other regional lenders with a gauge of the sector dropping more than 10% this week. FedEx Corp. was one of the bright spots on the benchmark, jumping around 9% after the courier boosted its profit outlook.
Some Credit Suisse counterparties put curbs on new dealings involving lender: Reports
At least four major banks, including Societe Generale SA and Deutsche Bank AG , have put restrictions on their trades involving Credit Suisse Group AG or its securities, according to five sources with direct knowledge of the matter, an exclusive report from Retuers said on Friday
Credit Suisse declined to comment. The bank has previously said that it is a strong, global bank. "We fulfill and basically overshoot all regulatory requirements. Our capital, our liquidity basis is very strong," Chief Executive Ulrich Koerner said earlier this week in a media interview, a spokesperson previously told Reuters.
The cautious stance adopted by Credit Suisse’s rivals, details of which have not been reported before, comes after the Swiss central bank threw a lifeline to the lender after its shares were pummeled in the aftermath of the U.S. banking crisis this week. The curbs add to the bank’s problems as it tries to restructure operations and find its footing after a series of costly scandals.
Biden seeks tougher penalties on executives of failed banks
President Joe Biden urged Congress to approve measures enacting tougher punishments on banking executives if mismanagement contributed to their institutions failing, following the recent collapse of three regional banks, Bloomberg reported on Friday
“I’m firmly committed to accountability for those responsible for this mess. No one is above the law – and strengthening accountability is an important deterrent to prevent mismanagement in the future," Biden said in a statement on Friday. “Congress must act to impose tougher penalties for senior bank executives whose mismanagement contributed to their institutions failing."
Credit Suisse CFO teams to hold talks this weekend on scenarios for bank
Credit Suisse AG will hold meetings over the weekend to assess scenarios for the bank as it struggles to regain confidence from the market, people with knowledge of the matter told Reuters on Friday.
The meetings will include teams of Chief Financial Officer Dixit Joshi, the people said.
Credit Suisse declined to comment.
On Thursday, the bank tapped the option of a $54 billion loan from the Swiss National Bank.
The emergency lifeline from the central bank has provided the embattled lender with only some relief, with its battered share price resuming its descent on Friday.
With investor confidence still fleeting, some analysts have said the loan facility has only bought Credit Suisse some time to work out what to do next strategically to restore profitability.
UK regulator warn over unacceptable risk at payment firms
Britain's financial regulator has voiced concern over "unacceptable risk" at some of the nation's non-bank payment firms due to "insufficient controls," AFP reported on Friday.
The Financial Conduct Authority wrote to bosses of almost 300 payment firms Thursday to urge them to safeguard customers' money, prevent use for financial crime like fraud or money laundering, and have robust governance.
The watchdog warned it would "take swift and assertive action", including sanctions and even closure where standards are not met.
First Republic Bank shares tank 24% as support fails
Shares of First Republic Bank slid 24% in early trading on Friday after being briefly halted as $30 billion in deposits injected by large U.S. banks failed to quell investor worries about the beleaguered lender, Reuters reported on Friday
Fears of an imminent collapse of the bank prompted an unprecedented deal put together by top power brokers including U.S. Treasury Secretary Janet Yellen, Federal Reserve Chairman Jerome Powell and JPMorgan CEO Jamie Dimon on Thursday.
Bank lifelines fails to stem sell-off
Credit Suisse and First Republic Bank shares came under renewed pressure on Friday despite multi-billion dollar support deals, while a source said European Central Bank supervisors see no contagion for euro zone banks from the turmoil, Reuters reported on Friday.
Big US banks on Thursday threw a $30 billion lifeline to San Francisco-based First Republic, which has been in the spotlight since two other mid-size U.S. banks collapsed.
US banks have sought a record $153 billion in emergency liquidity from the US Federal Reserve in recent days, surpassing a previous high set during the most acute phase of the financial crisis some 15 years ago.
Amid market woes, investors seek protection against market crash
Investors are increasingly seeking insurance against a sudden crash in stocks, fearing that more tumult is in store for markets after worries over the banking system shook asset prices over the last week, Reuters reported on Friday.
Various measures of perceived tail risk - the possibility of suffering large investment losses due to sudden or unforeseen events - have climbed to multi-month highs in recent days as concerns over contagion from the collapse of Silicon Valley Bank and instability at European bank Credit Suisse gripped markets.
Latest update on US banking crises
Global banking stocks have suffered significant losses since the collapse of Silicon Valley Bank last week. The bank's bond-related losses piled up due to the surge in interest rates last year, which has raised concerns about potential hidden risks in the wider banking system. Within days, Swiss lender Credit Suisse was also affected by the market turmoil and had to borrow up to $54 billion from Switzerland's central bank to improve liquidity. Read More
First Republic rout resumes as rescue package fails
First Republic Bank shares tumbled again on Friday, set for their worst week ever, as sentiment around the lender remained fragile even after proposals for $30 billion of aid from Wall Street’s biggest banks, Bloomberg reported on Friday.
Shares of First Republic sank as much as 23% Friday, triggering at least one volatility halt, bringing its losses for the week to a record 68%. The drop comes after the bank reported that its borrowings from the US Federal Reserve varied from $20 billion to $109 billion from March 10 to March 15, said it was suspending dividend payments and disclosed a dwindling cash position.
UBS Group AG and Credit Suisse Group AG opposed to forced combination
UBS Group AG and Credit Suisse Group AG are opposed to a forced combination, even as scenario planning for a government-orchestrated tie-up continues, according to people with knowledge of the matter, Bloomberg reported on Friday
UBS would prefer to focus on its own wealth-centric standalone strategy and is reluctant to take on risks related to Credit Suisse, the people said, asking not to be identified as the deliberations are private. Its smaller rival is seeking time to see through its turnaround after winning a liquidity backstop from the central bank, they said.
Wall St opens lower as bank worries linger
Wall Street's main indexes opened lower on Friday as investors remained wary about a potential banking crisis even as the country's largest banks came to the rescue of troubled regional lender First Republic Bank.
The Dow Jones Industrial Average fell 29.23 points, or 0.09%, at the open to 32,217.32. The S&P 500 opened lower by 1.59 points, or 0.04%, at 3,958.69, while the Nasdaq Composite dropped 20.93 points, or 0.18%, to 11,696.35 at the opening bell.
US Fed alarms at SVB began more than year ago
Just over a year before Silicon Valley Bank’s collapse threatened a generation of technology startups and their backers, the Federal Reserve Bank of San Francisco appointed a more senior team of examiners to assess the firm. They started calling out problem after problem, Bloomberg reported on Friday.
As the upgraded crew took over, it fired off a series of formal warnings to the bank’s leaders, pressing them to fix serious weaknesses in operations and technology, according to people with knowledge of the matter.
Wall Street points toward losses to wrap a tumultuous week
Wall Street pointed lower early Friday as a wobbly banking sector continued to be the focus in the U.S. and abroad.
Futures for the Dow Jones industrials fell 0.5% and futures for the S&P slipped 0.3%.
Despite a tumultuous week of wild swings spurred by the failure two U.S. banks, markets are still on track to finish with gains for the week.
The past few days, markets' focus has turned Switzerland's Credit Suisse and San Francisco's First Republic.
First Republic tumbled 13% in premarket Friday, wiping out gains triggered Thursday after a group of 11 big banks offered a $30 billion lifeline to the latest troubled U.S. lender. First Republic Bank rose 10% Thursday after slumping as much as 36% early in the day.
SVB Financial seeks bankruptcy protection for reorganization
SVB Financial Group said on Friday it filed for a court-supervised reorganization under Chapter 11 bankruptcy protection to seek buyers for its assets, days after its former unit Silicon Valley Bank was taken over by U.S. regulators.
The plan to seek bankruptcy protection comes after the company said on March 13 it was planning to explore strategic alternatives for its businesses, including the holding company, SVB Capital and SVB Securities.
SVB Securities and SVB Capital's funds and general partner entities are not included in the Chapter 11 filing, the company said on Friday.
Reuters reported on Wednesday that the parent company was exploring seeking bankruptcy protection for selling assets.
California banking regulators closed SVB on Friday and appointed the Federal Deposit Insurance Corporation as receiver for later disposition of its assets.
The collapse of SVB, the biggest bank to fail since Washington Mutual went bust during the financial crisis of 2008, has crippled banks stocks and triggered concerns of a contagion throughout global markets. (Read more)
First Republic Bank shares drop as $30 bln rescue fails to reassure investors
Shares of First Republic Bank tumbled 13% in premarket trading on Friday as $30 billion in deposits injected by large U.S. banks failed to quell investor worries about the beleaguered lender.
Fears of an imminent collapse of the San Francisco-based bank prompted a deal put together by top power brokers including U.S. Treasury Secretary Janet Yellen, Federal Reserve Chairman Jerome Powell and JPMorgan Chase CEO Jamie Dimon on Thursday.
First Republic suspended its dividend, disclosed its cash position and said its borrowing from the U.S. Federal Reserve varied from $20 billion to $109 billion between March 10 and March 15.
Shares of other U.S. mid-size banks including Western Alliance Bancorp shares and PacWest Bancorp dropped 2% and 5%, respectively.
First Republic was caught up in a widening banking crisis triggered by the collapse of two other mid-size U.S. lenders over the past week.
Euro zone bond yields fall, focus on banking crisis risks
Euro zone government bond yields fell on Friday, with investors expecting the European Central Bank to accelerate its monetary tightening only if market fears about a banking crisis on both sides of the Atlantic recede.
ECB supervisors meeting on Friday saw no contagion to euro zone banks from the market turmoil that has engulfed Credit Suisse and some U.S. banks.
However, Credit Suisse shares were down 10% after Thursday's rebound, while European bank stocks and the Stoxx 600 index dropped into negative territory.
The ECB's decision to raise interest rates by half a percentage point on Thursday signals strong confidence in the solidity of European banks, French ECB policymaker Francois Villeroy de Galhau said on Friday.
Germany's 2-year government bond yield, most sensitive to changes in policy rates, was down 0.5 bps at 2.55%.
Germany's 10-year government bond yield, the bloc's benchmark, was down 4.5 bps at 2.18%.
ECB sees no Europe contagion after US, Swiss bank rescues
European Central Bank supervisors see no contagion for euro zone banks from recent turmoil, a source said on Friday, after U.S. lenders threw First Republic Bank a $30 billion lifeline and tapped record amounts from the Federal Reserve.
Large U.S. banks on Thursday swooped in to rescue the San Francisco-based lender, which was caught up in market volatility triggered by the collapse of two other mid-size U.S. banks.
The rescue package came shortly after embattled Credit Suisse tapped an emergency central bank loan of up to $54 billion to shore up its liquidity. Shares in Switzerland's second-largest bank fell again on Friday despite the move.
The ECB, which on Thursday raised interest rates, held another ad hoc supervisory board meeting earlier this week in an unusual move ahead of a scheduled gathering next week.
The ECB supervisors saw no contagion to euro zone banks from the market turmoil, a source familiar with the content of the meeting told Reuters, adding that supervisors were told deposits remained stable across euro zone banks and exposure to Credit Suisse was immaterial.
Oil rises on demand hopes as banking fears ease
Oil prices firmed on Friday as a meeting between Saudi Arabia and Russia calmed markets and after support measures stabilised a banking crisis that set oil prices on course for their biggest weekly fall since December.
Brent crude futures firmed by $1.09, or 1.46%, to $75.79 a barrel by 1040 GMT. U.S. West Texas Intermediate crude rose $1.20, or 1.76%, to $69.55.
Both benchmarks hit more than one-year lows this week and are on track for their biggest weekly falls since December at about 9%.
Oil and other global assets were pressured this week by the collapse of Silicon Valley Bank (SVB) and Signature Bank and trouble at Credit Suisse and First Republic Bank.
Gold sprints towards best week since Nov on banking woes
Gold prices rose on Friday, seeing their biggest weekly gain since mid-November as a global banking crisis sent investors flocking to the safe haven metal.
Spot gold rose 0.6% to $1,931.12 per ounce by 1023 GMT. Bullion has risen about 3.5% this week, heading for a third consecutive weekly gain.
U.S. gold futures gained 0.7% to $1,935.80.
Gold this week benefited from safe haven trading and dollar-weakness, said Ricardo Evangelista, senior analyst at ActivTrades, adding the decision in Europe to raise rates weighed negatively on the dollar, contributing to gold's strength.
World shares up after First Republic aid spurs Wall Street rally
Markets advanced Friday in Europe and Asia, tracking a rally on Wall Street after a group of big banks offered a lifeline to First Republic Bank, the latest U.S. lender in the spotlight for troubles in the banking industry.
Shares rose in Paris, London, Tokyo and Hong Kong but edged lower in Mumbai. U.S. futures edged higher, while oil prices gained.
The S&P 500 jumped 1.8% Thursday, erasing earlier losses following reports that First Republic Bank could get help or sell itself to another bank. Markets have gyrated this week on concerns over the toll on banks from the fastest set of interest rate hikes in decades. The turmoil flared with last week’s collapse of Silicon Valley Bank, the second largest bank failure in U.S. history.
Germany's DAX gained 0.9% in early trading, to 15,102.37 and the CAC 40 in Paris was up 0.7% at 7,075.74. In London, the FTSE 100 rose 0.8% to 7,471.98.
Credit Suisse’s shares dropped as much as 5% on the Swiss stock exchange Friday, a day after the Swiss central bank agreed to loan the bank up to 50 billion francs ($54 billion) to shore up its finances.
In Asia, Hong Kong's Hang Seng jumped 1.8% to 19,548.26 and the Shanghai Composite index added 0.7% to 3,450.55.
Tokyo's Nikkei 225 index gained 1.2% to 27,333.79 and the Kospi in Seoul was up 0.8% at 2,395.69. Shares in major Japanese banks rebounded after falling sharply at times this week.
Australia's S&P/ASX 200 added 0.4% to 6,994.80. India's Sensex was 0.1% higher while Taiwan's Taiex surged 1.5%.
Credit Suisse shares fall again, sentiment remains fragile
Shares in Credit Suisse resumed their decline on Friday, giving up early gains, in a sign that investor sentiment remains fragile in a week that has seen the troubled Swiss lender secure a $54 billion lifeline.
A ratings downgrade and a U.S. lawsuit on Thursday offset some of the relief that stemmed from the emergency liquidity line the bank secured from the Swiss central bank earlier in the day.
Credit Suisse fell by as much as 5.8% following two days of sharp swings, which saw the its shares jump 20% on Thursday following a 24% drop on Wednesday when its largest investor said it would not be able to increase its stake. Volatility remained high.
The shares were last down 3.4% on Friday at 1.953 francs ($2.11).
Banks, energy stocks push FTSE 100 higher as crisis fears ease
UK's FTSE 100 rose nearly 1% on Friday, with bank stocks rallying as support measures eased fears of a global banking meltdown and commodity-linked stocks tracked commodity prices higher.
The blue-chip FTSE 100 rose 0.9%.
However, the index was on track to post its worst weekly performance in nine months as fears of a global banking crisis enveloped markets, following the collapse of two U.S. lenders, with troubles at Swiss lender Credit Suisse only compounding fears.
The fears began to ease after major U.S. banks on Thursday offered a $30 billion lifeline for beleaguered First Republic Bank, while Credit Suisse also received an emergency liquidity line from the Swiss central bank.
British banks gained 0.2%. Lender Barclays rose 1.2%.
US stock futures waver as banking crisis worries persist
U.S. stock index futures struggled for direction on Friday as investors remained wary about a potential banking crisis despite a lifeline to troubled regional lender First Republic Bank from the country's largest banks.
Big banks including JPMorgan Chase & Co and Morgan Stanley threw a $30 billion lifeline to First Republic Bank on Thursday, calming some nerves and helping Wall Street's main indexes notch gains, with the tech-heavy Nasdaq rallying over 2%.
Shares of First Republic Bank, however, fell 3.8% in premarket trading as the bank suspended its dividend payout.
Peer PacWest Bancorp fell 3.0% while Western Alliance advanced 1.1%.
The news of the rescue came on the heels of a 50-basis-point rate hike by the European Central Bank (ECB), which remained laser-focussed on taming inflation amid the broader banking crisis even after troubles emerged at Credit Suisse.
Concerns about a global banking crisis have dominated market sentiment this week after the collapse of SVB Financial and Signature Bank.
The ECB is also holding an ad hoc meeting of its Supervisory Board on Friday to discuss stress in the bank sector after recent market volatility, a spokesperson said.
Goldman Sachs and other banks expect smaller hike from ECB in May
Goldman Sachs and two other banks expect the European Central Bank to deliver a smaller quarter-point hike in May as it grapples with stress in the banking sector and high core inflation.
Goldman earlier expected the ECB to deliver a 50 bps hike in May. The Wall Street bank's terminal rate forecast now stands at 3.5%, down from 3.75% previously.
The change in forecast follows the ECB's decision to press ahead with a 50 bps hike, taking the deposit facility rate to 3%, despite calls from some rate-setters for a smaller raise amid uncertainty in the banking sector.
A rout in global markets triggered by the collapse of Silicon Valley Bank and Signature Bank, worsened by doubts around the future of First Republic Bank and Swiss lender Credit Suisse, have raised questions about whether central banks would temper the pace of their rate hikes.
Euro zone short-dated yields rise as banking crisis fears ease
Euro zone short-dated government bond yields rose on Friday, with investors expecting the European Central Bank to accelerate its monetary tightening course if risks of a banking crisis on both sides of the Atlantic recede.
The ECB's decision to raise interest rates by half a percentage point on Thursday reflects the central bank's priority to fight inflation and signals strong confidence in the solidity of European banks, French ECB policymaker Francois Villeroy de Galhau said on Friday.
Germany's 2-year government bond yield, most sensitive to changes in policy rates, was up 7.5 bps at 2.64%.
Meanwhile, expectations for the ECB deposit facility rate peak rose at 3.4% from 3.2% on Thursday but were still way below the 4.1% level seen before fears of a banking crisis started to bite on Friday last week.
The ECB is holding an ad hoc meeting of its Supervisory Board on Friday to discuss stress in the bank sector after recent market volatility.
ECB Supervisory Board meets to examine bank vulnerabilities
The European Central Bank has convened an unscheduled meeting of its Supervisory Board on Friday to discuss stress and vulnerabilities in the euro zone bank sector after a recent selloff in bank shares, a spokesperson said.
Bank stocks tumbled over the past week, spooked first by the collapse of Silicon Valley Bank in the United States, then the selloff in Credit Suisse, which only ended after the Swiss National Bank provided a 50 billion Swiss franc ($54 billion)lifeline.
"The Supervisory Board is meeting to exchange views and to provide members with an update on recent developments in the banking sector," said the spokesperson reported Reuters.
The gathering follows a similar ad hoc meeting earlier this week and comes after the ECB raised interest rates by 50 basis points on Thursday.
Oil set for worst week this year as traders watch for OPEC+ move
Oil headed for the biggest weekly loss this year after banking turmoil rippled across global markets, with investors watching for a potential response to the rout from OPEC and its allies.
West Texas Intermediate futures rose toward $69 a barrel on Friday, but are still down 10% for the week. OPEC+ chiefs from Saudi Arabia and Russia met in Riyadh on Thursday, and discussed efforts by the group to “promote market balance and stability." The cartel’s monitoring committee, which can recommend a change in production, is scheduled to meet on April 3.
OPEC+ will likely sit tight and monitor the market unless Brent drops below $70 a barrel for a sustained period, according to industry consultant FGE, while Energy Aspects Ltd. said the producer group will probably wait for financial markets to calm before deciding whether to react.
Troubles at Credit Suisse Group AG combined with options covering to drive oil to its lowest level in 15 months this week. While markets are starting to see some stability, investors will also be watching to see if the Federal Reserve will hike interest rates again next week following the turmoil.
European shares rally amid easing fears of banking turmoil
Continuing its recovery for the second straight session , European shares continued to soar on Friday. The fears of banking crisis seems to fade away after First Republic Bank and Credit Suisse managed to get relief package.
The pan-European STOXX 600 rose 0.8% by 0805 GMT, as banks gained 1.3%, after a $30 billion lifeline by large U.S. banks for embattled lender First Republic Bank . The package came less than a day after Swiss bank Credit Suisse clinched an emergency central bank loan of up to $54 billion to shore up its liquidity. Credit Suisse rose 1.8% in early trade, after jumping 19% on Thursday.
Lender-heavy indexes of Spain and Italy advanced 0.7% and 1.0%, respectively, but were still on track for sharp weekly losses.
Overall, the STOXX 600 index ended Thursday 1.2% higher after some back and forth as the lifeline to Credit Suisse offset concerns around the European Central Bank's big 50-basis point (bp) interest rate hike.
UBS, Credit Suisse oppose idea of forced takeover
Even when financial stability leaves no option than a forced combination, UBS Group Ag and Credit Suisse Group AG are opposed to such measures, reported Bloomberg citing sources familiar with the matter.
UBS would focus on its own wealth-centric standalone strategy and is not convinced to take on risks related to Credit Suisse, reported BB citing sources.
Recently, Credit Suisse shares tanked by as much as 30% on Wednesday after its top stake holder Saudi National Bank said they won't be investing in the bank anymore. However, the situation improved after the Zurich-based bank won a 50 billion franc ($54 billion) credit line from the Swiss National Bank. Notably, both the banks are unwilling to see takeover as a potential measure to deal with the current situation.
Oil prices gain momentum amid subsiding fear of banking crisis
As people expect improvement in the situation at global market after rescue plans announcement for First Republic Bank and Credit Suisse, oil prices made some gains on Friday. Another major reason behind the hike in price was the meeting beween Saudi Arabia and Russia that calmed markets amid strong China demand expectations.
Brent crude futures firmed by 30 cents to $75 a barrel by 0704 GMT, having snapped three days of losses to settle 1.4% higher on Thursday, reported Reuters.
U.S. West Texas Intermediate crude went up by 21 cents to $68.53 a barrel, after closing 1.1% higher in the previous session. Both contracts hit their lowest in more than a year this week and are set to post their biggest weekly falls since December at about 10%.
"The recent banking turmoil may continue to weigh on the demand outlook. These issues regarding inflation, the central bank's rate hikes, and confidence in financial systems cannot be settled quickly," analyst Tina Teng of CMC Markets told Reuters.
Goldman Sachs slashes ECB rate hike estimates from 50 bps to 25bps in May
After the European Central bank raised interest rates by 50 bps on Thursday, Goldman Sachs lowered its estimate for an interest rate hike by the European Central Bank (ECB) in May to 25 basis points after the central bank raised rates to fight inflation amid calls to rein in policy tightening. The investment bank reduced its estimate from the earlier forecast of 50 bps, pushing its ECB terminal rate forecast to 3.5% from 3.75% previously. The revised forecast comes after the ECB raised interest rates by 50 bps on Thursday.
UK businesses looks for alternative to move cash after SVB chaos
After the collapse of US banks and Credit Suisse trouble, British banks are also witnessing a pick-up in enquiries to switch cash between institutions.
One of the country's biggest lenders, Barclays, told Reuters it had experienced an increase in enquiries to switch or open business accounts in the past few days. The sixth largest bank of Britain, Virgin Money, said in a statement that it had also seen "net business deposit inflows in recent days".
Sam Franklin, CEO of recruitment platform Otta, which has around 70 full-time employees, said the current banking crisis has forced the smaller startups throughout the world to reconsider their sources of finances.
Franklin told Reuters a number of CEOs and startup execs had started looking for other banks with which they can park cash in addition to SVB UK. Barclays has emerged one of their favourite options.
Japan's top officials to hold special meeting to discuss markets after the SVB collapse
Officials from the Bank of Japan, Ministry of Finance and Financial Services Agency will meet on Friday noon to discuss about markets after the collapse of Silicon Valley Bank, Credit Suisse crisis,etc.
Till now, senior government officials of Japan have played down the impact of regional US banks failure including SVB, etc. However, the meeting will discuss the potential risks to Japan's economy after recent financial events like the Credir Suisse Group AG turmoil and First Bank turmoil.
Australian shares end higher as banking crisis worries ease
Amid the softening of the fears of financial instability due to banking crisis in the west, Australian shares ended on a higher note on friday. The stock rally was led by energy and banking stocks.
The S&P/ASX 200 index finished 0.4% higher at 6,994.8, but posted a weekly decline of 2.1%, falling for a sixth straight week.
Notably, the global markets suffered heavily after the back-to-back collapse of two US banks followed by Credit Suisse worries. However, the $54 billion rescue from the Swiss National Bank to Credit Suisse and monetary boost to the First Republic Bank managed to bring back the positive market sentiments.
In Sydney, financials rose 0.9%, with the "Big Four" banks up between 0.2% and 1.7%. Among individual stocks, Australian transit operator Kelsian Group fell more than 11% after the company undertook a discounted placement to fund its $325 million acquisition of a U.S.-based bus operator, reported Reuters.
US and European stocks advance on First Republic rescue
After the First Republic Bank rescue soothed concerns over financial stability, US and European equities futures advanced with Asian shares on Friday.
Not just in west, banking shares also performed well in share markets of Hong Kong, Japan and Australia. Even so, an Asia equity gauge was set for a second weekly loss after the recent turbulence in the banking sector.
Technology stocks were among the best performers on Friday, with the Hang Seng Tech Index rising about 4%. Baidu Inc. climbed about 15%, adding to the positive sentiment after brokerages tested its just-unveiled ChatGPT-like service and granted it their preliminary approval.
The moves in Asia followed the S&P 500 notching its largest one-day advance since January on Thursday as the biggest US lenders agreed to contribute $30 billion in deposits to First Republic. That eased speculation that the bank could be the next to fail after two high-profile demises touched off the crisis last week.
Relief rally to ease Credit Suisse and First Republic trouble lifts riskier currencies
The dollar flipped on Friday after the announcement of relief package to the First Republic Bank on Thursday. On the other hand, several riskier currencies earned some gain after the market sentiment improved due to relief rally.
The rescue effort on First Republic booster risk appetite globally, that made way for surges in the Australian and New Zealand dollars.
The antipodean currencies are traditionally shunned in times of risk aversion. The Aussie jumped 0.79% to $0.6710 in Asia trade on Friday, while the kiwi rose 0.67% to $0.62375, reported Reuters.
The euro's reaction to the decision was fairly muted, though it gained more ground in Asia trade on Friday, rising 0.32% to $1.0645. Elsewhere, sterling edged 0.28% higher to $1.2144, while the Swiss franc rose 0.3%. Earlier in the week, the Swissie had plunged the most against the dollar in a day since 2015.
Asian shares up after First Republic aid spurs Wall St rally
Responding to the announcement of $30 billion rescue package to First Republic, Asian share markets advanced in a similar fashion to the Wall Street on Friday.
The rescue package has indicated a confidence of the banking industry on the First Republic Bank, and has cheered the market sentiment to an extent. Chinese markets gained more than 1% while others also rose. U.S. futures edged lower and oil prices climbed.
The S&P 500 jumped 1.8% Thursday, erasing earlier losses. Markets have gyrated this week on concerns over the toll on banks from the fastest set of interest rate hikes in decades. The turmoil flared with last week’s collapse of Silicon Valley Bank, the second largest bank failure in U.S. history.
In Asia, Hong Kong's Hang Seng jumped 1.8% to 19,545.94 and the Shanghai Composite index surged 1.6% to 3,278.01.
Tokyo's Nikkei 225 index gained 0.8% to 27,222.25 and the Kospi in Seoul was up 0.8% at 2,396.06. Shares in major Japanese banks, which fell sharply at times this week, were mostly slightly higher.
Australia's S&P/ASX 200 added 0.3% to 6,985.30. Shares in India and Taiwan also rose.
Spreading the risk of financial contagion for a false sense of confidence in First Republic is bad policy, says Bill Ackman
Calling out upon the $30 billion rescue package created by eleven banks for the First Republic, Bill Ackman said Spreading the risk of financial contagion to achieve a false sense of confidence in FRB is bad policy.
In his recent tweet, he said "US Secretary of Treasury, Janet Yellen had pushed the SIBs to recycle some of the deposits they received from
First Republic back into FRB for 120 days.The result is that FRB default risk is now being spread to our largest banks. Spreading the risk of financial contagion to achieve a false sense of confidence in FRB is bad policy. The SIBs would never have made this low return investment in deposits unless they were pressured to do so and without assurances that FRB deposits would be backstopped if it failed."
Big banks create $30 bn rescue package for First Republic
To prevent another collapse of US bank, eleven of the biggest banks in the United States announced a $30 billion rescue package for First Republic Bank on Thursday. The investment has come at a time when the banking sector is heading off a broader crisis.
Notably, First Republic serves as a similar clientele like the collapsed Silicon Valley Bank. SVB failed after depositors withdrew about USD 40 billion in a matter of hours. It appears that First Republic, which had deposits totalling USD 176.4 billion as of December 31, was facing similar issues.
Credit Suisse loses equities heads in Asia as exodus worsens
Despite the improvement in situation at stock markets, the long existing crisis at Credit Suisse Group is further accentuated with the departures of several senior executives in its Asia-Pacific equities business.
The co-head of equities for Asia Pacific and head of equities for Japan in Credit Suisse, Nick Silver will exit the company for a senior role at BNP Paribas SA, reported Bloomberg citing sources familiar with the matter.
Jonathan Jenkins, head of equity sales for the region, and Chris Prasertsintanah, head of equities for South Asia and country manager for Thailand, have also decided to leave, according to the memo.
Silver is joining BNP Paribas as head of Asia-Pacific sales for the prime-brokerage division, which caters to hedge-fund clients, the people said. Murray Parker, a spokesman for the Paris-based bank, declined to comment. Jenkins and Prasertsintanah will also pursue opportunities outside Credit Suisse, the memo said.
Base metal gains in market amid easing banking crisis worries
Base metal prices made some gains on Friday after the revival of market optimism post Credit Suisse lifeline followed by First Republic Bank Rescue. On the other hand, dollar continued to remain weak.
Three-month copper on the London Metal Exchange rose 0.9% to $8,597.50 a tonne by 0149 GMT, while the most-traded April copper contract on the Shanghai Futures Exchange was up 0.1% to 67,180 yuan ($9,747.82) a tonne, reported Reuters.
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