Stocks Tumble Amid Bank Worries
By Stefan J. Bos, Chief International Correspondent Worthy News
NEW YORK (Worthy News) – Stocks tumbled on the Wall Street stock exchange in New York on Wednesday as worries worsened about the strength of banks on both sides of the Atlantic.
The S&P 500 stock index was 1.8 percent lower in afternoon trading, while markets in Europe fell more sharply as shares of Switzerland’s Credit Suisse bank fell to a record low.
The Dow Jones Industrial Average was down roughly 1.9 percent, while the technical-heavy Nasdaq composite was 1.2 percent lower.
“With the Credit Suisse situation, the market is looking at the possibility of an extension of the banking crisis,” warned Peter Cardillo, chief market economist at the Spartan Capital Securities, financial services firm pointing to pressures on shares of U.S. regional banks.
Analysts said Credit Suisse has been fighting troubles for years, including losses from the 2021 collapse of investment firm Archegos Capital. Its shares in Switzerland sank more than 22 percent following reports that its top shareholder won’t pump more money into its investment.
Wall Street worries intensified across the banking industry recently on fears about what may crack next following the second-and third-largest bank failures in U.S. history last week.
The U.S. government announced a plan late Sunday to protect Silicon Valley Bank and Signature Bank depositors, which regulators shut over the weekend. Authorities hoped to increase confidence in the banking industry, but markets remain doubtful.
Analysts said there is significant uncertainty about the banking industry as it struggles to absorb
the U.S. Federal Reserve’s fastest barrage interest rates hikes in decades.
The central bank’s decisions on rate increases follow years of historically easy conditions of nearly-free money.
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