PanamaTimes

Tuesday, May 28, 2024

Deutsche Bank heads new rout for banking stocks on financial markets

Deutsche Bank heads new rout for banking stocks on financial markets

There is a renewed rush away from banking shares across Europe as the market's attention turns towards Germany's largest lender.
Germany's largest bank has become the focus in a new wave of selling across banking and wider financial stocks, less than a week after the forced takeover of Credit Suisse.

Deutsche Bank shares fell more than 14% at one point during a volatile day of trading Europe-wide, but in late trading were around 8% down.

The bank's so-called credit default swap rate was up by almost a fifth.

It essentially represents a sharp jump in its cost of insuring against the risk of default.

Major banks in France and Germany also suffered share price hits, with Commerzbank around 5% down heading towards the close, while BNP Paribas and Societe Generale suffered similar declines of around 5% and 6% respectively.

In the US, shares were also hit, with troubled regional lender First Republic Bank initially falling 4% soon after opening, but was later 1% down.

London-listed banks were not spared pain either.

Markets have been jittery for weeks in the wake of the failure of Silicon Valley Bank in the US.

Fears about the impact of rising interest rates on banks' bond holdings have since claimed a major scalp in Credit Suisse, Switzerland's second-largest bank.

It was forced by regulators into a takeover by larger rival UBS last weekend, before financial markets opened for business on Monday.

It took until Friday for a new focus to emerge.

Chris Beauchamp, chief market analyst at IG, said: "We are still on edge waiting for another domino to fall, and Deutsche is clearly the next one on everyone's minds (fairly or unfairly).

"Looks like the banking crisis hasn't been entirely put to bed."

Banking stocks were down across the board in Europe, with the German DAX almost 2% down in late trading.

Deutsche Bank employs 7,000 staff in the City of London where the FTSE 100 was 1.26% lower by the end of the day.

Barclays closed 4.2% down, while NatWest, HSBC and Lloyds finished with declines of 3.6%, 2.6% and 2.4% respectively.

Wider economy stocks - such as mining and energy shares - also fell on fears the crisis of confidence in the banking sector would curtail the availability of credit and therefore economic growth.

The government and the Bank of England have previously moved to reassure investors that the UK banking system is at no risk as the financial strength of lenders is very high compared to pre-financial crisis levels and their European peers.

HSBC itself has spoken out in support of the sector.

"We're not worried about liquidity issues for UK banks, as they run with high levels of central bank reserves and shouldn't need to sell bond portfolios to meet deposit outflows," it said.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "Just as hopes had risen that contagion would be contained, banking stocks in Europe have been battered again by fears that fresh problems could be lurking...

"Waves of bad news keep hitting the banking sector and the tide doesn't look like it's set to turn any time soon."

But she added the European Central Bank had made clear it was standing by to boost liquidity if needed, and noted that the Bank of England was also firm in its belief there is still no systemic risk.
Comments

Oh ya 1 year ago
DB will be the next to fail, and then another and another. They papered over the 08 financial problems and now it is coming back but only bigger. Making UBS a bank that lost 140 billion in 08 take over CS a bank that lost only 8 billion in 08 shows you they are just trying to kick the can a little further down the road. And you know they stole 17 billion from the bond holders of CS thus proving holding bonds means nothing now days. Bank runs are picking up speed

Newsletter

Related Articles

PanamaTimes
0:00
0:00
Close
El Salvador's Bitcoin Holdings Reach $350 Million
Teens Forming Friendships with AI Chatbots
WhatsApp Rolls Out Major Redesign
Neuralink's First Brain Implant Experiences Issue
Apple Unveils New iPad Pro with M4 Chip, Misleading AI Claims
OpenAI to Announce Google Search Competitor
Apple Apologizes for Controversial iPad Pro Ad Featuring Instrument Destruction
German politician of the AFD party, Marie-Thérèse Kaiser was just convicted & fined $6,000+
Changpeng Zhao Sentenced to Four Months in Jail
Biden Administration to Relax Marijuana Regulations
101-Year-Old Woman Mistaken for a Baby by American Airlines: Comical Mix-Up during Flight Check-in
King Charles and Camilla enjoying the Inuit voice singing performance in Canada.
New Study: Vaping May Lower Fertility in Women Trying to Get Pregnant
U.S. DOJ Seeks Three-Year Sentence for Binance Founder Changpeng Zhao
Headlines - Thursday, 23 April 2024
Illinois Woman Wins $45M Lawsuit Against Johnson & Johnson and Kenvue for Mesothelioma Linked to Baby Powder
Panama's lates news for Friday, April 19
Creative menu of a Pizza restaurant..
You can be a very successful player, but a player with character is another level!
Experience the Future of Dining: My Visit to an AI-Powered Burger Joint
Stabbing rampage terror attack in Sydney, at least four people killed, early reports that a baby was among those stabbed.
Iran fired more than 300 drones and missiles at Israel overnight. Israel Reports Light Damage After Iran Launches Large Strike.
I will never get enough of his videos and the pure joy and beauty of these women!!
Scientists at the University of Maryland have developed an "invisibility cloak", for AI using adversarial patterns on a sweater, making the wearer nearly undetectable to standard object detection methods.
Lamborghini Bids Farewell to Its Best-Selling Sports Car: The Huracán
Sam Bankman-Fried Appeals 25-Year Prison Sentence for $8bn FTX Fraud
OJ Simpson, ex-NFL star who was acquitted of murder, dies aged 76
British Backpacker Imprisoned in Notorious Bolivian Prison: Family Raises Funds for Legal Fight and Essentials
Argentina: Venezuela Cuts Power to Embassy after Opposition Meeting
El Salvador Offers 5,000 Passports to Skilled Foreign Workers: Tax-Free Relocation and Citizenship
Panama Papers Trial Begins: Founders of Mossack Fonseca Face Money-Laundering Charges
75 Becomes the New 65: Retiring in Your 60s Unrealistic as Life Expectancy Increases and Costs Rise
Total Solar Eclipse of 2021: 32 Million Witness the Mystical, $1.5bn Spectacle Sweep Across North America
New shopping experience…
New world, new reality, let’s get used to it
UK Company Passes Milestone in Developing Space-Based Solar Power, Aiming to Power a Million Homes and Provide Constant Energy
Mexico Breaks Diplomatic Ties with Ecuador after Police Storm Embassy, Arrest Former Vice President
Monty Python were so ahead of their time
If there's a will, there's a way!
Rules about how to dress are important, but not so much if you have a lot of money.
Body Armor Firm Showcases Stab-Proof Vest in Demo on CEO
Mexico Cuts Diplomatic Ties with Ecuador After Embassy Stormed in Quito
Here is a tattoo idea, for engineers
Zoraya Ter Beek, a 28-year-old woman from the Netherlands, will undergo euthanasia in May due to severe mental health challenges
Here's a video featuring Fidel Castro, where he discusses his stance against war and his commitment to preserving life, positions that have put him at odds with the USA:
Woman reaches behind and steals gun from a security guard and shoots three people while getting detained in Chile
Take a walk around the safe and thriving downtown San Salvador.
Joe Biden criticised by Trump campaign for declaring Transgender Day of Visibility on Easter Sunday
Macron says France will help Brazil develop nuclear-powered submarines
A video demonstrating women's self defense class in 1930
×