Dow futures fall 500 points as Credit Suisse slide adds to financial sector woes: Live updates

Stock futures fell on Wednesday as pressure mounted on the financial sector, with shares of Credit Suisse, the Swiss bank with large US and global operations, plunging more than 20%.

committed to Dow Jones Industrial Average while fell 500 points or 1.6% s&p 500 futures And Nasdaq 100 Futures fell 1.8% and 1.6%, respectively.

In recent days, a crisis in the financial sector has centered around regional banks as Silicon Valley Bank and Signature Bank collapsed, both victims of mismanagement following eight interest rate hikes by the Federal Reserve in the past 12 months. Are. Attention turned to the big banks on Wednesday morning, with shares of Credit Suisse hitting an all-time low.

According to a Reuters report, the Saudi National Bank, Credit Suisse’s biggest investor, said on Wednesday that it could not provide more funds. It was said by the Swiss lender earlier this week that it had found “certain material weaknesses in our internal controls over financial reporting” for the years 2021 and 2022.

Finally Check US-Traded Shares credit Suisse The premarket was down 20.7%.

As Credit Suisse dragged down the European bank sector, US big bank stocks fell in sympathy. Citigroup and Wells Fargo each declined 3%, while Goldman Sachs and Bank of America declined 2% each. Financials Select Sector SPDR Fund lost 2.9% in premarket trading on Tuesday, giving up a 2% pop.

Regional banks, which rebounded on Tuesday to lift sentiment for the broader market, fell into the red again. SPDR S&P Regional Banking ETF (KRE) was down 3% in the premarket due to losses in Old National Bancorp, zions bancorp And fifth third bancorp, To be sure, the shares of First Republic Bank Clinging to profit.

Peter Bockover of Bleakley Financial Group said pressure on the financial sector was mounting broadly as bank failures changed the mindset of the industry.

“What this is telling us is that there is only a possibility of a large credit expansion contraction that banks are going to start [to] “Focus more on strengthening the balance sheet and focus on reining in lending,” Bokover said on CNBC’s “Squawk Box.”

“It’s a balance sheet rethink that the market has,” Bokover said, citing that many banks have bought long-maturity bonds, which have depreciated in value since the Fed raised rates. “Also, you have to wonder with a lot of these banks whether they’re going to have to go out and start raising equity.”

Elsewhere on Wednesday, investors will get more insight into the state of the economy through retail sales and producer price index data before the bell.

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