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Panic subsides on Wall Street as regional bank stocks rebound
Regional bank stocks rebounded Tuesday morning after being pummelled in a Monday selloff that was fuelled by a mix of contagion fears and a pile-on of short-sellers who profit when stocks lose value, CNN reported. Even after the federal government's intervention on Sunday to backstop deposits in two failed lenders, Silicon Valley Bank and Signature Bank, Wall Street had remained wary of smaller and midsize banks that are seen as having similar risks.
Asian markets fall amid SVB fallout fears
Japan's Nikkei 225 tumbled 2.19 per cent to post its third straight day of declines. Hong Kong's Hang Seng briefly dropped 2.5 per cent, before trimming losses in the afternoon. Korea's Kospi lost almost 3 per cent. China's Shanghai Composite shed 0.65 per cent, CNN reported. Banks were the hardest hit sector across the region, CNN reported.
Global banking shares slump as fallout spreads
However, shares in the US and European banks sold off sharply amid a crisis of confidence in global markets over the health of the financial system. Government bond prices soared as investors rushed for safe-haven assets, while economists suggested the febrile conditions in global markets could force the world's most powerful central banks to stop raising interest rates.
SVB's German branch ordered to halt transactions: BaFin
SVB, previously the 16th largest bank in the US that had been operational for 40 years, collapsed last week. The BaFin "has issued a ban today for Silicon Valley Bank Germany Branch on disposals and payments, as the institution is at risk of being unable to meet its obligations towards its creditors," it said in a statement on Monday.
HSBC acquires collapsed Silicon Valley Bank's UK subsidiary
"This acquisition makes excellent strategic sense for our business in the UK," HSBC Group Chief Executive Officer Noel Quinn said in a statement on Monday, adding that SVB UK customers "can continue to bank as usual, safe in the knowledge that their deposits are backed by the strength, safety and security of HSBC".
Billionaire investor Bill Ackman warns more banks will collapse despite US govt's intervention in SVB
Ackman, whose hedge fund Pershing Square Capital Management oversees roughly $16 billion in assets, criticized the government's response on Saturday as he predicted "economic meltdown" within hours of the banks opening on Monday morning. Ackman, who had urged the U.S. government to step in and protect all of the bank's depositors, praised the move but warned it unlikely to prevent more financial institutions from collapsing, Daily Mail reported.
Over $70 bn wiped off global crypto market, Bitcoin drops below $20,000
On Monday, Bitcoin was hovering around $18,000 and Peter Schiff, CEO of Euro Pacific Capital, predicted the world's largest cryptocurrency could soon drop below $4,000. Two crypto-friendly banks Silvergate Capital and Signature Bank collapsed last week, and billions of dollars belonging to crypto exchanges got stuck.