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| US and European Banking Shares Plummet as Investors Fear More Failures |
US stock markets faced another day of selloffs as investors grew increasingly concerned about the health of the banking sector. Worries that more banks could fail led to US and European banking shares dropping dramatically. US banks, including JPMorgan Chase and Citigroup, lost over 4% and 5.7% respectively, while First Republic, a regional bank, sank 15%. These losses mark a reversal from the previous day, when major indices had advanced as concerns about the financial system had appeared to ease. The decline in stocks came amid significant drops in large European banks, some of which fell by as much as 8% or more. Credit Suisse, Switzerland’s second-largest bank, was particularly hard hit, plunging almost 30% after its main shareholder ruled out providing more funding. The bank has been shaken by a series of scandals in recent years, and the announcement led to renewed anxiety about its future prospects. While the fall in US stocks was not solely attributable to concerns about the banking sector, it was a significant factor. The market decline overshadowed US economic data indicating that the economy may be slowing down, which could potentially ease pressure on the Federal Reserve to increase interest rates. Wholesale prices unexpectedly fell last month, and retail sales declined, with drops in department and furniture stores. Investors are currently divided about whether the Fed will increase interest rates by a quarter-point next week or maintain the status quo.
