New Bank Fears Evoke SVB Ghost, Hammering Stocks Worldwide

The ghost of Silicon Valley Bank returned to haunt markets, as new fears about US regional banks hammered stocks worldwide. Disclosures of bad loans at Zions Bancorporation and Western Alliance sparked the global sell-off.
Though these banks are much smaller than SVB, the news raised broader questions about credit quality and the impact of elevated interest rates. Analysts fear a “domino effect,” pointing to recent bankruptcies like Tricolor and First Brands as worrying precedents.
The market reaction was brutal. In Europe, the FTSE 100, Dax, and Cac 40 all fell. The banking sector was decimated, with €37.4 billion erased from its value. Barclays and Deutsche Bank were among the top fallers. Asian markets also closed deep in the red.
Investors fled to the perceived safety of gold, pushing its price to a new record of $4,378 an ounce. The VIX “fear index” surged, reflecting the heightened state of alarm across financial markets.