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Stocks fell Wednesday as pressure on the financial sector increased with shares of Credit Suisse, a Swiss Bank that has large U.S. and global operations, tumbling more than 15%.
The Dow Jones Industrials woozed 531.22 points, or 1.7%, to 31,633.31.
The S&P 500 slipped 53.75 points, or 1.4%, to 3,865.54. Wednesday’s decline brought the S&P 500's year-to-date gain down to less than a percentage point.
The NASDAQ Composite lost 90.26 points to 11,337.89.
In recent days, a crisis in the financial sector has centered around regional banks as Silicon Valley Bank and Signature Bank collapsed, both casualties of poor management in the face of eight interest rate hikes by the Federal Reserve in the last 12 months. Wednesday morning attention turned to the big banks, with shares of Credit Suisse hitting an all-time low.
Saudi National Bank, Credit Suisse’s largest investor, said Wednesday it could not provide any more funding, according to a Reuters report.
This comes after the Swiss lender said earlier this week it had found “certain material weaknesses in our internal control over financial reporting” for the years 2021 and 2022.
Citigroup dropped nearly 6%, and Wells Fargo shed 5%. Goldman Sachs dumped around 5.5%, and Bank of America lost 2.5%. Regional banks, which rebounded Tuesday to lift sentiment for the broader market, fell back into the red again, pushed down by losses of more than 10% in First Republic Bank and PacWest Bancorp
Prices for the 10-year Treasury leaped, lowering yields to 3.45% from Tuesday’s 3.68%. Treasury prices and yields move in opposite directions.
Oil prices lost $3.43 to $67.90 U.S. a barrel.
Gold prices gained $19.20 to $1,930.10 U.S. an ounce.
