Stocks are falling on Wall Street Friday as more worries about banks on both sides of the Atlantic tug markets lower. On Friday, much of the focus was on Deutsche Bank, whose stock tumbled 10% in Germany.
Bank stocks were mixed on Wall Street, including a 1.4% drop for JPMorgan Chase and a 0.8% gain for Bank of America.
Investors have zeroed in on smaller and midsized banks, the ones below in size of the “too-big-to-fail” banks and seen as greater risks.Treasury Secretary Janet Yellen has said that in cases where the government sees a risk to the overall system, it will guarantee deposits for bank customers, even those with more than the $250,000 insured by the Federal Deposit Insurance Corp. That’s what regulators did for both Silicon Valley Bank and Signature Bank.
A second report, though, suggested the fastest uptick in business activity for almost a year. The preliminary report from S&P Global topped economists’ expectations.Federal Reserve Chair Jerome Powell said worries about a pullback in lending helped push the Fed to raise rates by only a quarter of a percentage point this week, instead of a more aggressive half point, in its campaign to battle inflation.
The Fed has raised its key overnight interest rate to a range of 4.75% to 5%, up from virtually zero at the start of last year. It’s hinted it may raise rates one more time before holding them there through the end of the year.
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