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Major, regional bank stocks slide
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Block set to extend losses on Hindenburg report
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Durable goods orders fall in February
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Futures down: Dow 1.07%, S&P 0.92%, Nasdaq 0.59%
(Updates prices, adds details)
By Amruta Khandekar and Ankika Biswas
March 24 (Reuters) - Wall Street's main indexes were
headed for a lower open on Friday as concerns over the banking
sector's health sapped the appetite for financial stocks.
Treasury Secretary Janet Yellen said on Thursday that
measures will be taken to keep Americans' deposits safe, but
that did little to ease investor nerves about a liquidity crisis
in the banking sector that could limit lending and tip the
economy into a severe recession.
Shares of major U.S. banks such as JPMorgan Chase & Co , Wells Fargo and Bank of America dropped
between 1% and 2.8% in premarket trade.
Shares of regional lenders First Republic Bank ,
PacWest Bancorp , Western Alliance Bancorp and
Truist Financial Corp fell between 2% and 4.9%.
European banks also came under pressure after a report of a
U.S. probe into Credit Suisse and UBS further
soured the mood. Their U.S.-listed shares were down about 4.6%
and 3.4%, respectively.
U.S. shares of Deutsche Bank fell nearly 10%
after the bank's credit default swaps rose to a four-year high.
"Although they are trying to reassure markets that
they'll be standing by to take action if necessary, what
investors are taking this as is the fact that regulators,
central bankers and the U.S. government are still concerned
about the potential for contagion," said Susannah Streeter, head
of money and markets, Hargreaves Lansdown.
Banking crisis concerns were also reflected in bond markets, with U.S. two-year Treasury yields falling sharply to their lowest levels since September on Friday.
Traders' bets have now shifted toward a pause in U.S. rate hikes in May, after the Fed signaled caution about its next move amid the global banking crisis, sparked by the failure of two regional banks.
Data on Friday showed orders for durable goods fell 1% last month against expectations of a 0.6% rise.
S&P Global's survey due later in the day is expected to show
a weakening in U.S. manufacturing activity in March, while
remarks by Fed's St. Louis president, James Bullard, are also
expected after the opening bell.
At 8:32 a.m. ET, Dow e-minis were down 345 points,
or 1.07%, S&P 500 e-minis were down 36.5 points, or
0.92%, and Nasdaq 100 e-minis were down 76 points, or
0.59%.
Among major movers, Block Inc fell 2.4% in premarket
trading and looked set to extend losses from Thursday when
Hindenburg Research disclosed short positions in the payments
firm.
Activision Blizzard jumped 5.5% after the UK
competition regulator dropped some competition concerns in the
Microsoft-Activision deal.
Crypto stocks like Coinbase Global , Marathon
Digital Holdings and Riot Platforms dropped
between 2.2% and 3.4% after cryptocurrency exchange Binance
paused deposits and withdrawals on its platform due to issues
affecting its spot trading.
(Reporting by Amruta Khandekar and Ankika Biswas; Editing by
Sriraj Kalluvila, Vinay Dwivedi and Anil D'Silva)
