PARIS (Reuters) – The main European stock markets are heading down sharply on Friday morning in the wake of the plunge on Wall Street by SVB Financial Group, parent company of Silicon Valley Bank, which is fueling fears about the banking sector as investors wait moreover feverishly the official monthly report on American employment.
In Paris, the CAC 40 fell 1.78% to 7,185.71 points around 08:40 GMT. In London, the FTSE 100 fell by 1.59% and in Frankfurt, the Dax lost 1.7%.
The EuroStoxx 50 index fell by 1.89%, the FTSEurofirst 300 by 1.59% and the Stoxx 600 by 1.63%.
Futures contracts also foreshadow a continuation of the decline on Wall Street with a decline of 0.59% for the Dow Jones, 0.57% for the Standard & Poor’s 500 and 0.26% for the Nasdaq.
The American bank Silicon Valley Bank, which specializes in financing venture capital, caused panic on the markets on Thursday evening after announcing the liquidation of part of its bond portfolio and then a surprise capital increase to fill a hole of 1 $.8 billion in its accounts, reigniting fears of a liquidity crisis in the banking sector amid the withdrawal of deposits from start-ups and rising interest rates.
Its parent company, SVB Financial Group, plunged in the wake of 60% and fell further in out-of-hours trading, helping to wipe out more than $80 billion in bank capitalization on Wall Street. JP Morgan Chase & Co fell 5.4% and Citigroup 4.1%.
In Europe, the banking sector (-4.33%) logically opened sharply lower on Friday, showing the most significant decline in the Stoxx 600. In Paris, BNP Paribas lost 4.82%, Société Générale 5.5% and Crédit agricultural 3.33%. Elsewhere in Europe, Deutsche Bank fell by 6.95%, Commerzbank by 5.12%, Barclays by 5.33% and Unicredit by 4.29%.
In other corporate news, Casino lost 3.72% after the publication of annual current operating profit down 12.1% at constant exchange rates.
Investors are also awaiting February employment data from the US Department of Labor at 1330 GMT, which could influence the level of interest rates expected for the March 21-22 meeting of the US Federal Reserve. (Fed). Its chairman, Jerome Powell, said earlier this week that the evolution of the cost of credit would depend on the data received up to that date.
(Written by Claude Chendjou, edited by Kate Entringer)
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