Investors in the USA are getting rid of shares of Chinese companies, fears of a banking crisis: what you need to know in the morning

Main news of foreign markets this morning.

Photo: pixabay.com 3 US stock indexes fell on Tuesday

The S&P 500 lost 1.6%, the high-tech Nasdaq lost 2%, and the Dow Jones index fell 1%.

Investors are worried about the stability of the US banking sector after the First Republic Bank report. In addition, the consumer confidence index in the USA was published the day before. According to the Conference Board, in April this indicator fell to a nine-month low, that is, the fears of American consumers about the future are growing. This further increases the risk of a recession this year, Reuters reports.

Asian markets trade in different directions

The broad index of Asian shares (excluding Japan) MSCI AC Asia ex Japan Index rose by 0.2% today, Japan’s Nikkei fell by 0.6%, South Korea’s Kospi lost 0.1%, Singapore’s STI fell by 0.2%, China The Shanghai Composite was practically unchanged, while the Hong Kong Hang Seng rose 0.8%.

The mixed dynamics in the markets of the Asia-Pacific region is associated with growing concerns about problems in the US banking sector.

Shares of US regional banks resumed their fall

The index of the US banking sector — KBW Bank — decreased yesterday by about 4% and reached the lowest level since November 2020.

Investor sentiment worsened due to First Republic Bank’s deposit retention problems. The situation represents common problems in the sector: small regional banks are struggling to overcome the banking crisis that began last month.

As a result of yesterday’s trading, the value of the securities of almost all industry representatives decreased, including the largest US lenders: Bank of America (-3.2%), JPMorgan (2.2%), Citigroup (2.3%), Wells Fargo (- 2.2%) and Morgan Stanley (-2.4%).

Chinese stocks traded in the US have lost more than $100 billion since the beginning of the month

According to Yahoo Finance, the Nasdaq Golden Dragon index, which tracks the dynamics of shares of Chinese companies traded on American stock exchanges, has fallen by more than 10% since the beginning of April. This is the worst result since last October.

All because of concerns about geopolitical tensions around China, which overshadow the optimism associated with the recovery of the country’s economy after the COVID-19 pandemic.

According to Morgan Stanley, this month the main sellers of Chinese shares in the US were American hedge funds, which previously bet on the growth of the Chinese stock market.

Source: Ministry of Finance

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