Global stocks rebound, Credit Suisse shares surge after central bank lifeline
Global News
Stocks flipped to gains Thursday amid hopes for help for a bank at the center of Wall Street's hunt for what's next to crack in the struggling industry.
Stocks flipped to gains Thursday amid hopes for help for a bank at the center of Wall Street’s hunt for what’s next to crack in the struggling industry.
The S&P 500 was 0.8 per cent higher in midday trading after erasing an earlier loss of nearly that much following reports that First Republic Bank could receive financial assistance or sell itself to another bank.
The Dow Jones Industrial Average was up 103 points, or 0.3 per cent, at 31,978, as of 11:20 a.m. Eastern time, while the Nasdaq composite was 1.3 per cent higher.
This week has been a whirlwind for markets globally on worries about banks that may be bending under the weight of the fastest set of hikes to interest rates in decades. The crisis of confidence has been flaring since Friday’s collapse of Silicon Valley Bank, which was the second largest bank failure in U.S. history.
Since then, Wall Street has tried to root out banks with similar traits, such as lots of depositors with more than the $250,000 limit that’s insured by the Federal Deposit Insurance Corp., or lots of tech startups and other highly connected people that can spread worries about a bank’s strength quickly.
First Republic Bank has been at the center of the market’s swivels, and it fell 28.3 per cent. It’s down nearly 73 per cent this week alone.
But big banks including JPMorgan Chase and Morgan Stanley are discussing a potential deal that could mean a big infusion of cash for the bank, according to a report from The Wall Street Journal.