It wasn't much. The outlet reported that some hedge funds that clear derivatives trades with the bank had withdrawn some positions, "a sign of counterparties'" mounting concerns about doing business with Europe's largest investment bank.
Not much, but it revived long-dormant memories of 2008.
Deutsche Bank's U.S.-traded shares dropped 7 percent. European banks that trade in the U.S. fell roughly 3 percent.
The shed 15 points in a matter of minutes.
U.S. banks dropped, as well. JPMorgan Chase lost 1.5 percent.
Wait a minute. What do (possible) issues at Deutsche Bank have to do with JPMorgan?
And why would the entire market drop? Everything dropped: consumer staples, consumer discretionary and health care. Even Whirlpool fell $2.
What's Whirlpool got to do with Deutsche Bank?
On the surface, not much. But in the post-financial crisis worldview, it doesn't take much.
The logic goes like this:
You get the point. A slightly paranoid worldview is still very prevalent about banks that have trouble. Paranoid, but not completely absurd.
But what about the rest of the market? Why exactly did, say, Whirlpool drop $2?
First, the market trend in many sectors (health care, consumer staples) was already down before the story came out.
But the more important reason is that today's trading action is dominated by traders who will pull bids when there is market uncertainty. When you have heavier volume with fewer bids, prices drop to attract buyers. Throw in trend following programs and that will more than adequately explain how stocks that are not correlated could drop together.