European shares close down 3% as Credit Suisse leads banking stocks on a wild ride lower
This is CNBC's live blog covering European markets.
European stock markets fell sharply Wednesday, with banking stocks deep in negative territory amid the global Silicon Valley Bank fallout and more bad news for Credit Suisse.
The pan-European Stoxx 600 index provisionally closed 3% lower, with all sectors in the red.
Banking stocks plunged 7%, their worst session since Russia launched its full-scale invasion of Ukraine on Feb. 24, 2022, according to Eikon data.
The oil and gas sector fell 6.7% while mining stocks lost 5.6%.
Credit Suisse dropped to the bottom of the blue-chip index after the bank's biggest lender, Saudi National Bank, said it would not be able to offer it more financial help.
Its shares closed down 24% after falling as much as 30% earlier in the session.
In an interview with CAN quoted by Reuters, CEO Ulrich Koerner said: "Our capital, our liquidity basis is very, very strong."
"We fulfill and overshoot basically all regulatory requirements," Koerner added.
The Credit Suisse fall caused a wider banking sell-off to resume after the sector staged a modest recovery Tuesday. BNP Paribas, Societe Generale, Commerzbank and Deutsche Bank were among the banks to post steep declines.
Several bank stocks, including Credit Suisse, were temporarily halted from trade during the morning due to the steep losses. Deutsche Bank, Societe Generale, Commerzbank and UBS declined to comment.
Trade was buoyant in Asia-Pacific markets overnight and on Wall Street Tuesday, when U.S. bank stocks rebounded on optimism that the contagion risk from Silicon Valley Bank's collapse was contained.
However U.S. stocks were lower Wednesday as jitters returned.
Meanwhile, U.K. Finance Minister Jeremy Hunt unveiled his "Spring Budget," which includes extensions of the cut to fuel duty and of energy support measures. It comes as teachers, civil servants, rail workers and junior doctors strike over pay and working conditions.
Hunt also said the British economy was "proving the doubters wrong" as gilt rates, mortgage rates and inflation come down, and that it would avoid a technical recession.
European stocks plunge
Europe's Stoxx 600 index provisionally closed 3% lower as investors ditched Credit Suisse, rebooting the global banking rout.
European banks ended the session down 7% and Credit Suisse fell 24% after its biggest backer said it would not provide it with further financial support. The stock hit a fresh all-time low and fell below 2 Swiss francs ($2.16) for the first time.
Losses were seen across the board, with oil and gas stocks down 6.6%, financial services down 4.9% and mining stocks down 5.75%.
The U.K.'s FTSE 100 fell by 3.8%, France's CAC 40 by 3.6% and Germany's DAX by 3.3%.
Meanwhile, investors were "taking the knife to their [rate] hike expectations," said ING senior rates strategist, Antoine Bouvet, reckoning that tighter financing conditions would require less central bank tightening.
Rabobank's head of rates strategy Richard McGuire said central banks were unlikely to be "blown off course," however.
— Jenni Reid
Credit Suisse bond yields jump, credit default swaps race higher
Credit Suisse Group bonds sold off sharply, as the price of insuring those bonds also raced higher.
Credit Suisse 5-year credit default swaps reached a record high 694.83 Wednesday, according to Refinitiv. UBS' 5-year CDS was at about 88 Tuesday, while JP Morgan Chase 5-year CDS was at about 83.
By comparison, Credit Suisse reached a high of about 255 during the financial crisis in March, 2009, according to Refinitiv.
Credit Suisse's 10-year corporate bond was yielding more than 9% Wednesday. The bank's stock was also down about 17%.
A credit default swap allows investors to protect their holdings in a company or sovereign's bonds, against the chances of a default.
Euro on pace for worst day in almost three years
The Euro is down 1.84% against the dollar, falling to $1.0535 as of 11:05 a.m. ET. It is currently on track for its worst day since Mar. 19, 2020 when it fell 2.043% against the dollar.
The dollar index is up 1.28%, on pace for its best day since Mar. 7, when the index gained 1.21%. It is up 0.2% week-to-date and its sixth positive week in seven weeks.
— Hakyung Kim
Adjusting policy due to market sell-off 'likely to cause further alarm,' strategist says
Credit Suisse's woes are "not new news," Rabobank's head of rates strategy Richard McGuire told CNBC — but the "jitters related to a possible systemic read across from Silicon Valley Bank" are.
McGuire does not see central banks being "blown off course" by current stresses, saying that to do so would see them abandon their mandates to bring down inflation.
He noted the market is now pricing in a little under 50% odds of one more 25 basis point rate hike from the U.S. Federal Reserve.
"While reduced bank lending is a de facto tightening in and of itself we struggle to see the Fed and the [European Central Bank] relying upon such a mechanism when both its quantum and duration is impossible to predict," McGuire said by email.
"Furthermore, adjusting policy in the face of recent events is more likely to cause further alarm (by implicitly acknowledging the seriousness of the problem) rather than provide reassurance the situation is under control," he added.
"While there is an inherent unpredictability to the current situation, we think the market is overly quick to price out further tightening, meaning safe haven curves are likely to, once again, flatten back."
— Jenni Reid
Credit Suisse CEO: Our liquidity basis is "very, very strong"
Credit Suisse CEO Ulrich Koerner on Wednesday said: "Our capital, our liquidity basis is very, very strong," Reuters reported, citing an interview with CAN.
The comments came as the Swiss bank's share price plummeted, falling as much as 30% during the session.
"We fulfill and overshoot basically all regulatory requirements," Koerner said.
— Jenni Reid
U.S. stocks open lower
U.S. stocks opened lower Wednesday.
The Dow Jones Industrial Average fell 525 points, or 1.6%, while the Nasdaq Composite lost 1.4%. The 1.8% slide in S&P 500 put the broad index's 2.1% year-to-date gain at risk.
Credit Suisse is 'Lehman moment': Roubini
Credit Suisse is a "Lehman moment" for European and global markets, ultra-bearish economist Nouriel Roubini wrote on Twitter.
"'Too big to fail and too big to be saved'. It is not even clear what their various unrealized losses on securities and other assets are," he added.
Roubini also reposted comments he made two days prior, in which he said there was a "risk of global contagion" from a "very fragile" large European bank.
"Didn't want to cause a run & I didn't mention it was [Credit Suisse] but now this risk is out in the open & the contagion is already severe," he wrote Wednesday.
— Jenni Reid
Cycle that has put downward pressure on risk assets will bottom in the next quarter, strategist says
John Ricciardi, head of global asset allocation at Deuterium Capital Management, discusses the fallout from the U.S. banking fiasco and the near-term outlook for the economy.
Investors are 'cutting risk exposure' amid banking concerns
European banks are being pulled down by continued concerns about the collapse of Silicon Valley Bank, the path of interest rates, and banks' margins and asset qualities, said Russ Mould, investment director at AJ Bell.
But Credit Suisse is being "singled out by increasingly risk-averse investors" amid its ongoing turmoil.
"Investors had become bullish on banks thanks to hopes for an economic soft landing, an easing in inflation and a pause or pivot in central bank policy," he said in emailed comments.
"That pivot may be coming but not for reasons investors were expecting, owing to the uncertainties prompted by SVB's collapse and the possibility that central banks may have already pushed rates to levels whereby either the economy or the financial system (or both) are coming under unexpected strain.
"As a result, investors are cutting risk exposure and a scandal-ridden bank is one place they may well be keen to avoid under such circumstances."
— Jenni Reid
Credit Suisse 'will not be let to go belly up'
European banks were down 6.66% at midday in London.
Carlo Franchini, head of institutional clients at Banca Ifigest, said the Credit Suisse news was dragging the sector lower.
However, he added: "I believe Credit Suisse's crisis can be solved and the bank will not be let to go belly up," as quoted by Reuters.
— Jenni Reid
U.S. banks’ liquidity issues may have passed for now, but could come back worse, Opimas CEO says
Octavio Marenzi, CEO of Opimas, discusses the Federal Reserve's support of U.S. banks facing liquidity issues and the outlook for the sector.
Credit Suisse shares down almost 24%; multiple halts try to prevent further decline
Shares of Credit Suisse were down 23.79% around 11 a.m. London time. Trading was halted multiple times by the stock exchange operator as the stock plummeted.
The price was halted at $1.7430 just after 11 a.m. London time.
— Hannah Ward-Glenton
European banks halt trading as shares plummet
Shares of several European banks including Credit Suisse, Societe Generale and Italy's Monte dei Paschi and UniCredit have been halted from trading as prices plummeted.
Credit Suisse was down as much as 21% around 10.33 a.m. London time, followed by Societe Generale, which dropped 9.9%.
— Hannah Ward-Glenton
Credit Suisse shares down 10% to fresh record low
Shares of embattled bank Credit Suisse hit another all-time low for a second consecutive day, dropping by as much as 10% around 9.47 a.m. London time on Wednesday.
Investors are assessing the impact the bank's Tuesday announcement that it had found "material weaknesses" in its financial reporting processes for 2022 and 2021.
— Hannah Ward-Glenton and Elliot Smith
Platinum price surge forecast for 2023
Factors including power cuts in South Africa, the war in Ukraine and the increased production of hybrid cars could cause platinum prices to increase in 2023.
Investment bank UBS readjusted its price forecast for platinum in 2023, estimating that the precious metal will cost $1,150 per ounce for June, up from a previous estimate of $1,100, and will reach $1,200 per ounce in December.
"The key point is that we're expecting a pretty significant 24% year-on-year growth in terms of total demand," Ed Sterck, Director of Research at the World Platinum Investment Council told CNBC, but supply is only set to increase by 13% compared to last year.
The full story is available here.
— Hannah Ward-Glenton
Stocks on the move: Bollore up 8%, IG Group down 6%
Shares of French logistics company Bollore were up 8% in early trade after the company decided to launch a cash tender offer on its own shares.
It would aim to acquire a maximum of just over 288.6 million shares, representing 9.78% of its share capital, according to a company press release.
IG Group fell to the bottom of the Stoxx 600 index in early trade after third-quarter net trading revenue fell lower on market volatility and the company experienced a 5% drop in active client numbers.
The online trading organization reported revenue for the most recent quarter as 7% lower than the comparable quarter the previous year.
— Hannah Ward-Glenton
European equity markets open lower
European equity markets opened lower, with banking stocks still in negative territory following the global Silicon Valley Bank fallout.
The pan-European Stoxx 600 index was down 0.4% toward the start of trade, with most sectors and major bourses trading in the red. Retail stocks led losses with a 1.9% drop, followed by oil and gas stocks, which were down 1.4%. Banking stocks were down 0.5%.
— Hannah Ward-Glenton
BMW lifts margin forecast, expecting higher deliveries as it ramps up electric rollout
German carmaker BMW on Wednesday said it expects an EBIT (earnings before interest and taxes) margin of between 8-10% for its automotive range in 2023, with deliveries set to rise slightly from 2022. Selling prices are targeted to remain at a "stable" level.
The company reaffirmed the full-year 2022 results reported last week, including an EBIT of 10.6 billion euros ($11.4 billion) for its automotive segment, which had an 8.6% margin last year.
BMW is carrying out an extensive rollout of battery-electric vehicles and anticipates it will reach more than 50% BEV share well ahead of 2030. The company's BEV share is slated to reach 15% in 2023.
— Ruxandra Iordache
CNBC Pro: UBS says buy these 4 stocks if U.S.-China geopolitical fears continue to rise
UBS has named a number of Chinese stocks it says have remained "resilient" during periods of heightened geopolitical tensions between the United States and China.
In a note to clients on March 13, the Swiss bank said that more market volatility is expected when a potential U.S. ban on investment in some Chinese sectors is announced.
CNBC Pro subscribers can read more about the UBS' stock picks here.
— Ganesh Rao
China's industrial output, retail sales rise in January to February period
China's industrial output rose 2.4% in the January to February period, official data showed.
Retail sales rose 3.55% for the same period, in line with expectations.
China's fixed asset investment in the first two months of the year saw a rise of 5.5%, higher than expectations from economists polled by Reuters that predicted to see growth of 4.4%.
China's onshore yuan weakened after the data was released and traded at 6.8822 against the U.S. dollar.
The People's Bank of China kept the rate on 481 billion yuan of one-year medium-term lending facility loans at 2.75%.
– Jihye Lee
CNBC Pro: ‘Chaos creates opportunities’: Strategist says to look beyond the SVB fallout — and names his top picks
Worried about contagion from the collapse of Silicon Valley Bank? Veteran strategist Kenny Polcari believes the impact from SVB's failure will be fairly limited.
While investors are mostly shunning the banking sector in the short term, Polcari sees "some very interesting opportunities" in the space, as well as in other segments of the market.
Pro subscribers can read more here.
— Zavier Ong
CNBC Pro: As markets turn rocky, these global stocks look resilient and are expected to rally
Markets have had a rocky March so far, as inflation fears returned and the collapse of Silicon Valley Bank sent investors into a risk-off mode.
Against this backdrop, CNBC Pro used FactSet to screen for stocks on the MSCI World index and S&P 500 that look well positioned to withstand the volatility and are expected to do well looking ahead.
CNBC Pro subscribers can read more about the stocks here.
— Weizhen Tan
Moody's cuts outlook to negative on U.S. banking system
Moody's Investors Service moved its view on the U.S. banking system to negative from stable on Monday, citing a "rapidly deteriorating operating environment."
The move comes as the sectors reels following the closure of Silicon Valley Bank and Signature Bank. Banking stocks have mounted a comeback Tuesday after sliding over the past few sessions as concerns of contagion from the closures swirled.
"We have changed to negative from stable our outlook on the US banking system to reflect the rapid deterioration in the operating environment following deposit runs at Silicon Valley Bank (SVB), Silvergate Bank, and Signature Bank (SNY) and the failures of SVB and SNY," Moody's said in a report.
— Alex Harring, Jeff Cox
U.S. inflation data comes in line with expectations
The consumer price index rose 0.4% in February from the prior month, matching a Dow Jones estimate. The year-over-year increase of 6% was also in line with expectations.
— Fred Imbert
European markets: Here are the opening calls
European markets are expected to open higher Thursday.
The U.K.'s FTSE 100 index is expected to open 14 points higher at 7,626, Germany's DAX 13 points higher at 15,837, France's CAC up 4 points at 7,253 and Italy's FTSE MIB 17 points higher at 26,579, according to data from IG.
Earnings come from Tate & Lyle, Manchester Utd, Johnson Matthey, United Utilities and Pets at Home. Data releases include a detailed breakdown of Germany's first-quarter gross domestic product.
— Holly Ellyatt