- US stocks fell on Monday as investors assess the potential fallout from the collapse of Silicon Valley Bank.
- Futures were initially higher after the Federal Reserve and US Treasury announced measures to limit the risk of further bank runs.
- Other banks that are now in focus include First Republic, PacWest Bancorp, and Charles Schwab.
US stocks were lower on Monday after the Federal Reserve and US Treasury announced emergency measures to stop the spread of potential bank runs following the collapse of Silicon Valley Bank.
The measures allow banks to pledge their Treasury securities that may be underwater due to soaring interest rates and receive par value to help boost liquidity, if needed. The government also announced that all uninsured deposits held at Silicon Valley Bank and Signature Bank, both of which collapsed, would be available on Monday.
Concern grew over the weekend that a failure for customers to access their deposits at both banks would spur bank runs at other regional banks. Now investors are setting their focus on other banks that have large unrealized losses on their bond portfolios, including First Republic, PacWest Bancorp, and Charles Schwab, among others.
Here's where US indexes stood shortly after the 9:30 a.m. ET open on Monday:
- S&P 500: 3,816.22, down 1.17%
- Dow Jones Industrial Average: 31,739.55, down 0.53% (170.09 points)
- Nasdaq Composite: 11,016.96, down 1.09%
Here's what else is happening this morning:
- Short-dated US Treasury bond yields posted their largest drop in nearly 15 years, with yields on 2-year US Treasury notes falling as much as 44 basis points.
- First Republic Bank's stock cratered more than 60% on Monday as investors count the similarities between it and Silicon Valley Bank.
- Charles Schwab plunged as much as 25% in early Monday trades as investors scrutinized its $27 billion in unrealized losses related to its massive bond holdings.
- Goldman Sachs now expects the Fed to pause its rate hikes at next week's FOMC meeting as uncertainty related to the bank collapse soars.
In commodities, bonds and crypto:
- West Texas Intermediate crude oil fell 4.29% to $73.39 per barrel. Brent crude, oil's international benchmark, dropped 3.85% to $79.59.
- Gold rose 2.09% to $1,906.20 per ounce.
- The yield on the 10-year Treasury sank 25 basis points to 3.46%.
- Bitcoin jumped 5.6% to $22,382.
- Bitcoin rose 0.36% to $22,411, while ether dropped 0.31% to $1,590.