Already jittery investors have been in panic mode since the collapse of two regional US banks over the weekend sparked a sell-off across equities and ramped up concerns of a global recession.
That came a day after its annual report cited "material weaknesses" in internal controls at the firm, which has been hit by a series of scandals in recent years. Embattled midsized lender First Republic Bank collapsed more than 20 percent in New York and it has now lost more than 70 percent over the past week.The fear spread to Asia, where Japan's Sumitomo Mitsui Financial and Mitsubishi UFJ Financial shed more than two percent apiece, while South Korea's Hana Financial Group gave up more than three percent and HSBC dropped three percent.
"In the absence of facts, everyone is left with little choice but to speculate and frankly, what little commentary we've had hasn't really helped. Quite the opposite, in fact."The crisis has compounded problems for investors, who were already in a downbeat mood as they contemplated more Federal Reserve interest rate hikes to rein in stubbornly high inflation.
And now there is talk of the European Central Bank also calling a halt to its hiking campaign, despite inflation remaining elevated.