Shares of Europe’s largest banks dropped on Monday after extending credit to a major client that couldn’t meet its obligations.
A margin call triggered on Friday of U.S. investor Archegos Capital Management continued to ripple through markets. Nomura 8604, -16.33% shares skidded 16% in Tokyo after it said it had a claim of $2 billion against a U.S. client, while Credit Suisse CSGN, -13.83% fell 14% in Zurich after it said could see “highly significant” losses after a U.S. fund defaulted on margin calls.
Deutsche Bank DBK, -3.32%, which according to The Wall Street Journal also unwound Archegos trades, fell 4%, and UBS UBSG, -3.90% shares fell 4%.
In early trade, Goldman Sachs GS, -0.51% slipped 2% and Morgan Stanley MS, -2.63% fell 4%.
French banks BNP Paribas BNP, -1.94% and Société Générale GLE, -2.41% each fell over 2%.
Archegos holdings that were sold to meet margin calls included positions in U.S. media companies ViacomCBS VIAC, -6.68% and Discovery DISCA, -1.60%, and Chinese internet companies Baidu BIDU, -1.87%, Tencent Music TME, +1.19% and Vipshop VIPS, -8.72%.
More broadly, the Stoxx Europe 600 SXXP, +0.16% inched up 0.2% while U.S. stock futures ES00, -0.02% declined.
“Last week’s back and forth battle between the recovery optimists and the lockdown fretters ended with the bulls regaining the upper hand, and many global equity markets begin this Easter-shortened week within striking distance of their recent, or in some cases all-time, highs,” said Ian Williams, strategist at U.K. broker Peel Hunt.
The Ever Given container ship was refloated, an important step in unclogging the Suez Canal, which now has a backlog of 450 ships.
