HONG KONG: Asian markets sank Tuesday , with banks bearing the brunt of the selling on fears of contagion in the sector after the collapse of two regional US lenders.on Friday, followed by Signature Bank days later, forced US authorities to immediately pledge support for other lenders and depositors.
The collapse of SVB, which specialised in venture-capital financing largely in the tech sector, was largely the result of the Fed's sharp interest rate hikes aimed at quelling inflation, which hit securities hard. Equity markets were well in the red in early Asian trade Tuesday, with Tokyo, Sydney and Seoul almost 2 per cent down, while Hong Kong, Shanghai, Singapore and Taipei suffered hefty selling.
Bloomberg News reported that about US$465 billion had been wiped off the market value of global financial stocks in three days. Stephen Innes of SPI Asset Management added that the selling came despite non-US banks having little exposure to the firms in trouble and with global financial systems being flush with cash.
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