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, -13.35% fell 14% in Zurich after it said a U.S. hedge fund defaulted on margin calls.
Deutsche Bank DBK, -4.14%, which according to The Wall Street Journal also unwound Archegos trades, fell 5%, and UBS UBSG, -3.70% shares fell 4%.
In premarket trade, Goldman Sachs GS, -0.96% and Morgan Stanley MS, -0.19% each fell 3%.
French banks BNP Paribas BNP, -2.09% and Société Générale GLE, -1.75% each fell over 2%.
Archegos holdings that were sold to meet margin calls included positions in U.S. media companies ViacomCBS VIAC, -27.31% and Discovery DISCA, -27.45%, and Chinese internet companies Baidu BIDU, +1.97%, Tencent Music TME, -1.28% and Vipshop VIPS, -2.38%.
More broadly, the Stoxx Europe 600 SXXP, +0.29% inched up 0.1% while U.S. stock futures ES00, -0.41% 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.