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,
-13.95%
fell 13% in Zurich after it said a U.S. hedge fund defaulted on margin calls.
Deutsche Bank
DBK,
-4.52%,
which according to The Wall Street Journal also unwound Archegos trades, fell 5%, and UBS
UBSG,
-4.00%
shares fell 5%.
French banks BNP Paribas
BNP,
-2.36%
and Société Générale
GLE,
-2.27%
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,
+0.13%
inched up 0.1% while U.S. stock futures
ES00,
-0.51%
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.