Mountain goats aside, trading moved as banks faced renewed pressure with declines approaching the four percent mark for some and larger losses for others. Sabadell dropped more than 11 percent, Bankinter over seven, BBVA around 10 percent, Santander just above seven and CaixaBank about six percent. Unicaja posted a similar decline of roughly 6.8 percent, while Inditex fell nearly five percent. The session spoke to a broader risk mood, with investors watching for contagion from recent stress in global banks.
Concerns about international spillovers persisted during the mid-session. The Spanish Ibex, while showing resilience in parts, saw major declines that underscored ongoing fear of wider banking turmoil sparked by the earlier Silicon Valley Bank crisis. The trouble intensified with Credit Suisse facing internal control issues and a substantial annual loss for 2022. In response, Sabadell shed more than 11 percent, Bankinter more than seven, BBVA about ten, and Santander around seven, with CaixaBank around six and Unicaja nearly six and a half percent. Inditex also weakened, though it had reported a 27 percent rise in net profit to 4.13 billion and a 17.5 percent increase in revenue to 32.57 billion for the year. Barclays, BNP Paribas and Société Générale among others also posted losses as part of a broader European retreat. Deutsche Bank and ING also slipped, while the European Stoxx 600 fell by roughly 2.1 percent.
The selling extended beyond the Iberian market. Across Europe, the DAX retreated about 3.0 percent, the CAC 40 declined around 3.5 percent, and the FTSE MIB slipped near 3.7 percent. In aggregate, the Euro Stoxx 50 and the FTSE 100 recorded notable declines as broader market sentiment soured.
Credit Suisse, facing its own solvency concerns, traded at new lows on the Zurich exchange with shares down roughly 20 percent. The main shareholder, the Saudi National Bank, indicated it would not increase its stake, citing regulatory limits that cap holdings at ten percent. Analysts noted that while panic can be understandable after the SVB episode, Credit Suisse issues were not deemed systemic, though they did provoke a shift of deposits toward perceived safer institutions.
Sources pointed to governance problems at Credit Suisse, including a 2019 espionage incident and past penalties related to a bond scandal in Mozambique. Analysts cited ongoing reputational damage as a driver of client withdrawals. The Saudi entity had previously backed a capital increase with a 1.5 billion Swiss franc investment. In 2022 Credit Suisse reported a 7.293 billion Swiss franc loss, driven by exposure to risk assets that also faced stress from prior scandals. liquidity outflows were substantial during the year, complicating operations.
Two Franc Threshold
Zurich listed Credit Suisse shares traded below two Swiss francs for the first time in over a decade, echoing the severity of the recent selloff. The company’s leadership stated no further capital injections would be made due to regulatory constraints. Market participants watched as the stock price reflected deep investor skepticism about the bank’s immediate recovery prospects.
Observers noted that while the SVB episode is part of the backdrop, Credit Suisse challenges did not necessarily imply a systemic crisis. Depositors often seek safety during periods of uncertainty, but the market expected a degree of resilience in the broader banking system.
Meanwhile, the Saudi stake was reorganized as part of a capital move aimed at stabilizing the bank, with the Middle Eastern investor committing to a sizable but controlled investment. In 2022 the bank disclosed significant losses and faced reputational and regulatory pressures related to past misconduct and high profile incidents, contributing to a cautious market outlook.
Index Levels and Intraday Moves
The Spanish selective index hovered below the 9,000 point level, dipping to a midday trough before a partial reversal. Early trading showed the Ibex 35 around the 9,100 mark, but by mid-session it edged toward a floor near 8,800. The snapshot at midday captured Iberdrola bucking the trend with a small gain, while other listed companies posted modest declines. Several components showed less severe falls, including Logista, Rovi, Acciona Energías Renovables and Telefónica, which managed smaller losses.
In the commodity sphere, Brent crude slipped about 1.4 percent to roughly 76.31 dollars a barrel and West Texas Intermediate slid around 1.5 percent to about 70.21 dollars. The yield on the Spanish 10-year bond rose modestly, widening the risk premium versus German Bunds to around 109.8 basis points.
In the currency market, the euro edged lower against the dollar, trading near the 1.0616 level, highlighting ongoing currency volatility amid risk-off sentiment.