Silicon Valley Bank, Kbw Bank, Jpmorgan discussed on Bloomberg Daybreak Europe


Radio. So let's start with the market is pretty dramatic hours over in Silicon Valley. Silicon Valley bank shares tumbled 60% yesterday every bank in the S&P 500 financials index slumped on the back of that real concern spreading across the startup world, also the KBW bank index. That is closely watched. That closed 7.7% lower yesterday. The S&P had its worst day in a couple of weeks. Stock futures on the S&P 500 this morning are down 7 tenths of 1% stocks of absolutely slumped across Asia, the MSCI Asia Pacific index is down 1.9% this morning. And European stock futures are also down one and a half percent and it's the bond markets that seem largely the beneficiaries of this treasury is extending a big rally yields down 9 basis points now to three 81 you have a stronger dollar, Bitcoin tumbling to 20,000 and Brent down Stephen. Our top stories this morning, top executives at Silicon Valley bank are urging calm as prominent venture capitalists advised businesses to withdraw their money. Peter Thiel's Vander is fund and others say companies should now limit their exposure to the startup lender, quill intelligence CEO and chief trash just Danielle de martino booth says markets are worried. The market has now begun asking two questions. Will there be a white knight? And what bank is next? So we've seen the largest move in spreads since last October. We're seeing small and mid sized banks coming under attack and people are beginning to ask, how many banks are out there with similar levels of losses that they're sitting on that they can not move the terminal to martino booth spoke of their followed a surprise announcement from Silicon Valley bank that it was holding a two and a quarter $1 billion share sale after a significant loss on its portfolio. The lander scrambled to prevent a bank run comes as silvergate capital announced plans to wind down operations after last year's crypto industry meltdown. While the sentiment on Wall Street soured on that news, of course, the S&P 500 financials index saw its worst day since the COVID pandemic meltdown, Bank of America Wells Fargo and JPMorgan Chase all slid at least 5%. Ironically, many equity investors had piled into financial stocks to ride out the Federal Reserve's interest rate hikes, threadneedle founder and berry as that today's jobs data could change the picture even more. I think it's completely discombobulated 'cause I think that we're going to see the market just hang in limbo until we see those numbers come out and they will dictate whether we expect a 25 or 50% basis point hike. If we see a very strong labor market set of data come out tomorrow and as a result, the fed's been very clear they're going to be hawkish. I think we're going to see a real creator in equity values going into the last couple of weeks of this quarter. Okay, well, cratering. Now, market watchers like berry have one eye on the data today and another on potential defaults. Here in the UK, the government suspects Russians have exploited Britain's loose company register to launder war money, sources told Bloomberg that law enforcement agencies have identified hundreds of sham companies listed under Russian nationals. They are that the companies are trying to exploit the war in Ukraine for financial gain, the British government is in the process of strengthening laws to reform reform companies house and clamp down on financial crime. French president Emmanuel Macron and the British prime minister, Richard will aim to turn the page on years of acrimonious relations later today with more now from Paris his our UK correspondent Lizzie burden. Here in the city of romance, France and Britain will today try to rekindle theirs as UK prime minister Rishi sunak heads to Paris for the first such state visit in 5 years after 7 years of post Brexit acrimony. On the agenda will be defense, migration, nuclear power, and green subsidies, but to above all as Russia looks on, the two sides are determined to present a united front on the war in Ukraine. In Paris, I'm Lizzie burden, Bloomberg, daybreak, Europe. A New York judge has ordered JPMorgan to turn over more records from CEO Jamie Dimon to the U.S. Virgin Islands. The audio is related to a lawsuit accusing the bank of facilitating Jeffrey Epstein's sex trafficking JPMorgan has denied the Virgin Islands claim that diamond had a role in retaining Epstein as a client the latest news comes after the U.S. lander sued former executive jazz daily whose relationship with Epstein is the focus of the lawsuit. Right, there's a few of our top stories this morning, look, we are tracking the SVB story in depth and we'll discuss it in just a moment with our tech and startups editor who follows the scene in San Francisco so closely for us. But just a word on some light and use this body that I was reading about. The new obsessed by property prices. Do you live in London by any chance? I know, I'm sorry, I'm such a Brit. I'm such a londoner, what can I say? London's most in sport, apparently, is now rumford, giddy park, and how old Woods do you know why? Well, I can stab a guess. Anyway, is it to do with the Elizabeth line? It is. Rather luxurious, the speedy and the extremely quiet Elizabeth line has really kind of shrunk the distances in London and so this part of London that is way east that has been pretty cheap and not all that popular is now incredibly accessible to the city and to central London. So apparently house prices there are hot. Yeah, the median price for an existing home in havering was 462,000 pounds in November. That's compared to 417,000 a year earlier, so a pretty big jump there. The only other bar that saw double digit highest price rises in the same period was the one next door barking in domino. Yes, absolutely. Okay, and there's a really nice piece about this on the blue bag terminal, of course. Right, so let's move on though and talk about the banking story that is ripping through these global markets. Fears over the financial health of Silicon Valley bank have sent bank stocks tumbling and depositors considering their holdings at the lender that is, of course, favored by startups. Bloomberg's a tech and startups editor Anne van der Mae joins us now for more from San Francisco, really good to have you on the program this morning. Now tell us first of all, though, what exactly happened to SVB? Well, it started on Wednesday. When Silicon Valley bank said, it was taking steps to shore up capital, citing losses from the larger tech downturn. That's looking really banky, the favorite among tech startups in those tech startups have really been struggling in recent months. So this ignited panic and on Thursday, people in the tech industry really started worrying and some venture firms even told their portfolio companies to pull the money out of the bank. And that, of course, just made things worse. How do they not have this ripple through the market and how bad is this sell off? Does tell off was quite severe. Silicon Valley bank shares fell about 60% on Thursday, which is almost $10 billion in market value. They then fell another 30% in after hours trading. And this was bad news for the whole industry. Every bank in the S&P financials index was down on Thursday and the index had its worst day since mid 2020. People are clearly wondering if this is the start of a bigger problem. Okay, so how is Silicon Valley reacting? What may happen to SVB next? There was a general panic in startup circles today on message boards were lighting up. People were texting each other. They were calling each other. A lot of people were asking, should we pull our money out of Silicon Valley bank? Maybe the most significant thing here is that many venture capital firms were advising their portfolio companies to take cash out of the bank on

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