Banking troubles again roil markets

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This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

What you need to know today

Nikkei rallies

Asia markets mostly rose Thursday, while Japan’s Nikkei led gains and hit fresh 34-year highs. The Nikkei 225 rallied nearly 2% and the Topix also gained after a report said the central bank won’t tighten monetary policy aggressively. Overnight, the S&P 500

 rose and inched closer to the milestone 5,000 level, while the Nasdaq Composite

 climbed 0.95%. The Dow Jones Industrial Average

 also rallied on the back of another positive earnings session.

China’s VC shift

Geopolitics, sluggish growth and tight regulations are forcing a shift in strategy for China’s venture capitalists to seek investors outside the U.S. Beijing’s focus on policy support has also prompted VCs to look at consumer sectors, which usually require greater capital.

Russian oil

India’s energy minister claimed “the world is grateful to India for buying Russian oil,” adding the move keeps global crude prices affordable. The country’s refiners have been snapping up discounted Russian oil since Moscow’s invasion of Ukraine in February 2022.

SoftBank gains

Masayoshi Son’s SoftBank booked a more than $16 billion gain on its stake in Arm, which rallied in after-hours trading on a strong forecast. The company posted net income of $87 million, or 8 cents per share and quarterly revenue rose 14% from a year earlier.

[PRO] Bullish on Nintendo

Analysts are bullish on Nintendo and expect the Japanese video game’s stock price

 to rise by over 30% in the next 12 months. But that depends on whether the company’s highly anticipated console turns out to be a success, according to equity analyst David Gibson.

The bottom line

Trouble is brewing around another U.S. regional lender that has renewed Wall Street worries.

New York Community Bank moved quickly to reassure investors about its financial health after Moody’s cut its credit rating to junk.

The bank also named Alessandro DiNello as the new executive chairman to help stabilize the operations.  

Trying to calm market jitters, DiNello said NYCB has seen “virtually no deposit outflow” from retail branches, adding its liquidity position remained strong.

The moves sparked a nearly 7% jump in NYCB shares Wednesday after an initial decline. Yet, it’s a small dent in the stock’s more than 50% fall since the bank posted a surprise fourth-quarter loss last week. Fears were also exacerbated as the results showed mounting losses on commercial real estate.

Moody’s cited “multi-faceted financial, risk-management and governance challenges” at NYCB in its note late Tuesday downgrading the bank.

“In Moody’s view, control functions with strong knowledge of a bank’s risks are key to a bank’s credit strength.”

NYCB’s problems are reminiscent of the pressure the sector came under last year following the failure of Silicon Valley Bank, that sparked a regional banking crisis.  

It remains to be seen whether the latest measures will be enough to boost investor confidence or will there be more surprises to come.


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