Banks pressured after U.S. hedge fund client wilts

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Banks pressured after U.S. hedge fund client wilts


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 Friday of U.S. hedge fund 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,
-11.55%

fell 10% in Zurich after it said a U.S. hedge fund defaulted on margin calls. Deutsche Bank
DBK,
-6.26%
,
which according to the Wall Street Journal also unwound Archegos trades, fell 5%, and UBS
UBSG,
-4.20%

shares fell 3%.

Archegos holdings that were sold to meet margin calls included positions in U.S. media companies ViacomCBS
VIAC,
-27.31%

and Discovery Holdings
C4XD,
,
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,

was steady, while U.S. stock futures
ES00,
-0.56%

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 was refloated, an important step in unclogging the Suez Canal that now has a backlog of 450 ships.

Adidas
ADS,
+2.60%

shares rose 3%, but still traded about 12% below its highs of March. Huawei removed Adidas and Nike
NKE,
+3.38%

from its app store, the latest move by a Chinese company to penalize Western apparel makes that have boycotted Xinjiang cotton.



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