wolfstreet.com/2020/03/18/...sis-2-shares-plunge-to-1988-low/
Bank stocks in Europe plumbed fresh mutli-decade lows despite the release of a hurriedly improvised one-paragraph announcement by the ECB pledging to do just about whatever it could take to keep the banking system in tact. The ECB will continue “to monitor markets closely”, the message read, and is “ready to adjust all of its measures, as appropriate, should this be needed to safeguard liquidity conditions in the banking system.” In other words, the ECB is willing to throw what remains of the kitchen sink at the problem.
The message may have been intended to reassure investors, calm market jitters, and stop the sell-off of sovereign bonds and bank shares but if anything, it had the opposite effect. The Stoxx 600 Banks index, which covers major European banks, fell 3.7% to close at 83, below even the multi-decade low of 87 in March 2009, at the bottom of the first Financial Crisis this century. Today’s close was the lowest since February 1988, during the sell-off that followed Black Monday in October 1987....
But what is the ECB going to do to rescue bank shareholders? Not much. The ECB is primarily concerned with keeping the Eurozone duct-taped together. .... the ECB couldn’t care less about bank stocks, as long as the banks themselves don’t collapse. So it has thrown just about everything it has at the problem of keeping the Eurozone in tact, including conjuring up €4.7 trillion ($5.2 trillion) of fresh money, and pushing its policy rates and many bond yields into the negative, but with largely undesirable consequences for banks and their shares."
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