Credit Suisse fears rock Asian stocks; gold and dollar soar

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Credit crunch concerns leave markets on edge ahead of a European Central Bank meeting

Singapore — Asian stocks slid on Thursday and investors turned to the safety of gold, bonds and dollars as Credit Suisse became the latest focal point for fears of a banking crisis, leaving markets on edge ahead of a European Central Bank meeting later in the day.

“I think we’re getting into the hard hat territory again,” said Damian Rooney, a dealer at Perth stockbroker Argonaut. “The word contagion is knocking about ... we’re getting fear across the whole board here.” Commodities also nursed big falls. Brent crude futures were struggling to lift from 15-month lows and hovered around $74.16 a barrel. Copper slid 2.5% in Shanghai after a 4% drop in London overnight.

The latest pressure came in the wake of the collapse of three US banks in the space of a week and was triggered after the bank said it hadn’t stemmed deposit outflows and its biggest shareholder declined to offer further support. Money market pricing implies a less than a 20% chance of a 50bps hike from the ECB, down from 90% a day earlier.

 

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