European stock markets closed broadly flat on Tuesday amid lingering fears of a deeper crisis triggered by the collapse of Credit Suisse and two US banks.
The pan-European STOXX 600 index closed down 0.06%, at 444.45 points, after rising 0.8% during the day.
The European Central Bank’s top supervisor was concerned that the recent sell-off in Deutsche Bank shares showed investors were on edge and could be spooked by moves in the credit default swaps (CDS) market.
The German bank fell nearly 2% on Tuesday after falling nearly 9% last week after its cost of insuring debt against default risk jumped to a more than four-year high.
“The question now is how much more of a concern the renewed fear of recession will be in the (banking) industry than it has been,” said Chris Beauchamp, chief market analyst at IG Group.
While the European Banks Index rose 0.7% on Tuesday, shaving much of its gains, it is on course for its worst monthly performance since March 2020, when financial markets were hit by pandemic fears.
Swiss UBS rose 1.7% after Chief Executive Ralph Hamers said the bank saw its government-orchestrated takeover of Credit Suisse as a growth opportunity, in an internal memo seen by Reuters. Credit Suisse shares advanced 0.7%.
In LONDON, the Financial Times index advanced 0.17%, to 7,484.25 points.
In FRANKFURT, the DAX index was up 0.09% to 15,142.02 points.
In PARIS, the CAC-40 index gained 0.14%, at 7,088.34 points.
In MILAN, the Ftse/Mib index appreciated by 0.47%, at 26,329.46 points.
In MADRID, the Ibex-35 index registered an increase of 0.43%, to 8,944.30 points.
In LISBON, the PSI20 index appreciated by 0.92%, to 5,835.62 points.
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