PacWest’s already battered shares fell by 40% in premarket trading. The bank said it was talking to potential partners and investors, and would keep evaluating “all options to maximize shareholder value.”
A raft of other regional lenders fell in sympathy before the opening bell: Western Alliance Bancorp slid 17%, while Comerica and Zions Bancorp fell by 7% and 10%, respectively. First Horizon sank by 41% after its $13.4 billion sale to Toronto’s TD Bank was called off.
The jitters follow the failures of Silicon Valley Bank, Signature Bank and more recently First Republic Bank. “The cumulative effect of these bank failures will take its toll both on financial-market conditions and prompt nervousness among the investment community,” said Brian O’Reilly, head of market strategy at Mediolanum International Funds.
Oil stabilized after going haywire. Most-traded contracts for WTI, the U.S. benchmark, hovered around $69 a barrel after a mini-flash crash early Thursday. They are down more than 10% in the past three sessions.
Gold prices gained, briefly surpassing their record closing high in Asian trading hours, before paring gains. The precious metal was recently up more than 0.6% at about $2,049 a troy ounce.
Index futures ticked lower, ahead of a big earnings day, with Apple and other big companies on tap. Treasury yields held steady.
Read More: Dow Futures Slip; PacWest, First Horizon Stocks Tumble