Markets in the US and Mexico feel the impact of the collapse of Silicon Valley Bank

The stock markets of the United States and Mexico collapsed on Friday, weighed down by the firms of the financial sector, after the collapse of the Silicon Valley Bank (SVB), which on Friday was closed by US regulators.

The S&P 500, the most representative stock index of the United States market, fell 1.45%, for a weekly drop of 4.55 percent. It is the worst week for the US index since September 2022.

Of the 11 sectors within the S&P 500, the one that posted the biggest loss both on Friday and during the week was the financial sector, which, with a drop of 8.55%, had its worst drop since June 2020.

For its part, the technological Nasdaq fell 1.76%, while the Dow Jones fell 1.07 percent. In the week they pointed to a drop of 4.71 and 4.44%, respectively.

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Banco Intercam analysts explained that the falls in financial sector shares were explained by fears of a contagion effect in the banking system, although they described this possibility as “unlikely.”

Also, there have been fears of a possible general bank run and now the questions revolve around whether the higher rates are causing problems in the financial system,” Intercam analysts said.

In Mexico, the Index of Prices and Quotations of the Mexican Stock Exchange (S&P/BMV IPC) fell 1.18%, with the financial sector leading the losses with an intraday drop of 3.58 percent.

The five largest banks in Mexico in market value (Banorte, Inbursa, Bajío, Regional and Gentera) lost 33,467 million pesos in capitalization between Thursday and Friday.

sebastian.diaz@eleconomista.mx