Global Markets Shaken by US Private Credit Strain

Global markets were shaken as signs of strain in the US private credit market came to light. The trigger was news from two regional lenders, Zions and Western Alliance, which reported significant losses from bad loans, sparking a worldwide sell-off.
European markets were hit hard, with the FTSE 100, Dax, and FTSE Mib all falling. The banking sector was the worst affected, with €37.4 billion wiped from its value. Barclays and Deutsche Bank were among the top fallers.
The anxiety also gripped Asian markets, with the Nikkei and Hang Seng closing deep in the red. The panic revived fears of a 2023-style banking crisis, raising questions about the health of the economy in a high-rate environment.
Investors, seeking refuge, piled into gold, pushing the price to a new record high. The VIX “fear index” surged, confirming the high level of investor nervousness.