Indian stocks started Friday in the red, extending a sharp fall on Thursday when benchmarks marked the worst decline since early August. Concerns over a weakening economy and a pick-up in selling by foreign investors have weighed on confidence this week.

Indian Stocks Fall Most Since Early August

India's New F&0 Rules Lead to Stocks Fall

The Silicon Valley Bank (SVB), one of the leading lenders in the United States has sparked a wave of panic in the country and brought down banking shares across the world. The development comes as the SVB announced a share sale to shore up its finances, but the plan did not go well on the Wall Street as investors went on a sell-off spree, triggering a crash in its shares. 
 
As concerns over the bank's financial position spooked the market, a person familiar with the matter said Greg Becker, the SVB Financial Group Chief Executive Officer held a conference call around 11:30 am with the bank's advising clients including its venture and capital investors for 10 minutes and urged them to 'stay calm' and to support the bank like they had been doing for the past 40 years. Now to understand what happened with one of the US's oldest lenders, it's important to look at why did it happen and what's next. Here's everything you need to know:

When and how did the crisis begin?

As per Google Finance, SVB's stock fell 60 per cent ($106.04) on Thursday and its bond posted record declines.

Back in 2021, the bank saw a massive influx in its deposits which jumped from $61.67 billion to almost $189.20 billion. As its deposits grew, it failed to generate its loan book fast enough to generate the yield it wanted to see on the deposited capital. To tackle this, the bank purchased a large mortgage-backed security (MBS) worth $80 billion for its hold-to-maturity (HTM) portfolio. Over 95 per cent of these MBS were for over 10 years, with an average yield of 1.56 per cent.&nbsp;

However, with the rise in Fed rates, the value of SVB's MBS decreased, as the customers could buy "risk free" bonds from the Fed at a 2.5x higher yield, meaning,&nbsp;with the rising value of the Fed, the value of existing bonds fell.&nbsp;

Who are the SVB's clients?

The United States' leading lender is deeply connected to startups, as its focuses on trade in Silicon Valley and tech startups only.&nbsp;

As per the bank's website, it does business with over 50 per cent of all US venture capital-backed startups and almost 45 per cent of US venture-backed tech and healthcare companies.

The SVB announced that it had sold $21 billion of its Available For Sale (AFS) securities at a $1.8 billion loss and was raising another $2.5 billion in equity and debt.&nbsp;

This came as a surprise for its investors, who thought that the bank won't sell its AFS securities. Prominent venture capitalists advised businesses and startups to withdraw their money from the bank.&nbsp;

According to Bloomberg, a high-profile VC firm, Founders Fund, asked its portfolio companies to move their money. Union Square Ventures and Founder Collective also advised their portfolio companies to pull their funds from the bank.&nbsp;

What could happen next?

With the ongoing crisis at the SVB, analysts have raised their respective concerns.

According to a founding engineer at Glean, Debarghya Das if tech companies and startups continue to pull their money out of the bank, the SVB might go bankrupt, and tech companies would be wiped out, raising the chances of recession. &nbsp;

The Silicon Valley Bank (SVB), one of the leading lenders in the United States has sparked a wave of panic in the country and brought down banking shares across the world.

The Silicon Valley Bank (SVB), one of the leading lenders in the United States has sparked a wave of panic in the country and brought down banking shares across the world. The development comes as the SVB announced a share sale to shore up its finances, but the plan did not go well on the Wall Street as investors went on a sell-off spree, triggering a crash in its shares. As concerns over the bank's financial position spooked the market, a person familiar with the matter said Greg Becker, the SVB Financial Group Chief Executive Officer held a conference call around 11:30 am with the bank's advising clients including its venture and capital investors for 10 minutes and urged them to 'stay calm' and to support the bank like they had been doing for the past 40 years. Now to understand what happened with one of the US's oldest lenders, it's important to look at why did it happen and what's next. Here's everything you need to know: When and how did the crisis begin? As per Google Finance, SVB's stock fell 60 per cent ($106.04) on Thursday and its bond posted record declines. Back in 2021, the bank saw a massive influx in its deposits which jumped from $61.67 billion to almost $189.20 billion. As its deposits grew, it failed to generate its loan book fast enough to generate the yield it wanted to see on the deposited capital. To tackle this, the bank purchased a large mortgage-backed security (MBS) worth $80 billion for its hold-to-maturity (HTM) portfolio. Over 95 per cent of these MBS were for over 10 years, with an average yield of 1.56 per cent. However, with the rise in Fed rates, the value of SVB's MBS decreased, as the customers could buy "risk free" bonds from the Fed at a 2.5x higher yield, meaning, with the rising value of the Fed, the value of existing bonds fell. Who are the SVB's clients? The United States' leading lender is deeply connected to startups, as its focuses on trade in Silicon Valley and tech startups only. As per the bank's website, it does business with over 50 per cent of all US venture capital-backed startups and almost 45 per cent of US venture-backed tech and healthcare companies. The SVB announced that it had sold $21 billion of its Available For Sale (AFS) securities at a $1.8 billion loss and was raising another $2.5 billion in equity and debt. This came as a surprise for its investors, who thought that the bank won't sell its AFS securities. Prominent venture capitalists advised businesses and startups to withdraw their money from the bank. According to Bloomberg, a high-profile VC firm, Founders Fund, asked its portfolio companies to move their money. Union Square Ventures and Founder Collective also advised their portfolio companies to pull their funds from the bank. What could happen next? With the ongoing crisis at the SVB, analysts have raised their respective concerns. According to a founding engineer at Glean, Debarghya Das if tech companies and startups continue to pull their money out of the bank, the SVB might go bankrupt, and tech companies would be wiped out, raising the chances of recession.

Silicon Valley Bank crisis: What led to stock crash & what's next. Here's everything you need to know

World&nbsp;stocks&nbsp;on Friday closed out their steepest weekly slide since the pandemic meltdown of March 2020, as investors worried that tighter monetary policy by inflation-fighting central banks could damage economic growth.

The US&nbsp;Federal Reserve's biggest rate hike since 1994, the first such Swiss move in 15 years, a fifth rise in British rates since December and a move by the European Central Bank to bolster the indebted south all took turns roiling markets.

The Bank of Japan was the only outlier in a week where money prices rose around the world, sticking on Friday with its strategy of pinning 10-year yields near zero.

Also read |&nbsp;<a href="https://www.wionews.com/business-economy/day-after-fed-rate-hike-us-stocks-plunge-amid-recession-fears-488925">Day after Fed rate hike, US stocks plunge amid recession fears</a>

After sharp early losses, world&nbsp;stocks&nbsp;steadied somewhat to ending Friday's session down by just 0.12 per cent. The weekly slide of 5.8 per cent&nbsp;was the steepest since the week of March 20, 2020.

Wall Street's Dow Jones Industrial Average slipped 0.13 per cent, the S&amp;P 500 added 0.22 per cent, and the Nasdaq Composite jumped 1.43 per cent.

For the week, the S&amp;P 500 dropped 5.8 per cent, also its biggest&nbsp;fall&nbsp;since the third week of 2020.

"Inflation, the war and lockdowns in China have derailed the global recovery," economists at Bank of America said in a note to clients, adding they see a 40 per cent chance of a recession in the United States next year as the Fed keeps raising rates.

"We look for GDP growth to slow to almost zero, inflation to settle at around 3&nbsp;per cent&nbsp;and the Fed to hike rates above 4 per cent."

The Fed on Friday said its commitment to fight inflation is "unconditional". Fears that its rate hikes could trigger a recession supported Treasury prices and slowed the rise in yields, which&nbsp;fall&nbsp;when prices rise. Ten-year Treasury yields retreated to 3.22944&nbsp;per cent&nbsp;after hitting an 11-year high of 3.498% on Tuesday.

Southern European bond yields dropped sharply after reports of more detail from ECB President Christine Lagarde on the central bank's plans.

Watch |&nbsp;Steepest weekly slide in world stocks since March 2020 as tighter monetary rules worry investors

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"The more aggressive line by central banks adds to headwinds for both economic growth and equities," said Mark Haefele, chief investment officer at UBS Global Wealth Management. "The risks of a recession are rising, while achieving a soft landing for the US&nbsp;economy appears increasingly challenging."

In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan fell to a five-week low, dragged by selling in Australia. Japan's Nikkei fell 1.8&nbsp;per cent&nbsp;and headed for a weekly drop of almost 7 per cent.

Japanese Yen Dives

Bonds and currencies were jittery after a rollercoaster week.

Overnight in Asia, the yen tanked after the Bank of Japan stuck to its ultra-accomodative policy stance. The yen fell 2.2% by late Friday, bolstering the U.S. dollar, which rose 0.73% against a basket of major currencies.

Sterling fell 1% in New York as investors focused on the gap between U.S. and UK rates. The Bank of England is opting for a more moderate approach than the Fed.

"If a central bank does not move aggressively, yields and risk price in more in the way of rate hikes down the road," said NatWest Markets' strategist John Briggs.

Also read |&nbsp;<a href="https://www.wionews.com/world/bank-of-japan-keeps-easing-despite-global-rate-hikes-489112">Bank of Japan keeps monetary easing despite global rate hikes</a>

"Markets may just be continuously adjusting to an outlook for higher global policy rates as global central bank policy momentum is all one way."

Slower growth could dent fuel demand, so U.S. crude fell 6.42% to $110.04 per barrel and Brent was at $113.30, down 5.43% on the day.

Gold was off 0.8% at $1,841.13 an ounce, weighed down by a firmer dollar.

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World stocks on Friday closed out their steepest weekly slide since the pandemic meltdown of March 2020, as investors worried that tighter monetary policy by inflation-fighting central banks could damage economic growth.

World stocks on Friday closed out their steepest weekly slide since the pandemic meltdown of March 2020, as investors worried that tighter monetary policy by inflation-fighting central banks could damage economic growth. The US Federal Reserve's biggest rate hike since 1994, the first such Swiss move in 15 years, a fifth rise in British rates since December and a move by the European Central Bank to bolster the indebted south all took turns roiling markets. The Bank of Japan was the only outlier in a week where money prices rose around the world, sticking on Friday with its strategy of pinning 10-year yields near zero. Also read | Day after Fed rate hike, US stocks plunge amid recession fears After sharp early losses, world stocks steadied somewhat to ending Friday's session down by just 0.12 per cent. The weekly slide of 5.8 per cent was the steepest since the week of March 20, 2020. Wall Street's Dow Jones Industrial Average slipped 0.13 per cent, the S&P 500 added 0.22 per cent, and the Nasdaq Composite jumped 1.43 per cent. For the week, the S&P 500 dropped 5.8 per cent, also its biggest fall since the third week of 2020. "Inflation, the war and lockdowns in China have derailed the global recovery," economists at Bank of America said in a note to clients, adding they see a 40 per cent chance of a recession in the United States next year as the Fed keeps raising rates. "We look for GDP growth to slow to almost zero, inflation to settle at around 3 per cent and the Fed to hike rates above 4 per cent." The Fed on Friday said its commitment to fight inflation is "unconditional". Fears that its rate hikes could trigger a recession supported Treasury prices and slowed the rise in yields, which fall when prices rise. Ten-year Treasury yields retreated to 3.22944 per cent after hitting an 11-year high of 3.498% on Tuesday. Southern European bond yields dropped sharply after reports of more detail from ECB President Christine Lagarde on the central bank's plans. Watch | Steepest weekly slide in world stocks since March 2020 as tighter monetary rules worry investors "The more aggressive line by central banks adds to headwinds for both economic growth and equities," said Mark Haefele, chief investment officer at UBS Global Wealth Management. "The risks of a recession are rising, while achieving a soft landing for the US economy appears increasingly challenging." In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan fell to a five-week low, dragged by selling in Australia. Japan's Nikkei fell 1.8 per cent and headed for a weekly drop of almost 7 per cent. Japanese Yen Dives Bonds and currencies were jittery after a rollercoaster week. Overnight in Asia, the yen tanked after the Bank of Japan stuck to its ultra-accomodative policy stance. The yen fell 2.2% by late Friday, bolstering the U.S. dollar, which rose 0.73% against a basket of major currencies. Sterling fell 1% in New York as investors focused on the gap between U.S. and UK rates. The Bank of England is opting for a more moderate approach than the Fed. "If a central bank does not move aggressively, yields and risk price in more in the way of rate hikes down the road," said NatWest Markets' strategist John Briggs. Also read | Bank of Japan keeps monetary easing despite global rate hikes "Markets may just be continuously adjusting to an outlook for higher global policy rates as global central bank policy momentum is all one way." Slower growth could dent fuel demand, so U.S. crude fell 6.42% to $110.04 per barrel and Brent was at $113.30, down 5.43% on the day. Gold was off 0.8% at $1,841.13 an ounce, weighed down by a firmer dollar. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Stocks in biggest weekly loss since 2020 on interest-rate worries

The BSE Sensex fell by 185 points in early session today due to losses in realty, power, PSU, metal and infrastructure stocks amid weak Asian cues.

Besides, investors were cautious ahead of September quarter GDP data to be released later in the day.

Offloading of positions by participants with today being the last trading session of November series contracts in the derivatives segment pulled down the index, brokers said.

The 30-share flagship index was down 185.24 points, or 0.55 per cent, at 33,417.52 with sectoral indices led by realty and power falling up to 0.88 per cent.

The gauge had fallen 121.68 points in the previous two sessions.

The 50-share NSE Nifty too was quoting lower by 57.50 points, or 0.55 per cent, at 10,303.80.

Weakness in the rupee, which slipped 24 paise to 64.55 against the dollar today, too weighed on the sentiments.

Among laggards Kotak Bank, Cipla, Adani Ports, ONGC, M&amp;M, Reliance Industries, Coal India, Axis Bank, Hind Unilever, Tata Motors, Bharti Airtel, HDFC Ltd, Tata Steel and Lupin dropped up to 1.71 per cent.

Hong Kong&#39;s Hang Seng weakened 1.21 per cent while Shanghai Composite lost 0.26 per cent in early trade. Japan&#39;s Nikkei too shed 0.10 per cent.

US Dow Jones Industrial Average ended 0.44 per cent higher yesterday.&nbsp;

The BSE Sensex fell by 185 points due to losses in realty, power, PSU, metal and infrastructure stocks

The BSE Sensex fell by 185 points in early session today due to losses in realty, power, PSU, metal and infrastructure stocks amid weak Asian cues. Besides, investors were cautious ahead of September quarter GDP data to be released later in the day. Offloading of positions by participants with today being the last trading session of November series contracts in the derivatives segment pulled down the index, brokers said. The 30-share flagship index was down 185.24 points, or 0.55 per cent, at 33,417.52 with sectoral indices led by realty and power falling up to 0.88 per cent. The gauge had fallen 121.68 points in the previous two sessions. The 50-share NSE Nifty too was quoting lower by 57.50 points, or 0.55 per cent, at 10,303.80. Weakness in the rupee, which slipped 24 paise to 64.55 against the dollar today, too weighed on the sentiments. Among laggards Kotak Bank, Cipla, Adani Ports, ONGC, M&M, Reliance Industries, Coal India, Axis Bank, Hind Unilever, Tata Motors, Bharti Airtel, HDFC Ltd, Tata Steel and Lupin dropped up to 1.71 per cent. Hong Kong's Hang Seng weakened 1.21 per cent while Shanghai Composite lost 0.26 per cent in early trade. Japan's Nikkei too shed 0.10 per cent. US Dow Jones Industrial Average ended 0.44 per cent higher yesterday.

Stocks fall ahead of GDP numbers, F&O expiry

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Indian Stocks Fall Most Since Early August

India's New F&0 Rules Lead to Stocks Fall

Silicon Valley Bank crisis: What led to stock crash & what's next. Here's everything you need to know

Stocks in biggest weekly loss since 2020 on interest-rate worries

Stocks fall ahead of GDP numbers, F&O expiry