Wall Street opens in red and the Dow Jones falls 0.58%

Wall Street began this Friday in the red and the Dow Jones, its main indicator, lost 0.58%, after the collapse of the German shares Deutsche Bank revive concerns about the banking sector and fears of a possible recession.

Ten minutes after the start of operations at the NYSEthe Dow Jones subtracted 186.79 points, to 31,918.98 units, while the selective S&P 500 fell 0.63% or 24.75 integers, to 3,923.97 points.

The composite index of the Nasdaq market, where the main technology companies are listed, left 0.66% or 77.69 units, up to 11,709.71 integers.

The New York parquet dawned downward as a result of the collapse of more than 10% of the shares of the Deutsche Bankand its contagion to other large European banks.

The fall in the German giant’s shares came after the entity announced that it plans to repay $1.5 billion of subordinated debt on May 24, before it matures in 2028.

The bank assured that it has “all required regulatory approvals” for that decision, but the news caused a deep impact in the banking sector.

This new setback for the sector occurs when Wall Street seemed to be leaving behind the storm that intensified in the United States in the past two weeks and which swept away the Silicon Valley and Signature banks.

The First Republic, the hardest hit by the financial crisis in recent days and which was rescued by the big banks with an injection of US$ 30,000 million, saw its shares devalued this morning by about 5%.

However, despite these falls, the three indices are on track to close the week positively.

On Wednesday, the US Federal Reserve (Fed) announced its decision to increase interest rates by 0.25 points and the president of the central bank, Jerome Powell, emphasized the credit risks of the banking sector.

Powell said banking industry stress could trigger a credit crunch, with implications “significant” for the economy.

By sector, energy, which has been very sensitive to the banking crisis, led the losses with a drop of 1.36%, followed by financial (1.18%).

Only the sectors of essential goods (0.41%) and public services (0.25%) operated positively.

Among the 30 Dow Jones stocks, the biggest losses were for financial companies such as American Express (-2.19%) and Goldman Sachs (-2.14%), while the companies that woke up best were Walmart (0.87% ) and Procter & Gamble (0.69%).