European stock markets were sharply lower Wednesday, with banking stocks in deep negative territory amid the global Silicon Valley Bank fallout and more bad news for Credit Suisse.

The pan-European Stoxx 600 index was down 2.4%, with all sectors trading in the red.

Banking stocks plunged 6.7%, followed by the energy sector, which was down 4.8%.

Credit Suisse dropped to the bottom of the blue-chip index, down 23% at 1:40 p.m. London time, after the bank’s biggest lender, Saudi National Bank, said it would not be able to offer it more financial help.

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Credit Suisse share price.

The Credit Suisse fall caused a wider banking sell-off to resume after the sector staged a modest recovery Tuesday. BNP Paribas was down 11.1%, Societe Generale was down 12.9%, Commerzbank was down 10.1% and Deutsche Bank was down 8.6%.

Several bank stocks, including Credit Suisse, were temporarily halted from trade during the morning due to the steep losses. Deutsche Bank, Societe Generale and UBS declined to comment.

That comes despite buoyant trade in Asia-Pacific markets overnight and on Wall Street Tuesday, where U.S. bank stocks rebounded on optimism that the contagion risk from Silicon Valley Bank’s collapse was contained. U.S. stock futures were lower early Wednesday.

Meanwhile, U.K. Finance Minister Jeremy Hunt unveiled his “Spring Budget,” which includes extensions of the cut to fuel duty and of energy support measures. It comes as teachers, civil servants, rail workers and junior doctors strike over pay and working conditions.

Hunt also said the British economy was “proving the doubters wrong” as gilt rates, mortgage rates and inflation come down, and that it would avoid a technical recession.


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