Australia’s stock market plummeted after Credit Suisse shares plunged 24 percent

Australian stocks have tumbled and banks have faltered as financial markets worry about the possible collapse of Swiss bank Credit Suisse, which could trigger a new global financial crisis.

The Australian Stock Exchange’s benchmark S&P/ASX200 fell 1.7 percent in the first 90 minutes of trading Thursday morning.

This comes after Credit Suisse shares plunged 24 percent just days after the collapse of America’s Silicon Valley Bank and Signature Bank after a key investor refused to increase its stake in the struggling Swiss bank.

Saxo’s market strategist Jessica Amir said financial markets were concerned about a repeat of the global financial crisis in 2008, when banks stopped lending to each other, triggering a liquidity or credit crunch.

“We think it could possibly be, it’s basically evoking messages of a potential Lehman Brothers moment,” she told Daily Mail Australia.

“To step back, big picture, what’s happening is the interbank markets, there’s a liquidity squeeze there, and that’s a big problem.”

Australian stocks have tumbled with the banks as financial markets worry about the possible collapse of Swiss bank Credit Suisse

Despite being well capitalized, Australian banks bled as Westpac shares fell 2.2 percent to $21.18.

Saxo’s market strategist Jessica Amir said financial markets were concerned about a repeat of the global financial crisis in 2008, when banks stopped lending to each other, triggering a liquidity or credit crunch

That was more severe than the S&P/ASX200’s 1.7 percent decline, which sent it back down to 6,947.90 points.

But that decline was mild compared to the carnage in European stock markets, where shares in French bank BNP Paribas fell 10.1 percent while German bank Deutsche Bank fell 9.25 percent.

The Saudi National Bank, which holds a 9.88 stake in Credit Suisse, has declined to increase its stake, triggering the 24 percent plunge in its shares just days after Rich Dad Poor Dad author Robert Kiyosaki warned that she would be the next bank to collapse.

The Swiss National Bank has now signaled its willingness to intervene to save Credit Suisse, of which Axel Lehmann is the chairman.

The Australian Stock Exchange’s benchmark S&P/ASX200 fell 1.7 percent in the first 90 minutes of trading Thursday morning. This comes after Credit Suisse shares plunged 24 percent after a key investor refused to increase its stake in the struggling Swiss bank

“The SNB will provide liquidity to CS if required,” the Swiss central bank said in a joint statement with the Financial Market Authority.

Ms Amir said Saxo, her Danish employer, encourages clients to invest in safe haven assets such as gold and the Japanese yen.

“We urge our customers to be extremely vigilant,” she said.

‘So that means either reducing overall risk, possibly holding cash and considering some exposure to safe havens like gold and the Japanese yen.

“People should try to protect their portfolios in other ways as well.”

Source: | This article originally belongs to Dailymail.co.uk