After last week’s drama surrounding SVB bank, another banking crisis loomed this past week surrounding a 144-giant, Credit Suisse. The Swiss bank has been facing turmoil and problems for a while now. Last week, UBS bought out Credit Suisse in a CHF3.3B deal, shocking employeees in a swift move that also reduces investments and shores up banking inside the company. Credit Suisse’s $17B in bonds is now considered worthless. The Swiss government will backstop losses on CHF9B in assets purchased by the bank. To support the UBS takeover of Credit Suisse, SNB or Saudia National Bank, offers $100B in liquidity to UBS. Yet another bank, First Republic, is showing major signs of distress, despite a $30B bailout, resulting in a drop in their credit rating by the S&P. Several regional banks seem unable to withstand the drops in investment portfolios and loan books. These banking crises have roiled up markets, fueling strong concerns about the health of the global financial system. This stress in the banking system is expected to create a rough end to the bear markets in the United States, according to Morgan Stanley’s Michael Wilson. Banks are expected to tighten up lending rules. The reduction in available credit offered out by banks will in turn be expected to squeeze out growth from the economy. Central banks also announce measures to improve US dollar liquidity.

Earnings estimates are expected to go down as a result. Even the Oracle of Omaha, Warren Bufffet has stepped in to give advice to President Biden upon the President’s request. Will other banks be affected? Is the Fed still going to raise interest rates? We explore these questions and more on Twitter and right here in our new weekly blog post, Monday Market Report.

Consensus around an interest rate hike of 25bp is expected, according to FedWatch. Investors are keen to hear Federal Reserve chairman Jerome Powell’s decision by March 22. At that time, the Fed will also share a Statement of Economic Projections (SEP) with forecasts for stickier inflation.

Many large employers continue to slash their workforces. Amazon has reduced yet another 9,000 staff from its AWS and Twitch services. All in all, the company has removed 18,000 workers since November.

Despite the angst surrounding the banking industry and some initial wobbling, the S&P 500, Dow Jones, Nasdaq and Russell 2000 all posted gains.

Have a great week ahead!

Data for this report has been compiled from Yahoo! Finance, WSJ, FactSet, Bloomberg, FedWatch, Financial Times, and Reuters.