Bank stocks rebounded into the green in Friday midafternoon trading, shaking off liquidity fears that had pushed Deutsche Bank (NYSE:DB), Germany's largest lender, down as much as 15% in Frankfurt trading on Friday.
The German bank's loss shrank to 8.5% slide by the end of trading in Germany. European banks remained pressured, but their losses also diminished. Banco Santander (NYSE:SAN) ended Madrid trading down 3%, Barclays (NYSE:BCS) fell 4.2% in London, HSBC (NYSE:HSBC) dropped 2.6% and UBS (NYSE:UBS) slid 3.6%.
The KBW Nasdaq Bank Index (BKX) rose 0.5%. U.S. regional banks staged a turnaround with the SPDR S&P Regional Banking ETF (NYSEARCA:KRE) climbing 2.4%, erasing 2.3% drop at the beginning of the session in New York.
Among the strongest performers were: KeyCorp (NYSE:KEY), +5.0%, Bank OZK (NASDAQ:OZK) +4.9%, Citizens Financial Group (NYSE:CFG) +4.7%, M&T Bank (NYSE:MTB), and New York Community Bancorp (NYSE:NYCB), +4.1%, which is acquiring Signature Bank deposits and some of its loans.
By comparison, JPMorgan Chase (JPM) slid 1.4%, Bank of America (BAC) rose 1.1%, Citigroup (C) -1.1%, Wells Fargo (WFC) -0.4%, Goldman Sachs (GS) -0.9%, and Morgan Stanley (MS) -2.4%.
The 10-year Treasury yield (US10Y) rose to 3.37% by 2:10 PM ET, after slipping to as low as 3.29%. The U.S. Dollar Index perked up 0.6%.
Earlier today, Bloomberg reported that Treasury Secretary Janet Yellen called a previously unscheduled meeting of the Financial Stability Oversight Council. ECB President Christine Lagarde told EU leaders that the euro-area banking sector is strong, and German Chancellor Olaf Scholz said there's no need to worry about Deutsche Bank's (DB) future.