Asia Markets Slide on US Treasury Secretary Yellen’s Bank Crisis Comments

Asian shares saw little losses on Friday, as investors digested comments from U.S. Treasury Secretary Janet Yellen, who suggested that the federal government’s emergency actions to rescue failing regional banks may be used again if necessary.

Yellen had told senators the day before that the Treasury had no plans to insure all U.S. bank deposits without consent from Congress.

In Japan, the Nikkei 225 was down 0.13% at 9.36 A.M. Bangkok time, as the country reported core inflation at 3.1% for February, marking the first time in 14 months that the pace of inflation has slowed.

The Hang Seng index in Hong Kong was down 0.19%. In mainland China, the Shanghai Composite dropped 0.45%.

South Korea’s Kospi shed 0.51%. Australia’s S&P/ASX 200 was 0.30% lower.

The stock market in the United States closed Thursday with a gain despite a highly tumultuous session. The Nasdaq Composite, which is heavily weighted towards technology companies, led the way for advances, rising by 1%; the S&P 500 gained 0.29%, and the Dow Jones Industrial Average climbed 73.66 points.

The federal emergency procedures that were utilized to protect Silicon Valley Bank and Signature Bank customers can be taken again if necessary, Treasury Secretary Janet Yellen said on Thursday.

“We have used important tools to act quickly to prevent contagion. And they are tools we could use again,” Yellen said in written testimony before a House Appropriations subcommittee.

She also said, “The strong actions we’ve taken ensure that Americans’ deposits are safe.” To be sure, the regulators are ready to take more measures if necessary.

Her remarks come as regulators have tried to calm the banking market after the shutdown of Silicon Valley Bank.