The smile on the lips of investors faded again after hearing the statement of the Secretary of the Treasury of the United States Janet Yellen.
Speaking to members of the Senate Appropriations subcommittee on Wednesday, Yellen said she was not considering insuring all US bank deposits without congressional approval.
Previously, the government helped repay most of the uninsured deposits at two banks that collapsed last week, Silicon Valley Bank (SVB) and Signature Bank.
Therefore, some banking groups expect the same guarantee from the government to avoid further threats in the banking system.
As a result of the statement, First Republic Bank shares fell 15.5% in the New York session.
Meanwhile, the 3 main US indexes, the Dow Jones Industrial plunged 1.63% to 32030.12, while the S&P plunged 1.65% to 3,936.98 and the Nasdaq fell 1.37% to 12,567.15.
The US30 index fell to 32,180.50 during the Asian session.
In the meantime, the stock market also failed to rise following expectations of the Federal Reserve (Fed) to end its tightening soon.
The Fed raised rates by 25 basis points and indicated another increase would be made by the end of the year.
However, the central bank insisted that efforts to lower inflation remain a priority and no rate cuts are expected to be implemented this year.
