| Wall Street waits for the next domino to fall |
A big Bear Stearns-shaped cloud will be hanging over Wall Street this week.
As investment banks including Goldman Sachs, Lehman Brothers and Morgan Stanley kick off the first quarter reporting season, investors’ already-frayed nerves have been strained to breaking point by the crisis surrounding Bear.
Bankers say last week’s near-collapse of one of the most feared and influential US brokerage firms could not have come at a worse time for a sector battered by bad news and huge losses.
“Banks were going to report bad results anyway, but the Bear situation will put further pressure on share prices and management,” says a senior Wall Street banker.
“Short-sellers could have a field day with bank stocks this week,” he said.
The S&P 500 index of financial stocks has already lost one fifth of its value this year and shares in many investment and commercial banks, such as Citigroup, Morgan Stanley and Lehman Brothers have shouldered even bigger losses.