Asian stocks fell in early trade Monday despite a weekend call by Treasury Secretary Steven Mnuchin to top United States banking executives aimed at stemming market panic which saw Wall Street experienced its worst week in a decade.
Mnuchin announced the President's Working Group call in a Sunday afternoon tweet, in which he also revealed that he had reached out to the chief executive officers of the nation's six largest banks to inquire about market conditions.
A statement by Mnuchin on Sunday about his conversation with the banks and plans to convene the so-called Plunge Protection Team "was not especially comforting, however, given that investors had not generally been questioning market functioning in recent days, despite large declines", Nick Bennenbroek, currency strategist at Wells Fargo in NY, wrote in a note to clients.
"The CEOs confirmed that they have ample liquidity for lending to consumer, business markets, and all other market operations", the statement published on Twitter said.
US President Donald Trump's Treasury Secretary has called top US bankers amid an ongoing rout on Wall Street and made plans to convene a group of officials known as the "Plunge Protection Team".
"We continue to see strong economic growth in the U.S. economy with robust activity from consumers and businesses", stated Secretary Mnuchin and added "With the government shutdown, Treasury will have critical employess to maintain its core operations at Fiscal Services, IRS, and other critical functions within the department". Mnuchin said on Saturday Trump told him he had "never suggested firing" Powell.
The announcement comes after weeks of losses in the stock markets and fears of a burgeoning U.S.
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Mnuchin's talks Monday will include the board of governors of the Federal Reserve System, the Securities and Exchange Commission and the Commodities Futures Trading Commission, Treasury said.
Mr Trump has criticised the USA central bank for raising interest rates this year, which could further dampen economic growth.
Incoming White House chief of staff Mick Mulvaney also attempted to calm investors' nerves on Sunday, saying in an interview on ABC that the fundamentals of the U.S. economy are strong despite the recent market slide.
The S&P 500 fell 2.7% and the Nasdaq was off 2.2%. The Nasdaq gave up 8.4 percent, making it the first of the three major averages to fall into bear market territory.
Corporate credit markets have been under duress as well, and measures of the investment grade corporate bond market are poised for their worst yearly performance since the 2008 financial crisis.