Following yet another brutal sell-off in regional banking shares, which followed four bank failures since early March, Wall Street stocks fell on Thursday.
To 33,127.74, the Dow Jones Industrial Average decreased by 0.9 percent.
The tech-heavy Nasdaq Composite Index fell 0.5 percent to 11,966.40 and the broad-based S&P 500 fell 0.7 percent to 4,061.22.
As markets continue to process new interest rate hikes from central banks, steep declines by more banks are escalating concerns about a possible recession, according to analysts.
According to Edward Moya of Oanda, “concerns about financial stability are not going away any time soon.”
That, he continued, will continue to support claims that the economy is headed for a more severe recession than some are anticipating.
The European Central Bank followed the Federal Reserve in raising interest rates by a quarter point, which led to Thursday's losses.
All financial stock prices dropped, but midsized regional banks saw the worst drops as claims regarding their financial standing proved to be false.
Shares of Western Alliance Bancorporation fell 38.5 percent, PacWest Bancorp fell 50.6 percent, and First Horizon fell 33.6 percent.
Paramount Global, an entertainment company that slashed its payout in the wake of dismal performance, was also severely impacted, falling 28.4%.
However, after the Johnson & Johnson spinoff raised $3.8 billion for J&J, Kenvue shares soared 22.3 percent in the health and beauty consumer business' market debut.