Calm returns to global markets as banking crisis fears soothed

The FTSE 100 jumped by about 2% at one point during the day, and closed 132.37 points higher, or 1.79%, at 7,536.22.

Bank shares rebounded (Nick Ansell/ PA) (PA Archive)

Bank shares rebounded and some confidence in the sector has been restored after the US Treasury secretary said the country’s financial system is stable.

Janet Yellen told the American Bankers Association that “contagious bank runs” were the cause of recent turmoil for a number of global banks.

She signalled that the US government would intervene to protect people’s deposits if there were to be any new failures at smaller institutions.