Risk aversion is in full swing, thanks to a crisis at Silicon Valley Bank (SIVB), a pivotal lender to tech startups.

On Thursday, the self-described financial partner of the innovation economy sold off a $21 billion bond portfolio for a considerable loss to shore up liquidity, sending shockwaves across financial markets. The bank's issues reportedly stem from the Federal Reserve's (Fed) aggressive rate hikes and the resulting slide in bond prices and rise in yields. The two move in the opposite direction).

The fear is that other lenders might also be facing SIVB-like problems, as evident from the sharp slide in the stateside banking stocks and their European peers. The KBW Nasdaq banking index fell over 7% on Thursday, registering its biggest single-day decline since 2020.

Bitcoin and ether have declined by 8% each in the past 24 hours, reaching a two-month low. In the meantime, Treasuries, or U.S. government bonds, have witnessed safe haven flows. The 10-year yield traded at 3.85% at press time, down 15 basis points from Thursday's high of 4%. The two-year yield has dropped to 4.83% from 5.07%.

(By Omkar Godbole)