European bank shares slumped Friday, sending stock markets tanking as contagion fears erupted once more after a raft of global interest rate hikes. Frankfurt’s Deutsche Bank shares nosedived more than 13 percent on the lender’s spiking cost of default cover, or credit default swaps, while peer Commerzbank tumbled by 10 percent. In Paris, Societe Generale shed nearly eight percent and BNP Paribas lost around seven percent in value. And in London, Barclays, NatWest and Standard Chartered tumbled about six percent. Investor panic also sent oil prices sliding about three percent on weaker demand fears owing to a possible recession. Share prices in energy majors including BP, Shell and TotalEnergies also tanked. The haven dollar surged against the euro and pound. “The selloff in banks has resumed, highlighting just how fragile sentiment is towards the sector,” City Index analyst Fiona Cincotta told AFP. “As central banks continued hiking rates this week the outlook is looking increasingly shaky. “Deutsche Bank has come under the spotlight as a possible target for contagion risk,” she added. Indices in the key European capitals plummeted by more than two percent, after earlier losses across Asia. Central banks pressed on this week with monetary tightening to bring down high inflation — even though the troubles in the banking sector have been linked to their interest rate hikes. The region’s indices had wobbled Thursday as investors weighed rate hikes in Britain, Norway and Switzerland. That came one day after the US Federal Reserve ramped up borrowing costs, and one week after a hefty increase from the European Central Bank. Friday’s fresh market woes overshadowed news of an upbeat survey showing eurozone economic growth hit a 10-month high in March. Global markets were slammed earlier this month by the collapse of three regional US lenders, notably Silicon Valley Bank. Switzerland’s enforced UBS buyout of embattled Credit Suisse last weekend sent further shockwaves across trading floors. “Contagion fears are not yet going away,” warned Finalto analyst Neil Wilson. “It only stops once people stop asking who’s next. And it does not seem like we are at that stage yet.” Some investors are however hopeful that central banks could be nearing the end of their interest rate-hiking cycle. Pledges by global authorities to provide support to troubled lenders and depositors provided some stability. The turmoil has also forced the Fed and others to change their monetary policy game plan to avoid further problems in the finance industry.