Global markets took a hit on Monday as financial stocks tanked on both sides of the Atlantic. US banks and UK-listed lenders led the decline, dragging down broader indexes in the process.

The culprit? A bold policy proposal that's rattling the financial sector. The administration's push for a one-year ceiling on credit card interest rates is threatening what banks consider a crucial profit engine. Credit card lending—with its typically higher interest margins—has long been a lucrative business for financial institutions worldwide.

This move highlights how traditional policy decisions ripple through asset markets. When one of the world's largest economies signals it's reconsidering the rules around lending rates, it doesn't just affect bank balance sheets; it reverberates across global capital flows. Investors holding exposure to financial stocks watched their positions shift as the policy implications became clear.

For those tracking cross-market correlations, this serves as a reminder: macro policy shifts in traditional finance often create broader market movements that touch everything from equities to alternative assets. When banking revenues face pressure, institutional investors reposition their portfolios—and that reshuffling can influence liquidity and sentiment across multiple asset classes.