After two turbulent sessions, European markets rebounded, rebounding 1.86% in Paris, 1.83% in Frankfurt and 1.17% in London. In Zurich, the SMI gained 0.8%.
The stock markets rebounded on Tuesday, relieved by the widely anticipated decline in inflation in the United States in February and by the removal of a risk of contagion in the banking sector which had tormented the markets in recent days.
After two turbulent sessions, European markets rebounded, rebounding 1.86% in Paris, 1.83% in Frankfurt and 1.17% in London. In Zurich, the SMI gained 0.8%.
On Wall Street, the Dow Jones gained 1%, the Nasdaq index gained 2.14% and the broader S&P 500 index, 1.62% at 5:00 p.m. GMT.
“For now, the markets seem to continue to calm down and European investors, in particular, are once more more inclined to buy (…). Each positive news currently acts as a balm on the soul of the market participants”, explains Andreas Lipkow, independent analyst.
The disruptions experienced by the American banking sector following the bankruptcy of Silicon Valley Bank (SVB) should have a limited impact on European establishments, which are organized differently, according to the American financial rating agency Moody’s.
US inflation slowed further in February to 6% year on year, its lowest level in nearly a year and a half. It also decelerated over one month, to 0.4%, once more in line with analysts’ expectations.
But economists are worried regarding inflation excluding food and energy prices, which rose once more over one month, to 0.5% once morest 0.4%.
“At a time of market turmoil, reading the inflation figures complicates the task of the US Federal Reserve (Fed), which must perform a balancing act to both lower inflation and preserve the stability of the banking system,” comments Edoardo Campanella, economist at UniCredit.
According to him, “the stress in the banking system has clearly shifted the balance of risks in favor of a more cautious approach” at the next Fed meeting in a week.
Investors who were still wondering last week whether the Fed would raise rates by 25 or 50 basis points due to the resilience of the job market and inflation, are now considering 25 points or even a pause in the monetary tightening.
For its part, the European Central Bank (ECB) is expected to raise rates on Thursday by half a percentage point for the third time in a row, but observers speculate on the continuation of its monetary tightening in the face of the persistence of the inflation and turbulence in the banking sector.
The banks are back in color
Financial institutions, which lost more than 450 billion euros in market capitalization in two days, according to the MSCI financial world index, resumed colors like Deutsche Bank (+4.09%), Commerzbank (+ 4.18%), BNP Paribas +3.08%, Société Générale +2.26%, Banco BPM +1.33%, Standard Chartered 1.16% and HSBC 1.57%.
Massacred on the stock market for three sessions, the American regional banks began to stop the bleeding: First Republic Bank rose by more than 55% and Western Alliance by 42% around 4:45 p.m. GMT.
Meta prunes once more
Meta, parent company of social networks Facebook and Instagram, will cut 10,000 more jobs following a first wave of 11,000 layoffs in early November, group CEO Mark Zuckerberg announced on Tuesday. Meta shares rose more than 6% around 4:45 p.m. GMT.
In other markets
After a spectacular drop in interest rates on government bonds on Monday, the sovereign debt market rebounded sharply on Tuesday: the yield on the 10-year US bond stood at 3.64% and the two-year at 4 .38% around 4:55 p.m. GMT.
The dollar recovered a little once morest other currencies. The euro fell 0.12% to 1.0718 dollars and the pound 0.22% to 1.2115 dollars around 4:55 p.m. GMT.
Bitcoin climbed 7% to $25,953, following surging more than 12% on Monday.
After experiencing a volatile session on Monday and reaching its lowest since January during the day (78.34 dollars), the barrel of Brent oil from the North Sea fell by 0.58% to 80.36 dollars and that of WTI American lost 1.97% to 73.32 dollars, to GMT.
