Shortly before 10:00 a.m., the SMI index of star stocks plunged below 11,900 points before returning to around 12,000 points. This raised fears of a mini stock market crash, across all European markets. A market player contacted by AWP mentioned a “fat finger” (entry error) in Stockholm in the futures trading activities. “It shows the extreme nervousness of the markets,” noted a broker.
After this incident, trading resumed its normal course, the Swiss Market Index (SMI) falling 1.05% to 12,001.17 points at 11:00 a.m.
“Investors are now pricing in a rate hike of 50 basis points (bps) at Wednesday’s (Fed) meeting and…75 bps in June, which would be the first since 1994,” John wrote. Plassard of Mirabaud Bank.
Consumer prices in the United States continued to rise in March, rising 6.6% over one year and 0.9% over one month. The PCE inflation index, the most scrutinized by the US Federal Reserve (Fed), has reached its highest level since January 1982.
But for IG analyst Vincent Boy, the Fed might “soften the tone on the next rate hikes”, in order to calm investors’ expectations and allow the markets to rebound, as had been the case in March.
The session was further weighed down by concerns over China, where manufacturing activity fell in April to its lowest level since February 2020 due to lockdowns in major cities across the country.
In Switzerland, consumer sentiment deteriorated sharply in April. The corresponding index published by the State Secretariat for Economic Affairs (Seco) fell to -27 points, well below the multi-year average (-5 points).
