(BFM Bourse) – The CAC 40 is moving down at mid-session this Friday. The market is recovering from a tough week and is starting to turn its attention to the Federal Reserve meeting, which ends next Wednesday.
The tough week for the markets is slowly coming to an end. At mid-session this Friday, the CAC 40 fell, losing 0.4% to 6,999.02 points.
The market continues to follow the news related to major banking issues, including Credit Suisse. The group activated on Thursday an option allowing it to borrow up to 50 billion Swiss francs from the Swiss National Bank (SNB).
The price recovered violently on Thursday but lost 8.7% on Friday. The title may suffer from information from Bloomberg, reporting that neither Credit Suisse nor its Swiss counterpart UBS want to get closer, while this scenario has been mentioned by some analysts.
In the United States, large American banks, including Bank of America, Citigroup and JP Morgan Chase, came to the rescue of a weakened establishment, First Republic Bank. These eleven banks have decided to bring him 30 billion dollars of uninsured deposits to provide him with liquidity.
“The fact that US institutions have come together to preserve First Republic Bank sends a message to speculators that they should be careful when betting against the US financial system,” said Naeem Aslam, analyst at Zaye Capital.
The ECB after the Fed
The market is also digesting the announcements of the European Central Bank (ECB), which on Thursday raised its key rates by 50 basis points, or 0.5%. However, it has abandoned its references in its communication to the next changes in rates.
“Without minimizing the risks that may exist, the European Central Bank has decided to maintain its course in the fight against inflation”, underlines Sebastian Paris Horvitz, of La Banque Postale Asset Management.
The market will gradually turn its attention to the meeting of the monetary policy committee (FOMC) of the US Federal Reserve (Fed), which will end on March 22, next Wednesday. In the light of recent market turbulence, some economists believe that it could take a break from raising its key rates.
In China, the central bank lowered the reserve requirement rate for banks in order to support the economy by encouraging institutions to lend more.
As for values, Societe Generale rose 2.8% benefiting from an increase in HSBC’s recommendation to buy. Wendel, which published its financial results on Thursday evening, dropped 3%.
On other markets, the euro gained 0.2% against the dollar at 1.0635 dollars. Oil prices are rising, the contract on Brent from the North Sea for delivery in May takes 1.5% to 69.4 dollars a barrel while that of April on the WTI listed in New York is awarded 0.6 % at $75.20 a barrel.
Julien Marion – ©2023 BFM Bourse