The Paris Stock Exchange remains cautious on Thursday morning after efforts by the Swiss National Bank to restore investor confidence in Credit Suisse ahead of the European Central Bank’s monetary policy meeting.
After a sharp rebound opening (+1.48%) and having dropped 3.58% the day before, the Parisian coast is more hesitant: the star CAC 40 index only rose by 0.40% around 10:30 a.m.
On the Swiss Stock Exchange, the Credit Suisse share rose by more than 23%, the day after a historic plunge (nearly 25%) whose spark was the refusal of its largest shareholder, the Saudi National Bank, to commit more money to support the Swiss group, which has been struggling for two years.
In an attempt to calm the situation, the Swiss National Bank (SNB) said it was ready to make cash available to the Zurich establishment if needed and Credit Suisse announced on Wednesday night Thursday that it was going to borrow short term up to 50 billion Swiss francs (50.7 billion euros) to the SNB to strengthen its liquidity.
This painful episode comes after the collapse of several American regional banks last week which had already raised fears about the stability of the global banking system.
Complicated decision for the ECB
This turmoil complicates the decision of the European Central Bank, which is seeking to combat persistent inflation by raising its key rates without further destabilizing the financial markets.
Until recently, a 50 basis point hike at Thursday’s monetary policy meeting was almost done, as the ECB itself announced it last month. But the scenario of a quarter-point rise is no longer ruled out by the markets.
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An increase of only 25 basis points or a status quo is risky. It could confirm to investors a banking risk in Europe and that the bank is putting aside its fight against inflation, warns Christian Parisot, economist at the broker Aurel BGC.
Conversely, a rise of 50 basis points may increase pressure on the valuation of the banking sector, he continues, believing that there is no ideal response for the ECB today.
Bankers stop the bleeding
After a fall of more than 10% on Wednesday, financial stocks resumed some colors pending the decision of the ECB, rebounding 1.33% for BNP Paribas, 0.90% for Credit Agricole and 0.51% for Socit Generale.
TotalEnergies (+0.53% to 53.55 euros) announced on Thursday that it would sell nearly 1,600 service stations in Germany and the Netherlands to the Canadian food and fuel distribution group Couche-Tard, to better prepare for the end of the sales of thermal vehicles in Europe in 2035.
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