The control room of Euronext, the company that manages the Paris Stock Exchange (AFP/Archives/ERIC PIERMONT)
The Paris Stock Exchange was again weighed down Monday by the banking sector following the takeover of the takeover at a discounted price of the bank Credit Suisse by its great rival UBS.
After an opening in the red, the star CAC 40 index briefly returned to positive territory before turning around in a climate of stock market nervousness: around 10:25 a.m., the Parisian rating lost 0.47% to 6,893 points. Last week, the CAC 40 fell more than 4%, its worst performance in six months.
“The strong and rapid responses from the authorities reassure us, even if it is still too early to be sure that a systemic crisis is avoided”, comments Xavier Chapard, analyst at LBPAM.
“Markets remain tight this morning, which suggests that confidence, the sinews of war when it comes to banks, remains very fragile,” he continues.
UBS agreed on Sunday to buy struggling Credit Suisse, a 3 billion Swiss franc (3.03 billion euros) deal that was hastily concluded after intense negotiations with the federal government to save the country’s second-largest bank and restore investor confidence.
As part of this operation, which forms a behemoth of more than 5,000 billion dollars of invested assets, the Swiss National Bank grants liquidity assistance of up to 100 billion Swiss francs to the two establishments and the Swiss State grants a guarantee of 9 billion francs for potential losses related to assets taken over by UBS.
In the wake of this announcement, the central banks of the United States, Europe, Switzerland, England, Canada and Japan announced on Sunday coordinated action to improve access to liquidity, a kind of insurance to restore confidence in the financial system.
French Economy Minister Bruno Le Maire welcomed Monday a “good agreement” on RMC / BFM TV and hammered that “French banks are solid”.
The “two series of problems”, Credit Suisse and failures of American regulation, “do not concern French and European banks”, assured Monday the governor of the Banque de France.
A few days after a first stock market shock caused by the bankruptcy of the American bank SVB, the difficulties of Credit Suisse, reinforced by the refusal of its first shareholder Saudi National Bank (SNB) to increase its stake in the capital, rocked the markets. last week.
Swiss authorities announced on Sunday an agreement for UBS to buy its historic rival Credit Suisse for 3 billion Swiss francs.
In the bond market, short-term yields continued to fall sharply, signaling that investors consider at this stage and in this tense environment that the US Federal Reserve will not raise rates on Wednesday at its next meeting.
Banks under stress again
Societe Generale shares fell 4.83% to 20.18 euros, those of BNP Paribas by 3.57% to 49.84 euros and those of Credit Agricole by 2.40% to 9.75 euros.
Luxury and defensives support the odds
The luxury sector evolved in the green like Hermes (+1.27%), LVMH (+1.04%). L’Oréal took 1.28%. Defensive stocks such as Air Liquide (+1.39%) and Remy Cointreau (+1.03%) fulfilled their mission.
© 2023 AFP
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