The Paris Bourse fell by just 0.2%, to around 7,115 points (the Euro-Stoxx50 also posted -0.2%), after the Fed announced last night that it intended to continue raising rates and had no plans to reduce them this year, despite concerns about the health of the banking system.
The -1.5% fall in US indices was more related to a statement by Janet Yellen ruling out the scenario of a bailout of regional banks, leaving their creditors and shareholders to face up to their responsibilities (while systemic banks remain unfailingly supported by the Fed and the government).
US indices have just reopened up by an average of +0.6%.

Unsurprisingly, on Wednesday the Fed raised its target for the federal funds rate by a quarter point, while declaring that it is considering further rate hikes in view of persistently higher-than-expected inflation.

With regard to the recent turmoil in the financial markets, the Fed acknowledged that the banking turbulence was likely to affect both growth and employment in the USA. The Treasury believes that there is no need for further bailouts of the US banking sector at this time.
The US job market remains very robust: weekly jobless claims in the US fell by 1,000 last week, to 191,000 from 192,000 the previous week, according to the Labor Department.

This score remains very close to the lowest historical levels seen in the last 50 years.
The number of people receiving regular benefits rose slightly by 14,000 to 1,694,000 in the week to March 11, the latest week available for this statistic.

Across the Channel, the Bank of England has just raised its key rate by 25 pts to 4.25%, and is optimistic that inflation will slow at a faster rate than previously estimated.

The Swiss National Bank (SNB) raised its key rate by 50 basis points to 1.50% and reaffirmed that the Swiss banking system remains very solid, despite the woes of Credit Suisse.

On the yield side, a clear easing is taking place after the sharp deterioration of the previous day, and yields are falling back close to those tested on Tuesday: our OATs are easing by è8.5Pts to 2.775%, Bunds by -7.5Pts to 2.254%, Italian BTPs by -7Pts to 4.11%.
Across the Atlantic, T-Bonds are improving very slightly: -2.5pts to 3.475%, the yield differential should benefit the dollar, but it doesn't: the greenback loses a further 0.4%, now trading at around 1.090 against the euro.

Despite Wall Street's decline, oil prices turn the tide, with US light crude (West Texas Intermediate, WTI) recovering 1.7% to $71.2.

Gold, the safe-haven par excellence, benefited from the decline on Wall Street and in the dollar, in a "flight to quality" movement that took the fine metal up 1% to 1980 dollars an ounce, still close to all-time highs.

In news from French companies, Valneva (-2.5%) announced a net loss of 143.3 million euros in 2022, compared with a loss of 73.4 million the previous year, as well as a negative adjusted EBITDA which rose from 47.1 to 69.2 million year-on-year.

Voltalia (10%) reported net income, group share of -7.2 million euros for the past year, compared with -1.3 million in 2021, and stable EBITDA at 137.4 million (-10% at constant exchange rates), penalized by the deconsolidation of power plants sold in November 2021.

Aubay is reporting record net income of 35.6 million euros for 2022, compared with 34.4 million in 2021, and an operating margin down 0.2 points to 10.4%, on sales up 9.1% to 513.5 million.

Copyright (c) 2023 CercleFinance.com. All rights reserved.