ECB Delivers 50bps Rate Hike
The Euro rose against the dollar and on the crosses after the ECB delivered a 50 basis point rate hike at it’s latest meeting. This had been widely expected from the market in the weeks preceding the meeting, however odds had dropped dramatically in the last few days after the market turmoil brought about by issues in the banking sector both in the US and Europe. Some investors had been hoping for a bit of a reprieve from the central bank but were disappointed when they stuck to their guns with regard to the size of the hike. The single currency is now sitting above the 1.0600 level close to the middle of the monthly range.
Markets Recover As Banks Rebound – Nasdaq up 2.5%
US stocks markets enjoyed a strong day as news that some of the country’s biggest banks will come to the rescue of the beleaguered First Republic Bank. The Nasdaq led the way finishing up 2.48% with the S&P and Dow following along closing up 1.76% and 1.17% respectively. Investors are hoping the worst of the pain is out of the way now and the issues with SVB and Signature Bank will turn out to be isolated incidents rather than systemic across the sector. Asian bourses are set to open strongly, although traders remain cautious in light of recent events.
Traders Set for More Volatility Today
Traders are preparing for more volatility across the financial markets today as we move into the weekend. It has been a tumultuous week for investors and the focus has been firmly on the banking sector. There is little ahead in terms of economic data releases today in both the Asian and European sessions however focus will move to the latest sentiment data out of the University of Michigan once the North American session opens. Expect data impact to remain very much in second place however to any fresh news or upsets from the banking sector in terms of market impact.
