World stocks cautiously increase ahead of high-stakes Fed decision | – #World #stocks #cautiously #increase #ahead #highstakes #Fed #decision
SummaryCompaniesChart: World exchange ratesChart: Global asset performance
LONDON, March 22 (Reuters) – World shares rose to their highest in almost two weeks on Wednesday, although bank Cautious optimism that the crisis will be averted has been dampened by uncertainty ahead of a high-risk Federal Reserve meeting.
USA arising from the Fed’s control of its central bank’s failed Silicon Valley Bank political amid the storm and the financial world is expected to raise interest rates by 25 basis points (bps) in a decision that hinges on Fed Chairman Jerome Powell’s words. how it manages the market turmoil.
Unexpected inflation in Britain in February 10Data showing a rise to .4%, meanwhile, boosted sterling at the Bank of England’s meeting on Thursday, lifting expectations of a quarter-point rate hike.
USA stock futures edged higher, reversing earlier declines, Europe stock markets were higher (.STOXX) and Asia-Pacific shares outside Japan (.MIAPJ0000PUS) added 1.3%.
Japan’s Nikkei (.N225) was down 1.9% bank resulted in the restoration of shares.
All that sent MSCI’s World Stock Index (.MIWD00000PUS) up a third of a percent, hitting an almost two-week high.
of regulators and policymakers globally bank The sector’s efforts to combat volatility have helped stave off a rout in equity markets, and now the Fed is focused on giving markets more reason to rally.
“It’s very difficult for them,” said Francois Savary, chief investment officer at Prime Partners, referring to Fed policymakers.
“Either they don’t do anything and inflation because they say they are still in the process of raising rates, or they do 25 bps, and they say they don’t see the financial situation as putting the economy at risk, but we will assess the impact.”
QT AND POINTS
An additional challenge is whether the Fed will temporarily halt the sale of Treasury debt, known as quantitative tightening, and what Fed members will do with their point plan forecasts for future rate hikes.
Fed QT in question?
Having priced the risk of a rate cut like this last week, futures now imply an 86% chance of a quarter-point hike to 4.75%-5.0%. A few weeks ago, the market was betting on a half-point increase.
Bond investors will be hoping Powell can provide some calm given the wild volatility of recent days. Two-year Treasury yields fell nearly 6 basis points on the day to 4.11%, making a remarkable move from 5.085% to 3.635% in just nine sessions.
Europe Bonds went on a trip together. German two-year earnings overnight 20It posted its biggest daily jump since ’08 as markets returned to pricing in more ECB hikes.
Meanwhile, the euro hit a fresh five-week high of $1.0800, benefiting from renewed interest rate hike bets, Britain inflation after the data, sterling increased by 0.5% and reached 1.2274 dollars.
Dollar the index was softer, dollars and strengthened against the yen to 132.97, .
HOT SPOTS
Markets, unnerved by the turmoil in the banking sector, remained alert to signs of stress elsewhere.
The panic caused by the collapse of Silicon Valley Bank is far from over and a significant number of banks will fail within two years, hedge fund Man Group CEO Luke Ellis ( EMG.L ) said at a conference in London on Wednesday.
“I think within 12 to 24 months we’re going to have significantly more banks that don’t exist,” Ellis said. USAHe added that he thought smaller and regional banks in the UK and rival banks in the UK could be at risk.
First Republic Bank ( FRC.N ) was also in the spotlight on Tuesday after efforts to secure capital flows continued without success.
“The banking crisis is more severe credit conditions, and if you tighten conditions, you weaken economic activity, which puts more pressure on the banking sector,” said Savary Prime Partners. “I don’t think the banking crisis is over.”
Oil in other places prices Brent oil dropped 39 cents to $74.93 a barrel, while US crude oil dropped 34 cents to $69.33.
Reporting by Dhara Ranasinghe; Added by Wayne Cole in Sydney reportAlison Williams, edited by William Maclean
Our standards: Thomson Reuters Trust Principles.
2023-03-22 18:10:14
Source – reuters
Translation“24 HOURS”