Trading Insights: Stock indices jump higher, Fed opens emergency lending for US banks
Regulators step in to “back” all Silicon Valley Bank (SVB) depositors
The US Fed announced emergency actions to relieve investor concerns after the collapse of US Silicon Valley Bank.
- Funding to support US financial firms announced by US regulators
- US stock indices jump sharply higher on the reduced market risk that the SVB collapse will spread
US stock indices reaction
NASDAQ 100 index futures and CFD products advance +2% higher in front of today’s US opening session.
- The NASDAQ 100 index is highly sensitive to the technology sector
- SVB served as a bank for many high technology companies and their shareholders
- NASDAQ 100 index gained the most against the S&P 500 and DOW 30 indices after the announcement that SVB depositors will be backed by US regulators
Source: Chicago Mercantile Exchange
UPCOMING KEY ECONOMIC EVENTS
|Euro area Eurogroup Meeting of EU economic ministers; this is a non-policy event in which EU economic ministers meet to promote stronger economic growth across the Euro area|
- UK unemployment rate
- US inflation data
- US producer price inflation
- US retail sales
|European Central bank (ECB) interest rate decision|
|US consumer sentiment|
Cross asset bullet points:
- Gold (chart 1) price seems to have reversed its downtrend after pushing above the resistance at $1,860, (chart 1) placing the $1,900 round number in sight; short term downside support spotted around $1,844 (38.2% retracement from 4 week low).
- EUR/USD (chart 2) potential for further price extension towards 1.0823 in the very short term (5-13 days), current price remains above its multi-month upward price trend line (bullish); price is above its 20 and 10 day moving averages (bullish), relative strength index (RSI) above its signal line (bullish), downside risk seen below the 1.0525 key support
Not investment advice. Past performance does not guarantee or predict future performance.
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