The absence of new turbulence over the takeover of Credit Suisse by rival UBS or new fears about the banking system reassured investors and allowed global indices and banking stocks to rise sharply on Tuesday, AFP reported.

European bourses opened higher, with Paris up 1.46%, London up 1.11%, Frankfurt up 1.36% and Milan up 1.58% around 10:25 a.m. They have already recovered a bit on Monday after a major correction last week.

Banking stocks also rose strongly, with the banking sector up 2.21% on the Eurostoxx 600. Unicredit was up 2.97%, Deutsche Bank was up 2.43%, BNP Paribas was up 3.08% and UBS was up 3.32%.

Banks have already recovered from a sharp drop earlier in the session on Monday, reassured by the European Central Bank’s clarifications on how to save banks following the takeover of UBS Credit Suisse, analysts at Deutsche Bank said.

Also, Credit Suisse shares rose 0.53% on Tuesday, continuing to trade just above the strike price.

In Asia, the Hong Kong Stock Exchange rose by 1.36% and the Shanghai Stock Exchange – by 0.64%. The Tokyo Stock Exchange remained closed due to a public holiday.

The New York stock market ended higher on Monday, boosted by the hunt for cheap stocks, as the market calmed after 10 days of banking turmoil following the collapse of Silicon Valley Bank.

Investors are following the meeting of the Fed

But the regional bank First Republic lost almost half of its value again after another downgrade by the rating agency S&P.

The meeting of the American central bank (Fed) begins on Tuesday, and on Wednesday it is supposed to make a decision on monetary policy. Although the Federal Reserve has responded several times in recent days, “officials were unable to comment on the latest developments that occurred during the quiet period” ahead of the meeting, said Ipek Ozkardeskaya, an analyst at Swissquote Bank.

Therefore, the statements of Chairman Jerome Powell will be even more expected, as will the decision on further increases in key rates.

Investors have sharply lowered their expectations for an increase in monetary policy rates, central banks’ main tool to fight inflation, in the name of financial sector stability.

Another sign of the lull in markets is government bond yields, which took a hit during the week, little changed in the US and slightly higher in Europe.

The euro was up 0.10% at $1.0732 by 10:15 a.m. Bitcoin, which has risen several times, fell 1.76% to $27,590.

Oil prices fell again: at 10:15 GMT, North Sea Brent oil was at $73.05 (-1.00%), and US WTI was at $66.77 (-1.28%).

(article photo: DreamsTime.com)