by Claude Chendjou

PARIS (Reuters) – The main European stock markets are expected to fall sharply on Friday in the wake of the closing of Wall Street, weighed down by the banking sector after the setbacks of SVB Financial Group, while the imminence of the publication of the monthly report on employment in the United States hardly encourages risk taking.

Index futures suggest a decline of 1.51% for the Dax in Frankfurt, 1.39% for the FTSE 100 in London and 1.82% for the EuroStoxx 50. As for the CAC 40 in Paris, it could decline by 1.6% according to the first indications available.

After the bank specializing in cryptocurrencies Silvergate Capital, which announced its intention to end its activities on Wednesday evening, investors were surprised on Thursday evening by the difficulties of Silicon Valley Bank, a subsidiary of SVB Financial Group, which launched in disaster a capital increase to deal with a liquidity risk, fueling the specter of serious strains on the banking system.

“I think there is speculation that there are broader issues within the US banking system,” said Rob Carnell, an economist at ING.

On the macroeconomic level, investors are awaiting at 13:30 GMT the data from the US Department of Labor on employment for the month of February and a possible revision of the January statistic which had been significantly higher than expected, raising fears of a prolonged monetary tightening. .

The Reuters consensus predicts 200,000 job creations for February after 517,000 in January, an unemployment rate stable at 3.4% and average hourly wages up 0.3% over one month, as in January, but at a slower pace. more sustained over one year (+4.7% against +4.4%).

Fed Chairman Jerome Powell said earlier this week during his hearing before Congress that the magnitude of the interest rate hike for the March 21-22 meeting had yet to be determined. been decided and that it would depend on the data received up to that date.

In Europe, where the monetary policy meeting of the European Central Bank (ECB) is scheduled for March 16, investors will learn at 07:00 GMT of the final German inflation figures for the month of February before those of the whole of the euro zone next Friday.

The latest Reuters survey forecasts the ECB’s deposit rate to peak at 3.75%, higher than the 3.25% peak anticipated in the February survey.


The New York Stock Exchange ended sharply lower Thursday, under the effect of the decline in the banking sector and fears about interest rates.

The Dow Jones index fell 1.66%, or 543.54 points, to 32,254.86 points.

The broader S&P-500 lost 73.69 points, or 1.85%, to 3,918.32 points.

The Nasdaq Composite fell for its part by 237.65 points (2.05%) to 11,338.36 points.

The S&P-500 banking sector fell 6.6%, its weakest since last October, as investors turned their backs on it after SVB Financial Group (-60%) launched a stock sell-off to replenish its cash flow. JP Morgan Chase & Co lost 5.4% and Citigroup 4.1%.


On the Tokyo Stock Exchange, the Nikkei index ended down 1.67% at 28,143.97 points and the broader Topix fell 1.91% at 2,031.58 points.

The Bank of Japan (BoJ) left its monetary policy unchanged on Friday with a target for short-term rates at -0.1%, while its governor, Haruhiko Kuroda, is due to leave office in April.

In China, the SSE Composite of Shanghai dropped 1.1% and the CSI 300 lost 1.01%, while Chinese President Xi Jinping obtained from Parliament a historic third term of five years at the head of the country.


US bond yields fall sharply in the wake of data release showing a five-month record in the number of weekly jobless claims in the United States: that of ten years drops 10.1 basis points, to 3.82% , and the two-year-old 11.2 points, at 4.78%.

The likelihood of a 50 basis point Fed rate hike this month has fallen to 50% from nearly 70% before the new data.

In Japan, the 10-year JGB yield fell intraday to 0.391% after the BoJ decided not to change its yield curve control (YCC) policy before Kazuo Ueda took office. next month will be succeeded by the current governor, Haruhiko Kuroda.


The dollar is stable (+0.07%) against a basket of benchmark currencies, while the euro is trading at 1.058 (0.01%) after the unexpected figures for weekly jobless claims in the United States.

The Japanese currency is trading at 136.83 yen per dollar, penalized by the status quo decided by the BoJ.


Oil prices fell for the fourth session in a row, heading for their biggest weekly drop in five weeks on the prospect of a rise in interest rates in the United States which could weigh on demand.

Brent fell 0.45% to 81.22 dollars a barrel and US light crude (West Texas Intermediate, WTI) 0.71% to 75.18 dollars.

The two oil benchmarks could lose more than 5.5% this week, which would be their biggest decline since early February.

(Written by Claude Chendjou, edited by Kate Entringer)

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