(News Bulletin 247) – After its air hole the day before (-2.9%), the Paris Stock Exchange should try to stabilize on Wednesday at the opening, in the wake of Wall Street the day before, investors returning timidly into risky assets despite lingering fears.

Around 8:15 a.m., the ‘futures’ contract on the CAC 40 index – March delivery – advanced by 20.5 points to 7033.5 points, suggesting a modest recovery at the start of the day.

Investors were completely taken by surprise by the bankruptcy of SVB, but the intervention of the American authorities made it possible to curb the sell-off in the markets, which turned out to be relatively moderate.

At the close of the New York Stock Exchange last night, the Dow Jones fell less than 0.3%, while the Nasdaq Composite was up nearly 0.5%.

In Paris, the CAC 40 lost 4.5% over the past week, but still shows a gain of more than 8% since the start of the year.

The clearings suffered in recent days give hope for a scenario of ‘resetting’ the counters which would allow the markets to find a new dynamic.

The markets indeed seem to think that a major shift has just occurred and that the Fed has no choice but to limit, or even postpone, its interest rate hike program in order to avoid any risk of ‘systemic’ order.

According to the CME’s FedWatch barometer, market participants estimate the probability of a status quo from the Fed next week at 47%, with that of a 25 basis point hike being estimated at 53%.

Investors will follow, despite everything, with some feverishness the consumer price statistics which will be published one hour before the opening of Wall Street.

Reassuring figures on US inflation could alleviate concerns and encourage investors to return to equities.

January’s publication dashed hopes of rapid disinflation, given the still strong tensions in services but also the strength of goods prices.

According to the consensus, analysts hope that the rise in the CPI index will have slowed to 5.5% excluding energy and food in February, against +5.6% the previous month.

Strategists agree, however, that markets are unlikely to calm down anytime soon.

The CBOE Volatility Index, often dubbed the ‘barometer of fear’, which measures expectations of movements in the S&P 500, rose again yesterday to reach new highs since last fall.

The resurgence of volatility that accompanied the SVB affair could therefore be a harbinger of new shocks to come.

In its latest annual report, Credit Suisse acknowledged having identified “significant weaknesses” in the internal control of its financial statements for the 2021 and 2022 financial years.

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