(News Bulletin 247) – The Paris Stock Exchange should continue its recovery that began the day before on Tuesday, driven by an easing of concerns surrounding the health of the global financial system.

Around 8:15 a.m., the ‘future’ contract on the CAC 40 index – April delivery – advanced by more than 60 points to 7084.5 points, suggesting an opening up a little less than 1%.

For ten days, the threat of a new financial crisis has made investors nervous about the chances of survival of the spectacular ‘rally’ that the stock markets signed at the beginning of the year.

But the concerted action of the central banks of the main world economic powers, which have declared themselves ready to stabilize the markets and prevent any drying up of credit, seems to have calmed – at least for the moment – the warning of storm on the places financial.

Christine Lagarde, the President of the ECB, assured yesterday that ‘financial tensions could temper demand and do some of the work that would otherwise have been done by a restrictive monetary policy: without these tensions, we would have indicated that further rate hikes were needed’.

In other words, the cycle of rate hikes could well be over, since a restrictive policy is no longer necessary given the already very tight financial conditions in the markets.

As a London trader summed it up yesterday, ‘risks surrounding the banking system have become more important than monetary policy objectives’.

The risks therefore seem to have diminished, with investors accommodating without too many problems the prospect of more accommodating monetary policies.

The European banking sector also had a good day yesterday, with a rebound of more than 1.2% for the STOXX Europe 600 Banks sector index after a dark red start to the day.

As growing fears about banks have fueled market volatility in recent days, investors are now awaiting announcements from the US Federal Reserve.

Given the prevailing nervousness, the markets remain suspended on the decisions of the Fed, which will fall on Wednesday evening and which will be followed by a press conference by its chairman Jerome Powell.

According to the CME Group’s FedWatch barometer, the probability estimated by investors of a rate hike of 25 basis points hovers around 77%, while only 23% of investors expect the status quo.

On the macroeconomic level, participants will be attentive to the publication, during the morning, of the ZEW index of investor sentiment in Germany, then to the publication, this afternoon, of sales of existing homes in the United States. .

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