(News Bulletin 247) – The Paris Bourse should continue to rise on Tuesday at the start of the session after its consolidation at the start of the month, taking advantage of signs giving hope for an easing of tensions in the banking sector.

Around 8:15 a.m., the ‘future’ contract on the CAC 40 index – due April – climbed 54.5 points to 7147 points, suggesting an opening in positive territory.

The Parisian market experienced a turbulent start to the month, which led it to drop below the symbolic 7,000 point mark for a while and erase a good part of its gains recorded since the start of the year.

But the time now seems to relax and European equities, which had been largely neglected last year, remain among the best performers this year.

“In a context of improving prospects, investors have detected an opportunity in Europe given the easing of the energy crisis, relatively attractive valuations in the region and the reopening of China”, explains Antoine Lesné, head of of research and strategy at SPDR.

In Europe, the almost general rebound movement primarily benefits banking stocks, whose STOXX index gained 1.4% yesterday, bringing its annual decline to around 1%.

‘No news is good news’ remains somewhat the leitmotif of the European banking sector, but the appetite for risk is also supported by positive developments on the other side of the Atlantic, ‘underline analysts at Danske Bank.

Investor sentiment is benefiting from the takeover by US bank First Citizens of all the deposits and loans of Silicon Valley Bank (SVB), which went bankrupt earlier this month.

The recovery is also favored by the weakening of the dollar, the rise in oil prices and solid economic indicators, such as the Ifo business climate index published yesterday in Germany.

The rise in European equities is, however, curbed by a new episode of tension in the bond market, against a backdrop of renewed appetite for riskier assets.

On the other side of the Atlantic, the selling movement is confirmed with yields on ten-year Treasuries which rose again to reach nearly 3.53% yesterday.

Expectations of a 25 basis point rate hike from the US Federal Reserve in early May rose in the space of a weekend from 17% to 45%.

The dollar, meanwhile, continues to fall against the euro, which returns to around 1.0820 against the greenback in the wake of the strength of the Ifo index released yesterday.

On the oil market, prices are stabilizing with a barrel of American light crude which advances by 0.1% to 72.8 dollars

While investors seem willing to take on more risk now that banking fears have dissipated, they remain cautious on a number of issues.

In a note published yesterday, the DWS teams questioned in particular the ‘unhealthy relationship’ that links European banks to American real estate.

‘The further turmoil that hit European bank stocks on Friday, amid concerns over their exposure to US commercial real estate, shows that investors are still not comfortable with European banks, even after the takeover of Swiss credit’,

Inflation also remains a major concern.

While awaiting new data on this front in the euro zone as in the United States by the end of the week, investors will be attentive to the publication, this afternoon, of the Conference Board’s American consumer confidence index. .

While the recent turmoil in the financial markets could weigh on household sentiment, the ConfBoard survey places particular emphasis on employment conditions which, to date, remain solid.

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