The banking buzz in Europe on Wednesday surrounded a leadership change at UBS, whose stock climbed 2.2% after the Swiss bank rehired Sergio Ermotti as CEO to steer its massive takeover of failed rival Credit Suisse .
The surprise move seeks to take advantage of Ermotti’s experience rebuilding the bank after the global financial crisis 15 years ago. European bank indexes rose 1%.
With bank bosses in the frame, there was also interest in news that JPMorgan CEO Jamie Dimon will be interviewed under oath in May in connection with the bank’s relationship with Jeffrey Epstein, the late sex offender and a former client.
Broader stock markets were higher across the board, with Wall St futures up almost 1% ahead of the open. The VIX index of implied stock volatility slipped back to its lowest level since March 9 – the day after the SVB shock emerged.
Interest rate markets assessed the easing of bank tensions and also the surprisingly resilient U.S. consumer confidence reading for March, a survey which straddled the quake in SVB and the related depositor nerves.
Two-year Treasury yields hit their highest level in a week at 4.12% early on Wednesday before slipping back. Futures markets now show a 50-50 chance of one more Fed rate hike in this cycle in May and half a point of easing by yearend. The dollar was marginally higher.
Elsewhere, there was good news in the chip world. Germany’s Infineon climbed 5.1% after the chipmaker raised its outlook for both its fiscal second quarter and the whole of 2023. The wider tech index climbed 1.7% to lead sectoral gains.
The crypto world continued to look in trepidation at pressure on dominant exchange Binance.
After suing Binance this week, the chairman of the Commodity Futures Trading Commission said on Tuesday that activity at the crypto exchange was a pretty clear case of evasion and U.S. authorities needed to step in aggressively and as quickly as possible.
