Daily Alert – Thursday 16th March 2023: Markets calm as SNB saves Credit Suisse

Mark NugentDaily Alert, March 2023

Daily Alert – Thursday 16th March 2023: Markets calm as SNB saves Credit Suisse

Good afternoon.

Today’s Daily Alert is text-based only.

Yesterday was strongly risk-off as Credit Suisse’s largest shareholder, Saudi National Bank, ruled out taking a bigger stake in the Swiss bank. It just might have had something to do with the way it was said. “The answer is absolutely not, for many reasons outside the simplest reason, which is regulatory and statutory,” the Saudi National Bank’s chairman said when asked about further liquidity injections. Ouch.

This, coming hot on the heels of the Silicon Valley Bank failure, spooked the markets. One reaction was a weakening of the EUR, which destroyed my EURGBP long trade.

Today, things are calmer. Credit Suisse has managed to secure a credit facility with the Swiss National Bank.

Elsewhere, the European Central Bank hiked rates by 50 basis-points as per previously stated intentions. ECB President Lagarde said “If the baseline as we have it was confirmed and was to persist, we would have more ground to cover.” So still hawkish then.

As of 5pm UK-time, equities are rising, oil has stabilised, the Euro has gained back a little of yesterday’s loss and the US 10-year yield is rising although the USD is down.

Tonight, I will have a look at potential reversals in equities, oil and the EUR as a partner to the GBP.

I’ll be back tomorrow.

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