US stock index futures advance amid Credit Suisse crisis

Following a swing in the previous session, US stock index futures rallied as investors tried to pull Credit Suisse out of the crisis while awaiting a new monetary policy decision from the Federal Reserve Bank.

Investors are now monitoring the potential for a 25 basis point rise in interest rates after the Federal Reserve meeting, a sudden reversal of the expected 50 basis point rise that was forecast before the financial disruption caused by the bankruptcy. from Silicon Valley.

The UBS bailout of Credit Suisse and interventions by central banks to strengthen liquidity lessened the possibility of contagion in the broader banking industry, thus boosting Wall Street primary index values.

Shares of regional lenders advanced in premarket trading, with First Republic Bank rising 23.7% after hitting a record low on Monday.

Western Alliance Bancorp and PacWest Bancorp rose 6.8% and 4.7%, respectively, compared to their peers.

Major US banks such as JPMorgan Chase & Co, Citigroup and Bank of America advanced between 0.7% and 1.4%.

The Fed faces a relatively difficult task at this week’s FOMC meeting.

US Treasury yields rose for the second day in a row as the threat of a banking crisis passed, with the yield on the two-year note, a clear indicator of interest rate expectations, last standing at 4.05. %.

Home sales statistics for February will be released later the same day, indicating the strength of the economy.

European markets advanced

The pan-European Stoxx 600 index rose 1.35%. Banks gained 3.2% while the financial services sector advanced 2.4%.

European markets were volatile, with the pan-European Stoxx 600 Index down in early trading.

UBS on Sunday entered into an emergency bailout deal whereby they bought rival Credit Suisse for 3 billion Swiss francs. According to UBS statistics, the combined bank will have $5 trillion in invested assets. Credit Suisse shares fell 53.3% at one point on Monday, while UBS rebounded from losses to 3.9%.