“The worst of the financial instability seems to have passed for the time being.” It was reported that US Silicon Valley Bank was acquired by US regional bank First Citizens Bank and all deposits were taken over. Earlier this week, it was announced that Credit Suisse would be acquired by UBS. However, Deutsche Bank shares were also seen as an unstable market selling target. At the beginning of the week, both movements have regained calmness, and there is a rewind in the movement of risk caution.
“However, it seems it’s still too early to feel relieved.” It seems that the worst is just getting out of the way. Demonstrated protections for depositors have deterred bank runs, but investor losses have not been recovered. To what extent are funds and pension funds suffering? There is a possibility that negative news will come out in the future.
The short-term money market is also swaying expectations of a US interest rate hike. At one point, the FOMC meeting in May was expected to halt interest rate hikes, but now the 25bp rate hike has risen to about 40%. Market sentiment is elusive.
The fact that this week is a milestone such as the end of the month, the end of the quarter, and the end of the term is likely to amplify the unstable situation. A flow-driven phase is also assumed, and we would like to assume that big players will enter before and after the Tokyo mid-price time and London fixing time.
Deutsche Bank shares fell again today, down 2.4%. It is assumed that the risk-off trend will continue.