European shares rise on cautious optimism
At the beginning of the week, European stocks rose as a moderate level of optimism resurfaced following a quick decline on Friday.
The pan-European Stoxx 600 index advanced 1.2% as almost all sectors increased. Construction stocks advanced by 1.52%, banks by 1.33%, and financials by 1.42%. Mining stocks retreated 0.4% after China’s industrial profits fell significantly.
However, investors remained on high alert due to signs of stress in the banking system. The deal includes purchasing approximately $72 billion in SVB assets at a $16.53 billion discount.
Deutsche Bank shares sold off after the German lender’s credit default swaps were upgraded. The stock was up 4.8% in morning trading on Monday.
In February, the business index in Germany was promoted for the fifth month in a row.
The most obvious change was in manufacturing, where companies expressed positive expectations, and signs of pessimism slowly disappeared from their outlook.
Deutsche Bank shares advanced in the morning after retreating in the previous three sessions as European banks posted cautious earnings reports. The stock advanced 3.72% and was 6.6% higher after the opening.
Last week, the German lender caused jitters in markets as the levels of its credit default swaps, a form of insurance for bondholders in the event of a default, increased drastically.
Stock futures rise
Stock futures increased, sending Wall Street ahead of last week’s gains.
- Dow Industrial Average rose 92 points or 0.32%
- S&P 500 futures advanced 0.32%
- Nasdaq-100 futures advanced 0.12%
Regional banks to the higher end, the SPDR S&P Regional Banking ETF advanced more than 2% in the premarket. First Republic was the fund’s top gainer, advancing 24%. PacWest also advanced at 9%.
Wall Street ended a successful week despite a volatile situation related to the Federal Reserve’s interest rate hike and the ongoing banking turmoil. The main Nasdaq Composite indices advanced by 1.72%.