Ipek Ozkardeskaya
Swissquote Bank Ltd
We spent the weekend talking about whether Credit Suisse will finally go bust or not. The share price is down below 4 francs a share, and the credit default swaps are going through the roof. The 5-year CDS for Credit Suisse spiked to 250 from around 60 at the start of the year. It means that the market is aggressively pricing a default for one of the biggest Swiss banks.
Is it possible? Yes, it is possible, but it is highly unlikely.
Zooming out, the third quarter ends with losses, even though we thought that the summer rally could’ve given something. But no.
The S&P 500 finished the 3rd quarter having slipped to the lowest levels this year. The same is true for Nasdaq and the Dow Jones. $24 trillion have been wiped out of the stocks so far this year.
And the last quarter begins with aggressive rate hike expectations from the Federal Reserve (Fed), but also from the European Central Bank (ECB) and the Bank of England (BoE) to fight inflation and the dollar strength.
Nike has been the latest company warning investors of falling profits due to mountains of stockpiles that they inherited from the pandemic times – and which brought the company to make nice price discounts -, and the strong dollar.
This week, we will watch how Tesla will react to the latest delivery report, the OPEC decision and the US jobs figures… and hope that this week’s jobs data doesn’t reveal strong job additions, and solid salary growth in the US.
This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.
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