With the publication of the Fed minutes next Wednesday, investors' attention is on Wall Street and international markets. After a week of losses on Wall Street and in European stock markets, it remains to be seen whether a reversal of the short trend is feasible or whether it will continue lower.
The possibility of a new immediate interest rate increase by the Fed (at the October 28-29 meeting) has decreased drastically, with the more likely scenario being that it happens on December 8-9. If this happens, it gives traders room and time to seek to act at higher price levels, taking into account that in between (the two Fed meetings) the midterm elections in the US intervene (on November 3).
On Wall Street, the “key” to the trend for October is the course of AI group stocks, which in the event of no interest rate increase may move upward. For the time being, developments on the geopolitical front in the Middle East do not carry the weight they had in previous phases of the market.
Brent at $102.7, WTI at $91.26, the yield on the US 10-year at 5.277%, on the 30-year at 5.63%, the VIX/CBOE at 15.31 points, the S&P 500 at 7,722.72 points with losses of 0.27% in the previous week.
After a correction of 1.10%, the General Index stood at 2,636.54 points, with the minus 2.13% at 3,135.08 points making the (negative) difference.
With average daily trading value at 507.8 million (40.8% higher than the immediately previous week), the market's adjustment in the first “post-rebalancing” period has the banking sector at the center.
Partly the S&P study warning about the high concentration of bank financing in a limited number of large business groups, partly the concerns of the ECB at a central level, combined with the earlier arguments of the IMF, sellers had a clear advantage in the sector's stocks.
Eurobank shares at 4.584 euros with losses of 2.51% over the week, Piraeus at 10.18 with a correction of 0.93%, National Bank at 16.835 with minus 3.44%, and losses of 2.86% for Alpha Bank shares at 4.46 euros. From the sector, those that stood out positively were Credia Bank at 0.98 (2.94%), Optima Bank at 14.65 (0.90%).
A significant development is the formalization of the acquisition of 70% of Pantelakis Securities by Credia Bank, the creation of CrediaPantelkis Securities, which broadens the sources of revenue/profits for the bank.
Revealing is the report by Nontas Chaldoupis, on the ECB's alertness due to business loans, at a time when both interest rates are on an upward path and European entrepreneurship is being hit by energy costs and persistently high inflation. Obviously, this also concerns domestic banking, explaining the partial “profit-taking” of positions last week.
On the winners/losers after the rebalancing, a related article refers, reminding that turnover reached 4.26 billion euros, of which about 3.74 billion euros went through the auctions, mainly due to the mandatory adjustments in the portfolios tracking the FTSE Russell and STOXX indices. The first, broad-scale, repositioning took place last week, while a “tail” (smaller in scale) remains, initially for the first sessions of the coming week.
From 6,757.38 points, the FTSE 25, after a weekly correction of 1.17% but with exceptions that may, from tomorrow, work to the benefit of the longs. According to stockbrokers, the fact of the outperformance of “front-line” blue chip stocks may act as a counterweight to possible new liquidations/pressures on banking shares.
HelleniQ Energy at 18.18 euros, with a weekly rise of 5.76%, ΕlvalHalcor at 3.81 (with 4.24%), Viohalco at 17.66 euros, with a rise of 4.13%, DAA at 12.50 (with 3.14%), Cenergy Holdings at 24.20 (with 3.07%), Metlen at 49 euros (with 1.45%, Motor Oil at 67.50 (with 1.28%), Jumbo at 24.86 (with 1.20%) create related hedging. It remains to be seen whether this will continue and to what extent it will be enough for the continuation of next week.
Concern in construction over public works (according to a survey by IOBE) with the sector burdened by increased costs.
Critical ballots in Brazil, with the election result concerning (indirectly) the case of Allwyn. The share price stands at 11.08 euros, with significant positions being unwound and a correction of 6.42% over the week.
Technically, according to the assessment of Manos Hatzidakis “... the General Index is on a clear corrective course from the recent yearly high, which differs from previous declines due to the intensity of the fluctuations and the increased trading activity. Friday's low was recorded just two sessions after the yearly high —and 17-year high— widening the weekly trading range to more than 100 points.
At the same time, turnover shows no signs of de-escalation, an indication that sellers' pressure remains strong. The 30-day moving average has now been convincingly broken, while the corresponding 50-day average constitutes a first support at 2,634 points”.
Steadily on the minds of entrepreneurs and market professionals is also the political parameter, with a relevant reference to the battle of the... agenda and the government's difficult bets.