A technology rally on Wall Street, a 7.9% “jump” in SpaceX shares, and significant gains for IBM, up 2.8%, and Nvidia, up 2.1%.
The US 10-year yield stood at 5.0940%, Crude Oil WTI at $99.36 and the VIX/CBOE fell to 16.68. Earlier, S&P 500 futures pointed to a higher “open”, up 0.56% at 7,759 points.
The consensus is that, as the chances of another Fed rate rise at its 27-28 October meeting fall, long bets on Wall Street are gaining strength.
Investors were holding back on European stock markets, while the Greek market stood apart as the cavalry returned to the banking sector.
Brent stood at $111.52 and France’s 10-year yield at 4.958%, while the EuroStoxx Banks index rebounded 1.44% to 288.26 points.
The CAC 40 stood at 7,834.51 and the DAX at 25,645.04, with the latter trading at a striking premium to the former.
Buyers returned to the banking sector in force, lifting Euronext Athens by 1.28% to 2,643.62 points.
Of total trading volume of 44.14 million shares, 34.39 million were in bank stocks. Of total turnover of €332.3 million, about €215 million was in National Bank, Eurobank, Piraeus and Alpha Bank. Add the nearly €160 million traded on Tuesday, out of a total of €310 million, and the focus of the “strong hands” becomes clear. Trading worth €370 million-€375 million, compared with €360 million-€362 million over the two-day period, makes it clear where the bet is being placed, mainly by traders but also by investors.
Brokers broadly agree that the “freedom” given to the management teams of the systemic banks over the dividend policies they can pursue was the “fuel” the “strong hands” needed to build long positions in all four systemic banking groups. DBRS MorningStar also provided a catalyst, accelerating moves by “fast money”.
The banking sector led the way over Tuesday and Wednesday, with a “tail” of buy orders and long players looking for the upward momentum to continue beyond 3,100 points. In practice, the target set early yesterday of breaking above the 3,100-point area was reached sooner than expected, and with a significant increase in trading volume and turnover. It remains to be seen whether this will be confirmed at the weekly close tomorrow, Friday.
Alongside the banks, buyers returned to many frontline blue chips, creating the conditions for further gains in the FTSE25. The index stood at 6,772.57 points, with significant inflows into GEK TERNA, PPC, Metlen Energy & Metals, Cenergy Holdings, AKTOR, as well as TITAN, ElvalHalcor and Coca-Cola HBC, among others, lending momentum at least for today and tomorrow.
Leveraged activity picked up immediately in mid- and small-caps, with EXAE, Europe Holdings, CMFC, Performance and KRI-KRI among those standing out.