EUROPEAN EQUITY UPDATE: Equities trim earlier losses with banking names leading the charge

Analysis details (09:45)

Equities in Europe trade mostly lower but off worst levels after an initial downbeat open following the fallout from the FOMC. The region initially succumbed to the losses seen across Wall Street after Fed Chair Powell’s press conference concluded, whilst today’s focus has been on the myriad of central bank activity including the Norges and SNB moving in lockstep with consensus (though the SNB shy of market pricing), whilst the BoJ and Japanese government also intervened in FX markets with Dollar selling and JPY selling for the first time since 1998. Elsewhere, US equity futures have been similarly clambering off lows into positive territory with little in the way of drivers to explain the trimming of losses in stocks themselves. Nonetheless, Europe remains mostly negative (Euro Stoxx 50 -0.4%; -0.5%) with the FTSE MIB (+0.2%) the current outperformer as the Banking sector leads the charge in Europe. Banks are lifted as central banks continue hiking rates, whilst Deutsche Bank (+3%) and UniCredit (+6.4%) continue to grind higher after issuing constructive guidance and commentary. Basic Resources and Energy stocks also gain as base metals and crude oil futures benefit from the USD pullback after Japan intervened in markets. Overall, sectors are mostly negative but do not portray as much of a defensive bias as they did at the cash open. Ahead, the BoE will steal the limelight (full Newsquawk preview available in the Research Suite), with policymakers forecast to hike rates ahead of the UK mini budget unveiling tomorrow.

22 Sep 2022 - 09:45- Fixed IncomeResearch Sheet- Source: Newsquawk