Spreadex Market Update
US sues Binance & CZ, indices rise with bank stocks
Coinbase slumped 7.8% after the CFTC, the US regulator for futures trading, announced it was suing crypto exchange Binance and its founder, CEO Changpeng Zhao, known as CZ. Elsewhere, banking stocks led gains on Wall Street as the FTSE and pound rose on Monday.
Sentiment improved at the start of the new week on news that First Citizens Bancshares bought Silicon Valley Bank. Gold suffered a more-than-1% decline on reduced haven demand, while global stock indices finished higher.
Key Factors for Today
- European markets are set for a positive open as banking stocks recover
- US futures point to higher open on Wall Street
- ASX was up 1% on Tuesday, leading gains in Asia
- US regulator sues crypto exchange Binance and CEO CZ
- First Republic stock rises 23%, leads gains in US regional banks
- BOE Governor Andrew Bailey reiterates his determination to raise rates
Market movers
- FTSE back over 7500
- S&P 500 stalls ahead of 4000
- Gold slides again, off as much as $65 from recent peak
- Oil builds on recovery off 1-year lows
- EUR/USD retakes 1.08 as the dollar softens
- GBP/USD makes another attempt at 1.23
Econ Calendar
- BOE’s Governor Bailey speech (9.45 am)
- S&P Case Shiller Home Price Index (2 pm)
- ECB’s President Lagarde speech (2.15 pm)
- US consumer confidence (3 pm)
Earnings
- Micron Technology Inc
- Lululemon Athletica Inc
- Walgreens Boots Alliance Inc
- McCormick & Co. Inc
- Bellway PLC
Coinbase shares reel
The shares of listed crypto exchange Coinbase tumbled nearly 8% in response to the latest US crackdown. Cryptocurrency prices took a tumble on Monday after the Commodities Futures Trading Commission filed a lawsuit against Binance, the world's largest crypto exchange, and CEO Changpeng Zhao for trading violations. Bitcoin and Ethereum were among the cryptos that slid lower on Monday. Coinbase's shares have fallen hard over the past several trading days after the company said it received a Wells Notice from the Securities and Exchange Commission (SEC).
First Republic leads Regional bank stock gains
FRB shares surged 18% on Monday after it was revealed that SVB, which collapsed two weeks ago, had finally found a buyer. Last week, FRB secured a $30 billion rescue package from larger rivals. Despite this, the company's shares are down nearly 88% this year. FRB's gains led other US regional bank stocks higher; these banks were hit hard by the banking turmoil that swept the market this past month.
BOE Supports Cable
BOE Governor Andrew Bailey said further UK interest rate hikes might be needed if inflation persists, but inflation is expected to fall steeply. The remarks are being interpreted as a sign interest rates will not return to their pre-crisis highs of 5.75%. The pound ended Monday 0.55% higher, primarily on the back of a weaker dollar, helping cable back above $1.23.
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