European markets open to close, BOE and SNB rate decisions

Swiss franc weakens significantly against dollar, euro and pound after rate hike

The Swiss franc weakened considerably against the US dollar, the euro and the pound following the central bank’s decision to raise interest rates by 75 basis points to 0.5%.

As of 9:30 a.m. London time, the dollar was up 0.9% against the Swiss currency, while the euro and the pound sterling were both up around 1.4% against the franc.

Earlier this week, the Swiss franc hit its highest level against the euro since January 2015, as economists began speculating on the prospect of a 75 basis point rise.

—Hannah Ward-Glenton

Norway’s central bank raises interest rate to 2.25%

Norway’s central bank raised its interest rate from 1.75% to 2.25% and indicated that it plans to raise rates later this year.

There are “clear signs of a slowing economy,” Norges Bank said in a statement, and “the easing of pressures on the economy will help rein in inflation further.”

Based on the current assessment of the monetary policy committee, the key rate will most likely be raised further in November, according to the bank.

—Hannah Ward-Glenton

The Swiss National Bank raises its key rate to 0.5%

The Swiss National Bank raised its benchmark interest rate at 0.5%, a change that ends an era of negative rates in Europe.

The 75 basis point increase follows a drop to -0.25% on June 16, which was the first rate hike in 15 years. Previously, the Swiss central bank had kept rates at -0.75% since 2015.

Inflation in Switzerland is currently at its highest level in three decades, reaching 3.5% last month.

—Hannah Ward-Glenton

Italy goes to the polls on Sunday, here’s what to expect

Italian voters head to the polls on Sunday in a snap general election that is expected to see a government led by a far-right party come to power.

If this happens, it will mark a massive political change for a country already struggling with continued economic and political instability.

Polls prior to September 9 (when a blackout period began) showed a right-wing coalition easily winning a majority of seats in the lean upper and lower houses of parliament.

Atmosphere during Giorgia Meloni’s rally in Cagliari to launch her campaign for the upcoming Italian general elections in Cagliari on September 02, 2022 in Cagliari, Italy. Italians go to the polls for the general elections on September 25, 2022.

Emmanuelle Perrone | Getty Images News | Getty Images

The coalition is led by Giorgia Meloni’s far-right Fratelli d’Italia (Brothers of Italy), and includes three other right-wing parties: Lega, under Matteo Salvini, Silvio Berlusconi’s Forza Italia and a more minor coalition partner , Noi Moderati.

The party of the Brothers of Italy stands out and should win the largest share of the votes for a single party. We see him getting nearly 25% of the vote, according to poll aggregator Politiche 2022far ahead of its closest right-wing ally, the Lega, which is expected to win around 12% of the vote.

Read more about the upcoming elections here

—Holly Ellyatt

Opening of the market: Fortum up 4%, Accor down 6%

Shares of fortune rose again in early trading on Thursday after the Finnish company agreed to sell its 56% stake in the German public service Uniper to the German government. The public energy company transferred its stake in a nationalization agreement.

French hotel company Accor saw its shares fall 6.3% at the market open after JP Morgan downgraded its rating on the stock from neutral to underweight. The investment bank expressed concern the group could not return to its previous level of profitability, saying “our concerns have now outgrown the reasons why we like it”.

—Hannah Ward-Glenton

Credit Suisse plans to split its investment bank into three: The FT

Swiss credit plans to spin off its investment bank into three, according to the Financial Times.

Swiss lender wants to have a separate ‘bad bank’ exclusively for risky assets as it recovers from several years of scandals and blunders.

New proposals suggest Credit Suisse will sell off some of its profitable units as part of the sweeping reshuffle, with full plans expected to be announced during the bank’s third quarter results on October 27, the FT reported.

—Hannah Ward-Glenton

Oil prices climb after Fed rate hikes, demand fears persist

Oil prices rose after the Fed’s third consecutive rate hike.

Reuter also reported Chinese refiners expect the country to release up to 15 million tonnes of petroleum product export quotas for the rest of the year, citing people familiar with the matter.

Brent futures rose 0.45% to settle at $90.24 a barrel, while United States West Texas Intermediate also gained 0.45% to $83.3 a barrel.

— Lee Ying Shan

Fed hike should keep Asian risk assets under pressure, says JPMorgan

Asian risk assets, especially export-oriented companies, will remain under pressure in the near term after the Fed’s rate hike, according to Tai Hui, chief APAC market strategist at JPMorgan Asset Management.

Tai added that a strong U.S. dollar is likely to persist, but monetary policy tightening in most Asian central banks – with the exception of China and Japan – should help limit the extent of currency depreciation. Asian currency.

The US dollar indexwhich tracks the greenback against a basket of its peers, strengthened strongly and last settled at 111.697.

—Abigail Ng

CNBC Pro: This fund manager beats the market. Here’s what he’s betting against

Stock markets are down but the fund managed by Patrick Armstrong at Plurimi Wealth continues to post positive returns. The fund manager has a number of short positions to play on market volatility.

Pro subscribers can find out more here.

— Zavier Ong

CNBC Pro: Morgan Stanley’s Mike Wilson names key attribute he loves in stocks

Morgan Stanley’s Mike Wilson remains on the defensive in the face of continued market volatility this year. It names the key attribute it looks for in actions.

Stocks with this attribute have been “rewarded” this year, with the trend expected to persist until the market turns more bullish, according to Wilson.

Pro subscribers can find out more here.

— Zavier Ong

European markets: here are the opening calls

European stocks are expected to open in negative territory on Wednesday as investors react to the latest US inflation data.

Britain’s FTSE index is expected to open down 47 points to 7,341, Germany’s DAX down 86 points to 13,106, France’s CAC 40 down 28 points and Italy’s FTSE MIB down 132 points to 22,010 , according to data from IG.

Global markets retreated after a higher-than-expected rise US consumer price index report for August that showed prices rose 0.1% for the month and 8.3% a year in August, the Bureau of Labor Statistics reported Tuesday, defying economists’ expectations that headline inflation would fall 0.1% month-on-month.

Core CPI, which excludes volatile food and energy costs, rose 0.6% from July and 6.3% from August 2021.

UK Inflation figures for August are due and Eurozone Industrial Production for July will be released.

—Holly Ellyatt

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