The FTSE 100 rises as Credit Suisse borrows $54 billion from the central bank.
The FTSE 100 and European stocks bounced back this Thursday after heavy losses in recent days after the Swiss central bank offered support to embattled lender Credit Suisse (CS).
The troubled bank said it will borrow up to 50bn Swiss francs (£44.5bn/$53.7bn) from the country’s central bank to shore up its finances. Credit Suisse is one of 30 banks globally deemed too big to fail, forcing it to set aside more cash to weather a crisis.
Problems in the banking sector surfaced in the US last week with the shock collapse of Silicon Valley Bank (SIVB), the country’s 16th-largest lender, followed two days later by the failure of New York’s Signature Bank (SBNY).
The FTSE 100 (FTSE) rose 0.74% to 7,398 points during midday trading.
The chief executive of Credit Suisse told his staff to focus on facts as he pledged to rapidly move ahead with a plan to streamline operations.
In a memo to staff, Ulrich Koerner said the bank would continue to focus on the transformation of Credit Suisse from a position of strength, citing an improved liquidity coverage ratio and recent capital raisings.
He said: “Effective communication is key to ensure that our clients and external stakeholders understand the strengths of the bank, our strategy, and the accelerated progress we are making to create the new Credit Suisse.
“At times like this, it is important to focus on facts and reinforce the strengths of the bank.”
Shares in Credit Suisse (0I4P.L) surged by 15% after its plans to borrow cash from the Swiss National Bank emerged.
FTSE 100 TECHNICAL ANALYSIS DAILY CHART:
FTSE 100 is currently trading in the down channel.
FTSE 100 is currently trading below all SMA.
RSI is in an oversold zone which suggests bullishness and Stochastic suggesting no trend.
Immediate resistance is at 7453.6 & its immediate support level is 7302.6
HOW TO TRADE FTSE 100 IN THIS WEEK
FTSE 100 is trading the down Channel; it has broken its important support level and; it will continue to trade downside until any trend reversal.
