A rescue deal for Credit Suisse and a central banks drive to restore confidence eases fears of contagion
Singapore — Futures and Asian stocks fought to stabilise though banks remained under pressure on Monday as a rescue deal for Credit Suisse and a concerted effort by central banks to restore confidence eased immediate fears of contagion.
“The market’s taken a positive view that that’s one area of concern that’s been cauterised,” said Jason Wong, a senior strategist at BNZ in Wellington. Central banks including the US Federal Reserve, the European Central Bank and Bank of Japan on Sunday pledged support for market liquidity by increasing the frequency of seven-day US dollar-swap operations from weekly to daily.The BOJ said there were no bids for dollars during its operation on Monday, potentially a positive sign if it signals there isn’t urgent demand.Japan’s Nikkei fell 0.4% and the Hang Seng fell 0.9%, with Hong Kong financials down 1%. Financials in Australia fell 0.7%.
“Investors are trying to price out stability risks, but also having to process having their assets written down to save depositors,” said Damien Boey, chief equity strategist at Sydney-based investment bank Barrenjoey.
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