The main index on the Oslo Stock Exchange immediately rose 0.6 percent from the start. A few hours into the trading day, the rise continues, and at 10.45 the main index rises 0.8 per cent.
So far this year, the main index has risen 1.3 per cent. The spot price for North Sea crude oil, a key reference price for oil trading worldwide, has fallen 11 per cent so far this year. In the morning hours on Monday, the price rises by half a percent to 76.6 dollars a barrel.
The rise in oil prices in the morning hours is good news for several heavyweights on the Stock Exchange. Equinor rises 1.7 per cent, Aker BP is currently up 1.7 per cent and Hydro rises over two per cent.
The crown strengthens
The Norwegian krone recovered quite a bit towards the end of last week, after falling sharply against the euro in the previous days. On Monday morning, the krone strengthens further. At the time of writing, one euro costs NOK 11.60, while by comparison one had to pay NOK 11.89 for one euro on Thursday last week.
Nordea’s currency strategist Ole Håkon Eek-Nielsen believes that the rise in the krone exchange rate comes from Norges Bank’s statements after it raised the key interest rate last Wednesday.
Nordea’s currency strategist Ole Håkon Eek-Nielsen at the interest rate and currency desk in their offices in Oslo. (Photo: Mikaela Berg)
– What was said is read by the market as the interest rate being raised more if the krone exchange rate remains weak, and that means something. The interest rate differential against abroad has gone in favor of the Norwegian krone, yet it is strange to determine that it is the driver as that was not the case last week when the krone continued to weaken while the interest rate differential increased, says Eek-Nielsen.
That the krone exchange rate has weakened to the extent it has has been inexplicable to many. Eek-Nielsen says that the krone usually weakens if the stock market crashes, but so far this year there has been little drama. The krone has nevertheless weakened “steadily and steadily”.
– It has been a form of persistence, adds Eek-Nielssen.
This week the stage is set for the publication of a number of key figures, both here at home and abroad. Eek-Nielsen says that the inflation figures here at home and the inflation figures coming from the US which will arrive on Wednesday, will have an impact on the risk segment in the market, which in turn will have an effect on the krone exchange rate.
The economists at Handelsbanken Capital Markets, for their part, write in Monday’s morning report that for the Norwegian krone, the presentation of the revised national budget on Thursday could probably cause fluctuations.
At the same time, the economists point out that petroleum prices, which have developed significantly weaker than assumed in the national budget. Both volume and price assumptions for oil and gas will affect expectations for the size of Norges Bank’s currency transactions on behalf of the central government, which several players have recently criticized.
– In light of the decline in petroleum prices, especially gas prices, expectations may therefore increasingly provide some more support for the Norwegian krone throughout the summer and autumn, it is further stated.
This week, investors and economists will receive several key figures for the Norwegian economy. On Wednesday, the inflation figures for April will be presented, on Thursday the revised national budget will be presented and on Friday GDP figures will be presented.
American Bankuro
American banks such as Silicon Valley Bank, Signature Bank and First Republic Bank – as well as Swiss Credit Suisse – have gone out of business in a short time. For every bank that has collapsed, authorities and central banks have assured that the dam is now closed and that the crisis is over.
Last week, the financial markets were once again characterized by unrest in the American banking sector. Several American banks, such as Pacwest Bancorp and Western Alliance Banccorp crashed on the American stock exchanges. On Friday, however, the companies strongly recoiled.
An analyst at one of the major investment banks in the USA, JP Morgan, believes on Friday that it is time to take advantage of the price falls, as in the Western Alliance. Analyst Steven Alexopoulos raises the recommendation from hold to buy, and sets a price target of $46. It will more than double in price after Thursday’s drop last week. Even after Friday’s recoil, it is still 70 percent up to Alexopoulos’ price target.
The positive wave of investors also took hold of larger banks such as Bank of America and Wells Fargo, where the price rise was 2.7 and 3.4 per cent.(Terms)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using links, which lead directly to our pages. Copying or other forms of use of all or part of the content may only take place with written permission or as permitted by law. For further terms see here.
2023-05-08 08:36:33
#Currency #strategist #krone #form #persistence
