March 28, 2023 (MLN): Most Asian markets on Tuesday edged higher after news of the sale of Silicon Valley Bank eased fears of a banking crisis.
European stocks rallied on Monday, and two of the three main Wall Street indexes advanced following news that First Citizens Bank would take over most of SVB, as reported by APP.
The positive market sentiment was driven by gains in bank shares, which had been hit hard last week due to concerns about the impact of the sector's turmoil on other major institutions.
The acquisition of SVB by First Citizens was seen as a positive development by analysts. Hong Kong shares rose by 0.5%, Sydney rallied by 1.1%, and Seoul was up by 0.4%. Jakarta and Singapore also gained, rising by 0.3% each.
Tokyo finished the morning session almost flat, while Taipei dropped by 0.8%.
The World Bank had warned on Monday that an anticipated economic slowdown in China could lead to the lowest global growth this century.
However, traders were taking the opportunity to regroup, and the banking sector appeared to be relaxing somewhat. The outlook for the rest of the month and for April, when first-quarter earnings will be released, was viewed as positive by market analysts.
While the reduced availability of credit to the real economy due to last week's tumult could still provide headwinds, there was a growing recognition that it could help the Federal Reserve in its inflation fight by keeping growth below potential, despite China reopening amid an improving backdrop in Europe.
