The flagship CAC 40 index recovered by 1.42% to 7,112.91 points after a rebound of 1.27%, without yet compensating for last week's losses of 4%.
"Investors have so far been reassured about the strength of banks' capital and this is the nature of the rebound" initiated since the day before, commented for AFP, Frédéric Rozier, portfolio manager of Mirabaud France.
They were able to count on the "strong reaction" of central banks and regulators concerned in the United States and Europe to reduce the mistrust of the banking sector generated by the bankruptcy of several US regional banks, followed by the liquidity crisis of Credit Suisse, bought by UBS last weekend to eliminate the risks of contagion to other institutions.
As a result, there is for the moment "renewed risk appetite, motivated by cheap buying" especially on banking stocks very shaken last week by these fears about financial stability, adds Mr. Rozier.
In this context, the US central bank, meeting until Wednesday, will have to navigate between persistent inflation that could push it to raise rates and the risk that such an action could fuel the banking crisis.
Investors remain torn between the likelihood of a quarter-point increase in key interest rates and a monetary status quo.
Banks catching up
Banks were among the best performers in the CAC 40 index: Societe Generale recovered by 4.30% to 21.93 euros, BNP Paribas by 4.15% to 54.74 euros, Crédit Agricole 2.25% to 10.28 euros. The insurer Axa also gained 4.15% to 27.72 euros.
TotalEnergies strengthens its efforts to fight global warming
TotalEnergies (+2.51% to 55.21 euros) announced on Tuesday the strengthening of its short-term objectives to reduce greenhouse gas emissions related to petroleum products, while their share decreases in its activities in favor of gas and renewable energies.
© 2023 AFP