Amidst a banking crisis and a volatile stock market, Bitcoin is emerging as a safe haven asset, with a 26% rise last week alone. The cryptocurrency has disconnected from stocks and bonds and rallied alongside gold. However, some analysts remain cautious, as it is unclear whether this bullish trend will continue or prove temporary. The rise in Bitcoin's price has also led to short-sellers buying back their positions. Nonetheless, Bitcoin's resurgence is fuelling interest in decentralised finance (DeFi), as tokens linked to such platforms rose to $49 billion last week. While Bitcoin's potential as an alternative in a banking crisis is still being tested, its current rally may be a turning point for its status as a decentralised, non-sovereign asset.
EQUITY
US stocks rose on Monday as a result of a $3.23 billion merger between Credit Suisse and UBS and efforts by central banks to boost investor confidence. However, the Credit Suisse AT1 bond worth $17 billion that is seemingly purged has spread massive losses to bondholders. Although some bank shares remained lower, the major S&P 500 sectors ended higher. Amazon's announcement to cut an additional 9,000 jobs led to a 1.3% drop in its shares as eight Amazon Go stores were set to close.
GOLD
Gold futures prices have risen to test the $2000 price resistance, but uncertainty surrounds its short-term direction due to two upcoming events: the Federal Open Market Committee's decision on the next interest rate hike and the recent global banking crisis. The possibility of a desperate bank liquidating gold and a higher interest rate may pressure gold prices.
OIL
The crude oil market has been unable to recover from last week's losses, mostly due to macroeconomic factors. Ongoing strikes in Europe, particularly in France, are anticipated to exert further downward pressure on crude oil prices, as several service sectors are expected to shut down as a result of changes to union members' pension schemes that were made without vote.
CURRENCY
The greenback traded lower as investors speculated the Fed might soften its hawkish rhetoric amid the banking crisis that spread to Europe's market. Investors are focused on the Federal Reserve's decision at Wednesday's FOMC, with a 75.3% likelihood of a 25 basis-point increase.
