Global banks enjoyed the reassurance of a Credit Suisse funding deal on Thursday after the stricken institution said they had secured a $54bn funding line with the Swiss central bank.

The FTSE 100’s rout subsided on Thursday as the index opened up sharply and traded as high as 7,458. As the session progressed, the gains dwindled and the index was trading up just 0.1% shortly after the ECB announced a 50bps hike on Thursday.

Credit Suisse’s new funding options drove a rally across Europe as the German DAX rose 0.1% and French CAC surged 0.5%.

“One minute the market is worried about a banking crisis, the next minute it is more relaxed. This hot/cold mentality creates an odd atmosphere and today we have another one of those days where investors are seemingly less worried. How long this situation lasts is another matter,” said Russ Mould, investment director at AJ Bell.

“News that the Swiss National Bank would step in and lend Credit Suisse up to 50 billion Swiss francs was the catalyst for investors to breathe a sigh of relief.”

“However, we are nowhere near safe territory for the markets. It would only take another piece of bad news from the banking sector anywhere in the world to put investors on edge again.”

Underlying concern in markets was evident in the regional US banks as First Republic Bank traded down 35% on reports the bank was exploring a sale following downgrades by ratings agencies.

Nonetheless, the FTSE 100’s most heavily hits banks provided some reprieve from the selling on Thursday. Barclays edged 1.7% higher and Standard Chartered opened higher before the gains evaporated to trade marginally lower. Standard Chartered is down 17% over the past five trading sessions.

Rentokil Initial

With attention remaining firmly on global banking stocks and the ECB’s rate decision, Rentokil Initial’s bumper revenue jump was somewhat overlooked.

The pest control and hygiene company’s Adjusted EBITDA rose 27% as it began the integration of their recent Terminix acquisition.

Following the latest Update from Greatland Gold (LON:GGP) concerning its exploration and development progress at its Havieron Project, Canaccord Genuity has maintained its Speculative Buy rating on the £369m capitalised company’s shares.

Their analyst Alexander Bedwany has a Target Price of 20p a share, compared to the 7.15p market price.

The flagship gold-copper project located in the Paterson Province in Western Australia is a Joint Venture with Australia’s leading gold producer Newcrest Mining – with Greatland having a 30% interest.

MD Shaun Day, who has recently been hosting a number of investor presentations on the group’s European Roadshow, stated that:

“The Havieron team continues to deliver strong results at the project. Total development has now surpassed 1,850m and pleasingly, decline development is continuing ahead of the current schedule.

Our most recent drilling activities highlight the potential of high grade mineralisation outside the Southeast Crescent which could add significant value to the mine plan at Havieron with additional gold and copper mineralisation intersected at the Northern and Eastern Breccia zones.”

Drilling Update

Improved geotechnical conditions have enabled increased productivity resulting in development outperforming the current schedule by 10%.

The main decline continues to progress ahead of the current schedule having surpassed 1,520m.  Decline support excavations for ventilation, services and materials handling takes the total development to over 1,850m.

The total advance is 10% ahead of the current schedule due to improved geotechnical conditions and the ongoing focus on productivity improvements.

Drilling activities at Havieron recommenced at the beginning of February 2023 with three drill rigs onsite and four holes completed for a total of 5,214m. This most recent drilling takes the total drilling at the project to 331 holes for 293,878m.

The drilling confirms the presence of high-grade gold and copper mineralisation outside the current Mineral Resource with recent results including:

– Northern Breccia: 29.9m @ 3.9g/t Au and 0.01% Cu from 945.1m

– Eastern Breccia: 57m @ 2.1g/t Au and 0.19% Cu from 1,262m

Analyst Opinion – more gold on the way

Canaccord Genuity has the view that the continued release of high-grade results suggests that a significant resource increase is likely later this year.

It also notes that no deal has, as yet, been agreed for GGP to sell off its Havieron stake to Newcrest Mining, the latter currently being bid for by Newmont.

Conclusion – cheap Aussie gold buy?

The shares, at 7.15p,  have hardly responded to the good news, leaving investors with an attractive buying opportunity if they wish to play in the Australian gold scene.

Halma shares were creeping higher on Thursday after the life-saving technology group said group adjusted profit before tax will be in line with market expectations.

In 2022 FY, Halma’s adjusted profit before tax grew to £316.2m and this years expectations of £353.1m to £369.6m would represent the 20th year of growth.

The company has achieved another year of profit growth through acquisitions and building organic growth momentum across all geographies.

“Today’s update was yet another reassuring statement from Halma who is on track to deliver its 20^th year in a row of record profits. It’s also been a record year for investment in M&A, committing to a deal spend of up to £264m. We think the challenging macro environment will present further opportunities for Halma to pick up complementary businesses at attractive prices,” said Derren Nathan, Head of Equity Research at Hargreaves Lansdown.

“Halma continues to prove the resilience of its sectors, and with order intake ahead of last year, next year is also beginning to shape up nicely.”

Nathan continued to explain how the recent selloff has tarred all companies with the same brush and suggested Halma’s declines were unjustified. He did, however, caution that the PE ratio was a little rich.

“The shares have not escaped the recent sell off in the FTSE 100, and that’s perhaps a little unjustified. Nevertheless, a mid-twenties earnings multiple is hardly bargain basement territory. Halma has earnt it’s market admiration through relentless delivery of earnings growth. With that in mind, it’s fair to say that Marc Ronchetti has some big shoes to fill when he takes the helm next month,” said Derren Nathan.

European stocks were in free fall on Wednesday as fears about the health of the European banking sector rattled markets.

The FTSE 100 and the German Dax sank over 2.5% at the time of writing while the French CAC and the Italian FTSE MIB were down around 3.5%.

Just as fears about SVB’s collapse appear to subside, investors in European banks were struck down by concerns about Credit Suisse.

Credit Suisse shares were down 20% after their biggest investor, the Saudi National Bank, said they would not pump more cash into the institution. Credit Suisse’s auditor had recently found problems with their financial controls and today’s developments sent the shares deep into the red.

“The fresh banking sell-off has taken hold as fears rise to the surface about the robustness of sector with the shadow of the SVB collapse still looming large. With the US banking sector downgraded to negative by Moody’s nervousness is super-high and that’s spilt over into a hot mess in Europe,” said said Susannah Streeter, head of money and markets, Hargreaves Lansdown.

The coming hours and days will be crucial not only for Credit Suisse, but for the European banking sector and broader indices. European banks were sold heavily and many were halted to regulate trade.

“The banking rout has taken on another ominous twist with trading halted in shares of big European banks including Credit Suisse, Société Generale, BNP Paribas, Monte dei Paschi and UniCredit,” said Susannah Streeter.

FTSE 100 banks were crushed. Barclays was down in excess of 7%, as was Standard Chartered. Lloyds was down over 4%.

Prudential was the FTSE 100’s top faller after disappointing full year results were exacerbated by the banking sector rout.