World Markets Live - April 25 - CNBC Live Events

CNBC Live Events

World Markets Live - April 25

We’ll be updating you throughout the day with essential breaking news, data alerts, earnings reports and all the major market movements.

    Saudi Aramco may not be worth the $2 trilllion figure quoted by officials. That's according to a Wall Street Journal report, which said those working on the offering have not been able to draft a model that matches that figure.
    The valuation is reportedly closer to $1.5 trillion. If accurate, it would mean that the oil giant is just off the combined market value of Amazon and Netflix.
    Oil prices are fairly flat today.
    Comment ()
    It's set to be a busy couple of days for the U.S. IPO market. A whole swathe of companies - including tech unicorn Cloudera - are due to float, making this the busiest week for IPOs in over six months. 
    Comment ()
    Stephen Macklow-Smith, Head of Europe Equity Strategy at JP Morgan Asset Management, advises not to attach too much importance to compliance rates with the OPEC oil cut and its effect on oil prices.
    You’re talking about the changes between three extraordinary large numbers. You’ve got supply on the one side, demand on the other and then you've got inventory, which includes speculative inventory being accumulated by traders. I just wouldn't attach too much importance to it.
    Comment ()
    Here are the top headlines following the opening of European markets.
    • Restyling at Christian Dior. LVMH and the Arnault family offer to completely take-over the group in a bid to simplify the business, sending the shares higher. 
    • Ericsson promises to continue with cost cuts to improve profitability as the Swedish firm posts a wider loss than expected in the first quarter.
    • Whitbread falls to the bottom of the STOXX 600 after the Costa Coffee owner says it expects the consumer environment to worsen in 2017.
    • Seeing the clearer picture. Novartis reports a drop in core income as it battles to revive sales at its eyecare unit Alcon and demand for its heart failure drug remains soft. 
    Comment ()
    The Stoxx 600 remains fairly flat in early morning trade, currently up less than 0.1 percent.
    The top performing stocks on the index include Volvo, which posted better-than-expected profits, and Christian Dior.
    Shares in Christian Dior are posting double-digit gains on news LVMH and its majority shareholder Bernard Arnault are set to completely take-over the brand, buying it for an enterprise value of 6.4 billion euros. 
    Comment ()
    French banks rallied on the back of Emmanuel Macron's win in the first round of the French Presidential election, as investors breathed a sigh of relief.
    Filippo Alloatti, senior credit analyst at Hermes Investment Management, agrees that investors were right to buy bank shares on the back of the result.
    It’s all about expectation. There was a lot of skepticism going into the first round of the French election, because of the failings of the polls in 2016. There was a lot of skepticism because all 4 candidates were within the margin of error of 5 percent. 
    Comment ()
    Norway's oil directorate says fifteen wells are planned for drilling in the Barents Sea in 2017, two more than in the record year of 2014.
    It says it is doubling the resource estimate for the Barents Sea. About 60 percent of the new resources are likely liquids and the rest is gas.
    Comment ()
    A cautious start to trade on European markets. Many of the major bourses are flat, while some of the shine is coming off the CAC 40 as the French index turns negative.
    Comment ()
    The euro remains strong today. The currency reached 5 month highs against the dollar yesterday, reaching a peak of around $1.094, after the results of the first round of the French presidential election.
    Comment ()
    North Korea has reportedly staged a massive live fire-drill to commemorate the 85th anniversary of the founding of its military.
    This as tensions in the region continue to escalate following the docking of a U.S. submarine in South Korea. The show of force comes amid rising fears over Pyongyang's nuclear programme.
    South Korea confirmed the live-fire drill was being carried out in areas around the city of Wonsan, according to Reuters.
    Comment ()
    Andrew Sentance, senior economic adviser at PWC, says it was a mistake for the Bank  of England to cut interest rates following the Brexit referendum result.
    That was an overreaction. The Bank of England still doesn’t have a coherent exit strategy on interest rates. We’ve got one member of the MPC voting for a rise in interest rates but she’s going to be leaving in a few meetings time.
    There was a period from 2013 when the governor and others talked about the circumstances under which they would raise interest rates under the famous forward guidance, but nothing actually happened. 
    Sentance says the BOE needs to show that it has some sort of strategy for raising interest rates.
    Comment ()
    Here's the top headlines for the next hour.
    • Restyling at Christian Dior. LVMH and the Arnault family, offer to completely take-over the group in a bid to simplify the business, sending the shares higher.
    • Seeing the clearer picture. Novartis reports a drop in core income as it battles to revive sales at its eyecare unit Alcon and demand for its heart failure drug remains soft.
    • Whitbread falls to the bottom of the STOXX 600 after the Costa Coffee owner says it expects the consumer environment to worsen in 2017.
    • Ericsson promises to continue with cost cutting to improve profitability- as the Swedish firm posts a wider loss than expected in the first quarter.
    Comment ()
    The ECB has released some findings from its lender survey. It says banks are seeing slightly tighter credit standards for business loans in the second quarter, with unchanged credit standards for housing loans.
    The central bank says banks are seeing further increases in demand for corporate, housing and consumer loans in Q2.
    The ECB adds that while QE has negative impacts on bank margins, it has a positive impact on lending volumes.
    Comment ()
    European markets remain cautious an hour after the open. The Stoxx 600 is up just 7 basis points.
    Comment ()
    Reporting for CNBC, Chery Kang provides the latest news on North Korea’s live-fire army exercise.
    We did not see North Korea testing its intercontinental ballistic missile or carry out yet another nuclear test. Instead, North Korea marked this military foundation day anniversary with a large scale live-fire drill and coming out with some harsh war rhetoric.
    This is a typical North Korean way of showing its force, saying if the U.S. and its allies come at it with pre-emptive strikes against North Korea, then they will be faced with the most brutal punishment in the sky and land as well as at sea.
    Kang says the risk of a missile demonstration or a nuclear test have become a little too much for North Korea in the current atmosphere of geopolitical tension.
    Comment ()
    First quarter net income at Novartis fell 4 percent, coming in at $2.7 billion.  That figure just topped analyst estimates.
    The Swiss drugmaker confirmed its outlook for the year ahead, but said 2017 will be a transition year as it spends heavily on ailing eyecare unit Alcon.
    Shares in Novartis are up more than 2 percent in trade today.
    Comment ()
    Paras Anand, head of European equities at Fidelity, says most central banks are stuck in a similar position.
    They are looking at raising rates as potentially being one of those events that chokes off growth. I suppose I have quite a different view of it. I think that actually if we go through a kind of a phase where monetary policy and the rate cycles kind of normalize you could actually have the kind of situation where economic activity actually accelerates on the back of that.
    Anand says the velocity of money in the economy has been very low, affecting lending.
    Comment ()
    U.K. public sector net borrowing for March increased to £4.365 billion versus £3.531 billion in March 2016. This compared to a Reuters poll of £1.5 billion for borrowing.
    Net cash requirement was £34.311 billion, versus £21.705 billion in March 2016.
    Public sector net debt, excluding banks and the Bank of England, was £1.612 trillion in March, or 80.7 percent of GDP.
    Corporation tax revenues for the financial year 2016/17 did hit a record high of £55.7 billion, exceeding the pre-crisis peak for the first time.
    Comment ()
    French banks rallied on the back of Emmanuel Macron's win in the first round of the French Presidential election, as investors breathed a sigh of relief. 
    Gina Sanchez, CEO of Chantico Global, thinks the bank rally should continue.
    If you saw what happened in the first quarter, there was a lot of trepidation; big concerns around Le Pen’s popularity. Once the election happened and Macron started to gain some popularity, you saw PE’s starting to expand, except in the banking sector. The banking sector was very concerned, so we really didn’t see the bounce.
    French banks bounced almost 6 percent yesterday and I think there’s more to come.
    Gina says if Macron wins the presidency, banks will breathe a sigh of release and more value will be unlocked from the sector.
    Comment ()
    South Africa's new finance minister Malusi Gigaba was recently appointed under controversial circumstances following President Jacob Zuma's firing of predecessor Pravin Gordhan. 

    The move came amid repeated allegations of corruption and shocked markets, leading to a currency sell-off and Moody's placing the country's credit rating under review. 

    CNBC’s Geoff Cutmore spoke to Gigaba in Washington last week, who moved to calm market fears surrounding his radical economic reforms
    It’s about addressing intractable problems in the South African economy. Inclusive growth discussion in South Africa, I could sum it up into 4 principles.
    First, structure. Change the structure of the economy, industrialize. The South African economy has a very little manufacturing sector. Its contribution could be far much more if we expanded manufacturing by industrializing the economy.
    Gigaba's other principles included strengthening state institutions and addressing corruption, creating new sectors of wealth and ownership, and forming partnerships between the government and other actors.
    Comment ()
    European markets are starting to show some confidence. The pan-European Stoxx 600 is now up around 0.18 percent.
    Here's a look at how the individual European bourses are performing. The French CAC 40 is positive once more, while the Swiss and U.K. markets are making decent gains.
    Comment ()
    Later this hour, we'll be speaking with the CEO of Ericsson about the telecom's latest earnings report, which have disappointed markets.
    Comment ()
    Future values point to further gains for U.S. markets at the open today, although much softer than the large gains predicted yesterday.
    Comment ()
    Here's what to watch for in the U.S. markets today.
    Major earnings reports will comme before the bell from Caterpillar, Coca-Cola and McDonald's. After the bell we'll also have earnings from AT&T, Capital One and Chipotle.
    On the data front, we'll have:
    • The S&P Case-Shiller report at 09:00 ET
    • New home sales for March at 10:00 ET
    • Also at 10 we'll have consumer confidence for April and the Richmond Fed survey.
    Comment ()
    Whitbread shares dropped to the bottom of the STOXX 600 after the Costa Coffee owner says it expects the consumer environment to worsen in 2017.
    Guy Ellison, Head of U.K. equities at Investec Wealth & Investment, says the market reaction was a surprise.
    We were surprised by the negative market reaction this morning to a set of numbers which have marginally exceeded consensus market expectations and contain nothing material in the way of new guidance. Having gained 10% over the last month up to last night’s close, short-term profit-taking looks the main motivation for the share price move this morning.
    Domestic consumer-facing businesses are likely to face a challenging year as discretionary spending becomes squeezed whilst High Street operators are having to absorb cost increases such as business rates and the National Living Wage.
    Comment ()
    LVMH and its majority shareholder Bernard Arnault are set to completely take-over the Christian Dior brand.
    Bernard Arnault, CEO of LVMH, discusses the deal.
    I’m not sure we’re going to buy 100 percent, because we make an offer to the minority shareholder which is around 26 percent. We’ll see if they come and respond to the offer. 
    The idea in doing that is giving them some liquidity and for my personal family group, it’s to increase its investment in LVMH, which is I think is one of the best groups in the world. It is a leader in this sector, it is a French company and long term perspectives are very good.
    Comment ()
    Shares in Ericsson are trading lower after it posted a bigger than expected first quarter loss of 12.3 billion Swedish krone. This as writedowns and restructuring costs dragged earnings into the red.
    Börje Ekholm, CEO of Ericsson joins CNBC from Stockholm. He says the company had a tough first quarter.
    We have a number of one time charges of 13.4 billion SEK that impacted our operating income and that’s why we had the loss, but we’re also three-quarters of our business, the networks division has a stable development and we see no accelerating losses in our IT and cloud and media businesses where we need to take actions.
    Comment ()
    Börje Ekholm, CEO of Ericsson says sales in Europe have been under pressure.
    We’ve seen Latin America be rather weak, but we’ve also seen good developments for example in Asia. So it is a mixed picture geographically, but with our presence in almost 180 countries we’re a fairly good cross section of the global economy, so we’ll have some that are better than others.
    Comment ()
    The German government is raising its 2017 GDP growth forecast to 1.5 percent from 1.4 percent, and is also raising its 2018 GDp growth forecast to 1.7 percent from 1.6 percent, according to sources reported by Reuters.
    Comment ()
    U.K. department store John Lewis reports sales rose 1.6 percent year on year in the week ending April 22nd.
    Also, Sales in John Lewis-owned food retailer Waitrose are down 4.6 percent.
    Comment ()
    Credit ratings agency Moody's says strong Swiss macro features, such as its strong economy and institutions and borrower creditworthiness will continue to mitigate consumer credit risks.
    It says it expects the performance of future securitisation deals whose collateral pools contain Swiss assets to be strong.
    Comment ()
    The French INSEE business climate index was stable at 104 in April, while the industry index rose 3 points to 108.
    Francois Cabau, analyst at Barclays Research, thinks decent growth in the economy is likely to be maintained in the second quarter.
    Consistent with the April “flash” PMIs, today’s INSEE release show business confidence at the strongest level since mid-2011, suggesting ongoing decent momentum ahead, although probably not accelerating.
    In turn, this is in line with our baseline scenario of French GDP growth maintained at 0.4 percent q/q in Q1 and Q2 17. If anything, the inter-quarter volatility (mainly via energy related output/consumption) suggests downside risks for Q1 and upside risks for Q2. 
    Comment ()
    Confident in the German services sector is continuing to fall, according to the Ifo institute's latest business climate index.
    The index fell to 107.8 in April from 108.3 in March, according to Clemens Fuest, president of the Ifo Institute.
    Sentiment in the German service sector weakened, but remains at a very high level. The business climate index fell to 107.8 points in April from 108.3 points last month. Service providers are somewhat less satisfied with their current business situation. They also scaled back their expectations slightly. Service providers nevertheless plan to recruit additional staff.
    Both logistics and advertising companies are extremely satisfied with their current business situation and optimistic about the future.  Consultants also report very good developments in turnover. After the record highs seen in recent months, architects, by contrast, reported a downturn in business in April. 
    Comment ()
    U.S. stock index futures pointed to a higher open on Tuesday morning, buoyed by a spike in risk appetite following centrist candidate Emmanuel Macron's victory in the first round of the French election.
    Comment ()
    President Donald Trump's "Buy American" policy is getting support from an unlikely place: China's biggest e-commerce company.
    In a video to be posted Tuesday, Alibaba founder Jack Ma said: As incomes rise, Chinese consumers are increasingly looking for high quality products from around the world, especially the United States.

    Trump's 'Buy American' policy is getting support from an unlikely place: A Chinese e-commerce giant

    CNBCConsumers in China "are increasingly looking for high quality products from around the world, especially the United States," Alibaba's Jack Ma said.
    Comment ()
    Jack Verdan, chief currency strategist at Julius Baer analyses what to expect from ECB later this week:

    The European Central Bank (ECB) will finally end speculation about an earlier end to the negative deposit rate, when it holds its press conference after its governing council meeting on Thursday this week. Both ECB Chief Economist Peter Praet and ECB President Mario Draghi have already made clear in recent weeks that interest rates will not rise before the ECB’s asset-purchasing programme comes to an end. Such speculations emerged after the last council meeting, when annual inflation hit 2% in February. The surprisingly low annual eurozone inflation reading for March, at 1.5%, now plays into the hands of the ‘dovish’ ECB council members, who see forward guidance as the most powerful monetary policy tool in times of zero or negative policy rates. The above-mentioned drop in the headline inflation rate and a lower annual core rate, which declined from 0.9% to 0.7%, are helpful reminders that the most recent inflation pick-up has little to do with genuine price pressure and is entirely transitory, related to the rebound in crude oil prices. Besides the renewed need for forward guidance as a policy tool, there seems to be little desire among the ‘hawkish’ ECB council members to end negative deposit rates ahead of an end to asset purchases. Dogmatic ECB ‘hawks’ are more concerned about the moral hazard involved in purchases of government debt than that involved in negative rates.
    Comment ()
    Let's check back on European markets that seem to have moved away from the French election relief rally amid geopolitical tensions. The stocks are staging a mixed performance:
    Comment ()
    Coca-Cola earnings: 43 cents per share, vs expected EPS of 44 cents
    Here's what the Street was expecting:
    • EPS: 44 cents, according to Thomson Reuters analysts' consensus.
    • Revenue: $8.874 billion, according to Thomson Reuters.
    Comment ()
    U.S. Secretary of Commerce Wilbur Ross is live on CNBC. He says U.S. trading partners are far more protectionist. On Trump, Ross says the President is open to near term deficit to spur growth.
    Ross also says tax proposal will be first salvo in negotiation. 
    Comment ()

    Wall Street set to extend gains as French vote lifts mood; slew of earnings eyed

    CNBCU.S. stock index futures pointed to a higher open on Tuesday following centrist Macron's first round French election victory.
    Comment ()
    Caterpillar earnings: $1.28 per share, vs expected EPS of 62 cents
    Here's what the Street is expecting from the construction machinery giant:
    • EPS: 62 cents, according to a consensus estimate from Thomson Reuters.
    • Revenue: $9.27 billion.
    Comment ()
    Oil rose on Tuesday, breaking a six-day streak of price falls, but with doubt swirling over OPEC's ability to force global crude inventories to drop, sentiment has turned more bearish.
    Comment ()
    Gold prices fell as markets grew less concerned that far-right leader Marine Le Pen would win the French presidential election, increasing investor appetite for risky assets such as stocks while denting bullion
    Comment ()
    McDonald's earnings: $1.47 a share, vs. expected EPS of $1.33
    Analysts expected earnings of $1.33 per share on $5.53 billion in revenue, according to Thomson Reuters estimates.
    Comment ()

    McDonald's up 2.5% on strong sales and guest counts

    CNBCMcDonald's is expected to post earnings of $1.33 per share on $5.53 billion in revenue, according to Thompson Reuters estimates.
    Comment ()
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