World Markets Live - August 1st - CNBC Live Events
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World Markets Live - August 1st

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

    Good morning everyone. Here are your top headlines at this hour:
     
    • The major U.S. averages post their best month since February. Oil breaks a losing streak with its best monthly performance in over a year, as the Treasury slaps sanctions on Venezuela.  
    • President Trump removes Anthony Scaramucci from his role as Communications Director after only 10 days in the job, as new chief of staff John Kelly makes his mark on the White House. 
    • Shipyard spat! Italy's Prime Minister Paolo Gentiloni says he will defend his country's interests after French President Emmanuel Macron angers Rome by nationalising the Italian-owned STX shipyard. 
    • On the earnings front, investors are awaiting BP in about an hour, while Apple will report after the bell stateside. 
       
    DSM has posted a 42 percent jump in net profit for the first half of the year and now expects full year earnings growth in the double digits, ahead of expectations.
     
    Feike Sijbesma, CEO, DSM joins us live:
     
    We conclude a very strong first half. All our businesses have been growing faster than the markets we operate in. Net profit up more than 40 percent.
     
     China is doing very well. If you look at the macro economic indicators, China is growing 10 percent but DSM is growing more than 10 percent.
    Bob Dudley - Group chief executive said:
     
    We continue to position BP for the new oil price environment, with a continued tight focus on costs, efficiency and discipline in capital spending.We delivered strong operational performance in the first half of 2017 and have considerable strategic momentum coming into the rest of the year and 2018, with rising production from our new Upstream projects and marketing growth in the Downstream.
    Venezuela opposition leader Antonio Ledezma and Leopoldo Lopez have been taken from their home. Both had been under house arrest. 
     
    This after the Venezuelan President Nicolas Maduro is attacking U.S. sanctions on the country, calling them desperate. The White House imposed a number of non-oil related sanctions on Maduro's government, labelling him a dictator. The U.S. administration says Maduro seized absolute power through a sham election, undermining democracy. Here's how U.S. national security advisor H.R. McMaster described the situation.
    Here are your top stories at this hour:
     
    • Oil breaks a losing streak with its best monthly performance in over a year, as the U.S. Treasury slaps sanctions on Venezuela.  
    • BP beats on second quarter net profit as production rises 10 percent. CEO Bob Dudley says the oil giant remains well positioned for the present oil price environment. 
    • Assets under management at British fund Man Group rise nearly 20 percent in the first half, lifted by the firm's recent purchase of real estate fund Aalto. 
    • Are juicy returns in store for Apple's third quarter earnings? Analysts await results after the bell, eyeing whether anticipation of the iPhone 8 has hurt sales of older models. 
    Higher oil prices and deeper cost cuts have helped BP to a second quarter profit beat. The British oil giant reported a 10 percent rise in production, though it took a big charge related to failed exploration in Angola.
     
    BP is now targeting output of 800 thousand barrels per day by 2020. Despite seeing an increase in net debt, BP said it expects relief in the second half of the year from a boost in divestment proceeds and a decline in payments related to the Gulf of Mexico spill.
     
     
    Rolls-Royce is running full throttle. The aerospace engine maker posted a first half profit of 287 million pounds, beating expectations. A pickup in engine orders boosted performance. The CEO says cost-cutting measures are working, but there's no room for complacency.
     
     
    Didi Chuxing says to invest and partner with Uber's European rival Taxify. That's according to Reuters.
    Spanish manufacturing activity expanded in July, albeit at a slower pace than the previous month, as job creation grew at the fastest rate in more than 19 years and output and new orders kept increasing, a survey showed on Tuesday.

    Markit's Purchasing Managers' Index (PMI) of manufacturing companies stood at 54.0 in July, down slightly from 54.7 in June. The index has held above the 50 line separating growth from contraction every month since November 2013.
     
    There were signs of a loss of growth momentum in the Spanish manufacturing sector during July, but rates of expansion in output and new orders remained solid and firms were able to secure new export business at a stronger pace than in June, senior economist at Markit Andrew Harker said.
    A little over 30 minutes since the start of the European session and Dax has slipped into negative:
     
     
    These are the top stories for the hour:
     
    • BP beats on second quarter net profit as production rises 10 percent. But the energy giant sees its earnings halve from Q1 due to a write-off on exploration in Angola.
    • Assets under management at British fund Man Group rise nearly 20 percent in the first half, lifted by the firm's recent purchase of real estate fund Aalto.
    • President Trump removes Anthony Scaramucci from his role as Communications Director after only 10 days in the job, as new chief of staff John Kelly makes his mark on the White House.
    Higher oil prices and deeper cost cuts have helped BP to a second quarter profit beat.
     
    The British oil giant reported a 10 percent rise in production, though it took a big charge related to failed exploration in Angola. BP is now targeting output of 800 thousand barrels per day by 2020.
     
    Despite seeing an increase in net debt, BP said it expects relief in the second half of the year from a boost in divestment proceeds and a decline in payments related to the Gulf of Mexico spill.
     
    Russ Mould, investment director at AJ Bell, says bears will focus on rising net debt, slower revenue gains from disposals, and cash flow not covering day-to-day expenses.
     
    The big debate: is that fat, juicy dividend safe? There’s enough in there to keep bears interested or there may not be.
     
    He says he’d be surprised if the company cut its dividend, but the company has to work hard to maintain that payment.
     
    BP Shares are up nearly 4 percent this morning.
     
     
    Venezuelan President Nicolas Maduro is attacking U.S. sanctions on the country, calling them desperate. The White House imposed a number of non-oil related sanctions on Maduro's government, labelling him a dictator.
     
    The U.S. administration says Maduro seized absolute power through a sham election, undermining democracy. 
     
    Nicolas Maduro celebrates the results of Sunday's election
     
    Meanwhile. Venezuela's opposition leaders have been taken from their homes, their families have said. The wives of Leopoldo Lopez and Antonio Ledezma both tweeted links to videos that appear to show the men being led into cars by armed officers.

    Both leaders were serving house arrests and had called on Venezuelans to join protests against Maduro. The government has not commented on the reports.
     
    BP is in focus today after posting underlying profit for the first half rose 75 percent to $2.2 billion, thanks largely to a recovery in the upstream business.
     
    Nicholas Hyett, equity analyst at Hargreaves Lansdown, says oil spills from several years ago are still weighing on the company.
     
    Were it not for the Deepwater Horizon oil spill more than 7 years ago, BP would be in pretty good shape right now. Despite the tough oil price environment, cash flows would be comfortably ahead of capex and dividend expenses, and the group is still managing to spend a reasonable amount on developing new fields.
     
    As it is, the Gulf of Mexico payments, which had a negative cash impact of around $2bn this quarter, continue to weigh on the group and are forcing it to take on an ever larger debt burden.
     
    Fortunately the group’s upstream division has delivered a strong set of numbers this time out, and while the Downstream refining business hasn’t delivered the growth we’ve seen from the likes of Shell, it remains robustly profitable. Gulf of Mexico costs are expected to fall from here, but BP remains a bit of a waiting game.
     
     Shares in BP are up more than 3 percent today.
     
     
    Not a huge movement by cable in reaction to the PMI data. Sterling was a little negative to the dollar but is now up about 2 basis points.
     
     
    Apple has failed to dismiss a lawsuit claiming it "broke" its FaceTime video conferencing feature to force users of older iPhones to upgrade. A U.S. judge ruled iPhone 4 and 4S users can pursue class action claims.
     
    However, Apple has argued the plaintiffs did not suffer any economic losses as FaceTime is a free service.
     
    This comes as Apple is set to release its third quarter earnings this week after reporting a decline in year-on-year iPhone sales in its previous quarter.
     
    Neil Campling, head of global TMT research at Northern Trust Capital Markets, agrees markets are more interested in the guidance for the next quarter rather than numbers from the past quarter.
     
    The key focus for Apple is what happens with the new product cycle for the next iPhone. The key thing really here is the timing of the ramp of the product, because many of the supply chain companies in the past couple of weeks have given guidance that suggests the quarterly ramp in September could be quite low, but then we could have a super cycle from December quarter onwards, because of component supply issues on the chip side.
     
     
    Ferrari's wants to produce a "utility vehicle" in a plan to double its profits. This is the final five-year plan under current CEO Sergio Marchionne, who is set to retire in 2021. The plan will will target annual deliveries beyond the self-imposed limit of 10,000 cars.
     
    That's according to Bloomberg citing sources.
     
    Shares in the luxury car maker are up nearly 2 percent today.
     
     
     
     
    Monday was the deadline for European Union countries to submit bids for hosting the European Medicines Agency (EMA) and European Banking Authority (EBA), which are both currently based in London.
     
    The headquarters will have to move away from the U.K. in light of Brexit, which is due to take effect by 29 Mar 2019. Around 1,000 staff are employed at the two agencies.
     
    19 cities proposed to host the EMA, including:
     •    Amsterdam (The Netherlands)
    •    Athens (Greece)
    •    Barcelona (Spain)
    •    Bonn (Germany)
    •    Bratislava (Slovakia)
    •    Brussels (Belgium)
    •    Bucharest (Romania)
    •    Copenhagen (Denmark)
    •    Dublin (Ireland)
    •    Helsinki (Finland)
    •    Lille (France)
    •    Milan (Italy)
    •    Porto (Portugal)
    •    Sofia (Bulgaria)
    •    Stockholm (Sweden)
    •    Malta (Malta)
    •    Vienna (Austria)
    •    Warsaw (Poland)
    •    Zagreb (Croatia)
     
    Meanwhile, eight proposed hosting the EBA, including Dublin. The Irish government has offered to spend 10 million euros to help with the relocation and committed to contribute €78m towards the agency's rent and maintenance in Ireland.
     
    The European Commission aims to assess the bids by 30 September. Interior ministers will vote on the new host countries at the EU General Affairs Council meeting in November.
    The MSCI Emerging Markets index rose 5.6 percent in July. The index is set for its 7th consecutive positive month for the first time since August 2014.
     
    Maarten-Jan Bakkum, senior strategist for emerging markets at NN Investment Partners, says emerging markets are continuing to recover.
     
    Growth momentum has been positive for more than a year, and has actually accelerated in recent weeks. This is largely why the recent nervousness in financial markets about a possible accelerated tightening in monetary policy in the US and Europe has had little impact on Emerging Markets (EMs). EM bonds saw outflows for the first time this year, but then yields hardly increased. At the same time, EM equities continued to attract new capital and the pace of the outperformance over developed markets even accelerated.
     
     
     
    WestJet Airlines reports Q2 net earnings of $48 million, up 32 percent. Q2 earnings per share is C$0.41, compared to the IBES view of C$0.28.
     
    The airline also announces a normal course issuer bid to buy back 5,856,671 outstanding shares on the Toronto Stock Exchange.
     
    Quality Systems Inc reports Q1 revenue of $130.9 million versus the IBES view of $126.8 million.
     
    The company sees full year 2018 revenue of $512 million to $530 million. However, it adjusted its earnings per share view to 62 cents to 70 cents, down from a view of 66 cents to 74 cents.
     
    The company says the change in outlook takes into account the incremental investments in Eagledream Health platform.
    Pharma giant Pfizer has beaten on its Q2 adjusted EPS with $0.67 edging past the average estimate of $0.66.
     
    Revenue fell to $12.9 billion from the first quarter figure of $13.15 billion. Pfizer has raised its 2017 adjusted guidance to a range sitting between $2.54 to $2.60.
     
    In premarket trade, Pfizer shares have risen.
     
    Source: CNBC
     
     
    Additionally, the CME group has reported second quarter earnings of adjusted EPS $1.23. That edging just above a consensus forecast of $1.21.
     
    The revenue was $925 million and the firm said the average number of daily contracts it executed across the quarter was 16.5 million.
     
    Source: CNBC
     
    Oil price have slipped on Tuesday but remain around the $50 a barrel mark.
     
    Traders believe the market is returning to a healthier balance between demand and supply.
     
     
    Our guest from this morning said balance could be hard to maintain.
     

    Oil demand going up, but supply is the issue: Pro

    CNBCRuss Mould, investment director at AJ Bell, discusses oil prices and the impact of shale gas and picks Shell over BP for choice of investment.
     
    No Trump tweets so far today. Surely Kelly's not that effective.
     

    Kelly flexes his muscle on his first day on the job at the White House

    CNBCHere's an early indication that John Kelly, a decorated retired Marine general who served three tours in Iraq, is not afraid to stand up to President Trump.
    U.S. personal income has come in unchanged in June versus a forecast 0.4% increase.
     
    The PCE core price index, which excludes food and energy , has come in at +0.1 percent in June. That corresponds to a 1.5 percent rise over the year.
    Driven out the door.
     
    The Automobile Association (AA) in the United Kingdom has sacked its chairman for gross misconduct. No explanation has been forthcoming but the move is immediate.
     
    Shares in AA have plunged.
     
     
    An excerpt of the regulatory statement outlining the move reads as follows:
     
    "The AA plc announces that Bob Mackenzie has been removed by the Board from his role as Executive Chairman, from his other roles and as a Director and as an employee of the Company, for gross misconduct, with immediate effect.
     
    The roles held by Bob Mackenzie will be filled as follows:
     
    John Leach has been appointed as Chairman. John joined the AA in June 2014 as a Non-Executive Director and was appointed as Senior Independent Director on 13 November 2014. John is also Chair of the Nomination Committee and a member of the Risk and Audit Committees.
     
    Simon Breakwell has been appointed as Acting Chief Executive. Simon joined the AA in September 2014 as a Non-Executive Director and is currently Chair of the Remuneration Committee and a member of the Nomination Committee. Outside of the AA, Simon is currently a Venture Partner at TCV, one of the leading global mid cap funds, and Chairman of Business Data 4 Travel. Simon was a founder of Expedia and a member of the main board for ten years from 1996. More recently, Simon was responsible for establishing the European operations for Uber.com."
     
    Pound sterling has hit a high of 1.3239 against the dollar. That is the highest level since Sep 16, 2016 when the sterling traded as high as 1.3248.
     
    The pound is still way lower than the level it touched just prior to the Brexit vote.


    These are the best performing blue chip stocks in the United States, after just shy of 25 minutes of trade on Tuesday.




    At one stage, the dollar index hit a 15-month low after weaker than expected construction spending and ISM manufacturing data.

    The manufacturing PMI dropped in July to 56.3  versus the June figure of 57.8. It should be remembered that readings above 50 still indicate an expansion of activity.

    Separately, the U.S. construction spend in June fell 1.3 percent. A rise of 0.4 percent was forecast.

    The dollar is bouncing around a little but remains under pressure. 


     
    European markets have closed higher on Tuesday afternoon as investors digested earnings reports.
     
     
    The pan-European Stoxx 600 was up with most sectors and major bourses in positive territory. Swiss stock markets were closed due to a national holiday.

    Oil and gas stocks were among the top performers on better-than-expected earnings news. BP surpassed analyst expectations on Tuesday, despite profits more than halving from the first three months of the year after a hefty charge from an unsuccessful project in Angola. Its shares were nearly 3 percent higher.

    British aircraft engine maker Rolls-Royce Holdings posted a first-half net profit on Tuesday, driven by an uptick in performance from its civil aerospace sector. Its shares surged to the top of the benchmark on the news, up over 9 percent.
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