World Markets Live - August 25 - CNBC Live Events
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CNBC Live Events

World Markets Live - August 25

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

  • Oil prices are rising as hurricane Harvey approaches the Texas coast. Crude oil refineries along the coast have been forced to close, workers have been pulled from offshore oil platforms and onshore oil drilling has ground to a halt. 
     
    Hurricane Harvey is seen in the Texas Gulf Coast, U.S., in this NOAA GOES satellite image on August 24, 2017.
     
    Almost 10 percent of offshore U.S. Gulf of Mexico crude output and nearly 15 percent of natural gas production has been stopped as a result.
     
    As a result, the impact on supply is pushing up oil prices. 
     
     
    Meanwhile, residents along the Gulf Coast brace for impact. Stores have seen shelves empty and several counties are being evacuated ahead of what is being called the most powerful storm in 12 years.
     
     The bread section of a Walmart store is empty as people prepare for the possible arrival of Hurricane Harvey
  • Welcome to World Markets Live this Friday. Our top headlines are as follows.
     
    • America's Gulf Coast braces for a beating from Hurricane Harvey, with oil refiners right in the path.
     
    • Samsung Group head Jay Lee learns his fate, as a South Korean court prepares to deliver the verdict in the scandalous corruption trial that rocked the powerful company and brought down the nation's president.
       
    • U.S. House Speaker Paul Ryan tells CNBC that no debt ceiling fight will stand in the way of tax reform.
    ​​
    • ​Mario Draghi, Janet Yellen and all the stars of central banking gather in Jackson Hole, with investors looking for clues on what policy moves they'll make next.
  • Tropical Storm Harvey intensified into a hurricane on Thursday as it hurtled toward Texas, with meteorologists forecasting that the storm could be a Category 3 "major hurricane" when it makes landfall late Friday or early Saturday. 
     
    Fears the storm could disrupt oil and gas production in the region have also sent Gasoline futures higher. Exxon and Shell have already evacuated some of their gulf platforms as a precaution. 
     
     
    The storm has strengthened since Thursday, potentially becoming the biggest hurricane to hit the U.S. mainland in more than a decade and taking aim between Houston and Corpus Christi on the coast of Texas.
     
    According to CNBC research US Gulf Coast refining capacity is about 9.016 million barrels per day or 46.2% of the total USA refining capacity. 
     
    Oil prices have also risen in session.
     
     
    This table shows the cost and stock market reaction of the U.S.'s biggest hurricanes.
     
     
  • The three major U.S. markets closed lower Thursday evening on incredibly thin volumes. Investors taking no risks ahead of that Jackson Hole meeting of central bankers.
     
     
    The Dow and S&P saw their 2nd negative session in a row, while the NASDAQ saw its 5th negative session in 6.  
     
    Consumer Staples lagged all sectors, with its worst day of 2017.  
     
    The sector is also on pace for its worst week of 2017.  Staples were hit hard by the news of Amazon closing its acquisition of Whole Foods on Monday. 
     
    As we stand at the moment in Asia, it is more of a positive session.
     
    This chart was taken at 06:10 a.m. London time:
     
     
    Opening calls for Europe are currently flat.
  • The dollar has edged higher ahead of the Kansas City Fed's Economic Symposium, gathering the world's top central bankers in the mountain town of Jackson Hole. 
     
     
    Investors are waiting anxiously for Chair Janet Yellen's speech at 3:00 p.m. London time.
     
    While they're not expecting any significant shift in policy, Fed-watchers have indicated her comments could outline a course-charting path for a possible successor, with a focus on how the central bank plans to unwind its balance sheet.
     
    Kansas City Fed President Esther George, a vocal hawk on the committee, who said the central bank was well 'set up' for a rate hike in the coming months, despite sluggish inflation.
     
    I think we should continue with the gradual rate path. 
     
    While we haven't hit 2 percent, I'm reminded that 2 percent is a target over the long term, and in the context of a growing economy, of jobs being added, I don't think it's an issue that we should be particularly concerned about unless we see something change.
     
    Dallas Fed President Robert Kaplan has expressed a more dovish tone, highlighting inflation as a cause for concern for the comittee.

    ECB-watchers, meanwhile, are hoping for any sign from President Mario Draghi that the central bank could begin to taper. He will deliver comments at 9:00 p.m. London time.
     
    ECB President Mario Draghi
     
  • A South Korean court has ruled that Samsung's vice chair and de facto leader has been handed a 5-year jail sentence.
     
    A South Korean court said that Jay Y. Lee gave a bribe to win the support of the country's then president.
     
    Shares in Samsung C&T which at one stage were 3 percent lower have pared some losses on the news.
     
     
    Lee was accused by a special prosecutor's office of bribing a close friend of former President Park Geun-hye to gain government favors.
     
    The 49-year-old scion of the Lee family was detained in February.
     
    The special prosecutor's office have accused Lee of bribing a close friend of former President Park Geun-hye to gain government favors for Samsung.
     
    Reuters reported that prosecutors had demanded a 12-year jail sentence for Lee.
     
    Jay Y. Lee, co-vice chairman of Samsung Electronics Co., center, is escorted by police officers.
     
  • House Speaker Paul Ryan has insisted the United States will raise the debt ceiling in time, echoing Majority Leader Mitch McConnell's comments earlier in the week. 
     
    Both men have attracted the ire of President Trump over the issue, he says they have created a mess.
     
     
     
    Away from the debt ceiling, Paul Ryan has been traveling around the country over the past few days, pushing for tax reform. Speaking exclusively to CNBC, the House Speaker said that the system in the U.S. is out of date. 
     
    We have a tax system written in 1986 for the 20th century and well into the 21st century and the rest of the world is passing us by really.
     
    We have such an antiquated tax system that dropping rates without fixing the actual system would not nearly be as growth producing as a system that cuts rates for workers, families and business.
     
    House Speaker Paul Ryan.
     
  • Qantas shares have hit a 10-year high in Sydney after the Australian carrier posted near-record underlying profit for the full-year.
     
    Qantas also confirmed plans to offer the world's longest flight, between Sydney and London, by 2022.
     
    In April Reuters reported that Airbus has increased the range of its A350-900ULR to 9,700 nautical miles (17,960 kms).
     
    Including headwinds, the Sydney-London flight is equivalent to 9,600 nautical miles.
     
    An Airbus SE A380 aircraft operated by Qantas Airways Ltd. takes off from Sydney Airport in Sydney, Australia, on Thursday, Feb. 23, 2017.
     
  • The Nikkei 225 has ended its Friday trading session 0.5 percent higher.
     
    For the week the index is around flat.
     
     
  • Amazon will slash prices on a range of goods once its takeover of Whole Foods is complete, while also saying it plans to sell Whole Foods products on its site. 
     
    The announcement sent shares of rival retailers and packaged food sellers lower. 
     
     
    On Thursday, Amazon said Prime members will receive additional savings and in-store benefits once Amazon and Whole Foods' technologies are fully integrated. Jeff Wilke, CEO of Amazon Worldwide Consumer, said in a statement that the discounts will make healthy and organic food affordable to "everyone."
     
    A recent survey by Piper Jaffray showed that 82 percent of the households making $112,000 or more a year are already Prime members, while just 67 percent of the households with income in the range of $68,000 to $112,000 a year have signed up. Those making less than $68,000 a year hovered around 50 percent penetration.
  • Will the Trump administration deliver on tax reform?
     
    Tim Drayson, head of economics of LGIM, says the problem with tax policies around the world is they are old, inefficient and very difficult to change, as policymakers always end up having to challenge vested interest.
     
    I think (U.S. tax reform) will happen, but the path of least resistance is ultimately just a straightforward tax cut, which are deficit funded.
     
    Now I know there’s a bunch of Republicans who will try and campaign for revenue neutrality and claim they are being efficient in balancing the books long-term, but there are a number of accounting tricks they can use to pretend its budget neutral.
     
    Drayson says these tricks include assuming stronger growth based on tax reform.
     
     
  • French consumer confidence for August has come in as forecast at 103.
     
    The July figure was 104.
     
    This reported by the official French official statistics body.
  • The largest sticking point in the Brexit negotiations is the legal enforceability of the divorce agreement and a potential transitional deal. That's the house view of Deutsche Bank, which has given its take on the enforcement and dispute resolution white paper issued by government this week. Aside from the biggest sticking point, the bank also thinks an off the shelf, EEA-style agreement is the most likely outcome.
     
    Oliver Harvey, U.K. macro strategist at Deutsche Bank, says the market is becoming bored of U.K. politics and the market is finding it difficult to trade on U.K. politics at the moment.
     
    The market has to a certain extent given up and I think what’s interesting is that we’ve had this big sell off in the pound, but at the same time there haven’t been that many political catalysts.
     
    Harvey says the fundamentals are driving sterling weakness.
     
    The euro is up 8 percent against sterling this year.
     
     
  •  
    Stocks in Europe, as an average, have opened almosts two tentsh higher.
     
     
  • The Swiss index in negative territory among the major national bourses in Europe.
     
     
  • Fiat Chyrsler and Volkswagen have held talks about potential joint production of some light utility vehicles, according to multiple reports.  
     
    Talks are still in the early stages, but comes amid speculation over potential interest in Jeep from China's Great Wall Motors. In a statement, Fiat declined to comment but said it evaluates "potential strategic transactions" from time to time. 
     
     
  • Could the U.S. default on its bond debt? That’s the warning from Nancy Pelosi, the minority leader of the House of Representatives.
     
    Manish Singh, chief investment officer at Crossbridge Capital, says the markets aren’t worried, but shared his concerns.
     
    Remember the last debt ceiling debate; the Republicans had to join hands with Democrats to get something past. Democrats are not giving in because they are so upset with Trump and what is happening in the Republican party. So it’s a fresh ground completely for this to turn into a crisis, where they are just dealing and dealing.
     
    I have a feeling there is less consensus. Nothing about this current Republican Congress gives me hope and faith they will do something, when they couldn’t even pass their own health care bill.
     
     
  • U.S. authorities have charged two former managers from Societe Generale accused of submitting false information to manipulate LIBOR rates.
     
    According to the indictment filed, the conspiracy was aimed at defending the bank's reputation after external analysts had drawn attention to higher than average interest rates the French bank had reported.
     
    The news having little effect on the company share price which this year has enjoyed a strong run until May.
     
     
  • Manish Singh, chief investment officer at Crossbridge Capital, says we will see a risk-off mood in markets.
     
    There is cash that is going to come in. I’m not overly bearish, but there could be a sharp correction and then a buy-in.
  • Condor is reportedly eyeing some of Air Berlin's planes, heating up the race for the insolvent carrier's assets.
     
    According to a local newspaper, the German unit of Thomas Cook is interested in a 'double-digit' number of planes and is in the process of preparing a concrete offer.
     
    Lufthansa submitted its proposal to Air Berlin on Wednesday, centering on the airline's Niki business.
     
    Meantime another German newspaper has reported that Easyjet is interested in up to 40 of Air Berlin's planes, with slots in Berlin and Hamburg.
     
     
     
  • At least 14 people are killed in southern Russia after a bus plunges into the sea, according to an Ifax report citing Russia's emergency service.
  • British foreign minister Boris Johnson says he thinks some of the sums for the Brexit bill seem to be very high, he has told the BBC.
     
    He says the U.K. has to meet its legal obligations in EU talks on the the Brexit bill. He says the country should pay not a penny more or a penny less than what we think out legal obligations amount to in the talks.
     
     
    This is a more mild take than in July when he said European leaders can 'go whistle' if they expect the UK to pay its EU divorce bill.
     
    Johnson also tells the BBC that U.S. President Trump is more likely to visit Britain in 2018 than this year.
  • Shares in supermarket chain Ahold Delhazie are under big pressure following Amazon's announcement that it will slash prices at Whole Foods once its takeover of the company is complete.
     
    Amazon also said it plans to sell Whole Foods' products on its own site. 
     
    The Dutch firm Ahold Delhazie reportedly operates 6,500 stores in 11 countries. 
     
     
  • Here are the top headlines this morning:
     
    • A court hands down a five year sentence for Samsung Group head Jay Y Lee in the bribery trial in South Korea.
    • Hard to stomach! Ahold Delhaize leads the food retailer sell-off, as Amazon's pledge to cut Whole Food's prices leaves grocers with a bitter taste. 
    • America's Gulf Coast braces for a beating, as Hurricane Harvey gets even stronger, with oil refiners right in the path of destruction.
    • Mario Draghi, Janet Yellen and all the stars of central banking gather in Jackson Hole, with investors looking for clues on what policy moves they'll make next.
  • Sweden's July producer prices index rises 5.7 percent year on year and 0.6 percent month on month, according to the country's stats office.
     
    Swedish household lending rose 7 percent year on year in July.
  • All this week the TV team has been talking about alternative investments for your money.
     
    Now it's the turn of gold. Josh Saul, CEO of The Pure Gold Company says that political uncertainty makes it the right time to buy gold and safe haven assets.
     
    The precious metal has enjoyed a strong run this year, up nearly 12 percent in 2017.
     
     
    Saul claims that gold demand isn't affected by good or bad news, but simply by uncertainty.
     
    He says there is evidence that government's enjoy holding a tangible wealth and cites the example of the Germans who have just returned a pile of gold back from the U.S.
     
    The Pure Gold Company sells physical gold and Saul says many of his clients are concerned about cyber attacks and can also benefit from tax advantages.
     
     
    Saul says most clients store their gold in approved vaults but he knows of one client who instead opted to bury it in their back garden!
     
     
  • Rusal has posted half year earnings which beat analyst expectations as it benefited from a global pickup in aluminium prices. The metal is currently trading around six-year highs as the Chinese government continues to take out supply
     
    Alexandra Bouriko, CFO of  Rusal is on CNBC exclusively to elaborate on the results.
     
     
    Bouriko says demand for aluminium grew 5.7 percent in the first half of the year and she expects a 2017 year-on-year growth figure of 5.9 percent.
     
    She says reduced Chinese production capacity has helped Rusal. This as the Chinese attempt to address pollution issues at their smelters.
     
    Bouriko says Asian markets outside China are also demonstrating improved demand.
     
    On rumors about switching its listing to London, the CFO is dismissive and says the company is happy with its current primary listing in Hong Kong.
  • Here are the top headlines for the hour:
     
    • A court hands down a five year sentence for Samsung Group head Jay Y Lee in the bribery trial in South Korea.
    • Hard to stomach! Ahold Delhaize leads the food retailer sell-off, as Amazon's pledge to cut Whole Food's prices leaves grocers with a bitter taste. 
    • Mario Draghi, Janet Yellen and all the stars of central banking gather in Jackson Hole, with investors looking for clues on what policy moves they'll make next.
  • The IFO says German business morale fell in August. The IFO business climate index dips to 115.9 in August versus a forecast of 115.5.
     
    This comes after three months of record high readings for the index, so a pullback can be expected.
     
    The current conditions index falls to 124.6 in August from 125.5 in July, while the expectations index comes in at 107.9 in August, beating the forecast of 106.8.
     
     
    This caused yields on German debt to rise. Here is the bund yield curve at 09:15 a.m. BST:
     
     
  • The euro comes off session lows and pares losses against the dollar, but remains in negative territory.
     
     
  • German bond yields are up around 1 basis point following the release of IFO business confidence data.
     
    Bond yields move inversely to prices, so rising yields indicates the market are selling German bonds as they are less desirable after the data.
     
     
  • Thailand's Supreme Court has issued an arrest warrant for former Prime Minister Yingluck Shinawatra after she failed to appear for a sentencing hearing.
     
    Yingluck faces up to 10 years in jail if found guilty of negligence over a state rice scheme, but said she could not attend court due to an ear problem.   
     
    The country's deputy prime minister said her whereabouts was unknown, adding that it was "possible" she had fled the country.
  • Amazon will slash prices on a range of goods once its takeover of Whole Foods is complete, while also saying it plans to sell Whole Foods products on its site. 

    The announcement sent shares of rival retailers and packaged food sellers lower, with Ahold Delhaize falling towards the bottom of the Stoxx 600. 
     
     
  • Condor is reportedly eyeing some of Air Berlin's planes, heating up the race for the insolvent carrier's assets.
     
    According to a local newspaper, the German unit of Thomas Cook is interested in a 'double-digit' number of planes and is in the process of preparing a concrete offer.
     
     
    Lufthansa submitted its proposal to Air Berlin on Wednesday, centring on the airline's Niki business.
     
    Meantime another German newspaper has reported that Easyjet is interested in up to 40 of Air Berlin's planes, with slots in Berlin and Hamburg.
     
  • Sterling has pared losses against the dollar and is currently up 0.1 percent.
     
     
     
  • The IFO reports the German business climate index fell to 115.9 in August.
     
    An economist for the IFO tells Reuters that the German economy remains unaffected by global political developments and that a drop in the current conditions index is a small drop from a high level. 
     
    The economist adds that uncertainty has diminished in business expectations and says the IFO sees no overheating of the German economy.
     
    Carsten Brzeski, chief economist for Germany and Austria at ING, says the drop is marginal.
     
    After six consecutive increases and three all-time highs in a row, Germany’s most prominent leading indicator, the Ifo index, just dropped for the first time.
     
    The drop, however, was only marginal and the Ifo now stands at 115.9, from 116.0 in July. Interestingly, the decrease was exclusively driven by the current assessment component. Expectations increased to 107.9, from 107.3 in July.
     
    The euro was little impacted by the IFO data when it was released at 0900 BST, but has since risen sharply to pare losses and turn flat against the dollar.
     
     
  • House Speaker Paul Ryan has insisted the United States will raise the debt ceiling in time, echoing Majority Leader Mitch McConnell's comments earlier in the week. 
     
    Both men have attracted the ire of President Trump over the issue. He says they have created a mess.
     
     
     
    Shrugging off the president's criticism, Mr Ryan focused on the Republican's push for tax reform. Speaking exclusively to CNBC, the House Speaker said that the system in the U.S. is out of date. 
     
    Happier times: Paul Ryan with President Trump
  • Tropical Storm Harvey intensified into a category 2 hurricane on Thursday as it hurtled toward Texas, with meteorologists forecasting that the storm could be a Category 3 "major hurricane" when it makes landfall late Friday or early Saturday.
     
     
    Fears the storm could disrupt oil and gas production in the region have sent Gasoline futures higher. Exxon and Shell have already evacuated some of their gulf platforms as a precaution. The supply disruption has pushed up oil prices.
     
     
    NBC's Sarah Daloff joins us from Galveston, Texas, to say the rains have officially started.
     
    The area is bracing for impact. It’s been more than a decade since the area has seen a major hurricane, with winds tapping 110 miles per hour. Harvey is shaping up to be just that. Now ahead of landfall, the governor of Texas has declared an emergency in 30 counties. Seven counties are under mandatory evacuation.
     
     
  • GameStop shares fell over 7 percent in after-hours trade after the world's largest video game retailer posted a narrow miss on quarterly profit expectations.
     
    The company has been attempting to enhance its technology brand units, which include AT&T and Apple authorised stores, in a bid to combat falling video game sales. Despite reporting a 7 percent rise, the retail units also failed to live up to analyst forecasts.  
     
    The share price is currently down almost 6 percent in extended hours trade.
     
     
  • All this week we have talked about alternative investments: how gold, wine, art and bitcoin can help boost your portfolio. Now, we look at how antique musical instruments have become an attractive alternative asset.
     
    Nigel Brown, founder of The Stradivari Trust, says his company pulls together syndicates of people to buy very expensive instruments for top string players to play and use.
     
    Contributors buy £1 nominal shares against the value of the instrument. The minimum investment is £5,000. Typical investors are those who are interested in music.
     
    The musician has the right to buy out the shareholders over the life of the trust (about 20 years). The only snag for the musician is they have to pay the going rate, so the instrument is revalued each year and if the share price, having started at £1, has gone up, the musician will have to pay the higher price.
     
    Brown says the average rate of return is 8 to 10 percent.
     
     
  • Thousands of gamers will descend upon Cologne in Germany this weekend for video game trade fair Gamescom. CNBC's Elizabeth Schulze grabbed a controller and investigated the rapidly growing games industry.

  • Qantas shares have hit a 10-year high in Sydney after the Australian carrier posted near-record underlying profit for the full-year.

    CEO Alan Joyce said the result was proof that the airline's three-year turnaround strategy is paying off, and that it now aims to make another $315 million in savings each year. 

    Qantas also confirmed plans to offer the world's longest flight, between Sydney and London, by 2022.
  • Speaking in Varna in Bulgaria, French President Emmanuel Macron says Poland has decided to go against Europe on a number of EU issues. He says Poland cannot determine Europe's direction, according to Reuters.
     
    Macron also says Bulgaria should be part of a revamped Schengen area and that he wants Bulgaria to play a full role in discussions on EU integration.
     
    Macron, left, with Bulgarian President Rumen Radev
  • White House economic advisor Gary Cohn says President Trump will launch a major push on tax reform next week with a speech in Missouri. That's according to an FT report.
  • A mosque has been attacked in the Afghan capital of Kabul. That's according to Reuters citing the police.
  • U.S. markets are called to open higher. This after the major indexes recorded losses in yesterday's session. 
     
    Market attention is turning to the Jackson Hole economic symposium, due to begin at 10:00 a.m. ET.
     
     
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