World Markets Live - August 29 - CNBC Live Events
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CNBC Live Events

World Markets Live - August 29

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

  • President Donald Trump says "all options are on the table" for North Korea, according to a statement from the White House.
     
    Trump says North Korea "has signalled its contempt for its neighbors, for all members of the United Nations and for the minimum standards of acceptable international behaviour."
     
    This after North Korea fired a missile which flew over Japan. Trump says "the world has received North Korea's latest message loud and clear."
     

    Trump says ‘all options are on the table' for North Korea

    CNBCPresident Donald Trump responded to North Korea's firing a ballistic missile that passed over Japan with a statement Tuesday.
  • North Korea has fired a missile that flew over Japan and then landed in waters off the northern region of Hokkaido.
     
    The move marks an escalation in tensions in the region as U.S. and South Korean military forces conducting joint drills in the area
     
    As at the close of trade Asian markets looked like this.
     
     
    Shinzo Abe, the Japanese Prime Minister, has offered his response:
     
    This missile which flew over Japan poses an unpreceded, serious and grave threat and it greatly damages regional peace and stability. And we strongly protested to North Korea.
     
    We request United Nations Security Council to hold an emergency meeting. We will coordinate with the international community and strongly demand to step up pressure on North Korea at the UN. Under the strong Japan-US alliance, we will do our utmost to protect people's lives and security with the sense of alertness.
     
    Abe says he has been in touch with the United States.
     
  • Good morning and welcome to the World Markets Live blog. Our headlines:
     
    • Asia on edge, as a North Korean test missile flies right over northern Japan, alarming residents and triggering a sharp response from regional leaders. 
     
    • A flight to safer investments is on, as worries over Asian instability drive investors to safe haven currencies.
     
    • Heavy rain and flooding from Harvey punishes the U.S. Gulf Coast, leavings tens of thousands homeless. The impact spreads far and wide, as oil refining is hobbled in the heart of America's energy industry.
     
    • Special Counsel Robert Mueller and his investigators zero in on President Trump's role in the response to Donald Junior's 2016 meeting with a Russian lawyer. Sources tell NBC News prosecutors want to know what Trump knew about the meeting and whether he sought to conceal its purpose.
  • This is said to be the first missile that has flown over Japan in a high altitude trajectory.
     
    Japanese residents received a text this morning to take cover as the country's military tracked the missile from North Korea.
     
    South Korea has responded to North Korea's missile launch with an show of force
     
    Four F-15 fighters have reportedly dropped eight MK-84 bombs as part of a military test.
     
    Vasileios Gkionakis, Managing Director, Co-Head of Strategy Research at Unicredit says money flows into yen as a safe haven aren't easy to explain but on the other side of the ledger, dollar weakness is a contributory factor.
     
     
     
  • Special Counsel Robert Mueller's team is investigating whether President Trump tried to conceal the purpose of his son's meeting with a Russian lawyer and a former Russian intelligence officer. That's according to an exclusive NBC News report.
     
    Sources say federal investigators are looking into whether President Trump made a "knowingly false statement" about the purpose of the 2016 meeting in Trump Tower. 
     
    Why did Trump's son meet with a Russian lawyer and a former Russian intelligence officer?
     

    Mueller Team: Did Trump Try to Hide Purpose of Meeting?

    NBC BostonFederal investigators working for Special Counsel Robert Mueller are keenly focused on President Donald Trump's role in crafting a response to a published article about a meeting between Russians and his...
  • Floodwaters from Tropical Storm Harvey are likely to rise, officials have warned, as heavy rain continues to pound the U.S. Gulf Coast.
     
    Another 10 to 20 inches of rain is forecast in coming days, with flooding expected to peak on Wednesday. At least seven people have died, and FEMA estimates that 30-thousand people will be housed in temporary shelters as a result of the flooding.
     
    President Trump is set to visit Texas today to survey the damage, while he has also approved an emergency declaration for neighboring Louisiana, where the rain is spreading.
     
    A man tries to wave down a rescue crew in Houston, Texas.
     
  • So why would the yen rise when North Korea is firing missiles into Japan's airspace?
     
    Leslie Shaffer has been asking around.
     

    North Korea just fired a missile right over Japan — but here's why the yen is rallying anyway

    CNBCIt’s a conundrum: Despite North Korea launching a missile over Japan, traders still see the yen as a safe-haven play, pushing it up.
  • German leader Angela Merkel met with European and African counterparts in Paris yesterday to discuss the migrant crisis.
     
    The group agreed on a new policy to grant asylum to vulnerable African migrants who apply for protection while at their country of origin instead of their destination. The move comes after Merkel recently told a German newspaper she had no regrets over her decision to admit over a million refugees in 2015.
     
    ‎European political commentator, Nina Schick, is on set and says even those in the German political field who are anti-immigration are still not against the concept of the European Union.
     
    Schick says Merkel currently enjoys a 17 percent lead in polls ahead of elections later this year.
     
    Schick: Whoever is junior coalition partner with Merkel will remain pro-EU.
     
    The political commentator says Merkel's wobble in 2016 is now over and she has now managed to convince the public that she is a stable leader on the world stage.
     
    Merkel says the main opposition, Social Democratic Party of Germany, have few avenues to build a winning case as Merkel has adopted so many of their policies.
     
    There aren't that many campaign issues where her contender is opposing her.
     
    Germany's Chancellor is set for her annual press conference at 9:30 a.m. London time this morning.
  • The European Union's Chief Brexit negotiator Michel Barnier has said he is worried about the progress of Britain's exit from the bloc.  As the third round of Brexit negotiations kicked off in Brussels, Barnier told reporters that the EU needs to know the U.K.'s position on all separation issues in order to start serious negotiations.
     
    The European Council guidelines are clear about what is expected on separation, on transition, and on conditions for the future relationship. The EU 27 and the European parliament stand united. They will not accept that separation issues are not addressed properly. I'm ready, I'm ready to intensify negotiations over the coming weeks in order to advance. And I'm glad, David, that you are here to clarify the UK position. 
     
    Meanwhile, Britain's Brexit minister David Davis said London wants the EU to show flexibility as the talks between the U.K. and EU proceed. 
     
     
    For the United Kingdom, the week ahead is about driving forward the technical discussions across all the issues, all the issues. We want to lock in the points where we agree, unpick the areas where we disagree, and make further progress on the whole of range of issues. But in order to do that will require flexibility and imagination from both sides.
     
  • The UK government is set to order all listed companies to publish and justify the pay ratio between executives and workers. This in a bid to boost corporate accountability.
     
    The move is part of the business department's new set of corporate governance reforms, which are aimed at improving fairness and transparency. 
     
    Are the British really clamping down on fat cat salaries?
     
  • The German GFK indicator of consumer confidence has come in at 10.9 heading into September, marking the 5th consecutive increase.
     
    It is at its highest level in 16 years.
  • The dollar has fallen to a four-month low against the yen, as investors pile into safe haven assets in response to the latest provocation from North Korea. The Swiss Franc also pushed higher against the dollar in Asian trade. 
     
    Nandini Ramakrishnan, Global Market Strategist at JP Morgan Asset Management is on set and kicks off by addressing North Korean tension.
     
    Nandini Ramakrishnan, Global Market Strategist at JP Morgan Asset Management.
     
    Nandini Ramakrishnan says working out economic ramifications of geopolitical day to day uncertainty is quite hard to translate to the long term investing advice that her clients seek.
     
    It is a bit tough to model it out in terms of asset classes but it is obviously a bit risk-off. 
     
    Ramakrishnan says witnessing the apparently improved better trade relations between the  U.S. and China has been a positive surprise but there is some measure of concern that progress could reverse if the U.S. adopts a real protectionist stance.
  • All major bourses in Europe are expected to open in negative territory, as concerns surrounding North Korea return.
     
    Stock markets worldwide are showing signs of nervousness.
     
    Futures in Europe and the U.S. point to a negative open on Tuesday, while markets in Asia are trading lower.
     
     
  • On set Nandini Ramakrishnan, Global Market Strategist at JP Morgan Asset Management addressing the Fed's rate path.
     
    She says the Jobs report this Friday will only be considered as part of a trend as August is a typically quiet, and therefore volatile, month.
     
    The big question is wage growth going to finally increase. That is the only lacking issue. If you look at the dual mandate, Unemployment has been great, the quits and hires has been good but the wage growth has lagged.  
     
    Ramakrishnan says Yellen's Jackson Hole speech was definitely a longer term outlook and there is a sense that the Fed is looking beyond  its dual mandate and is now considering financial stability.
  • The French July consumer spending measure has indicated a +0.7 percent month-on month rise, equating to a 2.1 percent year-on-year rise.
     
    The euro is very close to $1.20 and is at its strongest versus the dollar since January 2015.
     
     
  • Copper prices have risen to their highest level in almost 3 years, bucking the falling trend among risk assets after North Korea's latest missile test.
     
    The gains were on the back of shrinking inventories and a slightly weaker dollar.
     
     
  • Markets have opened lower with all European sectors in sell mode.
     
     
     
  • Renault Nissan is creating a joint venture with automaker Dongfeng Motor to build electric cars in China. The move comes as a number of global automakers work to build cleaner vehicles in the country.
     
    Glencore says it's looking to sell its second Australian coal mine. This comes as the Anglo-Swiss commodities house tries to rein in debt and redeploy capital. Glencore has said it would start a process to sell its Rolleston mine, which produces coal used for making electricity. 
     
     
     
    Statoil has said exploration results in the Arctic have been disappointing.The Norwegian oil and gas giant said initial discoveries in the Barents Sea were promising but it has so far not had a hit that might result in a new standalone field. 
     
    Astrazeneca is partnering with artificial intelligence company Berg to find new ways of treating Parkinson's disease. The British pharmaceutical company should provide chemical fragments that Berg will use on potential drug candidates. Separately, Astrazeneca has also received approval from the FDA for expanded use of a breast cancer drug.
  • The euro has confidently leapt into the 1.20 handle this morning.
     
     
    A few views on that:
     
    The euro has strengthened a lot faster than a lot of us anticipated this year but this shouldn't threaten our overall positive view on European equities.
     
    Nandini Ramakrishnan, Global Market Strategist, JP Morgan Asset Management
     
     
     
    I think it has moved too far too soon but ultimately it is optimism on European equities that is moving the euro. No one wants the pound and no one wants the dollar.
     
    Christopher Peel, Chief Investment Officer, Tavistock Investments 
     
     
     
    Meanwhile @Birdyword from the Wall Street Journal was, apparently, never in doubt.
     
     
  • The Chinese foreign ministry has called for restraint from all sides after North Korea fired a missile that flew over Japan.
     
    Chinese officials added that all sides should pursue the avenue of talks.
     
    Top investor Mohamed El-Erian has pointed out the shift in U.S. debt as one major market reaction following the missile launch.
     
  • A reminder of our top news this morning:
     
    • Asia on edge. North Korea fires a test missile over northern Japan, alarming residents and triggering a sharp response from regional leaders. The instability drives investors to gold and safe haven currencies.
     
    • Meanwhile bullish Euro-zone sentiment sees the euro strike a 2-and-a-half year high against the dollar.
     
    • Danger zone. Heavy rain and flooding punishes the U.S. Gulf Coast, leavings tens of thousands homeless. The impact spreads far and wide, as oil refining is hobbled in the heart of America's energy industry.
     
    • Special Counsel Robert Mueller and his investigators zero in on President Trump's role in the response to Donald Junior's 2016 meeting with a Russian lawyer. Sources tell NBC News prosecutors want to know what Trump knew about the meeting and whether he sought to conceal its purpose.
  • Floodwaters from Tropical Storm Harvey are likely to rise, officials have warned, as heavy rain continues to pound the U.S. Gulf Coast. Another 10 to 20 inches of rain is forecast in coming days, with flooding expected to peak on Wednesday. At least seven people have died, and FEMA estimates that 30-thousand people will be housed in temporary shelters as a result of the flooding.
     
    U.S. fuel prices continue to rise as more Gulf Coast refiners cut output, leaving more than 13 percent of the country's refining capacity offline.
     
     
    Amrita Sen, Chief Oil Analyst at Energy Aspects says the gas price fall should stick but you can expect diesel to rise quickly once the rebuild operation gets underway.
     
     
  •  
    4 or 5 months ago the government wasn't talking to business. That has changed. Whether they are listening...
     - Colin Stanbridge, CEO, London Chamber of Commerce and Industry
     
     
     
    Colin Stanbridge says his organization is trying to negotiate the conversations between British business and the U.K. government.
     
    Stanbridge adds that if Philip Hammond steps down as Chancellor then British business views may well lose a powerful ally.
  • Tom Clarke, Partner and co-Portfolio Manager at William Blair is on set and says he won't jump on the safe haven bandwagon as he considers North Korea is an agitator within a bigger game.
     
    Clarke argues that North Korea is trying to sow division between U.S. and China without full scale aggression.
     
    He says in terms of investment, you should short Korean won and perhaps move away from Japanese assets but the wider picture is that markets are unlikely to swing wildly on the threat of North Korea alone.
     
     
    Clarke notes that any recent uptick in market volatility is coming from a very low base.
  •  
    Long euro is not really a crowded trade right now. There is reluctance to believe it will go a lot higher but there is still upward pressure at this point
     
    Tom Clarke, Partner and co-Portfolio Manager at William Blair says the run of the euro isn't over.
     
     
  • Triple-digit losses are now on the cards for the Dow Industrial Average Index.
     
     
    The flight-to-safety trade is on across all of the obvious asset classes. This print taken at 9:34 a.m. London time.
     
     
  • Heavy rains from tropical storm Harvey caused large-scale U.S. refinery outages, pushing up gasoline prices, while crude prices have also risen on Tuesday.
     
    Crude production is not seen as being as directly affected by Hurrican HArvey as gasoline has been.
     
    "Data available so far point to sizably larger refining than production disruptions," U.S. bank Goldman Sachs said in a note to clients.
     
     
  • The yield on U.S. 10-year bonds have dropped to their lowest level since the day after the November 2016 general election result.
     
     
  • Gold seems to have continued its move north in session.  There was a brief dip, straight after news of the Korean missile which led to some speculation over the commodity's status as a safe haven for wealth in risky environments.
     
    However that seems to have been short lived with the precious metal now more than 1 percent more expensive in trade and over 2.5 percent higher over a 7-day period.
     
    Much of that rise in the gold price is because of a corresponding fall in the dollar which is what the metal is internationally priced in.
     
     
  • According to Reuters, the French President Emmanuel Macron is claiming "concrete" results from Russia on preventing the use of chemical weapons in Syria.
  • We might have a slightly higher oil price but it seems geopolitical tension is the bigger factor today as investors sell the ruble.
     
     
  • So are euro bulls optimistic about Europe or negative about the dollar. 
     
    The euro has risen more than 14 percent against the dollar so far this year due to optimism about economic growth and fewer political risks
     
     
    The monthly sentix Euro Breakup Index is currently near its all-time low; only 8 percent of the 1,000 institutional and retail investors surveyed believe the euro to break up within the next twelve months. That’s down from around 25 percent near the start of the year. 
  • JPMorgan has offered a note on the economic impact of Hurricane Harvey.  The research team estimate that the physical damage will be in the $10-$20 billion range. 
     
    This would put Harvey in the top ten costliest storms, but still well below the $159 billion estimated damage from Katrina.
     
    • Hurricane Harvey may first depress economic activity, then support it over time as rebuilding takes hold.
    • The net impact on Q3 and Q4 GDP should be positive, but very small; we are not changing our forecast.
    • There may be a few noticeable effects on the high-frequency data.
       
    Source: Google, left; LM Otero | AP
  • French President Emmanuel Macron says he wants to strengthen Europe's economic and monetary union in light of Brexit, according to Reuters.
     
    Macron says Europe must considern several formats for "those who want to move forward together" and says he will announce new proposals for Europe after the German elections next month.
  • The EU condemns the North Korean missile launch and says it will consider "appropriate response" after the next UN meeting, according to a statement.
  • The U.K. government feels it is in a good position in Brexit talks and would like to move forward to discuss its future relationship with the EU, according to a spokeswoman for Prime Minister Theresa May.
     
    The government is seeking to agree by the October EU summit to move to discuss the post-Brexit relationship.
     
    May's spokeswoman also said the prime minister is outraged by North Korea's "reckless provocation" by illegal missile tests and will wortk with international partners to keep pressure on North Korea.
  • Moscow calls on North Korea to show restraint and avoid any new provocative action. Meanwhile, it also urges the U.S. and its allies to avoid any military escalation in the region. That's according to Ifax.
  • The pan-European Stoxx 600 is facings its worst day of the year. Political concerns caused by North Korea, as well as the strong euro weighing on Europe's exporters, is causing the sell-off.
     
     
  • The Amazon and Whole Foods deal completed on Monday. On its first full day of ownership, Amazon slashed prices on several products at the food retailer.
     
    The deal, valued at $13.6 billion merger, was completed in 73 days. That's the fastest public U.S. retail acquisition over $5 billion on record, according to Thomson Reuters' Deals Intelligence Team. It is also Amazon's largest acquisition to date.
     
    Shares in Amazon are down more than 1 percent in premarket trade.
     
     
  • Bank of Montreal reports net income of C$1.4 billion for Q3. Earnings per share was C$2.05, beating the IBES view of C$2.00.
     
    Total revenue was C$5.46 billion. The bank is increasing its quarterly dividend by 5 percent to C$0.90 per share.
  • The euro remains above the $1.20 level as we hit the midday point. Against sterling, the euro is at multi-month highs and is up nearly a third from its 2015 lows.
     
     
    Jaisal Pastakia, investment manager at Heartwood Investment Management, says the resurgence comes on the back of improving growth and fewer political risks.
     
    We expect euro strength to be sustained against sterling owing to improving economic fundamentals in Europe; a narrowing interest rate differential; and continuing Brexit uncertainty that is likely to weigh more heavily on the U.K. economy. 
     
    However, continuing euro appreciation versus the U.S. dollar is more questionable. The strength of the euro is a concern for the European Central Bank, which is endeavouring to lift inflation to target.
  • Best Buy reports Q2 net income of $209 million on revenue of $8.94 billion. Earnings per share are 67 cents, beating the IBES expectation of 63 cents. The retailer sees full year 2018 revenue growth of around 4 percent, up from its previous forecast of 2.5 percent.
  • U.S. markets are called sharply lower, with the Dow expected to lose almost 100 points at the start of Tuesday's tradining session. This comes as political tensions are stoked by North Korea's missile launch, as well as the economic impact of Hurricane Harvey. The storm has left hundreds of thousands of Americans without power. It is causing widespread flooding and devastation.
     
     
  • Uber announces it will provide life, disability and medical insurance to its 450,000 drivers in India.
     
    The ride-hail service says these insurance policies will be provided by ICICI Lombard General Insurance.
  • Here's the full statement from the White House.
     
     
  • Sterling is down against the euro and Japanese yen today but is up against the U.S. dollar.
     
    A surprise fall in house price data is weighin on the currency, according to Paresh Davdra, CEO and Co-Founder of RationalFX.
     
    Weaker than expected figures which saw a 0.1% slide in UK house prices took analysts by surprise and led to the pound moving lower against the euro. It comes as the latest round of Brexit negotiations get off to a shaky start as prominent EU figures including chief negotiator Michel Barnier voice concern over the slow progress of talks.
     
    It would appear investors share the view of the EU with the pound’s weakness seeming emblematic of the slowing UK economy and a lack of investor faith in the progress of negotiations. The strength of the euro is also a factor, with the shared currency showing little sign of slowing as QE tapering approaches and putting further pressure on the pound.
     
    Notably, sterling was able to rise against the dollar which found itself weighed down by tensions over North Korea’s most recent  missile launch.
     
     
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