World Markets Live - July 12 - CNBC Live Events
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CNBC Live Events

World Markets Live - July 12

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

  • Good morning and welcome to World Markets Live. Here are the opening calls for European markets.
     
    As ever, we'll begin full coverage from 0600 BST
     
     
  • These are the top stories this morning:
     
    • A volatile ride for U.S. stocks, as Donald Trump Junior releases his email exchange with a Russian lawyer, which sparks a temporary sell-off, while the Euro hits its highest level against the dollar in more than 14 months.
    • Investors nervously await Janet Yellen's speech on Capitol Hill, but IMF chief Christine Lagarde tells CNBC in an exclusive interview that the Fed will not cause another taper tantrum
    • Oil prices trade solidly higher as the market awaits the OPEC report.
    • A report cites panic at Apple as the tech giant scrambles to fix last minute software bugs affecting the iPhone 8, which is expected to be released in September.
  • Oil prices extended gains after the U.S. government's Energy Information Agency announced on Tuesday that U.S. crude oil inventories fell by 8.1 million barrels to 495.6 million in the week to July 7.
     
    It also lowered its expectations for U.S. oil output in 2018. 
     
    It expects 2018 crude oil output to rise to 9.9 million barrels per day (bpd) from 9.3 million bpd this year, a 570,000 bpd increase. This was down from last month's forecast 680,000 bpd year-over-year increase.
     
    Meanwhile, the market is looking ahead to the latest monthly OPEC report released today, which will provide an outlook for the crude oil market.
  • The euro is at a four month high against the U.S. dollar. This as markets question whether or not the Federal Reserve will raise rates before the end of the year.
     
     
  • A volatile day for U.S. markets.
     
    Stocks sharply sold off early on after Donald Trump Jr. released his emails concerning meeting a Kremlin-linked lawyer, but markets later recovered.
     
     
  • Donald Trump Junior has released the emails that preceded his meeting with a Russian lawyer last year. The exchanges show he believed he was going to get damaging information about Hillary Clinton, as "part of Russia and its government's support" for the Trump campaign.
     
  • The U.S. Senate has announced a two-week delay to its usual August recess. Senate Republican leader Mitch McConnell (pictured) says the move allows senators more time to work on legislation and approving nominees. They may seek a vote on a controversial healthcare overhaul bill as soon as next week.
     
     
  • Bond yields surged after ECB President Mario Draghi hinted at the possibility of tweaking the central bank's aggressive stimulus in a speech in Sintra, Portugal, last month.
     
    However, the IMF's Managing Director Christine Lagarde has told CNBC she believes euro zone monetary policy is likely to remain accommodative for an extended period. 
     
    Every region is in a different place at the moment. We are hearing different narratives depending on the circumstances. I believe that President Draghi and his team are also working on the basis of facts. I've heard regularly and repeatedly in the last few days from some of his team members that of course interest rates would remain low for an extended period of time.
     
    They are independently setting those rates, those standards, those methods of unwinding, we should leave them to determine how it's going to happen, and markets have their expectations as well.
     

    EU project 'alive and kicking'; Brexit has inspired non-members to join, says IMF's Lagarde

    Britain's exit from the European Union has not only revitalized current members but it has also inspired countries outside of the bloc to apply for membership, the International Monetary Fund's managing director, Christine Lagarde told CNBC Tuesday.
  • NBC's Peter Alexander reports on Donald Trump Junior's emails and how it ihas affected the administration.

  • Turkish police have killed five militants in raid on house used by an Islamic State cell in central Turkish city of Konya, according to Reuters citing CNN Turk.
     
  • Take part in CNBC's latest trader poll.
     
    Which asset class do you think is most directing the market? Is it oil price swings, bond yield spikes or tech stock gyrations?
     

    Poll: Which asset class is most directing the market?

    For this week's trader poll, we want to know which asset class you think is giving the market the most direction.
     
  • Statoil has bought a 10 percent stake in a licence for an oil prospect in Brazil.
     
    Statoil now owns a 76 percent stake in the BM-S-8 licence in Brazil's Santos Basin.
     
    Statoil acquired the stake from QGEP for $379 million. Statoil estimates recoverable volumes from the licence are in the range of 700 to 1,000 million barrels of oil equivalent. 
  •  
    Apple is reportedly scrambling to fix bugs on its next iPhone. According to Fast Company, problems with wireless charging and 3D sensing have engineering and design teams working around the clock.
     
    Apple typically releases new iPhones in September, but some industry watchers think the next model might appear as late as November. We asked Apple for comment about the reported problems, but a spokesperson wasn't immediately available.
     

    'Panic' as Apple works 'feverishly' to fix iPhone 8 bugs ahead of launch, report says

    Apple is reportedly working around the clock to iron out software bugs still affecting the iPhone 8 ahead of its September launch.
  • CNBC's Geoff Cutmore weighs in on the Apple story and provides context on what the tech giant is trying to do.
     
    May 2nd, Apple announced its second quarter earnings. The headlines on those numbers were earnings beat on adjusted basis, revenue miss slightly and iPhone sales were flatter and the fear was China sales here. And I think at the time, Tim Cook suggested the reason the iPhone sales weren’t as strong as they could of been and didn’t meet the market expectations was anticipation of new models coming to market.
     
    And I think you’ve got to ask yourself, if you are in the market for a new phone at this point, do you buy the 7S or do you buy the 7S plus, which is likely to be launched at a cheaper price point than the iPhone 8?
  • Norway's DNB reports Q2 net profit of 5.23 billion Norwegian krona, beating expectations of 4.46 billion. The company announced it is initiating a share buyback programme.
     
    Loan losses came to 487 million NOK, well below expectations of 1.31 billion NOK. The company says it is not worried that it will record losses on home mortgages and is positive that the housing market is levelling off after several years of unsustainable price increases.
  • VEON and MegaFon have announced they are ending their Euroset joint venture.
     
    Russia's MegaFon will buy the 50 percent stake in Euroset from Vimpelcom, according to the company's statement. MegaFon will own 100 percent of Euroset. 
     
    The companies did not provide financial details of the deal.
  • Oil has been trading up, following news from the States. The Energy Information Agency cut its production forecast for next year, while API data showed a large drawdown in inventories.
     
    Reporting from the World Petroleum Congress in Istanbul, CNBC’s Steve Sedgwick spoke to Frederik Willem de Klerk, former president of South Africa during the apartheid era, about misappropriation and land seizures in South Africa.
     
    The constitution effectively protects land security, home ownership and shared ownership security. As long as the constitution is not amended and it cannot be amended easily, there is securtity in that regard. 

    The voices we hear about taking land without compensation is from extremist wings. It's been rejected even by the ANC even in its disarray, in clear terms that they don't stand for expropriation of land without compensation. 

    My message to investors is the legal system and constitutional system in South Africa does safeguard you, and what we are hearing at the moment is extremist catching the headlines but that's not what is in essence within the law and in the hearts and minds of a majority of South Africans in play.
     
     
  • Coming up, CNBC will speak to Bob Dudley, CEO of BP, later this morning.
     
     
  • Speaking to CNBC at the  Europlace conference, the former governor of the Bank of France Christian Noyer said Paris can replace London as Europe's top financial centre after Brexit.
     
    What I see is that the vast majority of institutions if not all are planning to put in Paris their trading room. Why? Because market activities require high skilled staff and Paris is both a city where you can attract those high skilled people, not only because the city is nice, but because it’s a big city like London. It’s the only big city like London.
     
     
  • Amazon says its 'Prime Day' is on course to be the online retailer's biggest on record by sales. Customers ordered more than 3 times as many echo speakers, while third party sellers had shipped over 50 times more items by noon local time. 
     
    Prime Day was the first major test for the Amazon Prime Air fleet. The company introduced the cargo service last summer and has being spending billions of dollars on building its own logistics network.
  • Venture Capital investment in Europe has hit its highest level since 2007. That's according to a new report from Invest Europe, which shows a tenth of capital in 2016 came from North American investors. Over 50 companies have reached unicorn status, which implies a valuation over $1 billion, in Europe since 2000.
     
    Money app Revolut has raised $66 million in a new round of funding. Index Partners led the Series B round, with current stakeholders Balderton Capital and Ribbit also involved.
     
    Vlad Yatsenko, co-founder of Revolut, says his company offers a global account that allows users to spend and transfer money fee-free anywhere in the world.
     
    Our goal is to offer an account that removes borders for people who live between different countries and travel abroad often.
     
     
     
  • Here are the top headlines for the hour:
     
    • A volatile ride for U.S. stocks, as Donald Trump Junior releases his email exchange with a Russian lawyer, which sparks a temporary sell-off, while the Euro hits its highest level against the dollar in more than 14 months.
    • Investors nervously await Janet Yellen's testimony on Capitol Hill, as IMF chief Christine Lagarde tells CNBC in an exclusive interview that she disagrees with the Fed chair about the likelihood of another financial downturn.
    • A report cites panic at Apple, as the tech giant scrambles to fix last minute software bugs affecting the iPhone 8, which is expected to be released in September.
  • Burberry announces 3 percent underlying retail revenue growth year-on-year. The company says it is on track to deliver cumulative cost savings of £50 million in the full year 2018.
     
     
    First quarter comparable sales are up 4 percent. Retail revenue was up 3 percent to £478 million.
     
    The company says strength in mainland China drove improved mid-single digit percentage growth in Asia Pacific.
  • Barratt Developments reports total completions including joint ventures at 17,395, compared to 17,319 last year. This is the highest level in nine years.
     
    Profit before tax is expected to increase to around £765 million from £682.3 million last year, ahead of expectations. The total average selling price on completions increased by around 5.9 percent to circa £275,000.
     
    It expects to deliver on its financial targets set in 2014. 
  • The competition watchdog says it is referring the proposed Tesco-Booker merger for an in-depth investigation.
     
    The watchdog says in more than 350 local areas there is currently an overlap between Tesco shops and Booker-supplied stores, meaning shoppers could face worse terms when buying groceries.
  • Bank of England deputy governor Ben Broadbent says he is "not ready" to raise interest rates yet, Reuters reports citing Scotland's press and journal newspaper.
     
    Broadbent says there is reason to see the monetary policy moving in the direction of higher interest rates, but also lots of imponderables. He says the "mood of business" is key to his thinking on rates and that firms are likely to remain nervous amid Brexit uncertainty.
     
    Sterling has dropped to a two-week low on his comments.
     
     
  • U.K. retailer Tesco has commented on news the CMA is referring its merger with Bookers for an in-depth investigation.
     
    We are pleased that the CMA has accepted our fast track request, and we look forward to continuing our engagement over the coming months. This merger has always been about growth, and we remain convinced that it will bring benefits for consumers, independent retailers, caterers, small businesses, suppliers and colleagues.
  • Federal Reserve governor Lael Brainard says the Fed is likely to begin reducing its $4.5 trillion balance sheet soon.
     
    Her comment comes ahead of Janet Yellen's two-day Congressional Testimony on Capitol Hill. US lawmakers are likely to grill her on the Fed's tapering plans and its interest rate outlook.   
     
     
  • JD Wetherspoon reports like-for-like sales increased by 5.3 percent and total sales increased by 3.6 percent for the 11 weeks to 9 July.
     
    Year-to-date, like-for-like sales increased by 3.9 percent. The company has opened 9 new pubs since the start of the financial year and has sold or closed 38.
     
    It expects to open one more pub before the financial year ends. Net debt at the end of this financial year is currently expected to be around £715 million.
  • Bang & Olufsen reports group revenue increased 13 percent in Q4 of 2016/2017. It expects to continue growth momentum and increase revenue by around 10 percent compared to 2016/17.
     
    Revenue was 785 million Danish krona, beating expectations. 4Q EBIT loss was 95 Danish krona. Net loss for Q4 was 75.8 krona, worse than the 14 million krona seen by analysts.
  • Equiniti group has proposed the acquisition and carve out of the Wells Fargo share registration and services business for a total cash consideration of $227 million. The acquisition is expected to be strongly earnings accretive, with cost synergies expected to be at least $10 million per year.
     
    The acquisition is expected to be completed in Q4 2017 and Q1 2018 following competition of the carve out and regulatory approval.
  • The IMF's deput  managing director Mitsuhiro Furusawa says most countries in Asia are below the minimum 15 percent tax-to-GDP ratio needed to meet goals.
     
    The IMF says there is uncertainty about the direction of economic policy in some advance economies, especially the risk of inward-looking polciies.
     
    The normalisation of Fed policy has proceeded smoothly, according to the IMF. It says it is working with countries to resist damaging tax competition. The IMF adds it is trying to help countries to find ways to counter the artificial shifting of profits and assets to low-tax locations.
  • Asian shares are mixed in the overnight session. The Nikkei slid on gains in the yen. Investors are looking ahead to comments from Federal Reserve Chair Janet Yellen, as she is set to testify before congress.
     
     
  • Frederik Willem de Klerk, former president of South Africa, shared his scathing criticism of the current South African leadership with CNBC.
     
    I'm deeply concerned - what is going wrong is bad leadership at the moment. It's not good governance. It's a governing party which is within itself in disarray but there's light at the end of the tunnel.
     
    The time of President Zuma is running out. He will be replaced as leader of the African National Congress in December of this year.
     
    There are better candidates and not so good candidates vying for the position at the moment, at the moment the indications are that what I consider the best candidate is gaining ground, let's hope it happens.
     
     
     
  • Sanctions against Qatar will continue until demands of the four Arab states leading the boycott are met. They released a firm statement, as U.S. Secretary of State Rex Tillerson visited Doha, part of a trip across the Middle East.
     
    Meanwhile, Qatar is working to circumvent the blockade by importing 4000 cows, the first of which are arriving this week.
  • Michala Marcussen, global head of economics at Societe Generale, shares her thoughts on the ECB, the euro and oil prices.
     
    I don’t think the ECB is the more hawkish of the central banks today, but if we look at the euro on the one hand, so stronger euro is quite important because it lowers inflation, but it also eats into growth.
     
    The irony of the oil price is that, yes, if we’re assuming it’s more about the supply side, the oil price lowers your inflation but it actually gives a little bit of a lift to the growth side because it helps your consumer spending power.
     
    At the same time, we know that when oil dips too low, it becomes a concern for financial stability.
     
     
  • Amec Foster Wheeler is under investigation by the Serious Fraud Office over use of third parties, bribery and corruption offences.
     
    The British oil and gas services firm said it will cooperate fully with the probe, adding that it did not expect the investigation to impact its £2.2 billion pound takeover by John Wood Group.  
     
    Shares in Amec Foster Wheeler are called down 4 to 5 percent after the company confirmed the investigation.
  • Ryanair's CEO says Brexit may mean more share buybacks to keep in compliance with EU ownership laws. The company is also reiterating its warning that there will be no flights between Britain and Europe if the two sides fail to reach a Brexit deal.
     
    Addressing the European Parliament, Ryanair CEO Michael O'Leary warned a cliff-edge Brexit would leave Heathrow deserted and holidaymakers stranded. Ryanair is lobbying for the UK to remain part of the EU's 'Open Skies' agreement after March 2019.  
     
     
    Meanwhile, Britain's foreign secretary Boris Johnson has told the EU to "go whistle" over its final Brexit divorce bill. Responding to a question from a fellow eurosceptic Conservative MP in parliament, Johnson was urged to condemn demands by some EU officials for what he deems "extortionate" final payments.
  • South Korea's GS Galtex announces it has bought total of 3 million of U.S. crude for August to October.
     
    Oil prices remain up on reduced U.S. inventories and a lower production outlook for 2018.
     
     
  • European markets are open for Wednesday's session, moving higher.
     
     
  • All sectors bar media are in positive territory at the start of trade. The oil & gas sector is gaining on the stronger oil prices, while basic resources are up on signs of demand.
     
  • The major individual European bourses have open up higher this morning.
     
     
    These are the stocks pulling the STOXX 600 higher. Norway's DNB is near the top on strong earnings data.

    At the bottom of the index, Pearson continues yesterday's slide and John Wood Group is near the bottom following news that its acquisition target Amec Foster Wheeler is being investigated by the Serious Fraud Office.
     
     
     
  • As the initial European trades settle, Richard Harris, Chief Executive at Port Shelter Investment Management has joined Michala Marcussen, Global Head of Economics of Societe Generale on set with Geoff and Carolin.
     
    Harris says markets are relatively optimistic about the environment.
     
     
    I think the markets are looking at a relatively benign economic scenario. Europe is looking better, emerging markets are picking up and the dollar is finally giving relief to Asia.
     
    But we have had a great first half of the year so usually there is some sell-off in the second half.   
     
     - Richard Harris, Chief Executive at Port Shelter Investment Management
  • The Czech Republic's June jobless rate hits 4 percent, down from 4.1 percent in May.
     
    Czech CPI was unchanged month to month in June. CPI year to year in June was up 2.3 percent, down from 2.4 percent in May. Both readings matched forecasts.
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