World Markets Live - July 27 - CNBC Live Events

CNBC Live Events

World Markets Live - July 27

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 top stories this morning:
    • It's an earnings bonanza! Welcome to the busiest day on the calendar, with the likes of Shell, Diageo, Volkswagen and Amazon leading the raft of corporates releasing second quarter results.
    • Deutsche Bank also due this hour, with investors wondering how much the slump in fixed income trading is hurting the German banking giant.
    • Facebook shares touch a record high after hours, as the social network beats on earnings, revenue and user growth, with mobile video ads surging.
    • Stocks gain, the dollar falls and the Vix hits the lowest level since 1990, after the Fed says it will begin winding down its balance sheet soon, but softens its stance on inflation. 
    And here are the opening calls for European markets.
  • Today is the busiest day of earnings season on both sides of the pond.

    Before the bell stateside, we'll get numbers from the likes of ConocoPhillips, Verizon, Twitter and Procter & Gamble. Then after the close, Intel, Starbucks and Amazon are just a few of the names reporting.
    Here in Europe, Volkswagen, Deutsche Bank, Roche and Shell are among the big companies reporting. The earnings come as VW finds itself in the midst of a new crisis around emissions cheating. Shell continues to contend with a sputtering oil price recovery. And an expected fall in fixed income trading could hinder Deutsche Bank's battle to move beyond its legal troubles.
    Deutsche Bank reports pretax profit more than doubled to 822 million euros in Q2 2017, versus 408 million in Q2 2016.
    CNBC has a first-on CNBC interview with John Cryan, the CEO of Deutsche Bank, at 11am CET.
  • Roche says H1 sales were 26.34 billion Swiss francs versus a forecast of 26.11 billion francs. The company raises its 2017 outlook.
    Core earning per share came to 8.23 francs, versus a forecast of 7.93 francs.
  • AB InBev reports Q2 EBITDA of $5.35 billion versus forecast of $5.40 billion. Revenue was $14.18 billion versus a Reuters poll forecast of $14.25 billion.
    The company expects to accelerate total revenue growth in the full year. They says 20177 has been off to a good start and they will continue to push themselves to deliver good results.
  • Airbus reports H1 revenue of 28.7 billion euros versus 28.8 billion in H1 2016. Earnings per share was 1.94 euros, on reported EBIT of 1.8 billion euros. 
    The company maintains its 2017 guidance. It says the commercial aircraft environment is healthy and the robust backlog supports ramp-up plans. It expects to deliver more than 700 commercial aircraft, but this depends on engine manufacturers meeting commitments.
  • Along with the latest earnings news, we'll bring you exclusive interviews. Later this morning, CNBC will speak to Severin Schwan, the CEO of Roche.
  • Deutsche Bank reports net income of 466 million euros for Q2 2017. Pretax profit was 822 million euros, versus 408 million in Q2 2016.
    Provision for credit losses was 79 million euros, down 70 percent year on year. Revenues were down 10 percent year on year at 6.6 billion euros.
    CNBC has a first-on CNBC interview with John Cryan, the CEO of Deutsche Bank, at 11am CET.
  • Nestle reports H1 organic growth of 2.3 percent, versus a Reuters poll forecast of 2.8 percent. H1 sales came to 43.023 billion Swiss francs, down from 43.77 billion francs.
    The Swiss company confirms its 2017 guidance, and reports H1 net profit of 4.9 billion francs, beating forecasts of 4.83 billion francs.
  • The dollar index has fallen to its lowest level in over a year after the Federal Reserve signalled its balance sheet reduction would be starting soon.
    In its latest policy decision, the central bank kept rates on hold and made no changes to its overall policy. But the statement following its July meeting said balance sheet normalization would start "relatively soon". That's a change from June when it said "this year."
  • Following the latest Fed meeting, Simon Derrick, chief currency strategist at BNY Mellon, says people are hearing what they want to hear from central banks.

    He says Mario Draghi was cautious during last week’s ECB meeting, but markets interpreted it as relatively hawkish, sending the euro higher.

    He says at yesterday’s Fed meeting, the central bank did say it would begin balance sheet reduction relatively soon, but they didn’t change the wording on the inflation story.
    If you have a look at the Fed fund futures, we’ve moved from something like a 41 or 42 percent chance being predicted for a hike into December to now below 40 percent, yet there’s been no change in the wording from the Fed whatsoever. 

    The market is hearing what it wants to hear and that’s feeding through in two ways. It’s feeding through into risk-on, because people believe there’s less chance of a rate hike, and it’s leading to a weaker dollar.
    Derrick says he thinks the Fed will hike before the end of the year.
  • Here's a round-up of the latest earnings results:
    Bayer reports Q2 adjusted EBITDA of 3.06 billion euros and net income of 1.22 billion euros. The company says sales are expected to increase to more than 49 billion euros.
    Danone says Q2 sales rose 0.2 percent like-for-like to 6.664 billion euros. H1 recurring operating profit rose 7.3 percent like for like to 1.72 billion euros. It keeps its 2017 guidance and expects growth to accelerate.
    Schneider Electric reports H1 adjusted EBITDA of 1.72 billion euros, up from 1.59 billion a year ago. Revenue in the first haf was 12.17 billion euros versus 11.74 billion a year ago. The company raises its objectives for 2017 and expects full year organic revenue growth of 3 to 4 percent.
  • Facebook shares are pushing higher in extended hours trade after the tech giant's second quarter earnings came in ahead of consensus estimates. 
    CNBC's Arjun Kharpal says the social media company is in a sweet spot with a growing number of users and increasing revenue. However, revenue growth is losing momentum.
    The excitement around yesterday’s earnings call was focused on three products: video, Instagram and Messenger, and how Facebook now looks to those to make money. I think there is a lot of bullishness from Facebook but also the investment community about the potential in those areas.
  • Foxconn says it will build a $10 billion LCD display panel factory in Wisconsin, which  could eventually employ up to 13,000 people.
    Speaking at the announcement, President Trump praised the chairman of the Taiwanese electronics maker for making the decision. He also congratulated himself for sealing the deal.
  • Chipmaker AMS is boosting its revenue growth target, thanks to expectations of a ramp up in orders in the second half.
    The company supplies smartphone parts to giants such as Apple and Samsung. Its share price has more than doubled this year, in anticipation of the new Apple iPhone in autumn.
    Alexander Everke, the CEO of AMS, says the company has focused on sensor solutions in the last year. He says the company’s Q2 sales grew 22 percent quarter over quarter.
    He says pricing pressure is always present in the industry.
    We offer products and solutions which are highly differentiated, which not many companies can do. In some areas only we can do, which is why achieve better sales and better pricing.
  • Total reports Q2 2017 adjusted net profit jumped 14 percent to $2.5 billion compared to Q2 2016. Reuters forecast net profit of $2.3 billion.
    Total confirmed its target of $3.5 billion in cost reduction and plans to pay a Q2 interim dividend of 62 cents per share.
  • Royal Dutch Shell Q2 pretax profit was $2.55 billion. Revenue came to $72.13 billion. Net profit was $1.55 billion. Q2 dividend per share was 47 cents. 
    Cash flow from operating activities increased to $11, 285 million from $2,292 million a year ago.
  • Sky PLC reports full year earnings per share of 40 pence. Net profit was £695 million and operating profit was £964 million. Revenue was £12.92 billion and EBITDA was £1.94 billion.
    The company's revenue increased 10 percent on a 52 week basis. The company returned to profit growth in Q4. The company says it is confident on delivering on its plans. It intends to increase investment in Sky Originals by 25 percent.
  • Diageo reports full year operating profit of £3.56 billion. Full year organic operating profit grew 5.6 percent. Total dividend is 62.2 pence per share, an increase of 5 percent. 
    The company continues to expect mid-single digit organic net sales growth. Full year net sales was £12.1 billion, up 15 percent.
    Ivan Menezes, CEO at Diageo, says these are a strong set of numbers based on strong fundamentals.

    He says its productivity programme has helped. The company has confidence to raise its guidance for margin expansion and to initiate a stock buyback programme of £1.5 billion.
    The company is strong, it’s executing well, we believe we can sustain good quality growth margin expansion and cash generation as we move forward.
  • Lloyds Banking Group reports H1 total income up £9.3 billion. Profit before tax came to £2.5 billion. Operating costs were £4 billion. Net interest margin was 2.82 percent. Cost income ratio was 45.8 percent.
    Lloyds says the U.K> economy remains resilient following strong employment and GDP growth. It continues to expect capital generation at the top end of 170 to 200 basis points.
  • Roche shares are moving higher in pre-market trade, after it raised its full year outlook. The Swiss pharmaceutical giant says it expects to be able to up its dividend in the wake of posting first half numbers which beat consensus estimates.
    Severin Schwan, CEO of Roche, says it managed to raise its guidance because of the successful launch of new medicines.
    Those medicines do very well, that has led to the strong performance in the first six months. We expect this performance and dynamics to continue for the remainder of the year.
  • AstraZeneca reports Q2 pretax profit of $492 million and operating profit of $925 million. Q2 revenue was $5.05 billion. The company says it performed in line with views as the pipeline continued to deliver. Core earnings per share came to 87 cents. It reiterated its financial guidance for 2017.
    The company also announced a strategic oncology collaboration with Merck. The two will independently develop and commercialise two drugs. They will share the costs of this. 
  • These are the top headlines for the hour:
    • Deutsche Bank shares fall in pre-market trade despite a surprise jump in net profit, as the German financial giant suffers the same fate as its U.S. peers with a slump in fixed income trading.
    • Roche raises its 2017 outlook, as first-half profit tops market expectations, driven by strong sales from new drugs. The CEO tells CNBC he expects the strong momentum to continue.
    • Bayer shares fall in pre-market trade after the pharmaceutical and chemicals group trimmed its full-year sales forecast by 2 billion euros. CNBC will speak to the CEO at 9:00 CET.
    • Downstream powers Shell to a beat, as the oil giant more than triples its profits in the second quarter.
  • Some Asian earnings are out.
    Tokyo Electron reports net profit in the first quarter of 41.25 billion yen. versus 12.68 billion the year before. Revenue increased to 236.4 billion yen from 147.98 billion yen the year before.
    Fuji Electric sees Q1 group operating profit up 23.3 percent to 2.82 billion yen, compared to 2.29 billion yen the year before.
  • Anglo American reports earnings per share of $1.09 in the first half. H1 net profit was $1.42 billion, operating profit was $2.56 billion and pretax profit was $2.42 billion.
  • Volkswagen reports H1 operating results up 8.9 billion euros. Q2 revenue was 59.665 billion euros. The carmaker says its financial outlook is unchanged and it expects deliveries to moderately increase versus the previous year. 
    Q2 net profit was 3.192 billion euros. 
    VW says it anticipates challenges resulting from the economic situation, intense competition in the market, exchange rate volatility and the diesel issue.
  • Samsung Electronics reported earlier record high profits in the second quarter. The company told markets it expects the chip boom to continue.
    Samsung Heavy Industries has now reported Q2 net income of 22.7 billion Korean won versus a loss of 212.4 billion won the year before.
    Samsung SDI reports net profit of 186.59 billion Korean won versus 955.81 billion won the year before. Operating profit was 5.46 billion won versus a loss of 54.17 billion the year before.
  • Shell's second quarter profit has topped analyst expectations, rising nearly 250 percent to $3.6 billion, boosted by strong performance in its downstream division. The company's debt to equity ratio fell to just more than 25 percent, down from 28 percent a year ago. 
    Ben van Beurden, the CEO of Royal Dutch Shell, says electric is growing but liquid fuel is still important.
    He says the company is doing well on all fronts, but downstream is more than pulling its weight with earnings of $2.5 billion.
    On the topic of the transition to electric cars and governments banning petrol and diesel engines, he says oil won’t go out of fashion overnight.
    If we want to get to a 2 degree Celsius future, we have to electrify the more advanced economies even further, so electric mobility has to happen and has to happen fast, but even if all the advanced economies would go to 100 percent electric vehicles, that would simply not be enough.
    There’s going to be a lot of liquid growth in other areas where perhaps mobility still has to rely on conventional fuels. There’s going to be other modes of transport, shipping, aviation, that will see growth and for now go on liquids.
    He says oil and gas projects will remain relevant for decades to come.

    Shell profits triple but low oil prices mean it's remaining 'very disciplined'

    Europe's largest oil firm Royal Dutch Shell has beaten analyst expectations, reporting profits for its second quarter that are three times larger than this time last year.
  • European markets are now open. The Stoxx 600 moves to the downside, driven by a slew of earnings releases this morning. 85 of the Stoxx 600 are reporting results today.
  • Most of the individual European bourses are in the red at the start of Thursday's European trade.
  • Anglo American says it will resume dividend payments 6 months ahead of schedule. 

    This after the miner reported a $6.2 billion debt decline, below its year end target. Underlying EBITDA rose by 68% year on year to $4.1 billion, meeting analyst forecasts. The group said a "relentless focus on driving efficiency" led to "a step change in operational performance and profitablility."
    Mark Cutifani, CEO of Anglo American, says the company was able to pay a dividend this year as its net debt to EBITDA ratio has fallen.
    We believe the operation are in a good position to continue to generate free cash flow. All the hard work we've done has come to the fore. We're six months ahead of where we'd said we'd be on the debt. We're $800 million below the debt. We believe the shareholders should be sharing in the good performance.
  • Today is the busiest day of earnings season on both sides of the pond.

    Before the bell stateside, we'll get numbers from the likes of ConocoPhillips, Verizon, Twitter and Procter & Gamble. Then after the close, Intel, Starbucks and Amazon are just a few of the names reporting.
    Here in Europe, Volkswagen, Deutsche Bank, Roche and Shell are among the big companies which reported this morning. 
  • AstraZeneca shares are down more than 15 percent at the start of Thursday trade, setting the stock on course for its worst day ever.
    Initial results from the study of a lung cancer treatment showed the combination of two drugs failed to help patients. This failure is a big setback for the drug maker and is weighing on the stock price.
  • Bayer has slashed its profit growth outlook, as waning demand for crop chemicals in Brazil took its toll on the firm's results. The German chemicals company warned last month that weak sales in the Latin American country coupled with a struggling health business would hurt earnings by at least 300 million euros.
    Bayer CEO Werner Baumann says the decision to cut guidance is because it wants to be upfront with both good and bad news.
    He says the company and many of its competitors are struggling in Latin America, especially in Brazil.
    Having said that, overall group sales are slightly above prior year levels still and at the same time we see very, very pleasing performance in our pharmaceuticals business which is up 4.4 percent year over year and at the same time sees record levels of profitability.
  • Analytics and information provider Relx is trading higher after it reported a 14-point-2 percent rise in first half revenue . Pretax profit also rose 19 percent for the same period. 
    The Anglo-Dutch firm says it benefited from growth in its analytics and electronics businesses. The group, previously known as Reed Elsevier, raised its interim dividend by 14 percent.
    Nick Luff, CFO of RELX, says the transformation away from being a print business to a digital business has been going on for a long period of time. It’s currently down to 10 percent print revenue.
    The focus and efforts of the group go into the digital products and increasingly we’re bringing in more sophisticated analytics and decision support tools which add value through those digital products.
  • Nissan Motors net profit for Q1 of 134.92 billion yen, down from last year's 136.38 billion yen. Revenue was higher at 2.76 trillion yen, up from last year's 2.65 trillion.
  • Sweden's June unemployment rate comes in at 7.4 percent, versus expectations of 7.6 percent. Total unemployment is 407,000, while total employment is 5.129 million. 
    Swedish household lending is up 7.1 percent year on year in June.
  • These are the top headlines after the market open:
    • A mixed picture for European equities as eighty Stoxx 600 companies report results. Beverage makers post some of the most notable gains, as the CEO of Diageo tells us he is confident on the outlook.
    • AstraZeneca shares are set for their worst ever one-day loss, after a key lung cancer study fails, wiping $13 billion off the drugmaker's market cap.
    • Deutsche Bank shares fall on a 10 percent drop in revenue, as the German financial giant suffers the same fate as its U.S. peers with a slump in fixed income trading.
    • Downstream powers Shell to a beat, as the oil giant more than triples its profits in the second quarter. CEO Ben van Beurden tells us the energy market is regaining stability.
  • These are the stocks at the top and bottom of the Stoxx 600 following the market open and as several corporates report their latest results.
    Click or tap on the arrows to switch between charts.
    Near the top of the index is Diageo, which has posted a 25 percent rise in operating profit while also raising its margin growth forecast. The maker of Johnnie Walker whisky reported sales of £12.5 billion for the year ending June 30. Its board also recommended increasing its final dividend by 5 percent to 62.2 pence per share.
    Also, AB InBev profits jumped in the second quarter despite weakness in Brazil. The world's largest beer maker posted a twelve percent rise in core profit, broadly in line with expectations, as strength in China, Mexico and South Africa offset declines in Latin America's largest economy.
    At the bottom, Astrazeneca's combination lung cancer drug has failed a key trial, in what's seen as a big setback for the Anglo-Swedish pharmaceutical company. The news comes as Astrazeneca posted a second quarter fall in drug sales. This as the company lost patents on big drugs like cholesterol pill Crestor.
    Not on the chart, but shares in Deutsche Bank are taking a heavy hit in early trade, after the German lender suffered a 10 percent drop in revenues. This as it saw its fixed income trading business underperform. However, Deutsche posted a pre-tax profit of 466 million euros, beating expectations.
  • Asia markets close in the green as  markets digested a slew of earnings and the latest Fed decision.
    Sentiment in the broader region was positive, with the MSCI Asia Pacific ex Japan index near its highest levels since 2007.
  • Huawei reports revenue rose 15 percent year-on-year to 283.1 billion yuan ($42 billion) in the first half of the year. That's its slowest growth in four years, according to Reuters.
    The Chinese company reports an H1 operating margin of 11 percent.
  • Orange reports Q2 group revenue up 1.4 percent on a comparable basis to 10.2 billion euros. The company confirms its full-year and mid-term targets, with capital expenditures up 3.8 percent to 1.78 billion euros. 
    The French telecom's CEO says the group is on track to achieve deployment of its fibre optic netowkr in France in mid-dense areas. He says the group does not plan to buy sport rights and the group will not bid for the rights to France's national soccer tournament.
    Shares are up more than 2 percent on the results.
  • Bankia's second quarter net profit fell 14 percent, with the Spanish bank citing low rates as having weighed on its lending incomes. The figure, however, still came in above analysts’ expectations. Bankia also said its bad loan portfolio has decreased since the beginning of the year.
    The Spanish lender's share price is up half a percent so far today.
    Bankia CFO Leopoldo Alvear says the bank is battling with the low rate environment.
    We are a retail bank where 90 percent of our loans are floated. Therefore, the evolution of the 12 month Euribor is critical for the Spanish banks in general and specifically for Bankia.
    We are very sensitive to rates and we’ve been battling that through our income in the last few years, but now we are beginning to see a little bit of light at the end of the tunnel in terms of a turn in the rates.
    Alvear says when rates go up they will see a lot of income come in. He says the macro and micro is working reasonably well in Spain.
  • Euro zone June M3 money supply saw annual growth on 5 percent, matching estimates.
    Adjusted household lending growth in the euro zone was 2.6 percent year on year in June, versus 2.6 percent in May, according to the ECB.
    Non-financial corporate lending grew 2.1 percent year on year in June, down from 2.4 percent in May.
  • These are the top stories for the hour:
    • A mixed picture for European equities as eighty Stoxx 600 companies report results. Beverage makers post some of the most notable gains, as the CEO of Diageo tells us he is confident on the outlook.
    • AstraZeneca shares are set for their worst ever one-day loss, after a key lung cancer study fails, wiping 13 billion dollars off the drugmaker's market cap.
    • Deutsche Bank shares fall on a 10 percent drop in revenue, as the German financial giant suffers the same fate as its US peers with a slump in fixed income trading.
    • Downstream powers Shell to a beat, as the oil giant more than triples its profits in the second quarter. CEO Ben van Beurden tells us the energy market is regaining stability.
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