World Markets Live - June 13 - CNBC Live Events
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World Markets Live - June 13

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. We'll begin full coverage from 0600 GMT
  • Here are this morning's top headlines:
     
    • The tech wreck drags the Nasdaq to its worst 2-day losses of the year as Apple leads further declines amid overvaluation fears.
    • "I got us into this mess and I will get us out of it" says U.K. Prime Minister Theresa May as she prepares to meet DUP leader Arlene Foster in a bid to secure her parliamentary majority.
    • The U.S. Treasury reveals a regulation rollback that looks to lift the burden off Wall Street banks, as Steve Mnuchin says markets clearly like what President Trump is doing.
    • Deutsche Bank reaches a $170 million settlement over euribor rigging, but the German lender does not admit wrongdoing, saying its paying the fine to avoid the inconvenience of further litigation.
     
  • The Nasdaq has posted its worst two-day streak of 2017, as tech stocks continue to drag on stock markets. Increased volume in some of the bigger names like Apple and Amazon pulled the sector to its first back-to-back loss in nearly 2 months. The Nasdaq is still up nearly 19 percent since the U.S. Presidential election in November, driven higher by the FAANG stocks.
     
     
    Apple led the declines on Wall Street and has lost over 6 percent in the last two trading days as some analysts have become increasingly concerned over its valuation. Goldman Sachs warns the 'fairy tail scenario' behind the tech rally is unlikely to last, while Morgan Stanley and UBS have also cited overvaluation worries as a reason for the pullback.
     
     
  • CNBC's Steve Sedgwick weighs in on the "tech wreck" and says that while some of the valuations for FAANG stocks are huge, they're no worse than other stocks which offer less growth.
     
    Some of these valuations, compared to the amount I need to pay for the likes of Unilever, for Proctor & Gamble, for Danone, they don’t look that bad considering, and my point here is it’s all about paying for growth.
     
    When I have to buy an advertiser on twenty times forward that’s giving two to four times growth that is absolutely rubbish for me. But if I buy some of these, and listen to some of these figures: Amazon, 23 percent increase in growth last time to $35.7 billion. 
  • Goldman Sachs analysts have had their say on the recent moves in the tech sector. Click here to read why they current market scenario cannot last.
     

    Goldman: This 'fairy tale' scenario behind the tech bull market unlikely to last

    Goldman Sachs believes this odd mix of decent economic growth, yet declining interest rates can't last.
  • U.K. Prime Minister Theresa May is reportedly apologising to Conservative MPs for losing their parliamentary majority. Speaking behind closed doors, she told an influential group of British lawmakers: "I got us into this mess and I'll get us out of it."
     
    The next challenge facing Theresa May is securing the support of the Democratic Unionist Party for her minority government. The prime minister meets with the Northern Irish party's leader Arlene Foster later today. The two leaders are aiming to finalise a deal that would commit the DUP to supporting the Conservative Party on key votes.
     
    May met Foster in July last year.
  • A close confidant of President Trump says he's thinking about firing Robert Mueller -- the man looking into possible collusion between Russia and the Trump campaign. This from Christopher Ruddy, CEO of Newsmax Media.
     
    Speaking on PBS -- Ruddy said Trump is considering terminating the special counsel. The White House said in a statement "With respect to this subject, only the president or his attorneys are authorized to comment."
     
    (Robert Mueller)
     
    Meanwhile, U.S. Attorney General Jeff Sessions testifies before the Senate Intelligence Committee today. This follows the explosive testimony of former FBI Director James Comey. Comey told the Senate panel the FBI had information in February that would have made it "problematic" for Sessions to continue leading the investigation into Russian election interference.
     
    A Justice department spokesperson said Sessions requested his hearing be open to the public because he "believes it is important for the American people to hear the truth directly from him."
     
    (Jeff Sessions)
  • NBC's Peter Alexander has the latest on U.S. Attorney General Jeff Sessions scheduled testimony

  • Steve Mnuchin says the U.S. government can pay its bills at least through the beginning of September. Testifying before a Senate budget committee, the Treasury Secretary (pictured) added the administration had a back-up plan to avoid defaulting if Congress misses an August deadline to raise the debt limit. But Mnuchin repeated calls to lawmakers to raise the debt ceiling before their August recess.
     
     
    Meanwhile, the Treasury Department has unveiled its plan to reform the country's financial regulatory framework. The 150-page report proposes over one-hundred changes - including reducing restrictions on big banks' trading operations, easing annual stress tests and reducing the powers of the Consumer Financial Protection Bureau.
  • Russian police detained hundreds of protestors across the country as opposition leader Alexei Navalny was arrested and sentenced to his second prison term this year. NBC's Chief Foreign Correspondent Richard Engel reports.

  • Asian stocks shrugged off the "tech wreck" to record gains, although the Japanese Nikkei remained flat.
     
     
  • President Trump's business reform agenda is a major focus for fund managers at the Fund Forum International in Berlin, as investors weigh the investment opportunities for Europe and the United States.
     
    Peter Branner, CEO at SEB Investment Management AB, discusses the U.S. stock market and whether current valuations are supported.
     
    I think what has happened is an extension of the hype and I think that can continue. Fundamentals are also looking pretty good and growth outlook is nice, inflation rates are low, so I think the sentiment right now is pretty good.
     
    Being in Europe I may be slightly biased, but I think here might be even better. At least the valuations look more familiar to us in Europe than the U.S., and also with the Asian market being pretty stable I think this is where we think the most potential is, in the short term at least.
     
     
     
  • Deutsche Bank is settling an investor lawsuit claiming it rigged the Euribor benchmark. The German lender is not admitting wrongdoing.
     
    The bank says it's setting for $170 million to avoid further legal costs. Deutsche has already paid 15 billion euros in legal bills since 2009.
     
     
  • Altice USA is pricing its IPO at between $27 to $31 a share. The cable operator's Dutch parent company said it plans to sell up to 7 percent of the U.S. subsidiary, valuing the company at up to $22 billion.  
     
    The New York offering is seen as a move by Altice's founder, French billionaire Patrick Drahi, to fuel further expansion in the US. No date has been announced for the IPO.
     
     
    Meanwhile, Allied Irish Banks plans to raise up to $3.7 billion when it lists in Dublin and London. AIB has priced shares between 3.90 euros and 4.90 euros, in what is set to be one of Europe's largest bank IPOs since the 2008 financial crisis. 

    Ireland's Finance Minister Michael Noonan said the long-awaited stake sale remains on track and market conditions look favourable despite uncertainty following the UK election. 
  • Social Media is changing how big brands and companies interact with customers. It's also transforming politics. Electioneering is big business online with parties and candidates looking to win votes and reach a younger crowd. 

    The Trump administration is increasing focus on social as a primary tool of communication over more traditional forms of media.

    Ryan Holmes, CEO at Hootsuite, shares his view on the tech sector.
     
    There is a lot of value being created by the companies that are disrupting a lot of incumbents. So if you look at what Uber is doing, it’s consolidating the transportation industry and others, and I think that there is a lot of froth around this, but also I think  there is a ton of opportunity and if you look at the long game I think they are going to pay out very well.
     
     
     
  • Singapore's total employment falls the most in nearly eight years, down to 2.2 percent in the first quarter, which was lower than expected.
     
  • Telecom Plus reports full year pretax profit rose 16.5 percent to £40.9 million. Revenue fell 0.6 percent to £740.3 million.
     
    The company has announced a final dividend of 48 pence per share, with service numbers up by 4.9 percent to 2.3 million.
  • Halma PLC reports full year pretax profit rose 15.7 percent to £157.7 million. Revenue rose 19 percent to £962 million.
     
    The company says it expects to make further progress in the year ahead in line with expectations.
  • These are the top headlines for the hour.
     
    • The tech wreck drags the Nasdaq to its worst 2-day losses of the year as Apple leads further declines amid overvaluation fears.
    • "I got us into this mess and I will get us out of it" says U.K. Prime Minister Theresa May as she prepares to meet DUP leader Arlene Foster in a bid to secure her parliamentary majority.
    • The U.S. Treasury reveals a regulation rollback that looks to lift the burden off Wall Street banks, as Steve Mnuchin says markets clearly like what President Trump is doing.
    • Altice values the IPO of its U.S. cable business at $22 billion, as billionaire founder Patrick Drahi looks to expand his empire stateside.
     
  • Francesco Curto, head of the CROCI investment strategy and valuation group at Deutsche Bank, weighs in on the FAANG stocks.
     
    It’s a no brainer that these FAANG stocks have been delivering. On valuation on 2018 numbers, there are 15 stocks that are responsible for 50 percent of the increase in the S&P year to date and on next year numbers these stocks are as cheap or as expensive as the rest of the market.

    So we cannot really say that these stocks are expensive, or it’s not like 2000 in valuation for these stocks. These stocks are delivering earnings growth and this is why they have been rising and the rest of the market has been struggling.
     
     
  • The U.K.'s Competition and Markets Authority has raised concerns over the acquisition of part of Punch Taverns by Heineken.
     
    The CMA says the purchase could reduce competition in 33 local areas across the U.K. and Heineken must now offer proposals to address their concerns by June 20.
     
    The CMA says concerns were raised that the merger would close off an important route to market for brewers which compete with Heineken and could lead to a reduction in the choice of beers and ciders available at Punch Tavern owned pubs. 
  • Twelve US states plus the District of Columbia and Puerto Rico, have joined the United States Climate Alliance, a bipartisan group seeking to uphold key conditions of the Paris Climate Accord. This after President Trump triggered America's withdrawal from the agreement earlier this month.
     
    Nils Bolmstrand, CEO of Nordea Asset Management, explains why sustainability is important.
     
    To the same extent that President Trump is now seeing that his electorate is actually making their own decision and states are choosing to stay in the Paris accord, I think this for us is a client driven action. I think clients are today voting with their feet and actually putting their money into sustainability where they haven’t so much historically and this is an important change that has happened.
     
    Nils adds that Trump's decision to leave the accord will give it more momentum as people realise they need to take action and put sustainability at the top of the agenda.
     
     
  • The attorneys general of Maryland and the District of Columbia filed a lawsuit claiming government payments to Donald Trump's businesses violate the Constitution. The White House rejected the claim saying the lawsuit was motivated by "partisan politics." NBC's Justice Correspondent Pete Williams reports.

  • The shock outcome of the U.K. general election has cast doubt over Britain's proposed Brexit timeline. However, Michel Barnier - the European Union's chief Brexit negotiator - has warned the UK not to waste time before starting talks. Speaking to reporters, he said: "We must begin this negotiation. We are ready as soon as the UK itself is ready."
     
    (EU Brexit negotiator Michel Barnier)
     
    Meanwhile, Theresa May is facing growing calls from within her own party to moderate her stance on Brexit. Scottish Conservative leader Ruth Davidson says the government should prioritise the economy over cutting immigration in forthcoming negotiations. That sentiment was echoed by Nicola Sturgeon, the leader of the Scottish National Party, who urged the British prime minister to re-think her plan for Brexit.
     
    However, the U.K. Brexit Secretary David Davis insists his government remains set on leaving the EU single market. He says the step is necessary in order for Britain to take back control of its laws and borders. 
     
     
  • The chance of a hard Brexit has decreased somewhat since the election, according to a Reuters poll of economists: 33 out of 49 economists surveyed say the likelihood the U.K. will end up outside of the EU single market has receded slightly since last week's election.
     
    A few respondents believe it has receded significantly, while a similar number think it has increased.
     
     
  • Alexander Radwan, Member of German Parliament, is leading a delegation of German parliamentarians to London. They're meeting with top UK banking officials to talk about how Brexit might play out.

    Radwan says banks have to decide where they will go in the future, such as whether to stay in Britain or move to Frankfurt.
     
    These are business decisions and I don’t think at the end it will be one place. In Europe we have different places, like Paris, like Dublin, like Luxembourg, we have Switzerland. So I think the development will show where is the best place for the banks.

    Radwan was not decisive on the topic of whether or not euro-clearing would remain in London post-Brexit.
     
    This can’t be decided now, and we are not here advocating for Frankfurt, Frankfurt is a great place. We are just here to learn from politics.
     
    What does Brexit mean? 

    Soft Brexit, hard Brexit, at the end I learned this morning a new word, it’s open Brexit. 

    It is important for us to understand what it means, because the time is running.
     
     
     
  • Futures circling around a third of a percent positive as we countdown to the European open.
     
    We get Spanish inflation data and the ECB's Weidmann speaking at 08:00 BST/ 09:00 CET.
     
     
  • The executive shake-up at Uber could get even bigger, possibly leading all the way up to CEO Travis Kalanick. A much-anticipated report on company culture amid sexual harassment allegations is due out later today.
     
    Former U.S. attorney general Eric Holder led the investigation. Uber's board has reportedly voted to adopt Holder's recommendations.
     
    A source tells CNBC that Uber's board convened Sunday to discuss the findings from Eric Holder's report into sexual harassment allegations, among other things, at Uber.  According to reports, the board discussed a leave of absence for CEO Travis Kalanick.  
     
    Travis Kalanick
     
  •  
    Up around a third of a percent this morning as an average of Europe's top 600 stocks.
     
     
     
  • Individual bourses are waking up positive but it may be  struggle to rescue the losses incurred yesterday. 
     
     
  • The U.K.'s competition authority has found that Heineken's proposed purchase of Punch Taverns could be be anti-competitive.  
     
    The CMA says that it found 33 local areas where the proposed pubs would not face sufficient competition. It also raised concerns that the merger could close off a route to market for competing brewers.  
     
    Andrea Coscelli, CMA Acting Chief Executive, had this to say on the case.
     
    We have listened very carefully to a range of concerns about this merger. The companies will own less than 10% of all British pubs after any deal, but we are concerned about the loss of competition for pub goers in a number of local areas.
     
    Without sufficient competition from rivals, pubs in these areas might be able to raise prices or worsen the service they offer customers.
     
    David Forde, Managing Director for Heineken, responded saying it is confident it can satisfy the CMA's concerns.
     
    We welcome this positive step towards completing our acquisition of Punch A. This decision by the CMA acknowledges that there are only a small number of local areas where competition may be diminished due to our acquisition of the pubs in Punch A. We are confident we can offer the CMA suitable undertakings to satisfy their concerns.
     
    The competition regulator announced in February it was investigating Heineken's plans to acquire almost 2,000 pubs from Punch Taverns, in a deal worth £403 million. 
     
    Heineken shares are off 0.20 percent in reaction to the news.
  • Altice USA is pricing its IPO at between 27 to 31 dollars a share. The cable operator's Dutch parent company said it plans to sell up to 7 percent of the US subsidiary, valuing the company at up to 22 billion dollars.  The New York offering is seen as a move by Altice's founder, French billionaire Patrick Drahi, to fuel further expansion in the US. No date has been announced for the IPO.
     
    Legal proceedings into LafargeHolcim have been opened in France, according to Reuters. A judicial source told the news agency the country has opened a case against the company for funding of QUOTE 'terrorist enterprises'. CEO Eric Olsen announced his departure in April after an internal investigation into the company's operations in Syria. Olsen said he was not involved in any wrongdoing but said his departure next month will help close the exposure faced by the world's largest cement maker. 
     
     
    Deutsche Bank is settling an investor lawsuit claiming it rigged the  Euribor benchmark. The German lender is not admitting wrongdoing. The bank says it's setting for 170 million dollars to avoid further legal costs. Deutsche has already paid 15 billion euros in legal bills since 2009.
     
    RBS is reportedly nearing a multi-billion pound settlement with the US Department of Justice over the selling of toxic mortgage backed securities during the financial crisis. This, according to a report from Sky News. 
  • The three terrorist attacks which hit the UK in 2017 have hurt the domestic tourism industry.
     
    That's the warning from Merlin Entertainments, which operates a range of attractions in  Britain including Alton Towers and Madame Tussauds. The company says it continues to trade broadly in line with expectations despite the tough operating environment.  
     
    Merlin at the bottom of the Stoxx 600.
     
     
  • The Federal Reserve is expected to raise its benchmark rate when it announces its decision tomorrow afternoon. A Reuters poll of economists shows they overwhelmingly expect the rate to be hiked to a target range of 1.00 to 1.25 percent.

    Randy Kroszner, Professor Of Economics at the University of Chicago Booth School of Business, says  the Fed is set to hike because it is on a path to try and normalize.
     
    They are trying to look past individual pieces of data. You may recall they repeated this mantra of data dependence, data dependence, but I think that conveyed to the markets a lack of confidence because they didn’t know where things were going, so they had to respond to every bump and wiggle in the data.
     
    Now they have more confidence that the economy will be recovering and is on a good trajectory and so they can look past individual pieces of data and move forward.
     
     
  • Here are the best and worst  performers this morning in Europe.
     
     
    Capita, the business service provider, is performing well after a subtle change in tune. The company has issued warning after warning but this morning claimed the second half of 2017 will be pivotal.
     
     
  • Randy Kroszner, professor Of economics at the University of Chicago Booth School of Business, says the world seems to be in a stronger growth situation.
     
    Europe is certainly facing a stronger growth situation. The U.K. maybe not quite as much but the Eurozone much more. China, there was a lot of concerns last year it was going to crash, it seems to be growing in the mid sixes reasonably solidly.
     
    It's a broader confidence thing, it's not just unique to the U.S. If you look at the major companies in the U.S., for many of them the majority of their revenues comes from outside the U.S.
  • The Treasury Department has unveiled its plan to reform the country's financial regulatory framework. The 150-page report proposes over 100 changes - including reducing restrictions on big banks' trading operations, easing annual stress tests and reducing the powers of the Consumer Financial Protection Bureau.
     
    Randy Kroszner, professor of economics at the University of Chicago Booth School of Business, says it is a good time to look back at regulations and see if there were unintended consequences and if they’re doing what we want them to do.
     
    I don’t think we have the data to give a very clear answer to that yet. Small banks clearly have had a lot of burdens put on them and it’s been more difficult for them to move forward, but larger banks, they’ve had different kinds of burdens put on them but it seems they’ve been able to maintain lending. 

    The question is not only on the lending side but the liquidity side. There’ve been a lot of intended consequences from the confluence of regulations. Maybe each of these individual regulations were reasonable for addressing a particular problem. When you put them together, it may be more difficult to make markets. We’ve seen a lot more fragility in some markets.
  • Here are the top headlines following the market open.
     
    • The tech sell-off stalls in Europe as stocks shrug off the losses on Wall Street with nearly all the major equity markets moving higher.
    • Attention now turns to the Fed, which is widely expected to raise rates tomorrow. Former board member Randy Krozsner tells this programme that Janet Yellen and Co are on a path to normalise, despite recent weakness in economic indicators.
    • "I got us into this mess and I will get us out of it" says U.K. Prime Minister Theresa May as she prepares to meet DUP leader Arlene Foster in a bid to secure her parliamentary majority.
    • The owner and operator of the London Eye and Madame Tussauds, Merlin Entertainment, tells investors that terrorist attacks in London and Manchester hurt demand
  • Lots of inflation data has been released.
     
    Spain's final reading for EU-harmonised CPI in May grew 2 percent year on year, matching forecasts, but was unchanged month on month.
     
    Sweden's consumer prices grew 0.1 percent month on month in May, beating forecasts of zero growth. Year on year, inflation grew 1.7 percent.
  • German police report a shooting has taken place at a train station near Munich.
     
    At least one person was injured, but they say the area is secured.
     
    Click on the tweets to link to Twitter, which can provide translation.
     
  • Carlsberg has pledged to eliminate carbon emissions at its breweries by 2030. The Danish brewer also announced plans to only use renewable electricity at its plants by 2022, as part of a new sustainability strategy it is launching today. 
     
     
    Cees 't Hart, CEO of Carlsberg, joins us on the line from Copenhagen.
     
    He says while global leaders are not committing to the Paris Accord, that only energizes him and his company further to reduce carbon and water usage.
     
    He also hopes that the long term outcome of this could be to reduce costs for the firm.
     
    Carlsberg wants 100% renewable electricity by 2022. He says that will be made up of solar panels and buying renewable power.
     
    Click here for more on this story. 
     

    Carlsberg goes big on sustainability, targets zero carbon emissions at breweries by 2030

    CNBCMajor brewer Carlsberg has announced a host of targets relating to sustainability.
  • The Federal Reserve is expected to raise its benchmark rate when it announces its decision tomorrow afternoon. Janet Yellen and co may also provide details of how it plans to wind down its balance sheet, after building a $4 trillion portfolio of debt holdings in the wake of the financial crisis.

    Larry McDonald, managing director of ACG Analytics, says what problems lie ahead for the Fed.
     
    Asset prices are pumped up and have been for many years. It’s not just equities; a lot of different asset classes around the world are pumped up. The fundamental problem is when you suppress the business cycle for long periods of time, there’s a beast, there’s a serpent in the markets that is making its way into different places.
     
    Look at the amount of capital that’s flown in America into commercial real estate. It’s pumped up malls, we’ve built way too many malls, we have excess capacity of mall space.
     
    Larry says this "serpent" is going to knock the Fed off course again in the future.
     
     
  • The Italian economy minister has reinforced an earlier point that the solution for the indebted Veneto based banks will not involve any bail-in.
     
    He says the solution is "close" and that talks with EU institutions are encouraging.
     
    Italy's biggest bank, UniCredit, is holding talks with the Rome government and European authorities as Italy's biggest banks mull helping Rome bail out Popolare di Vicenza and Veneto Banca.
  • European asset managers are re-evaluating asset allocation strategies in the wake of the U.K. election result, as political risk across the continent remains a key concern for fund managers.
     
    Tom Caddick, head of global multi asset solutions at Santander Asset Management, says his asset allocation hasn’t changed dramatically.
     
    I think what we were seeing last year was an increase in policy fatigue; we were starting to see voter fatigue coming through. Some of what we’ve been doing is take the risk off the table. We’re still in favour of risk, but we’ve taken those positions back a little bit.
     
     
     
  • It is nearly 100 percent that they are going to raise rates. The big question is about how much information we will hear about the wind down of the portfolio.
     
    Randy Kroszner, Professor Of Economics at the University of Chicago Booth School of Business leaves us with the nugget that we shoudl watch out for from the Fed tomorrow.
     
    He says any sign that the Fed could speed the withdrawal of its stimulus program could well shake markets into life.
     
    The Federal Reserve
     
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