World Markets Live - June 28 - CNBC Live Events

CNBC Live Events

World Markets Live - June 28

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

  • A spokesman for the French government says the U.S. has not yet confirmed whether or not President Trump has accepted an invitation to visit Paris on July 14th.
    France's president Emmanuel Macron has invited Trump to attend the country's Bastille Day celebrations, which includes a military parade.
  • The euro is at multi-month highs against the dollar today. Markets are buying the currency and selling eurozone debt following indications from the ECB that it may start to wind down its trillion-dollar bond buying programme.
  • Jens Stoltenberg, Secretary General of NATO, is discussing the ongoing situation in Afghanistan.
    The situation in Afghanistan is difficult and we have to be prepared for more violence, more turmoil and also more terrorist attacks. At the same time
    I think that we have to remember that the main reason why NATO went into Afghanistan was to prevent Afghanistan from once again becoming a safe haven for international terrorists. We are able to achieve that because terrorists cannot operate, cannot plan, cannot train in Afghanistan in the same way they did before 2001.

    He adds that the reason for entering Afghanistan was the terror attacks of 9/11, which triggered the Article 5 of NATO, the doctrine of mutual defense.
  • Jens Stoltenberg, Secretary General of NATO, says he will not comment on the internal decision making in the White House administration, but says there is political oversight and control over decisions.
    I spoke with Secretary Mattis, the  Secretary of Defense, and I will meet him again tomorrow, and he is very into the details. He knows NATO, he knows Afghanistan very well. I am absolutely certain that he is following these issues very closely, because he understands that military issues in Afghanistan are also of political importance.
  • The cyberattack hitting Europe locks users out of their computer unless a $300 ransom is paid (via bitcoin).
    So far, the hackers behind the attack have amassed a total worth just $9,620.

    Hackers have made just 3.7 bitcoin – or less than $10,000 – with the latest cyberattack

    Those behind the cyberattack affecting Europe have only succeeded in receiving a total of nearly 4 bitcoins, worth just $9621.
  • U.K. Prime Minister Theresa May has spent the last hour answering questions in the House of Commons.
    Among topics discussed included, obviously, Brexit.
    She says the U.K. can achieve a comprehensive free trade deal with the EU as part of Brexit. She says negotiations have started constructively and positively, adding that a decision has been made on Brexit and the people want it to be delivered.
    She acknowledged that transition arrangements with the EU may be needed, but not unlimited ones.
  • Monsanto reports third quarter earnings per share of $1.90, with a gross margin of 56 percent. Net profit was $843 million on sales of $4.23 billion.
    The company expects to close out the full year with a return to growth and sees full year earnings per share at the high end of the range of $4.09 to $4.55.
  • The ransomware virus affecting businesses across Europe is having a significant impact, disrupting services and forcing rapid reactions from cybersecurity departments and companies.
    Here, Lee Fisher, EMEA security specialist at Juniper networks, outlines the impact of this malware and how it works.
    Initially, it appeared that this ransomware might have centered its efforts on targets in the Ukraine via accounting software, though more recent reports seem to confirm that it is also affecting systems in Spain, France, Russia and India. Indeed, more organisations across the globe may be affected as governments and businesses around the world find themselves locked out of their own machines.

    This malware is more malicious than most varieties of Ransomware, in that Petya does not just encrypt files on a targeted system one by one - it also encrypts the hard drive's master file table (MFT) which renders the master boot record (MBR) useless and the system unable to boot.

    Once the virus has infected the system, this message is displayed. Also, if the device is connected to other computers, the virus will seek to spread across the network.

  • The euro has tanked sharply in midday trading. The common currency was trading at multi-month highs earlier today.
  • Forex traders are citing a Bloomberg report that the ECB said the market has misjudged Draghi's spech on stimulus.

    The report says Draghi's comments were intended to prepare the market for decisions on stimulus later in the year, his comments weren't making a firm commitment, according to Reuters citing euro zone central bank sources. 
    The sources add that Draghi's comments suggest the ECB will be patient with inflation and can live with inflation taking longer to rise to target.
    The euro's now pared losses, but remains flat.
  • U.S. advance May goods trade balance comes in at minus $65.9 billion.
    Advance May wholesale inventories grew 0.3 percent.
    Advance May retail inventories excluding autos also grew 0.3 percent.
  • U.S. stock market futures extend gains following the release of economic indicators for May.
  • Ford Motor has issued a safety recall and two safety compliance recalls in North America.
    The carmaker is recallsing about 400,00 2015-2017 Ford Transit vans. The safety compliance recalls are for four Ford Police Interceptor utility vehicles to fix the second row seat attachment studs, and for three Ford Escape vehicles to replace the driver knee airbag modules.
    Ford says it is not aware of any accidents or injuries associated with these issues.
    The cost of the action is estimated at $142 million.
    Despite the recall, shares are flat in premarket trade.
  • The ECB's Ignazio Angeloni says concerns that liquidation under national rules of Italy's Veneto Bank may set a precedent to sidestep EU rules must be taken seriously, Reuters reports. 
    Angeloni says the European banking union is incomplete and therefore fragile. He urges the EU Commission to holde "systemic reflection" on the way Vento Bank's crisis is handled.
    He adds that, if possible, banks must reallocate securities subject to bail-in institution investors, not retail investors.
  • Credit agency Moody's warns U.S. retailer closures are negatively affecting some credit card banks and  asset-backed security trusts, according to Reuters.
    Moody's says as retailers close stores to improve profitability, the trend will put upward pressure on private label charge-offs.
    According to Moody's, among the largest private-lavel card issuers, Synchrony and Alliance Data rely heavily on retail business. Citi and Capital One rely on private-label card loans for high single-digit percentage of earnings, while Wells Fargo and TD Bank have very modest exposure to the sector.
  • Several firms across Europe have been affected by the modified Petya malware virus, which locked users out of systems  in order to extort a ransom.
    Ryan Rubin, managing director in Protiviti's EMEA security & privacy IT technology consulting practice, says the affected organisations were fortunate the attack was not more sophisticated.
    Given the access the malware has, more damage could have been done to these organisations to impact the confidentiality and integrity of their business.
    On a positive note, It is great to see the security community coming together to promptly dissect the attack and share research into the malware causing this attack. This will help wider organisations affected by the threat understand and respond quicker and enable those not yet affected to take appropriate action to minimise disruption.
    On a negative note, in many cases, the impact of this attack could be significantly reduced through sound basic security practices. Organisations need to be agile enough to learn from lessons in the past and react and respond quicker to emerging cyber threats.
    Rubin adds that the attack appears to be motivated less by cyber crime and more on spreading itself in order to cause disruption.
  • U.S. markets open solidly higher, recovering some of the losses incurred in yesterday's session.
  • Sterling hits a three-week high against the dollar as the Bank of England's Mark Carney says some removal of monetary stimlulus  is likely to be needed.
  • Bank of England governor Mark Carney says the monetary policy committee's tolerance for above-target U.K. inflation is limited.
    He says the central bank's readiness to raise rates hinges on how much weaker consumption is offset by business investment., as well as wages, unit labour costs and the economy's reaction to Brexit negotiations.
    He says global interest rates could rise given the stronger global economy, which makes a given policy setting more accommodative.
    U.K. 10-year gilt yields rose to their highest since May 11 after his remarks. Yields are up 8.5 basis points.
  • The Nasdaq is recovering a little from yesterday's 1.6 percent fall. It is currently up around 0.17 percent, but remains down for the month of June.
    Here are the winning and losing stocks on the tech-based index.
  • Monsanto shares are up almost 1 percent, hitting a 2-year high in early trading following the release of its latest earnings results. The company achieved $4.25 billion in sales in the third quarter.
  • ECB President Mario Draghi says monetary policy shouldn't be overburdened by other task, Dow Jones reports.
    Draghi says relatively confident eurozone productivity will increase as the economy improves.
  • Pending home sales index for May falls 0.8 percent to 108.5. They were seen 0.8 percent higher. Last month, sales fell 1.3 percent.
    Pending home sales are down 1.7 percent from May 2016.
  • Pending home sales tumble as supply crisis hits sales

    The pending home sales index from the National Association of Realtors dropped 0.8 percent month-to-month and is now 1.7 percent lower than May 2016.
  • Samsung has announced plans to expand its U.S. operations. It is going to open a $380 million home appliance manufacturing plant in South Carolina, according to Reuters.
  • The weaker than expected U.S. home sales data has caused the dollar to slump against other world currencies. The dollar fell to a 1-year low against the euro. It also hit  a 7-month low versus the Swiss franc of 0.958 francs.
  • Earlier today, advance economic indicators for the U.S. economy for May were released.
    U.S. advance May goods trade balance dipped to minus $65.9 billion. Advance May wholesale inventories grew 0.3 percent. Advance May retail inventories excluding autos also grew 0.3 percent.
    Ian Shepherdson, chief economist at Pantheon Macroeconomics, said they had hoped for better data.
    These data make it even more likely that net foreign trade will be a drag on Q2 GDP growth. Exports rose 0.4% m/m, reversing the April dip, with hefty rebound in autos and consumer goods. Imports dipped, but only by 0.4%, following a  1% increase in April. We expected the fall in oil prices to trigger a bigger decline.
    We still think a clear improvement in the trade numbers over the next few months is a good bet, given the strength of the ISM export orders index, but for now it looks as though better numbers won't appear until Q3.
     On the inventories data, Shepherdson says that a positive contribution to Q2 GDP from inventories remains their base case scenario.
  • Weekly U.S. crude stocks data is out.
    Weekly crude stocks built up 118,000 barrels to 509.21 million barrels. That's against an expected draw of 2.6 million barrels.
    Oil prices reverse earlier gains to turn negative on the news.
  • Bank of England Governor Mark Carney earlier cause sterling and U.K. bond yields to rise after making hawkish statements regarding the potential need to remove monetary stimulus.
    He did add caveats on his statement, pointing out the need to watch economic growth, consumption, wages and the response to Brexit. Here's what Peter Chatwell, head of European rates strategy at Mizuho International, had to say on Carney's comments.
    Remember that in the U.K., real wage growth is negative, which should continue to weaken consumer confidence going forward, posing downside risks to growth. Uncertainty over Brexit should see business investment slow. His most recent speeches have focused on these downside risks. As such what Carney is saying here is more along the line of "if I am wrong about the downside risks, then I see room to tighten monetary policy". 
    For now, this adds to bearish pressure on GBP rates and should translate into upward pressure on real rates premia across the GBP curve. This should mean that the entire GBP curve is affected, with the longer maturities suffering from higher real rates premia.
    Here's a look at sterling's performance against other major currencies today.
  • U.S. pending home sales data for May has knocked the dollar, after falling 0.8 percent, despite expectations of 0.8 percent growth. 
    Ian Shepherdson, chief economist at Pantheon Macroeconomics, described that data as "disappointing".
    The declines in pending sales in both April and May are a bit disappointing, and today's reading signals a small dip in June existing home sales, but they don't change the big picture. The message from the mortgage applications numbers over the past few months is that home sales should rise quite sharply over the next few months, hitting new cycle highs.
    Robust job growth, elevated consumer confidence, very low mortgage rates and the prospect of significant capital gains are all strong incentives to buy a home, for people who can qualify for a mortgage at or close to the benchmark rates.
  • Support for a high tax, high fiscal spending system is growing in U.K., according to the British Social Attitudes survey, conducted by the National Centre for Social Research.
    It found that 48 percent of survey respondents wanted increased taxation to allow for greater spending, an increase of 11 percent.

    That's despite more people voting for the fiscally conservative manifesto of the Conservative Party than the tax and spend manifesto of the Labour Party in the recent U.K. general election.
    What a difference 20 days makes.

    UK support for tax more, spend more fiscal system at highest level since financial crisis: Survey

    After seven years of Conservative government-led austerity, a new survey suggests that public sentiment in the U.K. could be changing gears.
  • Jim O'Sullivan, chief U.S. economist at High Frequency Economics, has weighed in on the weaker-than-expected pending home sales data. He highlights that new home sales are starting to recover.
    National Association of Realtors officials continue to cite low inventories as a factor holding down existing home sales. New home sales have generally been showing more growth than existing home sales recently; they were up 8.9% y/y in May. Also, existing home sales, based on final contracts, have been somewhat stronger recently than implied by the pending home sales index.  
    Existing home sales are up 3.6% from a year earlier, on average, over the last 12 months (through April), versus a 0.4% gain, on average, in the pending home sales index during that period.
     The sales data caused the dollar to slump against other currencies. Bonds were also sold off; the yield on benchmark 10-year Treasuries rose around 4 basis points, although bonds are starting to pare losses. Short-dated debt yields are lower.
  • Eating out is notoriously expensive and a new study suggests millennials are eating out too much, preventing them from developing a savings habit.
    The study also finds 29 percent of millennials are buying coffee at least three times per week..
  • President Donald Trump has accepted an invitation from French President Emmanuel Macron to visit France during Bastile Day on July 14th.
  • European markets are now closed. The pan-European Stoxx 600 finished the session flat.
    The performance of individual markets was much more mixed. The FTSE MIB rose more than 1 percent, while the German DAX and French CAC finished flat.
  • Banks outperformed the wider marker. The sector was up 1.37 percent. Basic resources and retail also tried to lead the market higher.
    Here's a look at the biggest gainers and losers on the Stoxx 600 index.
  • A last look at U.S. markets and the Dow, S&P and Nasdaq are extending gains.
  • We'll close the blog there.
    Tomorrow, we'll be reporting on the anniversary of the handover of Hong Kong; Germany's Angela Merkel will make a key statement in the parliament; NATO defence ministers will meet in Brussels; the U.K. will release house price and mortgage lending data; and we'll get the final U.S. GDP figure for the first quarter.
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