World Markets Live - May 12 - CNBC Live Events
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CNBC Live Events

World Markets Live - May 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. We'll begin full coverage from 0600 BST. To start with, here are the opening calls for European markets.
     
     
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  • These are the top headlines this morning.
     
    • Donald Trump tells NBC in an exclusive interview he would have fired James Comey regardless of the recommendation made by the Deputy Attorney General. 
    • China and the U.S. reveal a plan to redefine their relationship through a new 10-point package that will see China open its market to U.S. companies and agencies, in a plan hailed by the White House as a re-set of trade ties.
    • U.S. Treasury Secretary Steve Mnuchin arrives in Italy for the G7 Summit amid speculation he could give away more details on tax reform.
    • You do your job and we'll do ours. That's the message Unilever CEO Paul Polman has for billionaire investor Warren Buffett as he defends his decision to fight off Kraft. 
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  • President Trump says he planned to fire Former FBI Director James Comey before receiving a recommendation from the Deputy Attorney General.  
     
    In an exclusive interview with NBC News, the President described multiple conversations with Comey about whether or not he, the President, was under investigation.
     
     
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  • President Trump explains his rationale for removing the FBI Director.

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  • CNBC’s Steve Sedgwick asks why the news is focusing on the Comey issue and not asking Trump about his policies or promises on trade deals, jobs and the economy?
     
    Why aren’t we talking about infrastructure deals? Why aren’t we talking about reform of tax? Why aren’t we talking about health care? Why aren’t we talking about trade deals with China, which there was some movement yesterday?
     
    It just seems to me this administration is getting bogged down by looking in the mirror at itself and its own issues with other people within Washington, rather than looking at the big stuff.
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  • The United States and China have reached an agreement to expand trade between the two countries, aiming to increase access for financial firms and also enlarge trade in chicken and beef.
     
    The United States has said it will allow Chinese-cooked poultry to be imported into the U.S., while U.S. beef exports can enter China. The Chinese government also announced plans to enable U.S.-owned card payment services to begin operating in China. 
     
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  • G7 finance ministers and central bankers will kick off the first day of their two-day summit in Bari, Italy with a meeting discussing Greek debt. 

    This, as fellow finance chiefs await clues from U.S. Treasury Secretary Steven Mnuchin about President Trump's proposed policies on trade, taxes and climate change. 
     
    U.S. Treasury Secretary Steven Mnuchin arriving at the G7 meeting
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  • U.S. retail stocks tanked in yesterday's session, dragging on the markets.
     
    The SPDR S&P Retail ETF shed 2.7 percent after Macy's shares tumbled on weak quarterly results.
     
     
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  • Thyssenkrupp has posted a net loss of 879 million euros for the second fiscal quarter, compared to a profit of 61 million euros last year.
     
    The German industrial group said it expected a significant net loss for the full year, largely due to the writedown of its Brazilian steel division. 
     
    Guido Kerkhoff, CFO of Thyssenkrupp, says the company’s fundamentals are heading in the right direction and adds that technology is delivering to the bottom line.
    If you take a look at the order intake, we are on a record high for this quarter and overall in the backlog we do have across all regions. So even in Asia we saw growth in our order intake, especially driven by Korea and we saw unit-wise a growth in China. 

    Across the board, we see we are performing on order intake pretty strong
     
     
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  • ArcelorMittal has posted first quarter sales of just over $16 billion, falling short of analyst forecasts.
     
    This as the group's steel shipments fell more than expected. However, the mining multinational managed to turn out a net profit of one billion, while saying it expects market conditions to be broadly stable in the second quarter.
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  • Luxury brand Richemont reports full year sales fell 4 percent for the full year. 
     
    Full year sales came in at 10.647 billion euros and profit of 1.21 billion euros. Both were below forecasts of 10.684 billion euros and 1.338 billion euros respectively.
     
     
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  • A mixed day for Asian markets. News that the U.S. and China had made some trade agreements on financial services and other products helped to boost Chinese markets.
     
     
     
     
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  • Crude prices are steady after finishing more than 1 percent higher in Thursday's trade. This, after the U.S. Energy department reported a fall in inventories and the biggest weekly decline in stockpiles since December. 
     
     
    Discussing the upcoming Iranian presidential election, Miswin Mahesh, oil analyst at Energy Aspects, says the outcome could be interesting for the market.
    The dynamics are clearly changing. The Saudi-Iran relationship is still at the nexus of what’s moving things in the Middle East, and you’ve got Trump’s visit to Saudi Arabia as well.

    So the changing geopolitical stances from the previous presidency, which was a bit more leaning towards Iran, with regards to now Trump sort of going the other way, I think those factors are interesting.

    But for the OPEC meeting that is coming up, that hurdle is likely limited because Iran’s already agreed to 3.8 million barrels per day, which was the difficult thing to achieve last time round.
     
     
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  • Bitcoin briefly passed the $1,800 mark on Thursday to set a new record high, only two days after breaking the $1,700 level.
     
    It's down today in Asian trade but its recent rally has been driven by Japanese demand after the cryptocurrency was legalised in the country. Bitcoin has risen around 300 percent so far this year with the market cap now standing at nearly 29 billion dollars.
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  • Investor Mark Cuban has told CNBC that he wants to give Snap a chance and said there may be some upside potential. He said he expects Snap to get better at selling ads and said that if the company can get its act together on revenue he doesn't see some of the risks others have identified.
     
     
    Cuban also said the FAANG stocks are still undervalued. He was particularly bullish on Amazon, saying the opportunity for the company is very big.
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  • New French President Emmanuel Macron's 'La Republique en Marche' party has unveiled most of its candidates ahead of a parliamentary election next month.  Most of the names put forward having never held elected office, in an attempt to shake up the political establishment. The latest poll figures show that Macron's party along with his centrist allies will receive the majority of votes in the election.
     
    Alexandre Aidara, Parliamentary Candidate for La Republique en Marche, says Macron wanted to totally change the way of finding new candidates.
     
    He opened the process and anybody can be a candidate in La Republique en Marche, that’s why we had something like 14,000 candidates in the country for 577 candidates.
     
    We find many, many citizens with a very good background, but not necessarily people who has been a politician before. And that’s why we have this list of 528 candidates revealed yesterday.
     
    Aidara says it’s a way to renew politics in the country.
     
     
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  • Here are the top headlines for the hour.
     
    • Donald Trump tells NBC in an exclusive interview he would have fired James Comey regardless of the recommendation made by the Deputy Attorney General.
    • Retail in the red. Weak earnings from Macy's drag down retail stocks, with the department store plunging 17 percent after like-for-like sales fall for a ninth consecutive quarter.
    • Allianz confirms its full-year operating guidance as net inflows at Pimco boost earnings at the German insurer's asset management business.
    • Richemont's first quarter net profit misses expectations, with sales down 4 percent, as the luxury retailer faces slowing demand in its main markets.
    Comment ()
  • Chinese President Xi Jinping is expected to detail plans for his 'Belt and Road Initiative' at a forum in Beijing this weekend. Twenty-eight heads of state are due to attend the summit and over fifty project agreements are set to be signed in an bid to further the project's progress.
     
    The ambitious initiative to build a new Silk Road connecting China to Europe and beyond was proposed by Xi in 2013, but specifics have remained scant. A $40 billion fund has been earmarked for the scheme, but concerns have risen over the economic and security risks of the project, while some Western leaders remain suspicious of China's aims.
     
    President Xi Jinping and first lady Peng Liyuan disembark from a plane
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  • Saker Nusseibeh, CEO & banking standards board member at Hermes Investment Management, discusses the impact on traditional retail of Amazon, A.I. and online retail.
     
    If you put Amazon on your laptop or on your tablet, you’ll find that what you looked for keeps coming back at you and then things related to it. So the answer is it is disruptive and traditional stores have got to change what they’re about.
     
    We’ve seen attempts at that, so that they become a destination as opposed to a shopping experience, where you can drink coffee or tea.
     
     
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  • European markets will open for trade in less than half an hour. Here's a look at the expected opening values for the major bourses.
     
    The German DAX looks set to move higher following GDP growth of 0.6 percent in the first quarter.
     
     
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  • Unilever CEO Paul Polman defended his decision to spurn Kraft Heinz's takeover bid saying Unilever tells a growth story, while he's less sure about Kraft Heinz.  
     
    Speaking to CNBC, Polman also took aim at legendary investor Warren Buffett for pulling the strings behind the takeover attempt.
     
    Our strategy in investing is Warren’s strategy and my returns have been higher in the last 8 years than Warren’s returns. 
     
    I think it’s better if he leaves us with what we know how to do well.
     
     
     
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  • A turn-around at bond manager Pimco has boosted Allianz's first quarter results. 

    The German insurer has confirmed its earnings outlook for the full year, after seeing operating profit at its asset management business grow more than 24 percent in the first quarter. This as third-party net inflows at Pimco picked up. 
     
    Meanwhile, European mutual funds significantly trail their U.S. counterparts when it comes to board independence and diversity.
     
    A report from Fitch shows that only one third of European fund directors have no direct link to the fund's sponsor and women accounted for just 11 percent of board positions.
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  • Rusal's first quarter net profit increased 3 fold compared to the same period last year, boosted by a recovery in aluminum prices.  

    The Russian producer said that it maintained a steady EBITA margin at 20.7 percent despite a stronger ruble weighing on costs.

    We are joined on the phone by Alexandra Bouriko, CFO of UC Rusal.



    Bouriko describes the first quarter was "great" as aluminum prices grew by 8 percent during the period.

    She expects aluminum prices to keep rising through 2017 and 2018 as "European demand grows and we see more discipline from Chinese producers".

    Bouriko says Rusal witnessed a 3.3 percent increase of primary aluminum demand in the United States. 

    She also cites other regions that have increased demand, such as Japan, largely due to auto production.
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  • Germany's finance minister Wolfgang Schaeuble says he will tell U.S. Treasury Secretary Steve Mnuchin that the world needs the U.S to lead politically and economically.
     
    He also says the G7 will discuss the risk a corporate tax race to the bottom and hopes for a good solution to the issue at the meeting.
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  • European markets are now open. The pan-European Stoxx 600 opens with a small bounce to the upside on the last trading day of the week.
     
     
    Comment ()
  • A turn-around at bond manager Pimco has boosted Allianz's first quarter results.
     
    The German insurer has confirmed its earnings outlook for the full year, after seeing operating profit at its asset management business grow more than 24 percent in the first quarter. This as third-party net inflows at Pimco picked up. 
     
    Despite this, the share price has opened in the red on Friday morning.
     
     
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  • Thyssenkrupp has posted a net loss of 879 million euros for the second fiscal quarter, compared to a profit of 61 million euros last year.
     
    The German industrial group said it expected a significant net loss for the full year, largely due to the writedown of its Brazilian steel division. 
     
    The share price opened sharply lower, dropping more than 3 percent.
     
     
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  • Flat.

    The pan-European Stoxx 600 moved marginally higher shortly after the open with major bourses bouncing around the flatline and sectors pointing in opposite directions.


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  • Richemont missed expectations with its full year results. Sales growth and net profit both came in below forecasts as watch sales fell 15 percent, but the owner of Cartier noted a clear improvement in the second half thanks to a rebound in the US and China.
     
    Richemont proposed raising its dividend 6 percent and launched a new share buyback programme of up to ten million shares.
     
    The share price has tumbled at the start of trade, dropping more than 4 percent.
     
     
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  • The German DAX index is a little stronger today, boosted by the country's GDP growing 0.6 percent in the first quarter. However, CPI inflation was nil in April.
     
     
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  • Inflation picks up in  Spain. The country's national statistics institute reports CPI inflation grew 1 percent in April month on month. Over a year, inflation was up 2.6 percent.
     
    The Spanish IBEX hasn't moved much this morning. It looks set to record a loss for the week, as the index is currently down more than 2 percent for the week.
     
     
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  • Alan McIntosh, Chief Investment Strategist at Quilter Cheviot is on set and Steve picks him up on the French media story that Vincent Bollore is moving to merge Vivendi and Havas.

    Vivendi is due to take control of the second-tier advertising agency group Havas. Havas is run by the son of French media magnate Vincent Bollore. Bollore senior gained control of Vivendi in 2014.

    McIntosh highlights that the route to a media consumer has compelteyly changed and consolidation in the industry is unsurprising.


    For more on the story, click here.


    Comment ()

  • An investment in the oil majors over the last 12 to 18 months has been very lucrative.
     
     - Alan McIntosh, Chief Investment Strategist, Quilter Cheviot 

    McIntosh says the price run has abated in recent weeks but he still recommends the "supermajors". 

    He says they have adapted to a$50 per barrel environment and they are still paying a solid dividend.

    McIntosh: Still believes in oil majors. 

    Around the table, Saker Nusseibeh, CEO & Banking Standards Board Member at Hermes Investment Management, says he prefers to go for a firm that focuses on gas rather than oil.

    He cites oversupply and a trend towards electric vehicles.

    Comment ()
  • ArcelorMittal has posted first quarter sales of just over $16 billion, falling short of analyst forecasts. This as the group's steel shipments fell more than expected.
     
    However, the mining multinational managed to turn out a net profit of $1 billion, while saying it expects market conditions to be broadly stable in the second quarter. 
     
    The earnings miss has hit the stock price hard. It is down more than 4 percent at the start of Friday trade.
     
     
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  • These are the stocks at the top and bottom of the Stoxx 600 today.
     
    Vivendi is up strongly as the companies take the first step towards merging. German internet service provider United Internet is at the top of the table after announcing plans to acquire mobile operator Drillisch.
     
     
    Disappointing earnings results at Richemont and ArcelorMittal have sent these stocks to the bottom of the index.
     
     
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  • STMicro expects a 14 percent revenue growth this year to almost $8 billion dollars. This due to growing demand for chips for cars and smartphones. 

    Carlo Bozotti, CEO, STMicroelectronics is on set.

    Bozotti: sad that Europe has no smartphone industry

    He says Europe needs has two great opportunities: 

    One is smart driving. Quasi or full autonomous cars are a unique opportunity for Europe. The other is the industrial internet. The digitalization of manufacturing.  
     
     Bozotti says these two elements are crucial for Europe and ST micro wants to be in a position to ensure it can supply Europe as it moves forwards in these areas.
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  • The dollar is trading near a three-week high today on bets that the Federal Reserve will raise interest rates next month following strong economic data about producer prices and the labour market. 
     
    The dollar index looks set to record its strongest week of the year, up almost 1 percent.
     
     
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  • A reminder of our top stories:

    • A mega media merger lights up the French market! Shares in Vivendi and Havas spike as tycoon Vincent Bollore moves to merge the two businesses he controls in a 2-point-4 billion euro deal. 
    • First world problems for Richemont which misses expectations on the top and bottom line, sending shares deep into the red in Zurich. 
    • G7 Finance Ministers play down worries about U.S. tax reform plans as Treasury Secretary Steve Mnuchin prepares to join talks in Italy on the growth outlook. 
    • Donald Trump calls fired FBI Director James Comey a 'grandstanding showboat' as he tells NBC exclusively his rationale for sacking him earlier this week.
    Comment ()
  • Unilever's share price is flat today, but looks set to finish the week up more than 2 percent.
     
    This after the company's CEO Paul Polman defended his decision to spurn Kraft Heinz's takeover bid saying Unilever tells a growth story, while he's less sure about Kraft Heinz.  
     
    Speaking to CNBC, Polman also took aim at legendary investor Warren Buffett for pulling the strings behind the takeover attempt.
     
    Our strategy in investing is Warren’s strategy and my returns have been higher in the last 8 years than Warren’s returns. 
     
    I think it’s better if he leaves us with what we know how to do well.
     
     
     
    Comment ()
  • German GDP grew 0.6 percent quarter over quarter in Q1 on a seasonally adjusted basis, matching forecasts, according to the country's Statistics Office.
     
    This growth was driven by construction and exports, as well as positive impulses from domestic demand.
     
    German CPI was unchanged in April, but was up 2 percent year on year. 
     
     
    Comment ()
  • The Italian Finance Minister Pier Carlo Padoan has expressed his opinion on U.S. tax reform and Donald Trump's economic plans as he and other Europe's G7 Finance Ministers meet in Bari

    I'm not worried about US tax policy, I understand there is a very ambitious tax reform program in the US and we're watching closely on what is good for the US and what can be learned by other countries on tax reform.
     
     

    Comment ()
  • A much quieter day on the U.S. earnings front today with the notable exception of JC Penney.

    Friday's US Data (all times eastern)
    0830 CPI
    0830 Retail Sales
    1000 Business Inventories
    1000 Consumer Sentiment
    1300 Oil Rig Count

    U.
    S. futures are pointing to a slightly negative open later today.


    Yesterday, U.S. equities closed lower as retail stocks fell sharply on the back of Macy's weak quarterly results.

    The S&P 500 declined 0.2 percent with Macy's and Nordstrom dragging the index lower. 

    The Dow Jones industrial average fell around 25 points after briefly dropping more than 100 points, with Home Depot contributing the most losses. Helping the index cut losses were shares of Caterpillar, which rose 0.6 percent after Bank of America upgraded the stock to buy from neutral.

    The Nasdaq composite pulled back about 0.2 percent.

    Comment ()
  • U.S. government debt prices are higher this morning as investors look forward to several pieces of key U.S. data, including Retail Sales, Business Inventories, and Consumer Sentiment.

    The yield on the benchmark 10-year Treasury note was lower at 2.3750 percent, while the yield on the 30-year Treasury bond was also lower at 3.0175 percent. Yields move inversely to prices. 


    Comment ()
  • New French President Emmanuel Macron's En Marche party has unveiled most of its candidates ahead of next month's parliamentary elections. Most of those put forward have never held elected office before. The latest poll figures show that Macron's party, along with his centrist allies, will receive the majority of votes in the election. 


    Jonathan Fenby, Chairman China Team at TS Lombard is also an expert on France and joins Carolin on set. 

    He says after Macron unveiled his parliamentary candidates it became clear he is hoping that some moderate right wing will support En Marche without necessarily joining them.

    Meanwhile, the impact on markets of the Macron win is laid bare by this chart that shows the level of rotation into European stocks.

    Source: BAML, EPFR Global 


    Comment ()
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