World Markets Live - May 31 - CNBC Live Events

CNBC Live Events

World Markets Live - May 31

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

    The White House has reacted to what appears to be a growing rift with one of the U.S.' closest allies. NBC's Kristen Welker has the full story.

    Former Italian Prime Minister Matteo Renzi says all major political parties have found an agreement on a German-style electoral system.
    Speaking at a party meeting, he said the new law could be voted on in Parliament in the first week of July. The approval of a new electoral system is widely seen as the last step before early elections can take place.
    Federico Santi, Europe analyst at Eurasia Group, says there is significant risk of a hung parliament if early elections take place in Italy, despite potential reforms to the election system.
    Depending on whether or not this new system would be approved, I think this risk would be lower than with the current system. So in any case I think we’re looking at a coalition. The baseline for now is a grand coalition government involving the ruling Democratic Party and potentially Forza Italia, so the right-wing parties.
    Saudi Arabia's Energy Minister Khalid Al-Falih has said OPEC and non-OPEC members remain committed to bring oil inventories down to a five-year average.
    Speaking in Moscow alongside his counterpart, Russian Energy Minister Alexander Novak, Falih added that he expected cooperation between the two countries to last longer than the current output cut, a deal which will expire in March of 2018.

    Oil is under pressure this morning, off more than a percent. 
    Daragh McDowell, principal Russia analyst at Verisk Maplecroft, says he expects oil prices over the medium term is going to be about $40 a barrel, which is the assumption the Russian government is using in its budget.
    There’s always something that could be around the corner: there could be new discovery in the U.S.; there could be something that disrupts supply; there could be something that reduces demand. 

    The question is, what’s the long term horizon? Does Russia get in the economic reforms that it needs to do to get the country on a long-term footing, and so far we’re not seeing a huge amount of that.
    Lots of Euro zone data has been released.
    April unemployment falls to 9.3 percent from 9.4 percent in March, according to Eurostat. This is the lowest jobless rate since March 2009. 
    The jobless number fell 233,000.
    May inflation is estimated at 1.4 percent year-on-year versus 1.9 percent in April. This was below the 1.5 percent forecast.
    Sterling continues to lose in trade today, down more than half a percent against the dollar, euro and yen on poll results showing the Conservatives may lose their parliamentary majority.
    The tightening in the polls looks likely to keep sterling under pressure in the lead up to the general election on June 8, according to Nomura's Jordan Rochester.
    GBP is lower this morning and rightly so as there continues to be polling news that suggests a hung parliament is possible if the trend continues.
    GBP/USD has traded below 1.2800 early in the session, and EUR/GBP back above 0.7820. The move was driven by YouGov’s first constituency-by-constituency estimate of the election that predicts that the Conservative party would obtain 310 seats (down from the current 330) and fall short of an overall majority (by 16 seats), leading to a hung parliament.
    U.S. stock markets broke a 7-session win streak yesterday, closing lower after the extended weekend break. 
    The indexes look set to open broadly flat, according to future values. The Dow is called around 11 points lower.
    However, the markets look set to finish the month higher. The Nasdaq should finish June with a gain of more than 2.5 percent.
    A car bomb in Kabul has killed at least 80 people, according to Afghan officials. 
    The explosion took place in a busy part of the city near several embassies. The German embassy says some of its employees were injured in the blast and one Afghan security guard was killed.
    The U.K. broadcaster the BBC announced one of its drivers was killed and four BBC journalists were also injured.
    Bank of England data released this morning showed U.K. mortgage approvals weakened more than expected last month.
    April mortgage approvals were 64,645 versus 66,043 in March, below expectation of 66,050 and the lowest since September.
    Net mortgage lending hit a one year low of £2.731 billion, versus £3.051 billion in March. Net consumer credit increased by £1.525 billion, slightly slower than the previous month.
    Samuel Tombs, chief U.K. economist at Pantheon Macroeconomics, says these credit trends are consistent with weaker GDP growth in the second quarter.
    April’s money and credit figures suggest that GDP growth has remained sluggish in Q2. Households’ money holdings increased by just 0.3% month-to-month in April. As a result, year-over-year growth in their holdings declined to 4.5% in April—its lowest rate since January 2016—from 4.8% in March.
    Households’ financial resources are growing only modestly because employment and wage growth has been sluggish and the flow of unsecured credit has stabilised. 
    Tombs also said the housing market has continued to slow.
    Further falls in approvals seem likely, given that new buyer enquiries reportedly are declining moderately and real wages are being squeezed. In addition, remortgaging fell to a nine-month low of 40.6K in April from 42.3K in March, implying that the boost to households’ disposable incomes from refinancing existing debt at lower interest rates has continued to fade.
    Indeed, the effective interest rate on households’ outstanding secured loans only edged down to 2.60% from 2.61%, a slower rate of decline than in prior months.
    Tombs concludes that households and businesses aren’t borrowing enough or benefiting from lower interest payments to the extent required to prevent the economy from struggling in the second quarter.
    The European Stoxx 600 remains flat, currently down about 2 basis points. Here's a look at the individual major bourses.
    Oil prices are under pressure on concerns of global oversupply.
    Reports that Libya has increased production to 800,000 barrels per day this week has raised fears that the OPEC and non-OPEC production cut deal is being undermined.
    The last two weeks have been traumatic for the Conservative campaign... Attention has veered off Brexit after deeply unpopular education and social care plans were announced in the Conservative manifesto, while the Labour Party’s own policy proposals appear to have been effective at attracting (center-left) Liberal Democrat voters.

    - Deutsche Bank's chief economist Mark Wall on the floundering Conservative campaign.

    Sterling may have taken a hit from the Times commissioned YouGov poll suggesting a hung parliament but the currency is inching back up in recent trades.

    The German chancellor, Angela Merkel, has said she will negotiate Brexit with the United Kingdon in the spirit of Britain remaining a partner.

    Can May and Merkel remain cordial?

    Sterling took a hit after the publication of the latest YouGov poll, which projects that the Conservatives could fail to secure a majority in the U.K. general election. 
    Previous opinion polls suggested Prime Minister Theresa May's Conservative party would increase its majority, which currently stands at 17 seats.
    But what's this? 

    A new Panelbase poll puts the Conservative lead on 48 points, giving them a 15 percentage point lead over Labour Party on 33 points. 

    It marks a one-point gain from the May 15 election and has sent sterling higher to a point which almost recoups the day's losses.

    Panelbase does also qualify the result by stating it expects the Conservative lead to narrow again.
    From June 1, it will cost £5.48 ($7) to send an email to the UK visa service if you live outside the U.K.

    I guess that's one way to reduce immigration.

    Source: U.K. Government website 

    Libya's oil production has risen to 827,000 barrels per day according to the country's national oil corporation. 

    This after a technical problem at the Sharara field was fixed.

    The increase in production is helping to reduce oil prices today. At the same time Russian energy minister Alexander Novak has said the next OPEC/non-OPEC monitoring meeting will take place in Russia on July 22-24.

    Dow futures rose are up more than  30 points, while S&P and Nasdaq futures advanced 4 points and 22 points, respectively.

    Later, the U.S. central bank is set to release its latest instalment of the Beige Book, slated to come out at 2 p.m. ET.

    Dallas Fed President Robert Kaplan and San Francisco Fed President John Williams are speaking at separate engagements today.

    Elsewhere in data, investors will be on the lookout for the latest Chicago PMI figures, due out at 9:45 a.m. ET, followed by pending home sales, expected at 10 a.m. ET. 

    @ReutersJamie is highlighting the apparently benign nature of markets in recent weeks.
    And markets open in the green, the Nasdaq hitting another record high. Big cap Tech still garnering interest then.
     These are the biggest moves on the S&P 500.
    The Nasdaq has hit a fresh record. The money appears to be chasing chipmakers. Below are the best and worst performers on the Nasdaq 100.
    And completing the U.S. equity open is the Dow Jones Industrial Average. The best and worst look like this:
    Its the final trading day for May and the performance of U.S. banks are really weighing on the S&P 500 and the Dow Jones.
    Weaker than expected pending homes sales for April is sending the dollar and U.S. bond yields lower.
    Pending home sales fell 1.3 percent in April month-on-month and fell 3.3 percent year-on-year.
    The dollar is also struggling against the yen.
    Markets revenue at JP Morgan is about 15 percent lower in the second quarter from a year earlier according to  company CFO, Marianne Lake.
    Speaking at an industry event Lake said lower volatility was to blame. and that U.S. economic growth was "solid rather than stellar"
    Bank of America meanwhile has warned that its Q2 trading revenue will fall on a comparative basis and also announced a $300 million dollar charge on the sales of data centers.
    U.S. listed shares of oil firms are also struggling today. Libya which is exempt from OPEC cuts has confirmed it is upping output as it recovers from a technical problem at a main oil field.

    Election shock? Why you now need to sit up and take note of UK politics

    CNBCCNBC takes a look at how the race for Downing Street has evolved and whether there really could be a shock in store.
    Sterling has had something of a roller coaster ride as separate polls gave varied impressions of the likely outcome of the U.K. general election. One poll suggested a hung parliament while two subsequent polls suggested a comfortable win was still in the grasp of the Conservatives.
    It seems Theresa May is positive for sterling, while center left candidate Jeremy Corbyn is negative.
    European markets closed mixed Wednesday after a sharp fall in euro zone inflation boosted expectations that the European Central Bank (ECB) would remain fairly dovish at its meeting next week. The FTSE dropped late in session after sterling strengthened on suggestions that the ruling Conservative Party were still on course for a majority win.
    The pan-European Stoxx 600 closed 0.4 percent higher with most sectors and major bourses in positive territory.

    Europe's telecoms sector was among the best performing on Wednesday afternoon on reports of mergers and acquisitions.  Cellnex Telecom had hit the top of Europe's benchmark, jumping by nearly 5 percent following media reports that American Tower Corp was considering buying the Spanish operator. Ericsson moved up almost 6 percent on Wednesday after Cevian Capital decided to buy more than 5 percent of the Swedish telecom gear maker. 

    Elsewhere, basic resources stocks were the worst performing amid a significant decline in oil prices. Reports surfaced on Wednesday suggesting Libyan output was recovering from oilfield technical issues and subsequently fueled concerns among traders that OPEC-led production cuts would reduce a global supply overhang.
    And that is where we will leave the blog today. Do join us again tomorrow from 6:00 a.m. London time.
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