Squawk Box Europe Express

Global markets under pressure, as the Dow slumps after U.S. jobs data points to tightness in the labour market, while investors look ahead to a crucial week for data and earnings. Fresh data flashes warning signs for the Chinese economy, as the services sector contracts for the first time in four months, while the chip sector drags stocks lower after the US announces fresh restrictions. Russian President Vladimir Putin accuses Ukraine of a "terrorist act" after a bridge linking Crimea to Russia is hit by an explosion, disrupting a key military supply line. Nissan reportedly pushes Renault to sell down its stake in the Japanese carmaker, as part of talks that would see the auto giants create a joint venture to accelerate the development of electric cars.

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Credit Suisse sets aside CHF3bn to launch a public tender off with the aim of buying back its debt securities. The IMF warns of an upcoming global growth downgrade. Managing Director Kristalina Georgieva tells CNBC that “multiple shocks” are to blame and that drastic central bank moves are required to rein in inflation. The Dow is down but Wall Street is still set for a large weekly gain ahead of the non-farm payrolls. We are live in Prague at the inaugural summit of the European Political Community where Polish PM Mateusz Morawiecki tells us Germany’s addiction to cheap Russian gas and its “disastrous” energy policy have left the rest of Europe in a vulnerable position. And in tech news, Samsung posts its first quarterly decline for 3 years as it wrestles with a global slowdown and reduced memory chip demand.

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Opec + members slash output by 2m bpd, pushing up oil prices to a three-week high. The cartel’s secretary-general, Haitham Al-Ghais, tells CNBC the cut was not a political decision. The U.S., however, accuses Opec of siding with Russia and ‘shortsightedness’ for the reduction in production. The Biden administration immediately orders more oil to be released from its SPR. Ratings agency Fitch is the latest to issue a negative outlook warning for the UK. Elon Musk and Twitter could reportedly resolve their litigation wrangles later this week. The Tesla boss has launched plans to transform the social media platform into a ‘super-app’.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Opec+ members are reportedly considering a 2m bpd output cut ahead of its first in-person meeting in more than 2 years. Softer economic data inspires hopes of less drastic Fed tightening moves, which helps the S&P 500 log its best two-day gain in more than two years. Elon Musk agrees to purchase Twitter for the original $44bn sale price and will likely avoid the deal being dragged through the courts. And in corporate news, HSBC shares hit a 20-month high after reports the bank is set to offload its Canadian unit. And UK PM faces a further division from within her cabinet and party after refusing benefits increases in line with inflation.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

UK Chancellor Kwasi Kwarteng is reportedly set to bring his medium-term fiscal plan forward following yesterday’s U-turn on cutting the top rate of tax. Asian markets are in the green, extending the global rally. The Dow will look to build on its 760-point rally. Ukrainian forces continue to claw back more territory in the south and east of the country following Moscow’s annexation of four regions. In banking news, Credit Suisse’s credit default swaps reach new highs after the Swiss lender failed to calm market fears about its financial health.

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The pound slides as the S&P puts the UK on notice for a downgrade as the Conservative Party conference begins in Birmingham. Prime Minister Liz Truss admits her tax cut plans could have benefited from better communication. The Dow falls by 500 points to close below the 29,000 mark in what was the worst September for the index for 20 years. Ukrainian forces recapture the eastern city of Lyman as Russian President Vladimir Putin signs accession treaties for 4 illegally occupied regions. Oil prices surge on news that Opec+ producers are reportedly mulling a 1m bpd output cut. And in corporate news, Credit Suisse moves to reassure investors about its financial health, causing credit default swaps spreads to move sharply higher.

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The S&P 500 slumps to a new low for this year, weighed down by Apple’s broad declines. U.S. markets are set for the third consecutive negative quarter. However, Morgan Stanley CEO James Gorman tells our U.S. colleagues that he sees no signs of panic from investors. UK PM Liz Truss and Chancellor Kwasi Kwarteng are to have and emergency meeting with the OBR but Downing Street insists its mini-budget tax cuts are essential. Chinese manufacturing shows signs of recovery but the Caixin survey shows that services are struggling from a sharp slowdown. And in energy news, Germany outlines a €200bn package to shield consumers from soaring gas prices.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The Bank of England scrambles to restore market calm with a £65bn bond-buying programme. We are live for the latest from Threadneedle Street. Last Friday’s controversial UK ‘mini-budget’ also makes waves at CNBC’s Delivering Alpha conference with founder and CEO of Citadel, Ken Griffin, voicing his concern about the potential fallout for investor confidence. The 10-year Treasury yield falls by its largest amount since 2020 while the S&P 500 breaks its six-day losing streak but billionaire investor Stanley Druckenmiller tells this channel a downturn is still imminent. Porsche is set to list in Frankfurt later today in what is likely to be Europe’s largest IPO ever. And European leaders vow to investigate the recent Nord Stream pipeline leaks in the Baltic while European Commission President Ursula Von Der Leyen says the bloc will refuse to recognise referenda held in four occupied Ukrainian regions.

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The IMF slams the UK’s government’s budget plans cuts and say they will serve to impact the BoE’s rate hikes. The central bank’s Huw Pill says a strong monetary response will be needed to tackle soaring inflation. The S&P 500 sinks further into bear market territory. Asia equities fall to their lowest ever level in two and a half years. Stateside, Minneapolis Fed Chair Neel Kashkari says the central bank will continue to hike rates appropriately. St Louis Fed Chairman James Bullard is adamant that recession remains a risk but Ark Invest’s Cathie Wood believes deflation is around the corner in the next six months. European authorities launch probes into 3 gas leaks coming from the Nord Stream 1 and 2 pipelines in the Baltic Sea. Poland’s Prime Minister Mateusz Morawiecki and Denmark’s Mette Frederiksen believe sabotage cannot be ruled out.   

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

We are live at Threadneedle Street as sterling claws back some of yesterday’s record losses versus the dollar. The BoE and the Treasury have moved to calm jittery investors amid a brutal gilt sell-off. In the U.S., the Dow enters bear market territory while the S&P 500 posts its lowest close this year. Chatham House senior advisor Jim O’Neill says that assets are following messaging from the Fed. The World Bank slashes its China growth forecast, saying that it will lag behind regional peers for the first time in more than 30 years. Industrial profits continue to be impacted by Covid restrictions.  

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.