Squawk Box Europe Express

BHP announces a record half-year dividend payout after soaring iron ore prices pushed the mining giant’s results to a seven-year high. Oil prices, meanwhile, rise after a cold snap across Texas and northern Mexico leaves millions without power, shutting wells and refineries across the region. In virus news, the WHO has granted the Oxford University/AstraZeneca vaccination emergency use approval which will allow for wider access of the drug in low and middle income nations. We hear exclusively from Dutch Finance Minister Wopke Hoekstra who is confident that the vaccine rollouts will take Europe out of lockdown soon.   

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President Trump is acquitted of inciting the fatal Capitol Hill mob attack last month, marking the second time he has survived impeachment in 12 months. In Italy, Mario Draghi is sworn in as Prime Minister after unveiling a new cabinet featuring lawmakers from across the political spectrum. He’s now tasked with addressing the country’s economy recovery following the Covid pandemic. Brent crude and WTI both hit 13-month highs on the back of U.S. stimulus optimism, the potential easing of global lockdown measures and renewed tensions in the Middle East. Japan posts a better-than-expected Q4 GDP figure which pushes the Nikkei above the 30k mark – the first time in almost 31 years. And in the UK, the government hits its vaccine rollout target a day early, with 15m people in the most vulnerable sectors of society having received at least one injection.

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Disney soars in extended trading after the media giant tops first-quarter earnings forecasts, while subscriber numbers near 95m. Female-focused dating app Bumble lists on Wall Street with shares spiking on the debut. Strong sales in China and soaring online orders help L’Oréal to a topline beat. In political news, President Biden warns senators that Beijing could outstrip Washington on infrastructure investment. And in Italy, PM-designate Mario Draghi succeeds in gathering enough support from Five Star Movement MPs to create a new majority government. He is expected to name his cabinet today.  

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President Biden and Chinese Premier Xi Jinping speak on the phone for the first time with the new U.S. leader immediately raising the topics of trade and human rights. U.S. consumer prices are in focus as Federal Reserve Chairman Jerome Powell stresses the need for a jobs drive to propel the economy, while revealing the central bank “explicitly” seeks to target an average inflation of 2 per cent annually. In vaccine news, the WHO grants the Oxford-AstraZeneca vaccine its backing despite recent EU criticism over the drug’s efficacy. Earnings seasons is in full swing in Europe. Italian lender Unicredit posts a revenue loss for the fourth quarter but says it is determined to return more than €1bn to shareholders. And we hear from a slew of European chief executives, including the CEO of Schneider Electric.

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In a two-speed recovery, the Chinese manufacturing rebound continues to strengthen with factory inflation up for the first time in a year but consumer prices sink into deflationary territory. In Washington, six GOP senators cross the aisle to vote with Democrats to proceed with the impeachment trial of former President Donald Trump over “inciting insurrection” in last month’s Capitol Hill violence. Twitter posts a beat on estimates, but user growth is down since CEO Jack Dorsey’s banning of Trump from the platform. In banking news, French lender Société Générale reports a Q4 net loss of €290m but confirms its dividend payment after lower-than-expected pandemic-related provision costs.   

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U.S. equities and the Russell Index take a bullish turn once more with the Dow and the S&P 500 marking their longest winning streaks since August. Meanwhile, Tesla buys $1.5bn in Bitcoin, announcing plans to accept it as payment. The move pushes the cryptocurrency and its rivals Ethereum and Dogecoin to record highs. On the macro level, Goldman Sachs hikes its U.S. growth forecast after improving its baseline stimulus scenario. This, as Democrats look set to earmark nearly $50bn of the relief plan for the transport sector including $14bn for airlines, boosting shares in major carriers as a result. In energy news, oil reaches a 13-month high to pre-pandemic levels on hopes of global demand beginning to recover. And former President Donald Trump’s second impeachment trial is to kick off in the Senate later today.

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Asian equities respond to U.S. futures indications that last week’s rally – the markets’ best week since November - could continue. A poor U.S. jobs report on Friday raises hopes of a stimulus deal. In vaccine news, South Africa suspends inoculations after studies show that the jab created by Anglo-Swedish pharma giant AstraZeneca provides minimal protection against its national Covid variant. Meanwhile in M&A news, Japanese microchip giant Renesas is set to swoop for DAX-listed Dialog in a reported $6bn bid. In Italy, former ECB president Mario Draghi has secured conditional support from rival parties Five Star Movement and Lega as he attempts to rebuild the splintered government coalition.

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Equities in the U.S. soar with the S&P 500 reaching fresh highs off the back of improving employment figures. This, as tech stocks continue to push the Nasdaq to new levels. Washington takes aim at the Reddit retail investor frenzy with U.S. Treasury Secretary Janet Yellen vowing to review the episode with market regulators while hailing Wall Street’s resilience in the face of the rally. In vaccine news, Johnson & Johnson is set to achieve FDA emergency Covid jab approval. The drug maker may have up to 100m doses available by June. Meanwhile, the global microchip shortage has forced Ford and Stellantis to scale back production. Ford has warned the move may knock $2.5bn off its 2021 revenues while several German brands are considering building up stockpiles of the components. And a new IPO in Hong Kong is making waves. Chinese video media company Kuaishou lists strongly on the HKEX with shares almost tripling on its first day of trade.   

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The former president of the ECB, Mario Draghi, answers the Italian president’s call to form a new unity government amid the worst national economic crisis in decades. Former Prime Minister Matteo Renzi – who withdrew his party from Giuseppe Conte’s coalition – tells CNBC that Draghi is the man to rescue Italy from the current political impasse. In energy news, crude hits a one-year high as OPEC+ producers agree an extension to output cuts while US stockpiles plummet to their lowest level since last March. And today sees a slew of European corporate earnings released including Deutsche Bank, OMV and Volvo.   

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It’s the end of an era as Jeff Bezos hands over the reins of Amazon to Web Services CEO Andy Jassy later this year. This, as the e-commerce titan reports a record $125bn in Q4 revenues. Alphabet shares soar in after-hours trade as earnings top expectations despite a $5.6bn loss from Google’s Cloud unit. In Europe, Banco Santander suffers a record annual loss of €8.7bn but insists it will pay out its dividend. Siemens CEO Joe Kaeser marks his final quarter as CEO by raising full-year guidance following a 38 per cent surge in Q4 net income. And in Italy, President Mattarella is expected to invite former ECB President Mario Draghi to head a new government following the collapse of talks between the parties in the Conte-led coalition.

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