Commuters cycles past the Bank of England (BOE), left, in the City of London, UK, on Monday, Sept. 16, 2024. The central bank’s Monetary Policy Committee’s interest rate decision is scheduled for release on Sept. 19.
This is CNBC's live blog covering European markets.
European markets traded higher Thursday morning as investors continued to digest Donald Trump's presidential election win and political upheaval in Germany.
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Monetary policy decisions from the U.S. Federal Reserve and Bank of England, with rate cuts expected from both central banks, are also in focus.
The pan-European Stoxx 600 index was trading 0.4% higher by mid-morning, with most sectors in positive territory except for healthcare, retail, insurance and telecoms stocks.
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It's been a busy morning of earnings with a number of major European firms reporting. Adyen shares dropped 10%{
Why did Adyen shares just drop 10%?
Shares of Adyen dropped 10% in early trade Thursday, despite the the Dutch payments firm reporting a jump in sales in the third quarter.
Money Report
The sharp drop has been attributed to concerns around weaker-than-expected transaction volumes. Total processed volume grew 32% year-over-year, lower than analyst consensus.
Analysts at Citi said in a note that the weaker volume was likely to attract most of the focus from investors, reflecting concerns over end-market weakness.
Adyen reported third-quarter net revenue of 498.3 million ($535.5 million), up 21% year-over-year on a constant currency basis.
It's not the first time Adyen has seen its share price drop sharply of late. Adyen shares tanked nearly 40% in a single day last August on the back of worse-than-expected sales and declining profits.
Read the full earnings story here.
— Ryan Browne
GN Store Nord after its latest results.Telefonica shares were down 2.1% after the Spanish telecom company Telefonica said Thursday it is on track to meet its financial targets for the year despite a 314 million euro ($337.4 million) impairment in Peru. Elsewhere, Wizz Air shares lost 6.7% after the European budget airline posted a 33.2% drop in operating profit in the six months to Sept. 30.
Germany's DAX was trading 0.85% this morning after Chancellor Olaf Scholz sacked his Finance Minister Christian Lindner Wednesday night, effectively bringing an end to the three-party coalition. Scholz announced he would bring a vote of confidence to the German parliament on Jan. 15, raising the possibility of subsequent snap elections.
Central banks are being closely watched Thursday, with the Fed and BoE both expected to announce rate cuts. According to CME Group's FedWatch Tool, traders anticipate a 96.1% chance of a quarter-point rate cut at the end of the U.S. central bank's policy meeting, following a half-percentage-point reduction in September.
In the U.K., the Bank of England is widely expected to cut rates on Thursday, which would be the second such trim this year.
Global markets continue to react to Donald Trump's decisive election win, with U.S. stocks rallying Wednesday as Wall Street rejoiced the speedy conclusion of the presidential election. Asia-Pacific markets were mixed overnight.
Climate change prevention is critical for insurers, CFO says
Climate change prevention is becoming far more significant for insurance companies as they face rising losses from destructive weather events, such as hurricanes and floods.
Zurich Insurance Group's Chief Financial Officer Claudia Cordioli told CNBC that the insurer had seen "very severe cat [catastrophe] and weather losses, not only in the U.S., but also in Europe this year."
Hurricanes Helene and Milton that ravaged the U.S. in early fall, along with other severe weather events such as the floods that hit Central Europe and Spain, have brought the loss impact within the industry "to a considerable level," she said Thursday.
"And if you think that over the last seven to nine years, [severe weather events] have brought to insurers more than $100 billion of losses. It gives a sense of the magnitude of the weather and climate topic for the insurance industry," she added.
In an earnings update released earlier on Thursday, Zurich Insurance said third-quarter results included an estimated pre-tax loss of $160 million owing to Hurricane Helene. It also noted preliminary pre-tax losses attributable to Hurricane Milton are estimated to be less than $200 million in the fourth quarter. Shares of the insurer were up 0.4% Thursday.
— Holly Ellyatt
Rolls-Royce drops 4% after maintaining profit growth outlook
Shares of British engine maker Rolls-Royce lost 4.39% at 10:10 a.m. London time, after the company maintained its profit outlook in its latest trading update.
Rolls-Royce on Thursday said its current trading was "in line" with its full-year guidance issued in August, which forecast underlying profit between £2.1 billion ($2.71 billion) and £2.3 billion, and free cash flow between £2.1 billion and £2.2 billion in 2024.
"Continued good performance year to date gives us further confidence in the delivery of our 2024 guidance despite a supply chain environment which remains challenging," CEO Tufan Erginbilgic said in a statement. "We are also making good progress towards our mid-term targets, with a front-end loaded delivery of profit and cash flow improvements."
The company nevertheless noted that conditions in the aerospace industry supply chain remain "challenged," while noting it has focused its effort on 15 suppliers.
Rolls-Royce is set to release its full-year results on Feb. 27 and previously said it will reinstate shareholder distributions starting at a 30% payout ratio of post-tax underlying profit.
— Ruxandra Iordache
Sweden's Riksbank cuts rates by bumper 50 basis points
Sweden's Riksbank cut interest rates by 50 basis points on Thursday and signaled further trims to come as global central banks are seen syncing their monetary policy easing.
The bumper reduction — its first such move in a decade — brings the bank's key rate to 2.75% and follows a previous 25 basis points cut in September.
"If the outlook for inflation and economic activity remains unchanged, the policy rate may be cut again at the next monetary policy meeting in December and during the first half of 2025," the bank said in a statement.
— Karen Gilchrist
UK bond yields slip ahead of rate decision
U.K. borrowing costs ticked slightly lower Thursday ahead of the Bank of England's rate decision, softening a recent rally that has pushed gilt yields to their highest level in more than a year.
The 10-year gilt yield slipped two basis points to trade at 4.536% by 9:30 a.m. London time, while the 2-year gilt yield was three basis points lower at 4.481%. Yields move inversely to prices.
Bond yields spiked last week as investors pondered the extent of excess borrowing and increased taxes announced in the Labour government's Oct. 30 budget. That rally has since continued into this week, with 10-year yields hovering near their highest level since October 2023 following the conclusion of the U.S. presidential election on Wednesday.
— Karen Gilchrist
Wizz Air shares drop 7% on declining operating profit
Wizz Air shares lost 6.72% at 09:11 a.m. London time, after the European budget airline posted a 33.2% drop in operating profit in the six months to Sept. 30.
The company reported operating profit over the period that came in at 349.2 million euros ($375.9 million), compared with 522.9 million euros in the same six-month stretch of 2023.
The airline said the decline reflected "cost inefficiencies" resulting from grounded Airbus aircraft due to engine inspections. It said that 41 of its aircraft were grounded as of Sept. 30, down from 46 at the end of June, and forecast average groundings of 40-45 aircraft over the next 18 months, compared with a previous outlook near 50.
On the upside, the company noted "positive momentum" in the ensuing six months in terms of bookings and yield, "notwithstanding the volatile geopolitical situation in the Middle East."
Wizz Air's operations in the Israeli city of Tel Aviv have been suspended until the middle of January.
— Ruxandra Iordache
Europe is seen as a loser of a Trump presidency, Barclays strategist says
Donald Trump's historic election victory over Vice President Kamala Harris is likely to dent the outlook for European stocks, according to one strategist.
"I think Europe is seen as a loser of a Trump presidency," Emmanuel Cau, head of European equity strategy at Barclays, told CNBC's "Squawk Box Europe" on Thursday.
"A lot of that was priced in, right? Definitely in the last six months, we have seen European equities underperforming on the expectation that Trump would win and would put some tariff policy that would be negative for Europe, and that's what we got yesterday, right?" he added.
"So, the risk is priced in but it's still very weird now that Trump has been elected," Cau said.
His comments come after a surge in U.S. stocks on Wednesday, with the Dow Jones Industrial Average soaring by more than 1,500 points. By contrast, European stocks closed lower in the previous session.
— Sam Meredith
Adyen posts 21% jump in third-quarter sales
Adyen reported a jump in sales in the third quarter as the Dutch payments firm gained wallet share and added new customers, diversifying its merchant mix.
The company, whose technology allows businesses to accept payments online and in-store, reported third-quarter net revenue of 498.3 million ($535.5 million), up 21% year-over-year on a constant currency basis.
It comes after Adyen shares tanked nearly 40% in a single day last August on the back of worse-than-expected sales and declining profits.
Read the full earnings story here.
- Ryan Browne
UK supermarket Sainsbury's maintains profit outlook
U.K. supermarket group Sainsbury's has reported a 3.7% rise in retail underlying operating profit for the first half of the fiscal year.
The U.K.'s second-largest supermarket chain said retail underlying operating profit rose to £503 million ($650.7 million) in the six months to Sept.14 , up from £485 million in the same period last year.
It added that it expected to deliver retail underlying operating profit in 2024/2025 of between £1.01 billion and £1.06 billion and growth of between 5% and 10% from the previous year.
The supermarket group added that the strong growth of Sainsbury's and its Nectar loyalty scheme was partially offset by a lower contribution from Argos, its general merchandise offering.
"We remain confident of delivering strong profit growth in the full year, with continued leverage from Sainsbury's grocery volume growth and a stronger Argos H2 [second half] performance," Sainsbury's said in a statement.
— Holly Ellyatt
Delivery Hero updates profit forecast
Delivery Hero reported a jump in third-quarter revenues Thursday and updated sales forecasts, saying it now expects full-year earnings to come in at the lower end of its previous guidance.
The Berlin, Germany-headquartered food delivery firm said that sales in the three months ending in September grew by 24%, driven by stronger monetization.
Gross merchandise value (GMV), which is the total value of orders processed through its platform, climbed 9% year-over-year, with the Middle East and North Africa (MENA) accounting for the bulk of the growth.
Annual GMV growth in the MENA region was 30%, boosted by a 25% year-over-year increase in regional order volumes. The strong MENA growth comes as Delivery Hero plans to spin off its Middle East business Talabat and float it on the Dubai stock exchange later this year.
Delivery Hero also updated guidance Thursday, noting that it now expects revenue growth for the full year to come in at the upper end of its 18% to 21% guidance.
Full-year adjusted earnings before interest, tax, depreciation and amortization (EBITDA), meanwhile, is now expected to come in at the lower end of 725 million euros to 775 million euros, Delivery Hero said.
— Ryan Browne
The Fed is expected to cut interest rates again Thursday
The Federal Reserve likely will stick to the business at hand when it wraps up its meeting Thursday with another interest rate cut, but will have its eye on the future against a backdrop that suddenly has gotten a lot more complicated.
Financial markets are pricing in a near-certainty that the central bank's Federal Open Market Committee will lower its benchmark borrowing cost by a quarter percentage point as it seeks to "recalibrate" policy for an economy that is seeing the inflation rate moderate and the labor market soften.
The focus, though, will turn to what's ahead for Chair Jerome Powell and his Fed colleagues as they navigate a shifting economy — and the political earthquake of Donald Trump's stunning victory in the presidential race.
Read more on the story here: The Fed is expected to cut interest rates again Thursday. Here's everything you need to know
— Jeff Cox
Trump win and threat of more tariffs raises expectations for more China stimulus
Donald Trump's 2024 presidential win has raised the bar for China's fiscal stimulus plans, expected Friday.
On the campaign trial, Trump threatened to impose additional tariffs of 60% or more on Chinese goods sold to the U.S. Increased duties of at least 10% under Trump's first term as president did not dent America's position as China's largest trading partner.
But new tariffs — potentially on a larger scale — would come at a pivotal time for China. The country is relying more on exports for growth as it battles with a real estate slump and tepid consumer spending.
— Evelyn Cheng
Adyen posts 21% jump in third-quarter sales
Adyen reported a jump in sales in the third quarter as the Dutch payments firm gained wallet share and added new customers, diversifying its merchant mix.
The company, whose technology allows businesses to accept payments online and in-store, reported third-quarter net revenue of 498.3 million ($535.5 million), up 21% year-over-year on a constant currency basis.
It comes after Adyen shares tanked nearly 40% in a single day last August on the back of worse-than-expected sales and declining profits.
Read the full earnings story here.
- Ryan Browne
Chances of a 10% universal tariff under Trump next year are 'low,' says Michael Feroli
President-elect Donald Trump's aggressive tariff policy may not be set in stone yet, according to JPMorgan's Michael Feroli.
"We think odds of a 10% across-the-board tariff in 2025 are low, in part for procedural reasons," the analyst wrote in a Wednesday note. "China, on the other hand, is likely to face significantly higher effective tariffs."
Throughout his campaign, the former president has vowed to implement across-the-board tariffs of 10% to 20% on imports entering the U.S. Meanwhile, for Chinese goods, he's proposed a levy of between 60% to 100%.
— Sean Conlon
Here is how the stock market performs historically after an election
Here is how stocks can perform into year-end, now that markets have gotten past the election, according to Goldman Sachs' Scott Rubner.
Historically speaking, stocks rally into year-end from Election Day. However, the S&P 500 and Russell 2000 perform even better during presidential election years, while the Nasdaq Composite does worse.
Take a look at their historical performance between Nov. 5th through Dec. 31st.
- Historically, the S&P 500 rises 2.68% on average from Nov. 5th to Dec. 31st, in data going back to 1928. However, in election years, the broader index rallies 3.38% over the same time period.
- Typically, the Nasdaq gains an average 5.53% between Election Day and year's end, in data going back to 1985. In election years, however, the benchmark gains just 0.79% over the same period.
- In its history, the Russell 2000 gains 5.70%, on average, going back to 1979. In election years, the small-cap index surges 7.94% from Nov. 5th to December 31st.
— Sarah Min
CNBC Pro: Beyond ASML: Goldman reveals its refreshed list of top European stocks - giving one 50% upside
Dutch behemoth ASML has been a favorite among investors this year, but Goldman Sachs has adopted a cautious stance on the stock and removed it from its conviction list of top stocks.
Besides ASML, Goldman also removed several stocks from its Europe conviction list for November, and refreshed it by adding others
The stocks are featured in the investment bank's "Conviction List - Directors' Cut," which it says offers a "curated and active" list of buy-rated stocks.
CNBC Pro subscribers can read more here.
— Amala Balakrishner
Chinese EV stocks extend losses after Trump victory
Chinese electric vehicle stocks extended their losses after Donald Trump won the U.S. presidential elections.
Geely Automotive and BYD Co were among the top losers on Hong Kong's Hang Seng index, shedding 2.61% and 3.32%, respectively, Eikon data showed.
Other EV makers also fell, with Nio losing 2.86% and Xpeng down 1.42%. Xiaomi, which recently entered the EV market, was down 1.81%.
— Lim Hui Jie
European markets: Here are the opening calls
European markets are expected to open in mixed territory Thursday.
The U.K.'s FTSE 100 index is expected to open 14 points higher at 8,159, Germany's DAX up 25 points at 19,063, France's CAC down 12 points at 7,341 and Italy's FTSE MIB up 23 points at 33,703, according to data from IG.
Earnings are set to come from Zurich Insurance, Daimler Truck, Lanxess, Veolia, Legrand, Novonesis, National Grid, Sainsbury's, ITV, BT, Telefonica, ArcelorMittal, Munich Re, Heidelberg materials, Rheinmetall, Tate & Lyle, EDP, Euronext and AF-KLM.
German trade balance data will be released and the Bank of England announces its latest monetary policy decision.
— Holly Ellyatt
