European markets await euro zone inflation data

Time to sell ECB bonds is tough, says chief economist

Rafael Gallardo, Carmignac’s chief economist, said it was a very difficult time for the ECB to sell European bonds.

Economist says it's a tough time to sell ECB bonds

Gallardo made the comments on CNBC’s “Squawk Box Europe” on Wednesday.

Stocks on the move: Argenx up 6%, Avanza down 6%

Shares of Dutch biopharmaceutical company Argenx rose 6.7% by midday to lead the Stoxx 600 after the company announced it had bought a US Food and Drug Administration (FDA) priority review voucher worth $102 million.

At the bottom of the European blue chip index, Swedish bank Avanza fell more than 6% after suggesting the Riksbank’s latest policy rate hike would not have a positive impact on its net interest income.

– Elliot Smith

A short-term rally in the European market could be an opportunity to reduce equity exposure, the fund manager says

A short-term rally in the European market could be an opportunity to reduce equity exposure, the fund manager says

Maria Municci of M&G Investments says the rally could be a “tactical opportunity to reduce some of this equity exposure”.

Julius Baer fined £18m by UK regulator for ‘finder fee review’

A pedestrian walks past the Julius Baer Group Ltd headquarters in Zurich, Switzerland.

Stefan Vermuth | Bloomberg | Getty Images

Swiss private bank Julius Ber on Wednesday received an 18 million pound ($21.62 million) fine from Britain’s Financial Conduct Authority in connection with “paid analysis” for one of its clients from 2009 to 2014.

The regulator also announced on Wednesday that it will ban Gustavo Reitzin, the former regional head of Bank Julius Baer (BJB), Thomas Seiler, the former head of BJB’s sub-region in Russia and Eastern Europe, and Louise Whitestone, the former head of relations for Julius Baer International. Russian and Eastern European table.

An FCA investigation concluded that JBI facilitated the arrangement of finder’s fees between BJB and an employee of several Yukos companies, Dimitri Merinson.

“It was understood that the Yukos group companies would then provide Julius Baer with large sums of cash, from which Julius Baer could generate substantial income,” the FCA said.

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“In particular, there was an unprofitable exchange transaction in which the Yukos companies were charged much higher than normal rates and the profit was split between Mr. Merinson and Julius Baer.”

The FCA’s executive director of enforcement and oversight, Mark Steward, said there were “clear signs that the relationship was corrupt here, which were being seen and ignored by those at the top.”

“These vulnerabilities create the conditions in which the most serious financial crimes can thrive,” Steward said.

Julius Baer International said in a statement that it “deeply regrets and apologizes for the events and omissions that led to today’s notice.”

“We take full responsibility for these historic failures and have fully compensated our client. We have made significant organizational changes since this wrongful act occurred,” said JBI CEO David Durlacher.

– Elliot Smith

Inflation in the euro zone has eased, raising hopes for an ECB rate cut

Inflation in the euro zone fell more than expected in November, raising market hopes that record price increases across the bloc have peaked and that the European Central Bank will begin tapering interest rate hikes next month.

The consumer price index rose 10% year-on-year, down from 10.6% in October and comfortably below the 10.4% consensus forecast in a Reuters poll of analysts.

However, food price inflation, a major concern of policymakers, continued to accelerate, and lower energy prices accounted for the bulk of the decline.

– Elliot Smith

The UK will ease banking sector rules on retail and investment ringfencing, says minister

Britain is set to lift some of the anti-corruption rules imposed on banks in response to the financial crisis, UK Prime Minister Andrew Griffith told the Financial Times.

From 2019, banks with more than £25 billion ($29.9 billion) in deposits are required to formally separate their consumer operations from their investment banking divisions, including to protect against losses in any one and has a separate board.

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Lenders with limited UK business, such as Santander UK, Virgin Money and TSB Bank, could soon be exempt from the measures, the FT reported, with supporters saying it would make them more competitive.

Griffith said it would “make Britain a better place to bank” and “release some capital … over time.”

The biggest investment banks, including HSBC and Barclaysare still required to adjust their operations in order to reduce the risk to consumers from shocks in other parts of the business.

The government is promoting the reforms as part of measures to boost the UK’s financial sector.

— Jenny Reid

British business confidence has fallen in two surveys

A decline in British business confidence was recorded in two surveys published on Wednesday.

A measure from Lloyds Bank showed business confidence at its lowest level since February 2021 and below the long-term average.

It also found that overall economic optimism fell for a sixth straight month and hiring intentions were at an 18-month low.

Wage expectations for businesses eased slightly, but they said they would continue to target higher prices for their goods and services to offset higher operating costs.

Meanwhile, a survey of the service sector by the Confederation of British Industry showed a drop in optimism for the third quarter in a row. The fall was the steepest since May 2020, when Britain was under lockdown.

— Jenny Reid

Stocks on the move: SBB up 5%, Avanza down 7%

SBB Shares rose 5% in early trade, leading the Stoxx 600, after the Swedish real estate firm agreed to sell a 49% stake in its education division to Brookfield for SEK 9.2 billion ($870.42 million ) to sell.

At the bottom of the European blue chip index, the Swedish bank Avanza fell 7% after suggesting the Riksbank’s latest policy rate hike will not have a positive impact on its net interest income.

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– Elliot Smith

Inflation in France slightly higher than expected in November

France was the first major European economy to report inflation on Wednesday.

France’s consumer price index rose 0.4% month-on-month and 6.2% year-on-year, according to preliminary data from INSEE, unchanged from October and slightly above forecasts of 0.3% month-on-month and 6.1% year-on-year. .

Based on the EU consensus, the annual rate was unchanged at 7.1% in November compared to forecasts.

– Elliot Smith

CNBC Pro: Goldman Sachs’ Currie says oil stocks are trading “well below” their long-term trend

Goldman Sachs Global Head of Commodity Research Jeff Kerry told CNBC that historically, oil stocks have traded significantly higher than the current price level for crude oil..

For example, the price difference between SPDR Oil & Gas ETF and ICE Brent Crude The futures contract was around $66.60 on Tuesday. According to Coifin, as shown in the chart below, this is significantly lower than the $104 at the start of January 2017.

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European Markets: Here are the open calls

European markets are headed for an even higher open on Wednesday as regional markets await the latest inflation data from the Eurozone in November.

Britain’s FTSE is expected to be up 23 points at 7,536, Germany’s DAX up 68 points at 14,414, France’s CAC up 29 points at 6,697 and Italy’s FTSE MIB up 119 points at 24,597, according to IG.

The data release includes preliminary inflation figures for the single currency area, third-quarter gross domestic product readings for France and Italy, and Ireland’s unemployment rate for November.

— Holly Ellyatt


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