Squawk Box Europe Express

Will it be 'one and done'? U.S. stocks drop sharply as the Federal Reserve cuts rates by a quarter point for the first time since 2008. However, Chairman Jerome Powell suggests that this may not be the start of more easing to come, calling it a ‘mid-cycle’ move. The dollar jumps and the yield curve flattens on the news, but President Trump voices his disapproval of the decision. Bank earnings are also in focus. Standard Chartered beats H1 profits estimates but warns of trade tensions and lower interest rates on the horizon, while Societe Generale’s second-quarter net profit is hit by restructuring costs. Elsewhere on the corporate front, Siemens warns of weakness in some of its key markets, after third-quarter profits fall, missing expectations.

This hasn't happened in more than a decade. Squawk Box anchors preview today’s blockbuster U.S. Federal Reserve decision with the central bank poised to cut rates for the first time since the financial crisis. Apple shares jump in after-hours trade as the tech giant beats expectations and returns to growth in the third quarter, but iPhone sales miss estimates. It’s also a big earnings day in Europe with banks front and centre. Credit Suisse sees second-quarter net profit jump 45 per cent amid high levels of client engagement. French rival BNP Paribas also posts forecast-beating numbers due to a strong performance in its corporate and investment banking arms.

The focus today is on central banks with the Bank of Japan holding rates steady but markets anticipating a 25-basis point cut from the U.S. Federal Reserve. President Trump, however, insists that ‘a small cut is not enough’. Asian stocks move higher as trade talks between Washington and Beijing resume in Shanghai and earnings are expected from Chinese tech giant Huawei. Sterling plunges to a 28-month low as Prime Minister Boris Johnson angles the U.K. to a no-deal Brexit saying that the withdrawal agreement negotiated by former PM Theresa May is now dead in the water. Also, in corporate news, meat substitute company Beyond Meat sees its shares fall in after-hours trading on plans to sell more shares. Its sales however, have increased three-fold in the second quarter. 

The London Stock Exchange is set to expand its portfolio, confirming that it is buying data analytics platform Refinitiv for $27bn. In Asia, markets have been wary ahead of upcoming trade talks between Washington D.C. and Beijing with investors anticipating a rate cut from the Federal Reserve later this week. The unrest continues in Hong Kong with police firing rubber bullets and tear gas at pro-democracy protestors. It’s the eighth consecutive weekend of violence and Beijing is expected to speak out about the clashes. And in Vienna, Iranian diplomats hail ‘constructive’ emergency talks over the nuclear deal but also warned that Tehran will reduce its commitments should the remaining parties in the JCPOA fail to look after its interests.

A mixed session for Asian and U.S. stocks following concerns over central bank movements. The Federal Reserve is expected to be less aggressive next week but ECB president Mario Draghi has drawn the ire of the German banking association after he signaled a potential fresh round of stimulus. We discuss the market mood live at the first-ever Salzburg Summit. In corporate news, Amazon’s record profit streak finally comes to an end with Q2 data missing but Alphabet beats expectations and announces a $25bn share buy-back. We also have earnings from Signify and Pearson.

It’s a massive day of earnings on both sides of the pond. Tech stocks lead the S&P 500 and Nasdaq to fresh peaks, while Facebook’s Q2 results fly in the face of recent regulatory concerns. Tesla, however, sees shares plunge as second-quarter earnings fall short of estimates. We also have quarterly results from Roche, Unilever, AstraZeneca, Anglo American, Valeo and Diageo. The euro hovers near two-month lows against the dollar ahead of today’s rate decision amid the prospect of more easing from the European Central Bank. And in the UK, new Prime Minister Boris Johnson assembles his new cabinet with a decidedly pro-Leave character, vowing to deliver Brexit by Halloween.

Squawk Box anchors talk to Annette Weisbach about Deutsche Bank's bigger-than-expected second-quarter loss, as its major overhaul eats into the bottom line. Autos are another big theme on the show, as Daimler swings into the red in the period, while French rival PSA Group surprises to the upside. Overall, Chinese stocks follow Wall Street higher as sources tell CNBC that U.S. trade negotiators will visit Beijing for face-to-face talks next week. Amazon, Alphabet and Facebook dip after hours after the U.S. Department of Justice launches a sweeping antitrust probe into the tech giants. Shares in Snap, however, smash Wall Street Q2 estimates on the back of strong user growth. In the UK, Boris Johnson is set to take over as Prime Minister today, following a decisive victory in the Conservative Party leadership race.

Earnings season heats up with Swiss bank UBS beating on the top and bottom line, delivering its best second quarter in 9 years. CEO Sergio Ermotti tells CNBC the strong performance comes despite interest rate uncertainty. Santander also tops forecasts but second-quarter profit drops on restructuring costs relating to Banco Popular. In the U.S., technology stocks rally ahead of key reports from Facebook, Alphabet and Amazon. In the UK, foreign minister Jeremy Hunt calls for the formation of a European maritime mission to counter Iranian threats in the Gulf, but the focus is on the reaction from Downing Street, as Boris Johnson is expected to be named Conservative Party leader today.

International strife in the Strait of Hormuz drives oil prices higher. The U.K. government calls the seizure of a British-flagged oil tanker by Iranian commandos ‘an illegal act’. Chinese technology stocks soar on their first day of trading on the STAR market, Shanghai’s new exchange is aimed at rivalling the Nasdaq. In Japan, the ruling bloc falls shy of a super-majority in Upper House elections. The result could hamper Prime Minister Shinzo Abe’s push for constitutional reform. And there are chaotic scenes in Hong Kong with pro-democracy demonstrators clashing with authorities during the seventh consecutive weekend of violence in the territory.  

Asian stocks get a boost at the end of the week following dovish comments from New York Federal Reserve president John Williams and Federal Reserve vice-chairman Richard Clarida about a possible rate cut later this month. Tensions in the Gulf bump oil prices higher following the taking down of an Iranian drone by a US Navy vessel. In corporate news, Microsoft shares soar to a record high following a 12 per cent rise in Q4 sales fuelled by its cloud service. Meanwhile, Boeing will take a near-$5bn tax hit as a result of the on-going grounding of its troubled 737 Max planes.

U.S. stocks hit reverse on July’s gains, with the S&P 500 putting in its worst day in three weeks. In Europe, earnings from Novartis, Alstom and SAP dominate the headlines, while Netflix shares sink after a big miss for Q2 subscriber growth. Facebook’s cryptocurrency Libra keeps finance ministers on edge at the G7 meeting in Chantilly, France. And Amazon shares come under pressure after the European Commission launches an anti-trust investigation into how the online retail giant uses merchants’ data. 

A little way off record highs and a long way to go on a trade deal. U.S. stocks snap their winning streak as President Trump casts doubt on the progress of negotiations between the U.S. and China. Ahead of the G7 summit in Chantilly, France, Federal Reserve Chairman Jerome Powell reiterates that he will ‘act as appropriate’ to sustain the U.S. economic expansion amid increased global uncertainty. In Strasbourg, Ursula Von Der Leyen becomes the first female European Commission president, winning over MEPs with her vision of a greener, fairer Europe. In Washington, Facebook faces scrutiny over its plans to launch cryptocurrency Libra, while the Swiss firm set to oversee the currency’s privacy tells CNBC that is has yet to hear from the social media giant.

U.S. markets continue to break records but investors remain cautious about the health of the economy ahead of the upcoming earnings season. Facebook’s cryptocurrency Libra has come under more criticism, this time from U.S. Treasury Secretary Steven Mnuchin who has voiced concerns it could be used for illicit activities. In the UK, Tory Party leadership candidates Boris Johnson and Jeremy Hunt harden their Brexit stances but outgoing Chancellor Philip Hammond tells CNBC that he will do what he can to prevent a no-deal Brexit. And we’re live in Brussels where German defence minister Ursula Von Der Leyen faces a knife-edge vote which could make her the European Commission’s next president, or potentially cause an institutional rupture within the bloc should she not succeed.

Squawk Box anchors discuss the slowdown in Chinese Q2 GDP – at 6.2% it’s the lowest quarterly growth in 27 years. In Hong Kong, protests flare up again with demonstrators demanding the resignation of city CEO Carrie Lam. AB Inbev postpones its Budweiser IPO blaming weak demand which, at $9.8bn, would have been the biggest listing this year. We’re also live in Dubrovnik where the IMF and Croatian National Bank are holding a CESEE event. The leadership race to find the next managing director of the IMF is heating up.   

Another milestone for U.S. stock markets with the Dow breaching the 27,000 mark for the very first time, a day after the S&P tops 3,000.The Federal Reserve chairman Jerome Powell has kept July rate cut hopes alive, saying that the central bank would respond to increasing global risks. In addition, Powell voiced concerns over Libra during his Senate testimony while President Trump has also hit out at Facebook’s crypto-currency, saying it will have “little standing”. He also slammed Beijing for not sticking to trade promises ahead of June Chinese trade data being released. And in corporate news, China’s Fosun Tourism Group prepares a £750m capital injection into ailing UK firm Thomas Cook.  

U.S. equity markets hit fresh highs and the S&P 500 crosses the 3,000 level after Federal Reserve Chairman Jerome Powell sets the stage for an ‘insurance’ cut later this month. President Trump launches a probe into France's proposed tax on tech firms, sparking concerns the move could lead to more tariffs between the U.S. and Europe. And oil prices hit their highest level in six weeks as producers in the Gulf Mexico cut their output ahead of what could be the first major storm of the hurricane season.

Waiting for the Fed. Equity markets trade cautiously as central bank chairman Jerome Powell prepares to begin his 2-day testimony on Capitol Hill. Trade talks are back on, with a ‘constructive’ phone call between Washington and Beijing breaking the U.S.-China stalemate. Chinese factory inflation falls flat for the month of June following almost three years of unbroken growth, raising fears of a manufacturing slowdown. And in corporate news, Airbus is set to leapfrog Boeing as the world’s largest plane maker as the U.S. firm sees deliveries slide by 37%.

‘The extradition bill is dead’. Squawk Box analyses the impact of the scrapping of the controversial Hong Kong legislation following months of protests and civil unrest. Shares in Deutsche Bank see red as investors begin to question the bank’s dramatic overhaul, with 18,000 jobs set to go in a €7.4 bn shake-up. On Wall Street, Apple shares sink after Rosenblatt Securities downgrades the stock, citing a ‘fundamental deterioration’ in sales growth at the tech giant. And in Washington, President Trump launches a Twitter attack on the UK’s ambassador to the U.S. and UK Prime Minister Theresa May over leaked diplomatic cables critical of his administration.

Deutsche Bank announces a radical overhaul, cutting 18,000 jobs and exiting its global equities sales and trading business. The German lender’s CFO James Von Moltke tells CNBC that this round of restructuring will be the last. A strong U.S. jobs report prompts investors to dial back on hopes of a Federal Reserve rate cut. However, the Bank of France governor tells this channel that the ECB may move as early as this month. And we are live in Greece where we hear from newly elected prime minister Kyriakos Mitsotakis whose New Democracy has won a resounding victory ousting Alexis Tsipras and his Syriza party.

Samsung falls victim to U.S.-China trade tensions, warning second-quarter profits will halve after deliveries to the Chinese smartphone maker Huawei sink. Broader Asian equities stick to two-month highs while global bond yields hold near-record lows ahead of the release of U.S. non-farm payrolls data later today. Relations between Tehran and the West sour further following the seizure of an Iranian tanker suspected of Syrian sanctions violations by British forces off the coast of Gibraltar. And President Trump uses the 4th of July celebrations to highlight America’s military might, with tanks and aircraft featuring in a lavish parade in Washington D.C.