LONDON – Nov. 5, 2020: Fog shrouds the Canary Wharf business district including global financial institutions Citigroup Inc., State Street Corp., Barclays Plc, HSBC Holdings Plc and the commercial office block No. 1 Canada Square.
This is CNBC's live blog covering European markets.
European markets saw solid gains Tuesday, hitting their highest level in over a month, as traders reacted to a flurry of earnings reports in the region.
The regional Stoxx 600 index provisionally closed 1.15% higher, with all sectors in the green. Financial services led gains, up 2.62%.
Swiss banking giant UBS beat analyst expectations as it returned to a quarterly net profit after two successive losses. Shares climbed 9.5% in morning deals and ended the day around 7.6% higher.
Italian bank UniCredit also reported earnings Tuesday, with shares finishing around 3.6% higher.
Shares in BP fell around 1.3%, however, following the oil major's results.
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Stocks rose in the U.S., lifted in part by declining Treasury yields, as traders looked for more clues on when the Federal Reserve may start cutting rates.
Money Report
Asia-Pacific markets climbed overnight, extending gains from the previous session.
Stoxx 600 closes at highest level in over a month
The pan-European Stoxx 600 closed around 514 points on Tuesday, its highest level since intraday trading on April 2.
— Katrina Bishop
Europe markets end firmly in the green
European markets closed up around 1.1% on Tuesday.
The U.K.'s FTSE 100 index finished up by 1.3%, while Germany's DAX was 1.4% higher. In France, the CAC ended the day up 1% and Spain's IBEX was 1.5% in the green.
— Katrina Bishop
German chipmaker Infineon's shares jump over 12%
Infineon shares were trading over 12% higher by mid-afternoon in Europe.
Germany's largest semiconductor manufacturer cut its guidance, citing prolonged demand weakness, but also reported second-quarter sales that beat expectations.
Citi analysts, led by Andrew Gardiner, said in a note that the cut to revenue outlook was in line with investor expectations.
"The updated guidance does, however, indicate that while demand is weaker than expected, the cycle trough has also been reached for Infineon and it calls for revenue to increase in Jun- and Sep-Qs q/q/q and for margins to trough in Jun-Q before improving in Sep-Q," they wrote.
"Management cite continued weak demand in consumer and industrial and a slowing in growth in automotive, with FY24 expectations reduced for all 4 segments. We think the reduction in automotive growth to low-to-mid-single digits for FY24 is a prudent and reasonable cut to expectations, one that should be taken well by investors."
— Katrina Bishop
Stocks open in the green
The Dow Jones Industrial Average opened 23 points higher, or 0.06%, attempting to continue its fifth straight day of gains. The S&P 500 added 0.2%, while the Nasdaq Composite advanced nearly 0.1%.
— Pia Singh
Ferrari down 4.3% as China sales slow
Ferrari shares were 4.3% lower in early afternoon trade, despite the sports car manufacturer reporting that year-on-year revenue and profit rose by double-digit percentages in the first quarter.
Shipments over the period were near-flat at 3,560 versus 3,567 last year. However, shipments in Mainland China, Hong Kong and Taiwan — where Ferrari faces growing competition from firms such as China's BYD — fell by 20%.
CEO Benedetto Vigna said the company had achieved an "even stronger product and country mix as well as a greater contribution from personalizations."
"Our value over volume strategy continues to be successful," Vigna added.
Trading in the Milan-listed stock was automatically suspended twice during the session as the price fell, before resuming.
— Jenni Reid
Sterling dips ahead of Bank of England meeting
The British pound was slightly lower against the U.S. dollar and euro on Tuesday, as markets brace for this week's messaging from the Bank of England on the path of interest rates.
Sterling was down 0.17% against the greenback at 12:15 p.m. in London, snapping a run of four straight sessions of gains, and 0.1% lower against the euro.
The BOE's Monetary Policy Committee meets Thursday when it is widely expected to hold its key rate at 5.25%. Beyond that, money market pricing suggests a roughly 75% likelihood of a first 25 basis point rate cut in August, according to LSEG data.
Matthew Ryan, head of market strategy at Ebury, noted the pound has outperformed all other G10 currencies in 2024 except the U.S. dollar, driven by high interest rates, "high for longer" expectations and a brighter economic picture.
"The former two will be tested this week at the Bank of England meeting on Thursday, where we expect to see some clarification of the MPC's expectations for the timing of the first cut. Right now, markets do not expect this to happen till late summer at the earliest. Any validation of this outlook from Bank of England officials would add fuel to the pound's rally," Ryan said in emailed comments.
Economists at BNP Paribas said in a note last week that the BOE is unlikely to offer specific guidance but will signal that it is "gaining more confidence in the disinflationary process." They expect 75 basis points of cuts this year, more than markets currently expect, starting in August.
— Jenni Reid
French cognac makers surge as Macron hints at cooling of China trade dispute
Shares of several French cognac makers rallied on Tuesday after France's President Emmanuel Macron suggested that trade tensions between China and the European Union, which could impact the drinks makers, may ease.
Two of France's biggest cognac producers, Pernod Ricard and Remy Cointreau, were up 2.8% and 8.2% respectively as of 11:54 London time on Tuesday.
Earlier this year, China had launched an anti-dumping probe into EU brandy makers, which could lead to tariffs being imposed on imports of the spirit. Macron on Monday addressed the dispute during a visit from Chinese President Xi Jinping, who is currently visiting Europe.
"I thank the president for his open attitude regarding provisional measures on cognac and for his wish not to implement them," Macron said in a press conference on Monday.
— Sophie Kiderlin
Infineon: Lowered our expectations due to challenges
Sven Schneider, the CFO of Infineon, refers to prolonged demand weakness in key markets as reason for lowered expectations.
UniCredit hits 13-year high after hiking shareholder payout guidance
Shares of bank UniCredit were more than 3% higher at 9:50 a.m. in London, trading at their highest level since 2011, according to LSEG data.
Italy's second-biggest lender reported net profit of 2.6 billion euros ($2.8 billion) for the first quarter, ahead of a company-compiled consensus estimate, while also lifting its distribution guidance for 2024 to its 2023 level.
"We had an excellent quarter across every business and every metric, it's a record, it's the thirteenth quarter of profitable growth, and very simply we're getting more confident on what we can get this year and we're getting ahead on our plan of accumulating profit during the year," UniCredit CEO Andrea Orcel told CNBC's Charlotte Reed on Tuesday.
The bank's results were also boosted by a positive surprise on systemic charges, Orcel added.
— Jenni Reid, Reuters
UBS shares pop 8% on results beat
UBS shares were 8% higher at 9:39 a.m. London time, after the Swiss banking giant reported a swing back to profit after two quarterly losses and smashed first-quarter expectations.
Lower expenses and consolidation benefits following the takeover of Credit Suisse in June 2023 helped the bank post a net profit of $1.8 billion in the first quarter, ahead of a consensus forecast in an LSEG poll of $721.4 million.
Read more here.
— Jenni Reid
CNBC Pro: Will China's comeback stock rally last? Wall Street weighs in and shares stock picks
China stocks have staged such a strong rally after a protracted slump for the past few years that they're beating even the S&P 500 so far this year.
That breakout has come after a deep and lengthy decline in Chinese markets, as they lost nearly $5 trillion in three years. Investors were bearish as a result of the property debt crisis, slowing growth and other factors.
But is the bounce back sustainable? Here's what Wall Street and other analysts say, and what to buy in the market.
CNBC Pro subscribers can read more here.
— Weizhen Tan
CNBC Pro: After a tough quarter for global luxury, Barclays reveals its top 3 stocks to play the sector right now
Macroeconomic uncertainties may have pushed consumers - particularly those from China - to tighten their purse strings and reduce spending on luxury goods. However, Barclays notes that several companies in the sector make good plays right now.
While Chinese consumers' spending intentions for the ongoing quarter shows that they plan to spend more money on luxury, the investment bank's analysts "remain cautious about the possibility of seeing improving trends."
Still, expenditure on luxury goods is expected to 68% this year, up from 66% in 2023, they wrote, revealing the three names the like.
CNBC Pro subscribers can read more here.
— Amala Balakrishner
European markets: Here are the opening calls
European markets are expected to open higher Tuesday.
The U.K.'s FTSE 100 index is expected to open 37 points higher at 8,301, Germany's DAX up 45 points at 18,217, France's CAC 14 points higher at 8,009 and Italy's FTSE MIB up 79 points at 33,775, according to data from IG.
On Tuesday, earnings are set to come from BP, S4 Capital, Siemens Healthineers, Deutsche Post, Infineon, Bouygues, UBS, Adecco, Banco de Sabadell and Unicredit, among others.
— Holly Ellyatt
