Squawk Box Europe Express

Credit Suisse posts an adjusted pre-tax loss of CHF1.3bn following net Q1 outflows of CHF60bn. The Dow snaps a 4-week winning streak following last week’s U.S. bank earnings with investors bracing themselves for results from the tech sector. Chinese e-commerce giant Alibaba is reportedly set to list its logistics arm in Hong Kong. Several investment banks are interested in under-writing the IPO. And in Germany security workers stage a one-day walk-out over a wage dispute, causing all flights from Berlin to be cancelled.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Tesla appears to hike U.S. prices for its Model S and X cars following yesterday’s share slump by almost 10 per cent as investors scrutinized falling margins. Meanwhile, Mercedes-Benz posts a 15 per cent Q1 return on net sales. Preliminary results also show strong sales and robust pricing. Asian markets are in the red with bond yields coming in lower on the back of several poor U.S. corporate earnings and concerning data reports. We speak to French Trade Minister Olivier Becht who says his country is returning to ‘business as usual’ following the passing of President Macron’s highly unpopular pensions reforms. Demonstrations, however, continue, with rail workers striking and protestors targeting the Euronext exchange in Paris.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Tesla shares are down in extended trade after posting a 24 per cent fall in Q1 net profit. In a conference call, CEO Elon Musk says that following a series of price cuts, he accepts a loss in profits in exchange for growth in sales and market share. U.S. markets are steady following positive results from Morgan Stanley while regional lender Western Alliance shrugs off deposit concerns. This, as the Federal Reserve warns that banks are tightening credit access. We hear exclusively from Israeli PM Benjamin Netanyahu who warns against Chinese involvement in brokering peace in the Middle East. And in retail news, L’Oréal sees sales surge 30 per cent in the first quarter in Europe and North America. However, performance in China is flat since the country’s emergence from strict Covid regulations.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

There are mixed first quarter results for U.S. banks. Goldman Sachs posts a revenue miss while pulling away from its consumer business but BofA beats on higher rates despite CEO Brian Moynihan warning of a recession in the second half of the year. Streaming giant Netflix records a beat on EPS while missing out on revenue after delaying a clampdown on password sharing. Shares have clawed back ground after plunging by 12 per cent in afterhours trade. Atlanta Federal Reserve President Raphael Bostic tells CNBC he believes in a May rate hike and then pause to assess how tightening is affecting the U.S. economy. And in media news, Fox News settles with electoral machine maker Dominion for $788m over its reporting of the 2020 U.S. presidential election.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Chinese GDP grows by 4.5 per cent in the first quarter – faster than expected – following the lifting of strict Covid restrictions back in December. Manufacturing and retail have also show strong signs of rebounding. In the U.S., financial groups Charles Schwab, State Street and M&T witness combined deposit outflows of almost $60bn as investors flee to seek out higher returns. Apple announces it is launching its own higher-yield account. Asian indices are down but Wall Street remains buoyant ahead of further key bank earnings due later today. French President Emmanuel Macron uses a prime time TV address to the nation to defend his controversial pension reforms.   See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

U.S. banking earnings see JP Morgan post record Q1 revenues while Citi and Wells Fargo also beat expectations. In France, President Macron signs his controversial pension reform bill into law after the country’s highest court backed the bill and rejected calls for a referendum. Paris saw further protests over the weekend as a result. ECB policymakers have said that the recent banking turmoil has prompted a re-think about the rate hiking path, but Portuguese central bank governor Mario Centeno and his Finnish counterpart Ollie Rehn have told CNBC that pausing prematurely would be wrong. In pharma news, Merck reports promising test results for its mRNA cancer vaccine, while also sealing its $11 billion merger with biotech firm Prometheus. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

U.S. indices record their best performance so far this month as U.S. PPI data comes in softer than expected. IMF managing director Kristalina Georgieva tells CNBC the Fed must persist in its fight to rein in inflation. We also hear from Austrian bank governor Robert Holzmann who says that recent financial instability may require a stronger rate hike response from the ECB. Paris sees further violence following pension reform demonstrations. Dozens of the capital’s transport workers stormed the headquarters of LVMH ahead of a key ruling from the French constitutional council. And in banking news, HSBC has warned that shareholders’ proposals to restructure the bank will significantly hit dividend payouts. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Bundesbank President Joachim Nagel shrugs off the IMF’s recession warning for Germany, telling CNBC that his country’s economy has improved significantly, having ridden out last year’s energy crisis. Belgium’s central bank governor Pierre Wunsch praises the European banking sector, telling this channel that he estimates that the ECB’s terminal rate will end between 3.5 per cent and 4 per cent. Fed minutes for March push U.S. equities into the red following fears around the banking sector despite last month’s inflation print coming in at its lowest level for almost two years. The IMF’s First Deputy MD says central banks must remain resolute in the fight against price instability. Chinese exports for March come in positive, breaking a five-month slump. And in luxury news, LVMH posts a 17 per cent surge in Q1 sales following strong demand in the Far East.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The IMF warns the world economy is heading for its weakest pace of growth in more than 30 years as it cuts its medium-term outlook. The fund’s chief economist Pierre-Olivier Gourinchas tells CNBC that recent market turmoil has moved the conversation on from growth/inflation onto financial stability versus inflation. Despite the instability seen in the banking sector, the IMF’s Director of Monetary and Capital Markets, Tobias Adrian, believes that financial regulators were correct to move quickly to mitigate contagion. Swiss lawmakers symbolically reject the UBS-Credit Suisse rescue deal at the beginning of an extraordinary parliamentary session investigating the takeover that is expected to last three days. And HSBC swoops for more than 40 former SVB investment bankers as it looks to target health and tech opportunities in the U.S.   See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Chinese inflation slumps to an 18-month low with factory gate prices falling for a sixth consecutive month. Asian indices are in the green following dovish comments from the BoJ and BoK with investors banking on looser monetary policy, despite suggestions that the Federal Reserve will continue its rate hiking cycle. In the U.S., markets are flat following Good Friday’s robust jobs data. The CPI print and big bank earnings are due out later in the week. And in tech news, Alibaba announces plans to launch an A.I. rival to ChatGPT across all of its apps.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Weakening employment data and soft services activity in the U.S. provoke recession concerns for investors. The sentiment pushes the Nasdaq up to 1 per cent lower and has spilled over into today’s Asian session. French President Macron is in Beijing holding talks with new Premier Li Qiang in a bid to bring the Chinese onside regarding the conflict in Ukraine. He is due to meet President Xi later this morning. U.S. House Speaker Kevin McCarthy hosts Taiwanese President Tsai Ing-wen in California. Tsai issued a warning about Beijing ramping up regional tensions in the South China Sea region. In Switzerland, the federal government cancels Credit Suisse’s executive bonus programme following the bank’s dramatic rescue by rival UBS.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

JPMorgan CEO Jamie Dimon says the banking crisis is far from over and that after-shocks will be felt for years as the global economy nears recession. We are live in Basel where UBS holds its first AGM since the takeover of Credit Suisse and the return of Sergio Ermotti as CEO. Meanwhile, the board of Credit Suisse faced hostile shareholders at its final AGM with Chairman Axel Lehmann expressing his “grief” at the lender’s fate. In the U.S., February employment openings fall below 10 million which could indicate the Fed’s rate-hiking cycle could finally be cooling the economy. Equities, Treasury yields and the dollar all closed lower on Tuesday. Former U.S. President Donald Trump pleads not guilty to 34 felony counts of falsifying business records over alleged hush-money payments. Trump said he was a victim of electoral interference and a politically partisan judiciary. And, as oil nudges higher following this week’s surprise Opec+ supply cut, Shell CEO Wael Sawan tells our colleagues at CNBC Arabia that signi

The board of Credit Suisse prepares to face shareholders during its first AGM in four years and what will likely be its last as an independent bank. We are live in Zurich for the latest. The Dow soars by more than 300 points to close its first session of the second quarter as investors attempt to shrug off fears that the sudden Opec+ supply cut could once again flare up inflation. In Australia, the RBA maintains the interest rate at 3.6 per cent but hints that it could once again pick up its hiking cycle. Former U.S. President Donald Trump flies into New York ahead of his arraignment relating to alleged hush-money payments to a porn star. French cosmetics giant L’Oréal acquires Australian brand Aesop in a $2.5bn deal to expand into the high-end natural goods sector.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Oil surges 8 per cent following a surprise Opec+ cut to supply by more than a million bpd in a bid to reportedly stabilise the market. The Nasdaq enjoys its best quarter in almost three years, unfazed by rising interest rates and the recent banking crisis. In Switzerland, prosecutors investigate UBS’s government-backed takeover of Credit Suisse. The new mega-bank is reportedly ready to slash up to 30 per cent of its workforce. March factory activity in China comes in neutral, stoking fears over global demand. In autos news, Tesla deliveries jump by 4 per cent to a new record for the first three months this year. However, the EV maker misses estimates as production outpaces demand.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

UBS and Credit Suisse are reportedly facing interest payments of CHF10bn as the cost of last week’s emergency lifeline emerge. We are live on the shores of Lake Como, Italy where Ambrosetti managing partner Valerio De Molli tells CNBC the banking crisis is still far from over. In the U.S., the Biden administration hopes to tighten rules on mid-sized banks while bypassing Congress. Regional bank shares close lower as a result. European equities, however, shrug off banking sector contagion fears and are set to see off the month in the green. Non-manufacturing PMI in China for March grows at its fastest pace in a decade but factory activity remains sluggish. Former U.S. President Donald Trump has been indicted by a NY grand jury after a probe into hush money paid to porn star Stormy Daniels during the 2016 presidential campaign.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The EU claims the At1 bond wipe-out at Credit Suisse was wrong. We hear exclusively from the Single Resolution Board Chairman, Dominque Laboureix, who says the body would respect the hierarchy of those bondholders in any future banking crisis. In the U.S. Congress, lawmakers accuse Fed regulators of being ‘asleep at the wheel;’, following the collapse of SVB and Signature Bank. The S&P 500 closes back over the 4,000-point mark with tech stocks leading the way as banking sector jitters fade. The Boao Forum opens in China with new premier Li Qiang warns against chaos and conflict while IMF Managing Director Kristalina Georgieva highlights the economic costs of trade fragmentation.   See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

UBS re-appoints its former CEO Sergio Ermotti to take over from Ralph Hamers from the 5th of April. The Federal Reserve’s top regulator, Michael Barr, slams Silicon Valley Bank for its asset management prior to the lender’s collapse. In China e-commerce giant Alibaba spins off its businesses into six units that could potentially opt for separate IPOs. Asian markets are in the green on the news. And U.S. authorities hit FTX founder Sam Bankman-Fried with new charges, this time accusing him of allegedly paying a $40bn bribe to CCP officials.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The Federal Reserve’s top banking regulator calls the collapse of SVB “a textbook case of mismanagement”, blaming oversight at the start-up lender as Washington officials set up congressional hearings. Shares at First Citizens Bank soar following the deal with the FDIC to sweep up SVB’s deposits and loans. CEO Frank Holding tells CNBC the move will shore up confidence in the deposit system. Doubleline Capital’s Jeffrey Gundlach urges investors to sell into the rallies after warning a U.S. recession is imminent. And in crypto news, U.S. regulators sue exchange Binance and its CEO CZ for allegedly violating compliance rules to attract American consumers.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

First Citizens Bank has agreed to buy collapsed Silicon Valley from the U.S. FDIC, taking on all its deposits and loans. Regulators are mulling disciplinary action against Credit Suisse as the cost of insuring defaults causes Deutsche Bank to plunge. German Chancellor Olaf Scholz says that comparisons between the two banks should not be made. Chinese industrial profits slump by more than 20 per cent in January and February as rising commodity costs and a bumpy Covid recovery impact manufacturers. In France, Prime Minister Elisabeth Borne is to meet with opposition leaders as violent pension reform protests continue around the country. And in Israel, President Isaac Herzog has called on the government to stop its overhaul of the judiciary after Prime Minister Benyamin Netanyahu sacked the country’s defence minister over his opposition to the plans. The move has triggered mass demonstrations nationwide.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art1

U.S. equities close in the green following a rollercoaster session and are set to end the week higher after U.S. Treasury Secretary Janet Yellen moves to calm contagion fears. The UK, Switzerland and Norway all hike interest rates. BoE Governor Andrew Bailey says that the recent turmoil in the banking sector is not a repeat of 2008. EU leaders meet in in Brussels following the meeting between Chinese President Xi Jinping and Russian President Vladimir Putin and warn that the rapprochement between the two nations poses a ‘big challenge’ for the bloc. TikTok CEO Shou Zi Chew is grilled by U.S. Congress where lawmakers are threatening to ban the controversial Chinese app. Chew insists the company is free from CCP influence. And shares in Jack Dorsey’s payment firm Block slide following accusations by short-seller Hindenberg Research of inflated user numbers and allowing fraudulent paymentsSee Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-m