Squawk Box Europe Express

The S&P posted its strongest day of trade since June as U.S. stocks continue to rebound amid a pull-back in Treasury yields, with fears of higher interest rates easing. Apple jumps up to 5 per cent on the Nasdaq following a Warren Buffett endorsement in his annual letter to investors and after the reopening of its 270 U.S. stores. Video-calling firm Zoom is also in the green, going higher in late trading after it posts a near-370 per cent jump in Q4 revenues. In France, food giant Danone has succumbed to activist pressure to split its top management roles. Emmanuel Faber stays on as chairman but the CEO position is now vacant. And with the prospect of an increase in global energy demand, OPEC+ leaders are reportedly set to agree to hike supplies later this week, driving crude prices lower.   See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Last week’s U.S. Treasury yield highs recede with stock futures rising sharply. Sentiment has been partially boosted by higher prospects for stimulus with President Biden urging Senate to pass his $1.9tn Covid-19 stimulus bill after it was approved by the House of Representatives. Legendary investor Warren Buffett warns to “never bet against America” in his annual Berkshire Hathaway shareholder letter. Buffett announced he had bought close to $25bn of the company’s own shares in 2020. Meanwhile, weak export demand and continuing virus outbreaks have reduced Chinese factory activity to its slowest pace in nine months. And in tech news, Swiss-American computer software giant Logitech increases its full-year outlook on a predicted spike in pandemic-related sales.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Equities sell off strongly across Asia with tech stocks being dumped hardest. On Wall Street, the Nasdaq suffers a fall of 3.5 percent - its worst session since October - as the 10-year bond yield rally gathers pace. EU leaders meet virtually to discuss the disorderly rollout of vaccines across the bloc. EC President Ursula Von Der Leyen remains bullish that targets will be met by summer however European Council leader Charles Michel criticises vaccine makers transparency and shaky supply chains. And Swiss construction giant LafargeHolcim says it expects a second-half rebound in demand as global stimulus programmes begin to kick in.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Federal Reserve Chairman Jerome Powell allays U.S. inflation concerns in his testimony to the House, causing Asian markets to jump and Wall Street to pare back losses in another intra-day comeback. Berkshire Hathaway’s vice-chairman Charlie Munger slams “this new bunch of gamblers”, criticising SPACs, Tesla and cryptocurrencies for the increasingly frenzied speculation in the markets. This, as GameStop surges 100 percent in 90 minutes. Asia-focused lender Standard Chartered posts a full-year miss with a 57 per cent fall in profits and a doubling in impairment costs. In the U.S., Johnson & Johnson’s single-shot vaccination is due for FDA approval. Its dose reportedly offers an average efficacy rate of 66 per cent and near-total protection against hospitalisation and Covid-related fatalities.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Whipsawing on Wall Street. The Dow manages to claw back a 360-point loss to end yesterday’s session in the green following Federal Reserve Chairman Jerome Powell’s attempts to ease concerns about higher rates and inflation during a Senate testimony. Bitcoin is also volatile, temporarily falling below the $50k-mark, but recouping some losses after payment company Square invested $170m in the cryptocurrency. In autos news, Tesla shares nosedive by up to 13 per cent on the markets’ rotation away from tech stocks. The electric car maker’s stock is now in negative territory for the year. And Hyundai suffers the world’s costliest EV recall after up to 82,000 cars are deemed susceptible to battery fires.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

HSBC beats earnings expectations despite full-year profit falling by more than a third. Europe’s largest lender is promising to resume its dividend payout this year. Big tech companies weigh on the Nasdaq and S&P but the Dow moves to the upside on wider recovery optimism in the U.S. Tesla CEO Elon Musk is $15bn poorer, losing his title of world’s richest man to Amazon’s Jeff Bezos. The electric car maker shares post their biggest decline since September. British Prime Minister Boris Johnson outlines the country’s “one-way journey” out of national lockdown, citing the success of the UK vaccine rollout. And in Australia, the country ‘refriends’ Facebook after the social media titan reaches a deal with the government over media laws and journalistic content compensation.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The UK is to ease lockdown restrictions with Prime Minister Boris Johnson set to detail his roadmap to recovery. All eyes are on the bond market with the U.S. 10-year Treasury yield hitting highs not seen since this time last year. Boeing grounds some of its 777 planes after a mid-air engine failure on a United Airlines flight causes debris to rain down on a Denver neighbourhood and prompts an emergency landing. HSBC steps up its pivot towards Asia by reportedly relocating a number of executive staff from London to Hong Kong. The UK lender is to announce it is withdrawing its commercial business from 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.

U.S. Treasury Secretary Janet Yellen tells CNBC in an exclusive interview that only major stimulus will rouse the American economy following “the worst year for economic growth since WW2.” Yellen also said President Biden’s administration will maintain his predecessor’s trade pressure on China. The GameStop saga comes to Washington with Robinhood CEO Vlad Tenev going up against the House Financial Services Committee. Tenev defended the app’s decision to halt trading of the stock last month. However, he apologised for his company’s role in the market volatility during the retail trading frenzy. Meanwhile, carmakers continue to lament the effects of a chip shortage. We hear from Peter Schiefer, the auto sector chief at German chip-maker Infineon, who tells CNBC he believes the global semi-conductor squeeze is unlikely to be eased any time soon.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

It’s another busy day for earnings in Europe. Credit Suisse pre-tax Q4 profit slumps to a CHF88m loss as a slow post-virus recovery weighs on the lender. However, recent client activity is positively impacting its wealth management arm. Full-year revenue for 2020 at Airbus nose-dives by 30 per cent with an operating loss of €510m. The plane maker will also withhold its dividend this year. Meanwhile, digital discord Down Under after Facebook blocks news-sharing in Australia over a proposed law that will force social media platforms to pay for journalistic content. Australian Treasurer Josh Frydenberg says Facebook’s “heavy-handed” actions will damage its reputation in the country. In the U.S., retail sales spike as consumers spend their stimulus cheques, but the Fed warns economic recovery is far from complete.    See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The recent U.S. rally loses some steam. Meanwhile, the U.S. 10-year hits a 12-month high, with St. Louis Fed President James Bullard telling CNBC that investors are eyeing a “roaring” pick-up in post-pandemic U.S. economic activity. In energy news, the Gulf region’s cold snap is keeping refineries offline while millions suffer power blackouts. Robust commodity prices have led to Rio Tinto posting its best full-year profit in almost a decade. The UK miner plans to deliver a record dividend. In other corporate news, Nestlé sheds its North American mineral water brands to One Rock Capital Partners in a $4.3bn deal. And Berkshire Hathaway has disclosed a slew of new Q4 share positions including Verizon and Chevron.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

BHP announces a record half-year dividend payout after soaring iron ore prices pushed the mining giant’s results to a seven-year high. Oil prices, meanwhile, rise after a cold snap across Texas and northern Mexico leaves millions without power, shutting wells and refineries across the region. In virus news, the WHO has granted the Oxford University/AstraZeneca vaccination emergency use approval which will allow for wider access of the drug in low and middle income nations. We hear exclusively from Dutch Finance Minister Wopke Hoekstra who is confident that the vaccine rollouts will take Europe out of lockdown soon.   See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

President Trump is acquitted of inciting the fatal Capitol Hill mob attack last month, marking the second time he has survived impeachment in 12 months. In Italy, Mario Draghi is sworn in as Prime Minister after unveiling a new cabinet featuring lawmakers from across the political spectrum. He’s now tasked with addressing the country’s economy recovery following the Covid pandemic. Brent crude and WTI both hit 13-month highs on the back of U.S. stimulus optimism, the potential easing of global lockdown measures and renewed tensions in the Middle East. Japan posts a better-than-expected Q4 GDP figure which pushes the Nikkei above the 30k mark – the first time in almost 31 years. And in the UK, the government hits its vaccine rollout target a day early, with 15m people in the most vulnerable sectors of society having received at least one injection. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Disney soars in extended trading after the media giant tops first-quarter earnings forecasts, while subscriber numbers near 95m. Female-focused dating app Bumble lists on Wall Street with shares spiking on the debut. Strong sales in China and soaring online orders help L’Oréal to a topline beat. In political news, President Biden warns senators that Beijing could outstrip Washington on infrastructure investment. And in Italy, PM-designate Mario Draghi succeeds in gathering enough support from Five Star Movement MPs to create a new majority government. He is expected to name his cabinet today.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

President Biden and Chinese Premier Xi Jinping speak on the phone for the first time with the new U.S. leader immediately raising the topics of trade and human rights. U.S. consumer prices are in focus as Federal Reserve Chairman Jerome Powell stresses the need for a jobs drive to propel the economy, while revealing the central bank “explicitly” seeks to target an average inflation of 2 per cent annually. In vaccine news, the WHO grants the Oxford-AstraZeneca vaccine its backing despite recent EU criticism over the drug’s efficacy. Earnings seasons is in full swing in Europe. Italian lender Unicredit posts a revenue loss for the fourth quarter but says it is determined to return more than €1bn to shareholders. And we hear from a slew of European chief executives, including the CEO of Schneider Electric.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

In a two-speed recovery, the Chinese manufacturing rebound continues to strengthen with factory inflation up for the first time in a year but consumer prices sink into deflationary territory. In Washington, six GOP senators cross the aisle to vote with Democrats to proceed with the impeachment trial of former President Donald Trump over “inciting insurrection” in last month’s Capitol Hill violence. Twitter posts a beat on estimates, but user growth is down since CEO Jack Dorsey’s banning of Trump from the platform. In banking news, French lender Société Générale reports a Q4 net loss of €290m but confirms its dividend payment after lower-than-expected pandemic-related provision costs.   See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

U.S. equities and the Russell Index take a bullish turn once more with the Dow and the S&P 500 marking their longest winning streaks since August. Meanwhile, Tesla buys $1.5bn in Bitcoin, announcing plans to accept it as payment. The move pushes the cryptocurrency and its rivals Ethereum and Dogecoin to record highs. On the macro level, Goldman Sachs hikes its U.S. growth forecast after improving its baseline stimulus scenario. This, as Democrats look set to earmark nearly $50bn of the relief plan for the transport sector including $14bn for airlines, boosting shares in major carriers as a result. In energy news, oil reaches a 13-month high to pre-pandemic levels on hopes of global demand beginning to recover. And former President Donald Trump’s second impeachment trial is to kick off in the Senate later today.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Asian equities respond to U.S. futures indications that last week’s rally – the markets’ best week since November - could continue. A poor U.S. jobs report on Friday raises hopes of a stimulus deal. In vaccine news, South Africa suspends inoculations after studies show that the jab created by Anglo-Swedish pharma giant AstraZeneca provides minimal protection against its national Covid variant. Meanwhile in M&A news, Japanese microchip giant Renesas is set to swoop for DAX-listed Dialog in a reported $6bn bid. In Italy, former ECB president Mario Draghi has secured conditional support from rival parties Five Star Movement and Lega as he attempts to rebuild the splintered government coalition.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Equities in the U.S. soar with the S&P 500 reaching fresh highs off the back of improving employment figures. This, as tech stocks continue to push the Nasdaq to new levels. Washington takes aim at the Reddit retail investor frenzy with U.S. Treasury Secretary Janet Yellen vowing to review the episode with market regulators while hailing Wall Street’s resilience in the face of the rally. In vaccine news, Johnson & Johnson is set to achieve FDA emergency Covid jab approval. The drug maker may have up to 100m doses available by June. Meanwhile, the global microchip shortage has forced Ford and Stellantis to scale back production. Ford has warned the move may knock $2.5bn off its 2021 revenues while several German brands are considering building up stockpiles of the components. And a new IPO in Hong Kong is making waves. Chinese video media company Kuaishou lists strongly on the HKEX with shares almost tripling on its first day of trade.   See Privacy Policy at https://art19.com/privacy an

The former president of the ECB, Mario Draghi, answers the Italian president’s call to form a new unity government amid the worst national economic crisis in decades. Former Prime Minister Matteo Renzi – who withdrew his party from Giuseppe Conte’s coalition – tells CNBC that Draghi is the man to rescue Italy from the current political impasse. In energy news, crude hits a one-year high as OPEC+ producers agree an extension to output cuts while US stockpiles plummet to their lowest level since last March. And today sees a slew of European corporate earnings released including Deutsche Bank, OMV and Volvo.   See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

It’s the end of an era as Jeff Bezos hands over the reins of Amazon to Web Services CEO Andy Jassy later this year. This, as the e-commerce titan reports a record $125bn in Q4 revenues. Alphabet shares soar in after-hours trade as earnings top expectations despite a $5.6bn loss from Google’s Cloud unit. In Europe, Banco Santander suffers a record annual loss of €8.7bn but insists it will pay out its dividend. Siemens CEO Joe Kaeser marks his final quarter as CEO by raising full-year guidance following a 38 per cent surge in Q4 net income. And in Italy, President Mattarella is expected to invite former ECB President Mario Draghi to head a new government following the collapse of talks between the parties in the Conte-led coalition.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.