Squawk Box Europe Express

The global tech sell-off resumes on persistent A.I. valuation and central bank policy fears. The Bank of England held rates steady at 4.00% yesterday in a tight 5-4 split. BOE Governor Andrew Bailey tells CNBC’s Ritika Gupta that inflation is still his primary focus, despite the recent softening in the labour market. Meanwhile, Tesla shareholders approved Elon Musk’s $1 trillion pay package, the payout of which hinges on the CEO reaching lofty targets on humanoids and robo-taxis.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Global markets stabilize following the valuation-fueled tech rout, though the outlook for A.I. adoption remains mixed. In the U.S., the Supreme Court is hearing arguments over the legality of President Trump’s sweeping tariff agenda, with legal scholars split over the likely outcome. In the U.K., focus is back on the Bank of England ahead of today’s rate decision, with analysts split over the path forward given the recent spate of weaker data. It’s another busy day on the earnings front – Commerzbank reported a surprise fall in third quarter profit, though raised its revenue outlook with CEO Bettina Orlopp telling CNBC net interest income is improving. Meanwhile, the UK’s most valuable company, AstraZeneca, reported a strong set of results, beating on revenue and EPS while reiterating its full year guidance.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Global markets are in the red as concerns mount over A.I. stocks being over-valued, prompting a tech sell-off. In the U.S., Democrats record wins in key gubernatorial races in Virginia and New Jersey while in New York City, far-left candidate Zohran Mamdani claims victory to become mayor. Danish pharma giant Novo Nordisk slashes its top-end forecasts as sales growth expectations for its flagship obesity drugs tumble.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

UK Chancellor of the Exchequer Rachel Reeves signals a slew of tax hikes in her upcoming budget while Prime Minister Sir Keir Starmer has warned MPs in the House Of Commons of the need to make ‘tough but fair’ decisions. Philips posts a 3 per cent growth in sales in the third quarter and has hiked its FY margin forecast. In tech news, OpenAI inks a $30bn deal with Amazon to use its AWS cloud infrastructure while Microsoft wins approval to export Nvidia chips to the UAE. CEO Brad Smith tells CNBC that A.I. investments will eventually bear fruit.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

China relaxes restrictions on rare earth exports and stops investigations into the chip sector following last week’s trade agreement with the U.S. President Trump signals continued opposition to exports of Nvidia’s most advanced chips. Crude extends gains following Opec+ nations’ announcement that it would pause further output hikes going into the first quarter next year. In aviation news, Ryanair posts an H1 profit beat and predicts stronger footfall. CEO Michael O’Leary slams UK APD policy, telling CNBC UK Chancellor Rachel Reeves ‘hasn’t a clue’ about stimulating economic growth.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Nvidia announces a slew of deals with major South Korean firms involving more than 250,000 Blackwell A.I. chips with CEO Jensen Huang due to address the APEC summit in Gyeongju. Apple posts a Q3 beat thanks to strong iPhone sales while Amazon shares are up 13 per cent in after-hours trade following its fastest growth in cloud computing in years. In Frankfurt, the ECB holds rates steady at 2 per cent for the third consecutive meeting. President Christine Lagarde tells our Italian colleagues at Class CNBC she believes the continent is “in good place”.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

President Trump slashes tariffs on China to 47 per cent following a “12 out of 10 meeting” with his Chinese counterpart Xi Jinping in the South Korean city of Busan. Trump said that all rare earth restrictions had been lifted as one of several concessions from Beijing. Federal reserve Chairman Jerome Powell casts off assumptions of a definite December rate cut following the FOMC’s decision to cut rates by 25bps – their lowest level in three years – causing markets to waver. Airbus posts a Q3 net profit beat and confirms FY guidance despite scaling back production targets for the A220. CEO Guillaume Faury told CNBC that so far US-EU tariffs have not disrupted the plane maker’s supply chains. However, U.S. tariffs and Porsche’s abandonment of EVs for petrol engines push Volkswagen to a €1.3bn quarterly loss.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

UBS posts a pre-tax quarterly profit surge of 47 per cent. We hear from CEO Sergio Ermotti who shrugs off concerns about credit stress. President Trump lands in South Korea where he is due to meet with his Chinese counterpart Xi Jinping. He struck a positive tone speaking to CEOs at the APEC summit in Gyeongju, hoping for a trade deal with China that would see tariffs cut and be “welcomed by the world”. AI stocks push Wall Street to new record highs ahead of todays Federal Reserve rate decision. Nvidia unveils a spree of new bookings at its GTC even in Washington D.C.  See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Swiss pharma giant Novartis sees Q3 income up by a quarter, allowing it to achieve its FY guidance and countering the fall in generic drug sales Stateside. BNP maintains its forecasts despite Q3 net income and revenue missing expectations. The French bank says it is determined to appeal a U.S. jury’s verdict that ruled it breached sanctions on Sudan during the reign of President Omar al-Bashir. UK lender HSBC sees Q3 profits fall by 14 per cent on the back of legal provisions on a Bernie Madoff-related lawsuit. However, the bank still beat forecasts and hiked its net income guidance for the year.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The U.S. and China agree the framework of a trade deal with Presidents Trump and Xi Jinping due to meet later this week in South Korea. U.S. Treasury Secretary Scott Bessent says the move will help to dial down any further trade tensions between the two nations. Equity markets in Greater China have responded positively to the news while the Nasdaq is set to start the week 1 per cent higher. France has avoided a hat-trick of ratings agency downgrades, but Moody’s has revised its forecast for the country to ‘negative’, citing ongoing political turmoil and deficit fears. Swiss pharma giant Novartis has swooped for U.S. biotech firm Avidity in a $12bn cash deal.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

U.S. President Trump ceases all trade talks with Canada following an advertising campaign using former U.S. president Ronald Reagan to critique the current administration’s tariff policy. In Brussels, EU leaders fail to agree on the use of frozen Russian assets to bolster Ukraine’s war effort but European Commission President Ursula Von Der Leyen says the bloc will continue to increase pressure on Moscow. Chinese and Indian state-backed firms are reportedly adjusting their energy policies in the wake of new U.S. sanctions on Russian oil. We hear from the U.S. ambassador to the EU, Andrew Puzder, who says President Trump’s efforts to end the Ukraine conflict are genuine.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Tesla quarterly earnings disappoint due to elevated costs, sending shares down in extended trade. CEO Elon Musk has defended his $1tn pay packet. Luxury giant Kering posts a small improvement in like-for-like sales while cloud computing firm SAP falls short of quarterly expectations. U.S. President Donald Trump slaps ‘tremendous’ new sanctions on two of Russia’s biggest oil firms – Lukoil and Rosneft – in a bid to bring Moscow to the negotiating table over the war in Ukraine. European Commission Vice-President Kaja Kallas tells CNBC Trump’s move is a ‘signal of strength’.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Unicredit posts a bottom-line quarterly beat thanks to stronger-than-expected income within its trading unit. We hear from CEO Andrea Orcel who says he’s ‘not given up’ efforts at a takeover of German lender Commerzbank. In retail news, Adidas hikes its FY guidance but French luxury firm L’Oréal misses sales expectations. And brewing giant Heineken manages to stem a slump in Q3 sales but says that an uncertain outlook has prompted it to slash FY volume guidance.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Sanae Takaichi is elected as Japan’s first ever female prime minister after her LDP party agreed to a coalition deal with right-wing partners Japan Innovation Party. U.S. credit risk jitters ease and markets enjoy a comeback rally as investors now eye this week’s corporate earnings and a potential trade truce between the U.S. and China. In Europe, EU leaders rally around Ukrainian President Volodomyr Zelenskyy following last week’s meeting with President Trump at the White House. Zelenskyy is due in London for meetings with the Coalition of the Willing.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

European futures are back in the green following Friday’s market rout as contagion fears subside about a series of bad loans in the U.S. We hear from UK Chancellor Rachel Reeves who says she aims to tackle the headwinds facing the British economy in November’s budget while remaining unwavering to her fiscal commitments. In luxury news, Kering agrees to spin off its beauty division to L’Oréal in a $4bn deal as new CEO Luca De Meo aims to cut debt and refocus the group towards fashion.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

ECB board members continue to dampen hopes of further rate cuts. We hear from the heads of the Austrian and Croatian central banks who believe risks remain on both sides. U.S. President Donald Trump has hailed a ‘very good phone call’ with his Russian counterpart Vladimir Putin ahead of Ukraine talks in Budapest. President Volodomyr Zelenskyy is due to hold talks at the White House later today. And in banking news, the U.S.-listed shares giant BBVA pop after the Spanish giant failed in its €17bn hostile takeover bid of rival lender Sabadell. It did not manage to reach the 30 per cent threshold to be granted a second attempt.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

We hear from a slew of ECB board governors at the IMF Annual Meetings in Washington where they tell us the European economy is on the right trajectory to bringing inflation down and to boost growth but they remain divided over on how to tackle potential future pitfalls. U.S. Treasury Secretary Scott Bessent tells CNBC the White House will act in the U.S.’s best interest as the trade war with China threatens to flare up once again. Bessent said the stock market will not influence any U.S. government decisions. Nestlé posts better than expected Q3 sales with investors anticipating new CEO Philippe Navratil’s new strategy for the Swiss food giant. And in tech news, the world’s largest contract chip maker, TSMC, posts a near 40% rise in net profit in the third quarter.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

ECB President Christine Lagarde refuses to call an end to the central bank’s interest rate cutting cycle despite hailing the resilience of euro zone economies. Lagarde tells our colleagues Stateside she is anticipating all risks. Dutch chip maker ALSM posts net bookings ahead of forecasts for Q3 and is expecting stable sales next year despite a major slowdown in Chinese demand. Luxury giant LVMH posts a 1 per cent increase in third quarter sales thanks to a rebound in the Chinese market. We speak to the CEO of Swiss watch maker Breitling, Georges Kern, who says an easing of political tensions would immediately boost luxury goods consumption.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The S&P 500 and Nasdaq enjoy their best session since May, even as trade tensions with China simmer while Broadcom jumps 10% after becoming the latest chipmaker to ink a deal with OpenAI. President Trump declares the end of the war in Gaza, as the last living Israeli hostages are returned and hundreds of Palestinian detainees are released. At a special summit in Egypt, Trump points to an era of peace. Silver prices set an all-time high after a historic short-squeeze on the London market.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Futures point to a stock market rebound across Europe and the US as President Trump says 'it will all be fine' - after triggering a Friday sell-off with his 100% tariff threat against China. Meanwhile, Israel's military says the first hostages have been released by Hamas under the Gaza ceasefire agreement, as President Trump flies into the region. Iraq's Prime Minister tells CNBC he hopes today marks the start of lasting peace. Over in France, Sebastian Lecornu unveils his new government, two days after being reappointed Prime Minister - and prepares to present a budget proposal today.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.