Squawk Box Europe Express

U.S. Treasury Secretary Steven Mnuchin tells CNBC that he is prepared to meet Democrats in order to strike an agreement on the virus stimulus deal after earlier talks stalled, delaying a House vote on the matter. Following Tuesday night’s fractious first presidential debate, planners promise a more orderly face-off next time with new rules. In Japan, trading is suspended after a technical glitch downs systems at the Tokyo Stock Exchange. German pharmaceutical giant Bayer says it is looking to make a further €1.5bn in cost cuts which could result in job losses. However, it is maintaining its dividend despite the virus downturn weighing on its farms unit. And in utilities news, French waste and water giant Veolia has extended its deadline for Engie to improve its offer for a 30 per cent stake in Suez.   

U.S. President Donald Trump and Democrat candidate Joe Biden go head-to-head in the first of three presidential debates. The two clashed over healthcare, race, the economy and the Covid-19 pandemic during a fraught ninety minutes in Cleveland. Markets react with U.S. futures largely negative. Stateside indices are now on course to finish September mostly in the red. Disney announces 28,000 job losses and the theme park operator singles out California’s decision to keep Disneyland shut as a major reason behind the cuts. In China, September PMI figures show solid factory activity and services expansion as export orders grow as well. And in the UK, virus cases hit a record high of 7,000 with hospital deaths also on the rise.

US markets close sharply higher but the Dow, Nasdaq and the S&P 500 are all set to finish September firmly in the red to break a 5-month winning streak. As cases continue to rise amid the virus resurgence, Democrats are hopeful of striking a deal with the White House after proposing a fresh $2.2tn stimulus bill. Meanwhile the U.S. election race heats up with the first presidential debate set for tonight in Cleveland. This, as it is reported that President Trump paid no federal income tax for a decade. In Europe, Brexit talks resume and sterling rallies, but disputes between Brussels and London remain. European Commission President Ursula Von Der Leyen says that she is still hopeful of coming to an agreement to minimise the negative impact on both the British and EU economies. And in luxury news, LVMH slams U.S. jeweller Tiffany for its “catastrophic performance” and is filing its own lawsuit over the collapse of the proposed $16.6bn tie-up

A U.S. judge makes an eleventh-hour ruling to stop the Trump administration from blocking TikTok from app stores. This, as the Chinese social media company looks to seal the deal with Oracle and Walmart. Washington-Beijing trade tensions continue to weigh on the technology sector as China’s largest chip maker sees its shares dive after it is hit with tighter U.S. restrictions over security concerns. President Trump formally nominates Judge Amy Coney Barrett for the Supreme Court and is looking to confirm her ahead of November’s elections. In corporate news, HSBC shares jump on the news that Ping An Insurance has increased its stake in the bank, while Commerzbank names Manfred Knof as its new CEO. And Europe sees widespread anti-lockdown demonstrations with protestors and local authorities in Marseille, Madrid and London defying government decrees.  

Major U.S. indices survive a rocky session, finishing marginally to the upside. However, stocks are still on track to log a fourth week of losses. The outlook Stateside is marred by more pandemic uncertainty as Covid-19 cases in the U.S. rise to 7 million, with a surge in the MidWest and the Great Plains. In the UK, Chancellor Rishi Sunak unveils a £10bn programme to safeguard jobs as he confirms the furlough scheme will wind down next month. In tech news, a U.S. judge rules that the government must defend its decision to ban Chinese social media firm TikTok in court or delay plans to ban downloads of its app. President Trump says cyber-security is his primary concern. And, CNBC learns that French drug maker Sanofi and rival GSK’s joint effort could produce more than a billion Covid-19 vaccine doses by early 2021.

The Dow loses 500 points in a broad U.S. sell-off, as Federal Reserve Chairman Jerome Powell says more fiscal support is needed, while other central bankers say the US economy remains in a 'deep hole'. Asian equities join the declines, with the Hang Seng and Shenzhen Composite taking the heaviest losses, while European markets look set to open in the red. In corporate news, Tesla takes the trade war into its own hands, suing the U.S. government and Trade Representative Robert Lighthizer over the tariffs on Tesla imports from China.

‘Perilous point’: UK Prime Minister Boris Johnson imposes a new round of lockdown restrictions that could last up to 6 months as cases rise. At a virtual UN General Assembly, tensions rise as President Trump slams China for its role in the Covid-19 outbreak. Chinese President Xi Jinping says he is not seeking a cold war, nor a hot one. US indices break their losing streaks with tech stocks once again leading the pack. In retail news, sportswear giant Nike’s shares are set to hit a record high on strong Chinese demand and surging online sales.

Markets on both sides of the Atlantic plunge on heavy losses for banks and travel stocks. The Dow falls 500 points, the S&P 500 posts its first four-day losing streak since February and the Stoxx 600 sees its worst day since June. In the UK, Prime Minister Boris Johnson is expected to impose a new round of Coronavirus restrictions including a 10pm pub curfew and rolling back returns to work. TikTok negotiations continue with Beijing accusing Washington of bullying behaviour. An op-ed in a government-backed Chinese newspaper blasts the social media app’s deal with Oracle and Wal-mart, raising concerns that Beijing may not support the agreement. And President Trump has vowed to nominate a replacement for the late Supreme Court Judge Ruth Bader Ginsburg this weekend. NBC News has learned that Judge Amy Coney Barrett is the frontrunner.

Shares in HSBC fall to their lowest level since 1995 in Hong Kong as the bank is implicated alongside Barclays, Deutsche Bank, JPMorgan and others in a series of leaked documents detailing alleged suspicious fund transactions. The White House grants Chinese social media group TikTok one more week to seal a deal with Oracle and Wal-Mart. President Trump has given the deal his nod, but says parent company Bytedance must create a $5bn U.S. education fund. Meanwhile, the U.S. presidential race sees heightened tensions following the death of Supreme Court judge Ruth Bader Ginsburg. Trump has vowed to fill the vacancy by next week.   

Going public? TikTok considers a U.S. IPO as the Chinese-owned social media group looks to avert sanctions ahead of a weekend deadline set by the Trump administration. In Spain, Bankia and Caixabank join forces to create the country’s largest lender with up to €700bn in assets. Ratings agency S&P puts German finance company Grenke on negative creditwatch as it awaits the result of an accounting investigation. The company’s founder, Wolfgang Grenke has dismissed claims of fraud. And Britain is under pressure from Washington and Brussels over Brexit negotiations.

The Federal Reserve promises to keep interest rates at record lows until 2023, pushing the S&P 500, the Nasdaq and Asian indices into the red. President Trump says he is concerned about TikTok’s Oracle plan, saying he does not want Chinese tech firm ByteDance to maintain control. He is also seeking payment for the U.S. government’s role in facilitating the deal. And cloud-computing firm Snowflake sees shares surge by more than 100 per cent on its first day of trading on the NYSE.

The dollar falls on expectations that the Federal Reserve will remain cautious on the outlook for the U.S. recovery. JPMorgan CEO Jamie Dimon tells CNBC that the central bank has so far done enough to prevent a financial crisis. We also hear from Standard Chartered boss Bill Winters who says that continued central bank easing is hurting banks’ profitability. In tech news, Microsoft ups its quarterly dividend by 10 per cent which sends shares higher. This, after TikTok rejected its takeover bid and the White House suggests that a partnership with Oracle is imminent. And Apple CEO Tim Cook unveils a range of new products including a virtual fitness platform, a new iPad and iWatch, as well as a service bundle.   

The Nasdaq reverses a two-day losing streak as the U.S. Treasury says it will review the proposal for a tech tie-up between Oracle and TikTok. Chinese recovery improves with retail sales rising for the first time in 2020 and industrial production topping forecasts. UBS Chairman Axel Weber is reportedly drawing up a mega-merger plan with rival Credit Suisse to create a wealth management and investment giant. In auto news, FCA and PSA have revised the terms of their tie-up due to virus-related pressures. This will see the special dividend reduced and a planned spin-off delayed.  

Time is running out… Oracle emerges as the apparent winner for TikTok’s U.S. assets as CNBC learns that ByteDance hopes a “technology partnership” with the American software giant will stave off sanctions. This, after the Chinese group rejected a full-sale offer from Microsoft. Softbank shares surge after agreeing to sell chip designer Arm to Nvidia for $40bn. There are reports the Japanese investor is looking to go private. U.S. biotech firm Gilead is acquiring cancer treatment developer Immunomedics for $21bn as it continues work on its Covid treatment drug Remdesivir. And in the UK, AstraZeneca is restarting trials for its Coronavirus vaccine candidate after last week’s pause over safety concerns, while rivals Pfizer and Biontech expand the scope of their late-stage testing.   

The S&P 500 and Nasdaq are on track for their second week of losses. Market sentiment is dampened by the U.S. Senate voting down a GOP virus stimulus bill. London and Brussels are at loggerheads after the UK rejects the European Commission’s ultimatum and threats of legal action against the British government over its attempts to unpick the Brexit divorce treaty. Rio Tinto CEO Jean-Sebastian Jacques is stepping down after investors push for more accountability over the miner’s destruction of two Aboriginal sites in Western Australia. President Trump warns that he will not extend next week’s deadline for Chinese tech firm ByteDance to sell its TikTok assets in the U.S.  

Tech turnaround… U.S. equities snap a three-day losing streak with the Nasdaq posting its best session since April. In Europe, the ECB is expected to hint at further stimulus measures to tackle weak inflation and a strong euro. CNBC learns that Chinese tech company ByteDance is in talks with the U.S. government to avoid a full sale of its video app TikTok, ahead of President Trump’s deadline next week. In luxury news, jeweller Tiffany sues LVMH for dropping its $16bn deal after the French government urged the conglomerate to delay the tie-up amid the threat of U.S. sanctions on French products. And, U.S. House Speaker Nancy Pelosi warns the UK government that there will be “no chance” of a trade deal between London and Washington should the Good Friday Agreement be undermined during the Brexit divorce treaty.

Tech wreck on Wall Street: a massive sell-off in U.S. tech shares wipes off $1tn from the market cap of the six largest firms. The Nasdaq is plunged into correction territory after losing a further 4 per cent. Tesla loses a fifth of its value in a single session, falling more than 20 per cent in its worst-ever trading day, after the electric car giant is left out of the S&P 500. Asian indices also see red as concerns are raised over Japanese investment titan Softbank’s tech bets. And in pharma news, AstraZeneca halts global trials of its potential Covid-19 vaccine after an unexplained illness during Phase 3 testing.

Decoupling decisions…President Trump pledges to end America's reliance on China 'once and for all'. But in Beijing, Chinese Premier Xi Jinping says he supports multilateralism while standing ready to face external risks. Investors satisfy their thirst for liquidity, piling into debut trading of Hong Kong water giant Nongfu, sending shares over 80 per cent higher from its listing price. AB Inbev tells CNBC the drinks titan has no comment on a report that the search is under way for a new CEO, amid claims Carlos Brito is looking to step down after 16 years at the helm. And in Brussels, Brexit talks falter which weighs on sterling. However, the head of the EU’s ESM, Klaus Regling, tells CNBC that investors have never been so bullish on the bloc following its response to the Covid-19 crisis.

China’s largest chipmaker, SMIC, sees its shares nosedive by almost 20 per cent on concerns the company could be blacklisted by the U.S. administration. In Washington, U.S. Treasury Secretary Steven Mnuchin says he expects a deal to fund the government until December to be agreed upon by the White House and Congressional Democrats by the end of this week. Japan’s investment giant Softbank’s shares slide after being branded the ‘Nasdaq whale’ for buying up massive bets on U.S. tech stocks. European Commissioner Paolo Gentiloni tells CNBC that Europe must find a way to counter American tech dominance. Meanwhile France sees a record surge in infection cases, as drugmaker Sanofi says its Covid-19 vaccine could be priced for as low as €10 a shot.

Selling strikes Wall Street… The Dow sinks over 800 points in its worst day since June, as investors flee tech stocks in an abrupt end to the winning streak. Apple shares plunge 8 percent in the stock's worst day since March, as the tech giant loses $150bn in market value during the session. Asian equities see red, following US majors lower, as big technology firms across the region lead declines. And we are live at the Ambrosetti Forum on Lake Como where the mood among attendees remains cautious amid the market turbulence.