Market bets on rate hikes would hit economy, says BoE deputy governor
Bank of England Deputy Governor Ben Broadbent told investors that betting on big rate hikes would mean a “rather material” hit to the economy.
Broadbent said it was unclear how the UK government’s new energy price cap plan would affect inflationary pressures in the medium term after new finance secretary Jeremy Hunt scaled back the original plans.
– Hannah Ward-Glenton
German producer prices above market expectations
The Federal Statistical Office said on Thursday morning that producer prices in the country rose by 45.8% annually in September.
According to Reuters, economists had expected 44.7%. This fuels fears that overall inflation figures will continue to rise in the coming months.
– Matt Clinch
Nordic Telcos Plunge: Ericsson Down 12%, Nokia Down 5%
Ericsson shares fell 12% after third-quarter gains, while Nokia fell 5% in early trade.
Operating margins for both companies suffered from rising costs and contract delays.
– Hannah Ward-Glenton
Wed, August 17, 202212:29 am EDT
European Markets: Here are the opening calls
European markets are heading for a negative open on Thursday as investors assessed ongoing economic uncertainty.
According to data from IG, Britain’s FTSE index is expected to open 37 points lower at 6,899, Germany’s DAX down 106 points at 12,635 and France’s CAC down 52 points at 5,988.
Regional markets ended slightly lower on Wednesday afternoon as traders digested fresh inflation data for the UK and assessed rate hike expectations and recession fears.
The UK reported a rise in CPI to 10.1% on Wednesday, hitting a 40-year high announced by the Office for National Statistics in July. Food, energy and transportation prices drove the rise.
On the data front in Europe, France’s October business climate data is due. Revenue is due from Hermes, Kering, L’Oreal, Pernod Ricard, Vivendi, Akzonobel, ABB, Nokia and the Volvo Group.
— Holly Ellyatt
CNBC Pro: Chip stocks are down all year — but one looks “really inviting,” says fund manager
Semiconductor stocks have been beaten this year, but investors with a longer-term view of chips’ importance to secular trends like 5G, electrification, and artificial intelligence could look to buy the decline.
Hedge fund manager David Neuhauser shares a chip stock he likes.
Pro subscribers can read more here.
– Zavier Ong
Wed, Oct 19, 20227:29 a.m. EDT
Sterling extends losses as British Prime Minister Liz Truss addresses Parliament
Wed, Oct 19, 20225:36 a.m. EDT
UK markets are now equipped with a “skill risk premium”, says the economist
Recent weeks have brought a “skill risk premium” to financial markets, Paul Donovan, chief economist at UBS Wealth Management, told CNBC’s “Squawk Box Europe.”
“The financial markets have judged the UK government as not being as competent as it could have been,” Donovan said.
CNBC Pro: Using bonds to hedge against a recession? BlackRock says this is an “outdated” playbook
Recession fears are rattling markets, but the typical playbook of hedging with government bonds is “obsolete,” says BlackRock.
“In this environment, bond vigilantes are back, heralding the return of term premia,” BlackRock said, adding that it is underweight government bonds.
The asset manager says investors can still buy other types of bonds, however.
CNBC Pro subscribers can read more here.
— Wheat Tan
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