ECB’s Simkus: ‘Very clear’ at least one more rate hike needed
At least one more interest rate hike is needed to tame euro zone inflation, European Central Bank Governing Council member Gediminas Simkus told CNBC.
“It’s very clear for me that we need at least one more hike, and this is going to happen I think in July,” said Simkus, who is chair of the board of the Bank of Lithuania.
“Seeing this environment and also the market expectations of the interest rate path and also given … the stickiness of inflation and the upside risk, I would not be surprised to discuss at the governing council a hike also in September.”
Asked whether he saw a severe deceleration of economic growth in the second half of the year, Simkus said, “Actually, no.”
“Going into the last quarters of this year I think we’re going to see an improvement in economic activity given that inflation is coming down, wages are going up and the consumption contributor will have a positive effect.”
— Jenni Reid
U.S. stocks open little changed
German business sentiment ‘markedly pessimistic’: Ifo survey
Business sentiment in Germany worsened in June, according to a widely watched survey from the Ifo Institute.
The Business Climate Index fell to 88.5 points from 91.5 points, with Ifo saying “expectations were markedly pessimistic and companies’ assessments of their current situations were worse.” Economists polled by Reuters expected a reading of 90.7.
“Above all, the weakness in the manufacturing sector is steering the German economy into turbulent waters,” the survey found.
It comes after the German Purchasing Managers’ Index from S&P Global disappointed on Friday, with output falling from 53.9 to a four-month low of 50.8, versus a forecast of 53.5. A score below 50 indicates a contraction.
Germany entered a recession in the first quarter of the year.
— Jenni Reid
Associated British Foods trades lower despite lifted 2024 guidance
Associated British Foods was down 0.5% in early trade, despite posting increased revenue for the third quarter and raising its full-year guidance for 2024.
Associated British Food share price.
Low-cost fashion store Primark drove the group’s 15% revenue increase in the retail department, the British conglomerate said, while food was up 18% year to date.
— Hannah Ward-Glenton
European markets open tentatively higher
European markets opened marginally higher Monday in a potential bounce back following a downbeat week.
The pan-European Stoxx 600 index was up 0.1% at market open, with most sectors trading in tentatively positive territory. Oil and gas stocks led marginal gains with a 0.8% uptick, followed by travel and leisure and mining stocks, which each gained 0.4%. Banking stocks dropped 0.5%.
— Hannah Ward-Glenton
Apple touches new all-time high, bucking the trend
Apple was higher Friday afternoon, managing to hit new all-time highs even as the major averages declined. Shares were last up by 0.1%.
— Sarah Min, Scott Schnipper
Oil trades higher after aborted Russian mercenary revolt
European markets: Here are the opening calls
European markets are set for a positive open, according to IG data. The FTSE 100 is expected to see an 8.4-point uptick to 7,467.2, and Germany’s DAX is seen gaining 44.5 points to 15,863.7. France’s CAC is expected to rise around 20.6 points to 7,177.4, while Italy’s MIB is seen hitting 27,356.7 with a 19.2-point jump.
— Hannah Ward-Glenton