European markets in negative territory with Fed in the spotlight; SocGen down 10%

Slovakian central bank chief Peter Kažimír on Monday poured a drop of cold water on the narrative that the European Central Bank is finished with interest rate rises after Thursday’s hike.

“I wish last week’s interest rate hike was the last one. Nevertheless, common sense dictates, never say never’,” Kažimír said.

Inflation and growth forecasts in December 2023 and March 2024 will show whether the central bank is “unequivocally and steadily” moving toward its inflation goal, he said.

He also said it was “premature” for markets to bet on when the first cuts would occur, and that if rates were at their peak, “we may have to stay camping here for quite some time and spend the winter, spring and summer here.” 

— Jenni Reid

Oil prices edged higher as investors weighed the prospect of a widening supply deficit in the fourth quarter.

U.S. West Texas Intermediate crude gained more than 1% early Monday and hit a high of $91.70, the highest level since Nov. 8, 2022 when WTI traded as high as $92.17. So far this quarter, WTI has gained 29.8%, putting it on pace for the first positive quarter in three quarters.

Brent crude futures hit a high of $94.78, also hitting its highest level since Nov. 16, 2022 when it traded as high as $94.79.

The VanEck Oil Services ETF (OIH) gained 0.9% in premarket trading, led by Dril Quip, Liberty Energy and Transocean which were all higher by more than 1.5%.

— Pia Singh, Gina Francolla

Amit Walia, CEO of Informatica, discusses the role of “good data” in artificial intelligence.

Simon Gammon, managing partner at Knight Frank Finance, discusses changes in U.K. property prices.

Lonza fell to the bottom of the Stoxx 600 index after the drug manufacturer announced its CEO would be leaving by the end of the month. The company announced Pierre-Alain Ruffieux was leaving “by mutual agreement,” with Albert M. Baehny to take on his responsibilities until a permanent successor is appointed.

Lonza was down more than 10% in morning trade as investors assess what the move means for profit prospects.

Ocado shares were up 7% after investment bank Jefferies raised its target price for the food delivery company.

— Hannah Ward-Glenton

SocGen said it would target a 9% to 10% return on tangible equity ratio (ROTE) in 2026, up from a reported 5.6% ROTE at the end of June.

The bank returned to profit in the second quarter of 2023, but French retail banking revenues were down 13.6% from the previous year.

— Hannah Ward-Glenton

European markets had a negative open to start this week’s trading, following their Asia-Pacific counterparts lower as investors look ahead to a week of central bank decisions.

The pan-European Stoxx 600 index opened 0.2% lower, with sectors spread across positive and negative territory. Mining stocks led marginal gains with a 0.3% uptick, while household goods were down 0.5% at the start of trading.

— Hannah Ward-Glenton

Bank of America has named two European chip stocks as its “top picks” going into the end of the year.

The Wall Street bank’s “top autos semis pick” is expected to rise by more than 60% over the next 12 months.

CNBC Pro subscribers can read more here.

— Ganesh Rao

The inflation outlook for one year from now fell to its lowest level in more than 2½ years, according to a widely followed sentiment gauge released Friday.

The University of Michigan’s consumer sentiment survey showed one-year inflation expectations plunged to 3.1% in September, tied for the lowest since January 2021. Also, the five-year outlook fell to 2.7%, tied for its lowest since December 2020.

However, the overall sentiment gauge declined to 67.7, down from 69.5 in August and below the Dow Jones estimate for 69.2.

—Jeff Cox

China’s market advantage has been a huge user base, coupled with an ability to ramp up internet penetration to support an online ecosystem – from Taobao e-commerce sales to scan-to-ride bike shares.

“Early movers in the [large language model] market have already started the commercialization process, and regulatory approval for 10+ LLMs to open to the public has further cleared roadblocks to monetization,” Nomura analysts said in a Sept. 10 note, citing meetings with businesses and industry experts in Beijing in the few days prior.

CNBC Pro subscribers can read more here.

European markets are expected to open in negative territory Friday.

The U.K.’s FTSE 100 index is expected to open 22 points lower at 7,704, Germany’s DAX down 3 points at 15,890, France’s CAC 9 points lower at 7,366 and Italy’s FTSE MIB down 20 points at 28,888, according to data from IG.

Earnings are set to come from S4 Capital.

— Holly Ellyatt