This is CNBC’s live blog covering European markets.
European markets are heading for a higher open, with investor focus on the German government as it votes on historic debt reforms on Tuesday.
The U.K.’s FTSE 100 index is expected to open 18 points higher at 8,696, Germany’s DAX up 90 points at 23,207, France’s CAC 21 points higher at 8,091 and Italy’s FTSE MIB 101 points higher at 39,098, according to data from IG.
Earnings are set to come from Travis Perkins and Eni, while data releases will include the ZEW economic sentiment surveys for Germany and Europe.
Germany’s DAX will be closely watched Tuesday as lawmakers in Berlin vote on reforms to the country’s so-called debt brake rule to enable a rise in public borrowing in order to fund a hike in defense spending.
The motion, which requires a change to the German Constitution, needs backing from two-thirds of the lawmakers elected to the country’s parliament.
Traders will also be keeping an eye on talks between U.S. President Donald Trump and Russian leader Vladimir Putin on Tuesday in which they’re expected to discuss, over the phone, a potential 30-day ceasefire in Ukraine and Russia’s conditions for agreeing to a pause in the war.
Asia-Pacific markets rose overnight, tracking gains on Wall Street, which ticked up after U.S. retail sales data appeared to ease recession concerns. U.S. stock futures edged down Monday night.
Swiss National Bank considers ‘substantial’ loss potential for UBS
A logo of Swiss banking giant UBS in Zurich, on March 23, 2023.
In its latest scenario analysis, the Swiss National Bank considered a “substantial” loss potential for Swiss banking giant UBS, which completed its takeover of embattled domestic rival Credit Suisse in June 2023 after the latter’s tumultuous collapse.
Since then, Swiss regulators have raised concerns over UBS reaching “too big to fail” status and the risks that its potential downfall at any point could pose to the national economy.
“Integration costs and expected losses associated with the winding down of Credit Suisse’s legacy positions are currently impairing UBS’s loss-absorbing capacity,” the SNB said in its annual 2024 report out on Tuesday, stressing this is a “natural consequence of integrating and de-risking a bank with lower financial strength. At the same time, the planned wind-down of legacy positions should reduce UBS’s risk exposures and associated costs in the future.”
The Swiss lender further noted that UBS’ parent bank, UBS AG, has “current weaknesses in the capital backing of its participations in subsidiaries” but an overall stronger capital position than did Credit Suisse.
Nevertheless, “weaknesses in the current capital regime need to be addressed,” according to the SNB.
Questions have risen as to whether UBS will face increases in its capital requirements under new Swiss banking regulations that are being reformed.
— Ruxandra Iordache
European markets: Here are the opening calls
European markets are expected to open higher on Tuesday.
The U.K.’s FTSE 100 index is expected to open 18 points higher at 8,696, Germany’s DAX up 90 points at 23,207, France’s CAC 21 points higher at 8,091 and Italy’s FTSE MIB 101 points higher at 39,098, according to data from IG.
Earnings come from Travis Perkins and Eni, while data releases include the ZEW economic sentiment indexes for Germany and Europe.
— Holly Ellyatt
