US & Europe: Divided they stand
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What are the key market moves in Europe and Asia at the start of the episode?
Well, European leaders have been meeting in this talk of reigniting Europe wide bonds to fund defence spending across the European community. The winners today have been European defence stocks and European bond yields pushing higher today as well. Meanwhile, Japan's higher than expected GDP has pushed the yen higher. Oil is rising as it seems OPEC Plus might delay their increase in production from April. President Xi has been meeting tech leaders with an apparent shift in attitude that could be good for Chinese growth and the RBA today. Of course a cut is expected, but then what? It's Tuesday, it's the eighteenth of february twenty twenty four. It's the morning call from NAB. Good morning. Well, not much going on with the uh US dollar.
It is a holiday in the United States, of course, but there's a lot going on around the world anyway. So it's been up and down, but it's pretty much where it was yesterday, uh, but down one and a half percent year to date, it should be noted. But the yen, it's up naught point six percent today. The Aussie is up naught point two percent, a little over sixty three point six US cents now. The pound is up naught point three percent, just naught point one percent higher for the euro. US bond yields didn't move because it was a public holiday, at least President's Day in the United States, but German ten-year yields are up six basis points, up four in France, three in the UK. Aussie ten years were up four basis points yesterday to four point four five percent, now up a few basis points on that on futures.
And the US stock market closed, but the Eurostocks fifty is up half a percent, 0.4% for the FTSE 100, 1.3% for the DAX, the Nasdaq 100 on futures. is uh up as well about 0.2%, but the S P is flat on futures. And oil is higher today, 0.5% higher for Brent, 0.7% for WTI. Brent over seventy five a barrel now, but of course it was over eighty-two earlier in the year. And gold is up half a percent as well, uh giving Ary 10 to close to ten percent so far this year, uh but not quite as high as its peak. But the peak was just a few days ago, February the thirteenth. So NABS tappa str Strickland joins me today from Sydney. So i i th this is an interesting thing, Tapas. Uh with the European leaders holding their emergency summit on how to protect European defenses, in particular Ukraine, uh with less reliance on the United States, European arms makers have seen this big rise in their share price today.
So Ryan Metal in Germany up fourteen percent, Saab A B in Sweden up sixteen percent, BAE systems in the UK is up nine percent.
How are European defence stocks reacting to the emergency EU summit on defence spending?
So uh yeah, when the US president said said he wants uh the the the uh Europe to be less reliant on the on the US, just look what happens.
Yes, quite a big surge in uh European defence stocks and I think as a sector the uh the Eurostok six hundred aerospace and defence index is up four point two percent. So quite a large rise there. And really that's coming on the back of all the talk of uh the US wanting uh Europe to spend more on defence and obviously with that EU Leader Summit as well uh that uh is occurring right now. But on the But but on
that I just wonder whether President Trump thought, Yes, I want you to spend more on defence that we make. Rather than making it yourself. So it's sort of backfiring a little bit.
Oh it's possibly but I think he all his rhetoric over the past um year and indeed going back many years to his first uh US presidency was all about uh Europeans paying their fair share of defence and lifting up uh defence spending uh towards that uh NATO target, which is I think about two percent of GDP. And only uh one or two countries in the whole of Europe are actually uh reaching that target as as now. But the the important point really was that EU l led us Summit go going into it. Um, a lot of talk about joint financing being considered as a realistic option by a growing number of leaders. Um and importantly, uh in terms of easing up on the EU's fiscal rules. Yes. And so there's been some officials out there estimating that protecting Ukraine and expanding defence spending could cost uh Europe an additional three point one trillion over the next ten years.
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Chapters
8 chapters
1
What are the key market moves in Europe and Asia at the start of the episode?
0:01–2:21
2
How are European defence stocks reacting to the emergency EU summit on defence spending?
2:21–4:48
3
Why are US and Russian delegations meeting in Saudi Arabia without Ukraine present?
4:48–7:05
4
What impact is the OPEC+ decision to delay production increases having on oil prices?
7:05–9:21
5
How is President Xi’s meeting with tech leaders influencing Chinese growth outlook?
9:21–12:06
6
What does Japan’s stronger‑than‑expected Q4 GDP mean for BOJ rate expectations?
12:06–14:45
7
Will the RBA cut rates today and how does it compare to market pricing?
14:45–16:35
8
What are the upcoming economic data points that could shape Europe‑US‑Asia market sentiment?
16:35–16:45