European markets set to open flat to lower; UK inflation data ahead
London at dawn.
Dukas | Universal Images Group | Getty Images
Good morning from London and welcome to CNBC's live blog covering the latest action in European markets as well as business news, analysis, earnings and data.
Here are the opening calls on Wednesday:
European bourses are expected to open around the flatline, with London's FTSE seen opening 5 points higher at 8,781, Germany's DAX 1 point higher at 24,012, the French CAC 40 down 5 points at 7,933 and Italy's FTSE MIB down 27 points at 40,548, according to data from IG.
— Holly Ellyatt
British supermarket Marks & Spencer boosted pay for its frontline workers, such as shop assistants, by 15% from April 5 to May 31.
Chris Ratcliffe | Bloomberg via Getty Images
Here are a few things for investors to look out for on Wednesday.
Earnings reports are set to come from M&S , SSE , Currys and JD Sports .
On the data front, U.K. inflation figures for April will be published at 7 a.m. London time. We'll bring you the numbers and quick analysis on the data then.
— Holly Ellyatt
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CNBC
3 hours ago
- CNBC
Spirit makers face a sobering cocktail of challenges — from tariffs to teetotalers
Global spirit makers are staring down a sobering cocktail of challenges as tariffs and brand boycotts threaten to exacerbate wider shifts in drinking habits. French cognac maker Rémy Cointreau on Wednesday became the latest spirits maker, following Diageo and Pernod Ricard, to withdraw its sales targets on increased economic and trade uncertainty. "Given the continued lack of macroeconomic visibility, the geopolitical uncertainties surrounding U.S.-China tariff policies, and the absence to date of a recovery in the U.S. market ... the conditions required to maintain [Remy Cointreau's] 2029-2030 targets are no longer in place," it said in a statement. The move came as full-year sales at the group's cognac business, which includes its namesake Remy Martin brand, fell 22% on an organic basis on slowing U.S. consumption and "complex market conditions" in China. The popular brandy variety, which hails from the French region of Cognac, has been particularly caught in the crosshairs of ongoing U.S.-Sino tensions. LVMH similarly saw a 17% drop in its Hennessy cognac in the first quarter. But the specialty drink is far from alone as trade barriers weaken already drying demand for spirits. LVMH's wine and spirits remains the French luxury group's worst performing division, while Diageo spirits including Tanqueray, Gordon's and Smirnoff saw the steepest declines in the first quarter as sales of Irish stout Guinness rallied ahead. "Distilled spirits in the U.S. are going through a correction, and U.S. tariffs add another layer of uncertainty," Jefferies said in a note last month. The prestige — and often legal requirements — associated with spirits and wines mean that they are heavily dependent on local production and thus heavily exposed to U.S. import levies. Champagne must be produced and bottled within the Champagne region, for instance. "With spirits and wines you have terroir caches, and that means you're producing locally and exporting. Hence it's much more vulnerable to geopolitical tensions," Sanjeet Aujla, analyst at UBS, told CNBC via video call. Remy Cointreau estimated that tariffs as they currently stand could serve a 65-million-euro blow ($55 million) to its business after mitigating measures. Diageo, meanwhile, said about 25% of its business is set to be impacted by duties. The same does not apply for beer, which relies on local production and has been flagged as an unlikely winner from brewing trade divisions. Notably, the world's largest brewer AB InBev, as well as Dutch and Danish beermakers Heineken and Carlsberg all maintained their full-year guidance in the first quarter. As a result, wines and spirits are potentially more exposed to brand boycotts too, with consumers more likely to swap out a particular product on political grounds in favor of a locally-made alternative. The tariff hit comes as the industry has slowed over recent years following a strong decade of growth, particularly during the Covid-19 pandemic. Locked-down consumers forked out more on alcohol in 2020 and 2021, fueling a simultaneous surge in premium brands. "During the pandemic, not only did people drink more, they premiumized more," Aujla said. Spirits are often seen as an affordable luxury, especially in good economic times. But they nevertheless tend to be an occasional purchase, with many Covid-era stockpiles remaining in liquor cabinets across the world. As economic conditions turn, however, consumers may be less inclined to cough up $100 for a good bottle, instead downtrading or opting for lower-cost ready-to-drink (RTD) alternatives. "Spirits-based RTDs are weighing on distilled spirits growth alongside the impact of cumulative inflation," the Jefferies note said, adding that downtrading was most visible in vodka and rum products, while demand for premium whisky, tequila and gin remained more robust. "That [premiumization] is on pause today, given the cyclical headwinds we have in the industry," Aujla added. The drying demand comes as health and wellness trends spark a shift in consumer habits, with more people becoming "sober curious" and experimenting with lower alcohol consumption. Indeed, many drinks makers have sought to embrace that shift with new ranges of low and no alcohol products. Meanwhile, the proliferation of weight loss drugs — and early evidence of their role in suppressing alcohol cravings — pose another potential challenge for the industry. Nevertheless, analysts remain divided over the severity and permanence of the downturn. "There is considerable debate over the extent to which currently anemic demand is cyclical or structural," James Edwardes Jones, analyst at RBC Capital Markets, said in emailed comments. Cyclical pressures refer to economic headwinds and hangover supplies from the Covid-era, while structural shifts refer to changing consumer patterns. "It's a bit of both, and more cyclical than structural," Aujla said. "But when the cyclical headwinds dissipate, we think US Spirits industry growth will be 1-2% lower than the 4-5% historical growth."
Yahoo
4 hours ago
- Yahoo
‘They are in shock': Indian students fear Trump has ended their American dream
For weeks, Subash Devatwal's phone has not stopped ringing. Some of the calls have been from distressed students, at other times it is their panicked parents, but all have the same question – is their dream of studying in the US still possible? Devatwal runs an education consultancy in Ahmedabad, the main city in the Indian state of Gujarat. It is one of thousands of such organisations that exist across the country, helping Indian students achieve what many consider to be the ultimate symbol of success: getting into an American university. It has long been a booming business for Devatwal. Families in India will often invest their entire life savings to send their children to study in the US and last year there were more than 330,000 Indians enrolled at American universities, more than any other foreign nationality, overtaking Chinese students in numbers for the first time in years. But this year the situation looks drastically different. As Donald Trump's administration has taken aim at international students – first implementing draconian screening measures over political views and then last week ordering all US embassies globally to indefinitely pause all student visa interviews – many Indian students and their families have been left in limbo. Trump's unilateral decision to block Harvard University from admitting international students, which was later blocked by the courts, also caused widespread panic and stoked fears that foreign students at other universities could get caught in the president's crosshairs. 'The students are in shock. Most of them spend several years preparing to study in the US,' said Devatwal. He said many of his clients were now hesitant to pursue a US degree, given the high levels of turmoil and uncertainty following the Trump administration's new policies. Indian students can expect to pay between $40,000 to $80,000 (£29,500 to £59,000) a year on tuition alone to study in the US. In previous years, Devatwal's organisation sent more than 100 students to American universities but this year he said the number had dropped to about 10. Instead, families were shifting their focus to the UK and other European countries. A recent analysis by the Hindu newspaper estimated a 28% drop in Indian students going to the US in 2025. 'Families contribute their savings, take out loans from banks and borrow from relatives, all in the hope that the student will secure a good job abroad, repay the debt, and build a promising future,' said Devatwal. 'In such uncertain circumstances, parents are understandably reluctant to let their children take such a risky path.' Brijesh Patel, 50, a textile trader in Surat, Gujarat, said he had been saving money for over a decade to make sure his son could go to a US university, including selling his wife's jewellery and borrowing money from relatives. 'Everyone in the family wanted our son to go to the US for his studies and make something good of his life,' said Patel. His 21-year-old son, who he asked not to be named for fear of retribution by the US authorities, had secured a place at two American universities for his master's degree and Patel had already paid 700,000 rupees (£6,000) to consultancies who helped with the applications. But amid the turmoil under Trump, Patel said his son was being advised not to even apply for his student visa, due to the uncertainty and high probability of rejection. 'We simply can't take that risk. If our son goes now and something goes wrong, we won't be able to save that kind of money again,' he said. However, Patel said he was not willing to give up on the family dream just yet. 'I am an optimist, and my son is willing to wait a year,' he said. 'We're hoping that things improve by then. It's not just my son who will be living the American dream, it's all of us: my wife, our relatives and our neighbours. I've struggled my whole life – I don't want my son to face the same struggles here in India.' The fear among prospective and current students was palpable. Several Indian students studying in the US declined to speak to the Guardian, fearing it could jeopardise their visas. In India, a student selected in December to be one of this year's Fulbright-Nehru doctoral fellows – a highly competitive scholarship that pays for the brightest students to study abroad at US universities as part of their PhD thesis – said the applications of their entire cohort had recently been demoted back to 'semi-finalists'. The student, who asked to remain anonymous over fears it would affect their application, said they had invitation letters from top Ivy League universities for the fellowship, which is considered one of the most prestigious scholarships in the US, but now everything was up in the air. 'We are supposed to start in October and our orientation was scheduled for May, all the flights and hotels were even booked, but then it all got cancelled. Now we've been informed all our applications are under review by the Trump administration,' said the student. They said it had caused 'huge panic and anxiety' among those accepted. 'I know a lot of people are going back through their social media, deleting things and doing a lot of self-censoring.' Piyush Bhartiya, a co-founder of the educational technology company AdmitKard, said many parents who had been set on sending their children to the US were rethinking their plans. He cited one example of a student who had been admitted to New York University for the coming year but was instead planning to go to the London School of Economics after the US visa interviews were paused. Bhartiya said Indian students primarily went to the US to study Stem subjects – science, technology, engineering and maths – and so the focus had shifted to other countries strong in these areas. 'Germany is the main country where students are shifting to for Stem subjects,' he said. 'Other countries like Ireland, France, the Netherlands, which are also gaining substantial interest in the students. At the undergraduate level, the Middle East has also seen a lot of gain in interest given parents feel that it is close by and safer and given the current political environment they may want their kids closer to the home.' Among the Indian students forced to abandon their plans is Nihar Gokhale, 36. He had a fully funded offer for a PhD at a private university in Massachusetts, but recently received a letter saying the funding was being withdrawn, as the university faced issues under the Trump administration. 'It was quite shocking. I spoke to people at the university, and they admitted it was an exceptional situation for them too,' said Gokhale. Without the funding, the US was financially 'out of the question' and he said he had an offer from the UK he now intended to take up. 'For at least the next three or four years, I'm not considering the US at all,' he said. • This article was amended on 4 June 2025 to correct a conversion error. An earlier version said that 700,000 rupees was £68,000 instead of saying £6,000.
Yahoo
4 hours ago
- Yahoo
Hegseth says Nato allies ‘very close' to raising defence spending target to 5%
The US defence secretary, Pete Hegseth, said Nato allies were 'very close, almost near consensus' to an agreement to significantly raise targets for defence spending to 5% of GDP in the next decade. The Trump administration official indicated he expected the increased target to be agreed at a summit in The Hague later this month – and confirmed that the headline figure was to be split into two parts. 'This alliance, in a matter of weeks, will be committing to 5%: 3.5% in hard military and 1.5% in infrastructure and defence-related activities. That combination constitutes a real commitment,' he said. Hegseth was speaking at a press conference at Nato headquarters in Brussels after the morning session of an all-day meeting of defence ministers from the 32-country transatlantic military alliance. 'I'm very encouraged by what we heard in there,' Hegseth told reporters. 'Countries in there are well exceeding 2% and we think very close, almost near consensus, on a 5% commitment to Nato.' Nato's current target level for military spending, agreed at a summit in Cardiff in 2014, is 2% of GDP, but Donald Trump has repeatedly claimed that European allies and Canada do not spend enough compared with the US. In an attempt to avoid Trump wrecking the first Nato summit of his second term, the alliance's new secretary general, Mark Rutte, proposed a 3.5% plus 1.5% target, though there is some ambiguity about the target date. Initial reports suggested that Rutte wanted allies to hit the target from 2032, though earlier this week British sources suggested the date could be 2035. Sweden's defence minister said he would like to see the target hit by 2030. Only Poland currently exceeds the 3.5% target for hard military spending at 4.32%, according to Nato figures, while the US defence budget, the largest in the alliance, amounts to 3.4% of GDP, at $967bn (£711bn). The UK spends 2.33% of GDP on its military, but has pledged to increase that to 2.5% by 2027 and to 3% some time in the next parliament. Earlier this week the prime minister, Keir Starmer, declined to set a firm date for the UK achieving 3% as he unveiled a strategic defence review. Related: Why is defence such a hard sell? The same reason Starmer is struggling in the polls | Martin Kettle Rutte will visit London on Monday to meet Starmer before the summit. Downing Street said the prime minister and the secretary general would 'talk about how we ensure all allies step up their defence spending now in order to respond to the threats that we face now'. Germany's defence minister, Boris Pistorius, said Berlin would need up to 60,000 additional troops to meet new Nato targets for weapons and personnel. 'We are stepping up to our responsibility as Europe's largest economy,' the minister said on Thursday. Germany, which currently spends 2.12% of GDP on defence, had been singled out by Trump as a laggard in spending, though until Russia's full-scale invasion of Ukraine, Berlin had been reluctant to be a leader in European military spending, partly due to the memories of the militarism of the second world war.
