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tv   Bloomberg Markets European Close  Bloomberg  July 5, 2016 11:00am-12:01pm EDT

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close. live in new york and london for the next hour. we are covering stories in australia, france, and silicon valley. here is what we are watching today. the bank of england eases capital requirements. the bank pledges to do whatever is needed to shore up the financial stability. sinceoil has rallied hitting a 12 year low in january, but have prices hit a ceiling? ceoill hear from the vitol ian taylor. mark: and just glad you have a job, that is what financial firms plan to say to employees, as bonuses are expected to be cut 25%. we will discuss this gloomy
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outlook. vonnie: after the strongest weekly advance since november, u.s. markets have turned negative. julie hyman has the latest from the markets desk. taking a steprs back, looking at whether last in therise was justified wake of the brexit vote. all three major averages are down. the nasdaq down nearly 1% at this point. we saw a slow deterioration in the futures overnight. if you look at the overnight session into today, we were little changed and then we did as european markets opened lower. since then we have made a couple of attempts to come back but then let's lower following them. hard to believe we are almost in earnings season again. alcoa reporting on july 11.
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if you look at the prospects for earnings, there are continued predictions for them to be negative. analysts are projecting a 5.4% decline in earnings or the quarter, the fifth straight quarterly drop and the longest drop since 2009. take a look at the imap. energy shares continue to lead declines, extending now to more than 2%, as oil prices fall. we have the fela director speaking live right now. second, i have not coordinated this statement or reviewed it in any way with the department of justice or any other part of the government. they do not know what i'm about to say.
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but i want to start by thanking the fbi employees did remarkable work in this case. went to have a better case of -- sense of how much we have done, you will understand why i'm so great and proud of their work. first, what we have done. as ainvestigation began referral from the intelligence community inspector general in connection with secretary clinton's use of a personal e-mail server during her time at secretary of state. the referral focused on whether classified information was transmitted on the personal system. our investigation looked at whether there is evidence that classified information was improperly stored or transmitted on that personal system in violation of a federal statute that makes it a felony to mishandle classified information, either intentionally or in a grossly negligent way, or a second statute, making it a misdemeanor to knowingly removed classified information from appropriate
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systems or storage facilities. consistent with our counterintelligence responsibilities, we have also investigated to determine if there is evidence of computer intrusion by nationstates or by hostile actors of any kind. i have so far used the singular term e-mail server in describing the referral that began our investigation. it turns out to have been more complicated. secretary clinton used several different servers and administrators of those servers during her years at the state department. she also used numerous mobile devices to send and read e-mail on that personal domain. as new servers and equipment were employed, older servers were taken out of service, stored, and decommissioned in various ways. piecing all of them back together to gain as full and understanding as possible of the ways in which personal e-mail was used for government work has been a painstaking undertaking
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requiring thousands of hours of effort. for example, when one of secretary clinton's servers was decommissioned in 2013, the e-mail software was removed. that did not remove the e-mail content, but it was like removing the frame from a huge unfinished jigsaw puzzle, and then dumping the pieces on the floor. the effect was that millions of e-mail fragments ended up in the server's unused space. we searched through all of it to understand what was there and what parts of the puzzle we could put back together again. read alltigators also of the approximately 30,000 e-mails that secretary clinton provided to the state department in 2014. where an e-mail was assessed as possibly containing classified information, the fbi referred that e-mail to any government agency that might be an owner of that information, so that agency
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could make a determination as to whether the e-mail contained classified information at the time it was sent or received, or whether there was reason to classify it now, even if the content has not been classified when first sent to receive. that is the process referred to as unclassified. from the group of 30,000 e-mails returned to the state department e-mails in 52 e-mail chains have been determined by the owning agency to contain classified information at the time they were sent or received. eight of those chains contained information that was top secret at the time they were sent. 36 of those chains contain secret information at the time. eight contain confidential information at the time. that is the lowest level of classification. separate from those, about 2000 additional e-mails were a
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classified to make them confidential. those e-mails had not been classified at the time they were sent to receive. the fbi also discovered several thousand work-related e-mails that were not among the group of 30,000 e-mails returned by secretary clinton to stay in 2014. we found those e-mails in a variety of ways. some have been deleted over the years and we found traces of them on servers or devices that have been connected to the private e-mail domain. others we found by reviewing the archive government accounts of people who had been government employees at the same time as secretary clinton, including high-ranking officials and other agencies, folks with whom secretary clinton might normally correspond. this helped us to recover e-mails that were not among the 30,000 produced to state. recovered from that painstaking review of the millions of e-mail fragments
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dumped into the slack space of the server that was decommissioned in 2013. with respect to the thousands of e-mails we found not among those produced to the state department , agencies have concluded that three of those were classified at the time they were sent or received, one at the secret level, two at the confidential level. tope were no additional e-mails found. finally, none of those that we found have since been upclassified. i should add, we found no evidence that any of the additional work-related e-mails were intentionally deleted in an effort to conceal them in some way. our assessment is that, like many e-mail users, secretary clinton periodically delete e-mails, or were purged from her system when devices were changed. because she was not using a government account or even a had noial account, she archiving of her e-mails, so it was not surprising to discover e-mails not on her system in
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2014, when she produced those 30,000 e-mails to state. it could also be that some of the additional work-related e-mails that we recovered were among those deleted as personal by her lawyers when they viewed and sorted her e-mails for production in 2014. the lawyers doing the sorting for secretary clinton, in 2014, did not individually read the content of all of her e-mails, as we did. instead, they relied on header information and used search term to the find all work-related e-mails remaining on her system at the end of 2014. it is highly likely that their search missed some work-related e-mails and that we later found them. for example, in the mailboxes of other officials or in the slack space of the server. it is also likely there are other work-related e-mails they did not produce to state and that we did not find elsewhere and that are now gone because
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they deleted all e-mails they did not adduce to state and the lawyer then cleaned their devices in such a way as to preclude complete forensic recovery. we have conducted interviews and done technical examinations to attempt to understand exactly how that sorting was done by her attorneys. although we don't have complete visibility, because we cannot fully reconstruct the electronic record of that sorting, we believe our investigation has been to give us reasonable confidence there was no intentional misconduct in connection with that sorting effort. and of course, in addition to our technical work, we interviewed many people from those involved in setting up the personal e-mail system and maintaining the various iterations of secretary clinton's server, two staff members to whom she corresponded, those involved in the enough production to state, and secretary clinton herself. last, we have done extensive work to understand what
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indications there might be customized by hostile actors in connection with that personal e-mail system. that is what we have done. now let me tell you what we found. although we did not find clear evidence that secretary clinton or her colleagues intended to violate laws governing the handling of classified information, there is evidence that they were extremely careless in their handling of very sensitive, highly classified information. for example, seven e-mail chains concern matters that were classified at the top secret special access program at the time they were sent and received. those chains involved secretary clinton both sending e-mails about those matters, and receiving e-mails about those matters. there is evidence to support a conclusion that any reasonable person in secretary clinton's position or in the position of those with whom she was corresponding about those matters should have known that
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unclassified systems was no place for a place of that conversation. in addition to this highly sensitive information, we also found information that was properly classified as secret by the intelligence community at the time it was discussed on e-mail, excluding any later upclassified e-mails. none of these e-mails should have been on any kind of unclassified system, but their presence is especially concerning because all of these e-mails were housed on unclassified personal servers, not supported by full-time security staff like those found at agencies and departments of the u.s. government, or even with a commercial e-mail service . i think it is also important to say something about the marking of classified information. only a very small number of e-mails here containing classified information or markings that indicated the presence of classified information. even if information is not marked classified in an e-mail, participants who know or should
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know that the subject matter is classified are still obligated to protect it. while not the focus of our investigation, we also developed evidence that the security culture of the state department in general and with respect to the use of unclassified systems in particular was generally lacking in the kind of care for classified information found elsewhere in the u.s. government. with respect to potential computer inclusion by hostile actors, we did not find direct evidence that secretary clinton's personal e-mail domain in its various configurations since 2009, was hacked successfully. but given the nature of the system and of the actors potentially involved, we assess we would be unlikely to see such direct evidence. we do assess that hostile actors gained access to the private commercial e-mail accounts of people with whom secretary clinton was in regular contact from her personal account. we also assess that secretary
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clinton's use of a personal e-mail domain was both known by a large number of people and readily apparent. she also use her personal e-mail extensively while outside the u.s., including sending and receiving work-related e-mails in the territory of sophisticated adversaries. given that combination of factors, we assess it is possible that hostile actors gained access to secretary clinton's personal e-mail account. so that is what we found. finally, with respect to our recommendation to the department of justice. in our system, the prosecutors make the decisions about whether charges are appropriate based on evidence that the fbi helps collect. although we don't normally make public our recommendation to the prosecutors, we frequently make recommendations and engaging conversations about one resolution may be appropriate given the evidence. in this case, given the importance of the matter, i
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think unusual transparency is in order. although there is evidence of potential violations of the statutes regarding the handling of classified information, our judgment is that no reasonable prosecutor would bring such a case. prosecutors necessarily weigh a number of factors before deciding whether to bring charges. there are obvious considerations like the strength of the evidence, responsible decisions also consider the context of a person's actions, and how similar situations have been handled in the past. in looking back at our investigations into the mishandling or removal of classified information, we cannot find a case that would support bringing criminal charges on these facts. all the cases prosecuted involve some combination of clearly, intentional, and local mishandling of classified information, or vast quantities of information exposed in such a way as to support an inference of intentional misconduct, or
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indications of disloyalty to the united states, or efforts to obstruct justice. we do not see those things here. to be clear, this is not to suggest that in similar circumstances, a person that engages in this activity, would face no consequences. to the contrary. those individuals are often subject to security or administrative sanctions, but that is not what we are deciding now. a result, although the department of justice makes final decisions on matters like this, we are expressing to justice our view that no charges are appropriate in this case. i know there will be into public debate in the wake of this recommendation, as there was throughout the investigation. what i can ensure the american people is that this investigation was done honestly, confidently, and independently. no outside influence of any kind was brought to bear. opinionsere were many
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express by people not part of the investigation, including people in government, but none of that mattered to us. opinions are irrelevant, and they were all uninformed, because we did our investigation the right way. matter, and the fbi found them here, in a entirely apolitical and professional way. i could not be proper to be a part of this organization. thank you very much. you have been listening to fbi director jim komi. this was the finding on the investigation into the clinton e-mails. some of the headlines, he said the fbi found that clinton used several different e-mail servers and when some were finished, they would be decommissioned and a new one would be used. millions of e-mail fragments were in the server slack space and it took them a long time to piece it together.
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by the way, live shots of hillary clinton speaking at an event right now. eight of the e-mail chains, according to the fbi, contain top secret classification. there was no evidence that work-related e-mails were intentionally deleted. he also says the fbi is exposing to the justice department, who brings charges, that no charges should be brought. now we are going to go to break. this is bloomberg. ♪
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mark: i want to recap what happened in the last few minutes. gave thetor jim comey result into the investigation of the hillary clinton e-mail saga. cameof the headlines that out, ultimately, the fbi is recommending to the department of justice that no charges be brought. however, he did say that clinton used several different servers and none of them are linked any
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kind of commercial entity like gmail, and they were vulnerable to hackers. he also said the fbi may not ableknown it hackers were to get access to these e-mails, eight of which were top-secret chains. i want to bring in our senior executive editor for government. i don't know if you heard everything the fbi director said, but he did seem to prosecute her in the court of public opinion before saying that the fbi would not recommend that any charges be brought. >> i thought he was pretty tough on hillary and her comrades of the state department and how they handle these e-mails, called it, in some ways, reckless. that this would not necessarily end the controversy over her behavior. he said that she should have known that participants, in a row like hers, that subject is
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classified even though it is not marked classified. he also went into detail about how they resurrected these e-mails. he made it soundly there was delivered attempt to hide them. >> he did say there was no evidence of any deliberate attempt to hide them from public view once identified, but still, his language shows a great deal of criticism to how she handled those e-mails. while they did not recommend prosecution, i think that this will still be a story that will continue through the campaign. notld trump has made -- has commented much on how she handled that situation. mark: how long will this take in your estimation? >> not very long. the attorney general has said
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she will accept the recommendation of the fbi. i don't think she has a lot of room to do anything than to accept the recommendation. schenker, thank you. we will check in with you later. mark: the bank of england taking action, cutting capital requirements. mark carney says more help may be on the way. he spoke earlier as the bank published its biannual stability report. forget that, we are going to speak to scott hamilton. he oversees the bank of england for merck. -- bloomberg. scott: we heard from the stability side of the bank of england. this is from the commercial real estate property markets, the economy, households
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that may be vulnerable to economic changes, and fragile market liquidity conditions. what we heard today was the banks say those banks -- risks have begun to crystallize and have taken steps to cut the capital buffer. mark: what could implement to shore up financial stability? the firstoday, it is time we had a policy response. up until today, it has been about pumping liquidity into the financial system since 12 days ago, since the referendum. that covers liquidity and the capital. the missing element of this is demand. rate decision they could make next week, mark carney has made it clear, they could be looking at boosting policy over the coming summer. what we have had so far is the bank of england trying to shore up the supply of credit to the economy. what we have not addressed is the demand side of the equation. he says that will be the week
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part of the equation here. vonnie: contrast these cyclical approach with what the fed did, shoring up the banks in tough times, making them have more capital. >> the reason why mark carney says this is possible, u.k. banks have made a good effort to raise capital, raising in total 130 billion pounds of extra capital since the financial crisis. this accounts as a cyclical capital buffer. what was cut today is only a part of that. this was always designed to be varied based on circumstances. mark: we have heard from standard life, aviva as well. carney highlighting valuations
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of commercial real estate markets. it is evident that things are happening. seem to be investors pulling their money out of property fund. have tooerty funds many requests for money back, it is an automatic cutoff. we saw that yesterday with standard life investments, today with aviva. is whether more firms will take this step. mark: scott hamilton, thank you for being here. take a look at where european markets are trading as we head to the close. it looks like stocks are going to close lower for the second consecutive day. this is bloomberg. ♪
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♪ and newve from london york you are watching the european close on bloomberg television.
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secondsday session, the trading session of the week, stocks rolling. this is our global macro credits,go, equities, stocks, bonds, commodities. equity indices in europe, austria is 3% lower. switzerland, one .6% lower. finland, down by 2%. they falls in currency against the dollar. the swedish krona, down. sterling to the lowest level since september of 1985. it is a risk off day with investors fleeing riskier assets and taking to haven assets. i want to focus on the interesting charge i made up for you today. these are the u.k. miners. since june 24, the day of the of thndum results, one
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best-performing sub indexes on the ftse 250, the index as a whole, the mining index has risen 14 cents since the 24th of june. low.ing to a 12.5 year january 20. it is rebounded by 84%. it is overbought right now. if you look at the technical indicators, the 14-day rs i is at a high since march. i want to show you how the minor sat there since january 20. when core, doubling in value. -- glencore, doubling in value. quite incredible. those games. i want to focus on the u.k. property market that has been hit to badly since the brexit results became apparent on the 24th of june. the biggest homebuilder by market value, revenue rose by 12%. .verage selling price added 6%
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mortgage approvals for home purchases in the first quarter were 18% ahead of the prior year . it is too soon to say what effect brexit will have on u.k. new homes market. the market fundamentals are long-termported like unfulfilled demand. this is the 12 month chart for the 4 big homebuilders in the u.k.. this is the day before the brexit results became apparent. three out of the four homebuilders were sitting on 5%.ly gains of 0% to since then we have seen the , which are0% to 40% very reliant on the domestic economy. i want to focus on u.k. services. number. pmi the brexit referendum taking its toll on the u.k. services industries. customers canceling or postponing orders. matching a 38-month low, weaker
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than forecasts from economists and adding that the referendum was entering the economy before brexit vote.ock the combination of the services surveyed in three months through june indicates the economy grew quarter.e second let's put that into perspective. in in the first quarter, .6% the fourth quarter of last year. highlighting the nervousness ahead of the referendum vote on the 23rd of june. vonnie: the dollar-yen is below 102. it is lower for dollar-yen since last week. the 10 year yield is down to 1.37%. the low was 1.375. the spread at 81 basis points, the lowest we have seen. flattening, but the long end is
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coming down, as you solved wit -- as you saw with a 1.27%. if you look at the chart you will see a little bit of intervention, 6.69 for the offshore yuan and offshore indices are lower. with abigail doolittle. looking at a bit of a cell of with the nasdaq down 1%. the worst days since last monday brexit selloff. the biggest drag on the nasdaq is apple shares down 1.3%. they have cut estimates below consensus. citing a demand clause saying some consumers could be waiting for the new iphone 7 this fall. many analysts have high hopes, some even calling it an "super cycle" that could help apple and
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.he iphone demand recover michael mccaul at pacific crest has an interesting call and it does cut his rating on sky works and serious logic saying that his recent supply channel checks in asia suggest the iphone seven demand in the second half of the year could fall by 15% to 20% versus the demand for the 6s last year. if he proves true, he will -- that call will completely wall for the hopes around the iphone7 creating a recovery for apple and the iphone. the debate continues on. vonnie: you mentioned it was down since the tell part of the brexit last monday. lots of confusion. abigail: that's right. looking at a six-month chart, almost six-months out of the february lows, it suggests
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the nasdaq.on for a bearish uptrend reversal with the nasdaq trading below the uptrend. the sellers are starting to overtake the buyers and supporting the reversal. second and third, lower highs. on the brexit selloff a new lower low. that says the sellers are gathering strength. it could point to the nasdaq trading down toward those february lows. thanks, abigail. let's check in on the bloomberg first word news. .> thanks the fbi has recommended no charges be filed against hillary clinton over the use of a private e-mail server as .ecretary of state director calm he told reporters that clinton and her aides were extremely careless with the e-mails, but there was no intentional misconduct. clinton is speaking live at a campaign event in washington at
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the national education association at this hour. lawmakers in france urging the government overhaul of the --elligence agent seat intelligence agency in the wake of terrorist attacks. lawmakers say that overlapping agencies should be replaced with one unified structure. hungry is pushing back against the european union and his refugee policy. hungarians will vote on the plan to share the burden when it comes to sheltering refugees. the prime minister called the eu plan and abuse of power. in california, nasa's mission control celebrated a solar power spacecraft entering jupiter's orbit. the twocraft needed five years. the goal is to explore the planet's gravity and magnetic fields. global news, 24-hours a day, powered by our 2400 journalists, in 150 news bureaus around the world.
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i'm courtney collins, this is bloomberg. let's talk about the referendum and the pound plunging over 10%. recession, lower rates, a political climate weighing heavily on british minds. here is simon kennedy who oversees the brexit coverage at bloomberg. brexit accelerates the british pound. 100 years of debasement it is not an eight day phenomena, it is 100 years. simon: if you look back over the last century, and the pound has been simplistically driven at times with a series of devaluations. 1960'scently in the late when the prime minister spoke about the pound in your pocket. again with the crisis. the pound has taken a series of overs in three
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decades. mark: good for our competitors? simon: the bad outweighs the good. basedcturers, tourism industries welcome the cheaper pound. we not seeing much benefit in the wake of a natural crisis when the pound tumbled down. not much effect on the u.k. economy in the way of positive growth. a deficit continues to swell around 7% of gdp. in a world where there is not much demand in the best of times, a weak currency might not be much for us. vonnie: the idea of a 15% business tax, how realistic is that? would that help? when the next budget comes around. if he is the chancellor, that would be a goal.
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corporate taxes is an interesting phenomena. taxation spat the company still manages to miss out paying it. there are questions if they could introduce it into the context of being in the european union, or wanting to remain in some kind of trading bloc. more aspiration at the moment. a positive news drop from the brexit the gloom that has been coming out. vonnie: mark carney is trying to tweak monetary policy. to doks like he is trying things that are not exactly targeting a stronger or stabilizing pound. y have any estimation for what he might want to see the pound trading out versus the u.s. dollar or the euro? simon: he is a modern central banker, and they do not get into the area of predicting the market. i'm not sure. i'm sure he is willing to accept a weaker pound.
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to offset some of things he will do when and if he offsets rates. mark: the leadership balance with the leader of the republican party, the prime minister is underway. who is going to be knocked out of the five candidates? bookiesf you follow the , the former defense secretary is the one on the bubble most likely to be knocked out tonight . five candidates. the one receiving the delisting codes of the fellow conservative conservative mps. late in the here among the conservative members. the board of party. the currentsome in favorite, though not always the ultimate winner. divide betweena the 2 ladies? a slight divide opening in
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policies and thinking. onen: the biggest divide is was pro brexit and very vocal during the campaign. theresa may stock with david cameron and the remains side. a reluctant remain. k -- trying to make that make thecase that she is trying to rally the brexit case behind her here that it should be a brexit prime minister. and if there is she is part of that campaign. not to vote is continuing in parliament and should be finished at 7:00 p.m. eastern. stay tuned to bloomberg markets and we will let you know who is in and out of the race to be the next conservative leader. simon kennedy cover the brexit coverage for us.
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more on the hillary clinton e-mail case. director conley says the presidential candidate should not face charges over her actions. more coming up. this is bloomberg. ♪
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mark: live from london and new york i am mark barton. vonnie: i am vonnie quinn. this is european close on "bloomberg markets." over hillary filed clinton over her use of the primary e-mail server as the secretary of state has been recommended. we are joined on the phone.
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several servers, some were decommissioned. tell us what you think will .appen will they accept the recommendations from the fbi? >> what a dramatic games day? day.amatic news she has signaled her plans to accept the recommendations made it to her by the fbi. we may hear that more formally at some point. it previously signaled that. what you have on the one hand is a release to the clinton campaign -- relief to the killington campaign that at this point there are no further acts expected. on the other hand, a scathing indictment on character and judgment in the lead up to the by the fbions director. that any reasonable person in secretary clinton's position would know the unclassified system was not the place to do this. this is not some day she can
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feel good about, politically, even if it means there should be no final legal hurdles to her nomination here this is the day she was supposed to have her debut, and she will, with president obama. they will step on that message to some extent, you are seeing it already with donald trump. will they try to get ahead of it? of course they will. will the new cycle allow them to do that? vonnie: we got a tweet from trump immediately saying the system is rigged it. as usual, that judgment. a strange comparison to make in some ways. you can expect him to tweet whatever he thinks will work. is this a turning point for hillary clinton's campaign? did this be the moment we look back on? margaret it certainly is the
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answer to what has, until now, helped justify bernie sanders staying in as a competitor. helped keep the criticism and heron whether she top aides violated any laws. could you actually have a democratic harmony, or any nominee for president, in that situation with the potential for a prosecution over their head? theoes not eliminate specter of the conversations about her judgment, the criticisms about the controversies moving forward -- even in the absence of any prosecution. expect,e we can generally based on what fbi critique of said, a her judgment on this matter. tok: how do we expect trump capitalize on this?
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hillary clinton has not been ine to capitalize on trump recent weeks. i will display out on both sides? both candidates, interestingly, are campaigning in north carolina, which has been a battleground state in the last 2 elections. president obama won in 2008 and mitt romney in 2012. felt ins campaign states like that, if she were able to take it back, it would make the path difficult for donald trump. you see him planning to campaign in a different part of north carolina. you can expect him to try to make this the focus of attention to try to attract from the show of unity and power they will have for president obama and land togethern to on air force one and take a convention center triumphantly.
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vonnie: how should hillary clinton respond to the idea that she was careless, that she left the potential for hackers to get in. that the security said that they were not die with packers h -- that they would not know if packers had gotten in. how do you defend yourself against that? margaret: certainly, this will continued criticism and rhetoric since beaches, to take the center voters who are undecided about which way to go, and to say this is someone that you can trust. with hillary clinton has an doing is trying to convey the sense that she has made herself available, answered questions, moved from her mistakes. we saw in the lead up to this investigation a slowness in terms of her telling into two public remarks that she made a mistake and we do it differently in the future. she will be under a lot of with moreo admit
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clarity errors of her ways, and to make promises about how she would govern going forward. i don't know she will do that, but there will be pressure on her to acknowledge fully what the conclusions of this investigation have found and to affirmatively about how she would head off the surveyors in the future. vonnie: our white house correspondent covering hillary campaign. thank you. we'll bring you the justice department's decision as soon as it comes out. 4:50 one in london. financial firms preparing for bonus -- for bonuses to be if activity does not pick up. is this the new normal? ♪
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mark: not a great time to be a
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banker in london. the city's investment thanks will be cut 25% angst of brexit. let's go to stephen morris. the top of the most red for the day. the brexit. is it the catalyst for these potential cuts in bonuses? absolutely. when they saw the results of the referendum they would've known the prognosis for the economy is terrible. the m&a for their revenue and earnings. they would know this would seep into their pockets. they would be braced for this. it is the size and scale of the cuts. we have spoken to the minimum level they expect is 20%. right through to 50%. even a big doughnut, getting nothing. mark: can we expect another round of job cuts if client activity doesn't pick up?
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stephen: absolutely. bank executives are privately warning we could see more bank cuts coming in the autumn. in europe we have rules saying you cannot have a bonus more than twice your salary, meaning to fix the costs of banks. flexibility tos reduce pay by cutting bonuses, because people are contractually entitled to their salary. we could see job cuts off the bank of that as banks have to reduce their staff to meet fixed costs. vonnie: this could bring london more entwined with the mainland euro competitors? branch and german bankers do not get the same kind of bonuses? stephen: this over lining could could shiftbalance toward fixed salaries from bonuses and help ameliorate some of the effects and bring them into line with their european counterparts.
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you have to imagine bankers in london are looking at their budgets and having to recalculate quite drastically. mark: great job. to catch that story get on the bloomberg. london banker bonuses set to shrivel. look at the u.s. markets as we approach new in new york. made session, you have the average down 7/10. 1%.s&p 500 down 9/10 of the worst is the nasdaq down 1.1%. a little bit of reality settling in, or maybe people looking ahead to next week and earnings. a 2.5 year high today. you are watching bloomberg news. ♪
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>> it is noon in new york, 5:00 p.m. in london, and midnight in hong kong. ♪
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>> from bloomberg world headquarters in new york, i am shery ahn. >> i am matt miller. here is what we are watching. the fbi is recommending no charges be filed against hillary despite carelessness in the handling of classified information. what is next for the democratic presidential hopeful? bond deals falling. the fallout from the brexit vote continues. the pound trading at its weakest level against the euro since 2013. sabmiller investors toasting the plummeting pound. this live in the currency is creating a $3 billion windfall as the company continues its takeover of ab inbev. m

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