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tv   Bloomberg Markets  Bloomberg  September 6, 2016 10:00am-11:01am EDT

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we take you from san francisco to london and tell the stories of australia and germany in the next hour. tuesday after a long weekend in the u.s. the pursuit to become the world's largest feed producer. vonnie: the deals keep coming across the globe. anhad to germany for interview with the chief financial officer of that shares surging today after it agreed to buy spanish hospital group for over $6 billion. vonnie: volkswagen buying a stake in navistar.
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30 minutes into the trading day in the u.s. thatmuch awaited data julie hyman is back. julie: in terms of that data, the nonmanufacturing composite index coming in with a reading of 51.4, that is below the 54.9 that was estimated. above 50 is still expansion. the weakest pace in six years. we seen a slowdown in manufacturing as well. softening in the economic numbers that we've gotten recently. we are seeing stocks hold up relatively well. the nasdaq still hanging onto a gain of .25%. one thing that may be chipping
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away at the early gains today come energy prices. we are seeing oil come down after seeing a gain in the past several days. over speculation of some kind of opec production agreement. some disappointment being reflected in the outright freeze not being talked about. down .75%. we had some energy deal activity to talk about. and bridge will be buying the largestgy -- energy pipeline and storage company in north america. the largest foreign purchase ever by a canadian company. 12.5%. shares are up by also looking at eog resources, agreeing to buy gays petroleum for $2.5 billion.
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ace petroleum for $2.5 billion. also taking a look at media today. 1%. century fox shares down fast and furious this morning. gretchen carlson sued roger ailes -- she dropped her lawsuit , getting a $20 million settlement. fox has issued an apology to carlson. beta van susteren will departing fox news. something to keep an eye on as well. lower after vw agreed to buy navistar. this could be negative for cummins. 90 minutes left in the
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trading day here in europe. we are unchanged on the day. we've been down .1% today. we were rising for a fourth day earlier. the best run for almost a month. we are unchanged now, the highest level since january 6. a little flavor for today. , sweetening the bid for monsanto. than the previous bid. pay to be, i have to successful in the deal. it is m&a tuesday today. shares up by 5.6%, a german company, europe's biggest publicly traded health care provider commissioners rising the most in the year. it will pay almost 6 billion
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euros. you, 58%ard holdings sl owned by the capital partners and the company's management. the merger should result in savings of about 50 million euros a year and will be highly accreted to net income next year. euro area gdp .3%. we had a surge in exports driving growth in the second quarter. domestic spending slowed. .3 versus .5 in the previous quarter. politicalshows how uncertainty can harm economic growth. on big ecb guttering thursday. as well as discussing potential stimulus, the ecb unveils its latest gdp and inflation data.
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bring on mario draghi. let's check on the first word is today. president obama is promising to work with you and to tighten sanctions against north korea after another missile launch. the president signaled u.s. would redouble its efforts to choke off north korea's access to international currency and technology. president obama: we are going to work diligently together with the most recent u.n. sanctions already placing north korea under the most intense sanctions regime ever. we will work together to make sure we are closing loopholes and making them even more effective. mr. obama is pledging $90 million to clean up unexploded bombs and other munitions dropped during the vietnam war. saudi arabia makes -- the shrink
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deficit. the budget the government is reviewing thousands of projects valued at $20 billion they may cancel a third of them. a car bomb or through a commercial area of central baghdad today. at least 12 people were killed. the explosives filled pickup truck was left near a hospital. 20 people were wounded and 15 cars were damaged. islamic state claimed responsibility for the bombing. withtigators have come up a preliminary report on the crash of an emirates airliner in the pilot tried to land too far down the runway in a tailwind. all 300 people on board the plane did manage to escape.
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a firefighter was killed when a fuel tank exploded. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i'm a lisa parenti. this is bloomberg. vonnie: we are seeing the euro trade above $1.12. $1.34 for the first time in many weeks. fallingacturing isn 51.4. but muchexpansion mode lower than the 54.9 reading that analysts were looking for. er has raised its bid for monsanto for the second time. -- in 19% premium. it would create the world's biggest producer of feed and
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pesticides. a good $7.50 away from what analysts say they will need. how does this change things? >> not a lot, but it indicates how much beyer is willing to pay at the moment. now, there is a sense that beyer may not go much higher. they were looking at putting this through a capital increase and all that. shareholders have given him a lot of pressure about is this deal worth it or are you overpaying. you also have the question about -- they higher that go could go. monsanto talks about other options. it doesn't seem there are too many options left in the market because there's been so much
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consolidation in the space. we've seen a continued decline in crop prices. ?ow has that impact evaluations ruth: you look at the way , shares haverading kind of declined in the last few months. we have to keep in mind the that whatever companies are looking at consolidating, you don't want to be the last one going to regulators to get your approval when the space has already consolidated so much. even if we get some sort of arranged deal, the regulators discover it. the odds are quite high come aren't they? ruth: you still have to get all the approvals in place. this only a 50% chance of this deal actually happening. and it would require a whole lot -- theinvestment
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this has been going on for the last few months. if this doesn't happen, can they have expansion internally as well and maybe look at something else? yes. it seems beyer has the advantage. monsanto wanted to consolidate in the month before. vonnie: the other deal we are watching today is volkswagen buying a significant stake in navistar. is it a good move on the part of volts wagon -- volkswagen? ruth: they want to get away from all of last year. navistar in itself has had its own share of problems.
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using their market share declining, they've had problems with standards. theirlast quarter was most profitable one after 13 or 14. for now, they're talking 500 million in synergies in the next five years. the car division was struggling in the u.s. even before the omissions scandal. the truck business seems to be doing well. they want to be seen as doing well in one space. in way of getting back their reputation step-by-step. do not miss our interview with the chief executive of bw truck and navistar.
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what a show we've got for you today. the chief executive stephan sturm joins us for exclusive interview. this is bloomberg. ♪
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mark: live from london, i'mmark: mark barton. vonnie: and i'm vonnie quinn. you are watching "bloomberg markets." chemicals with a $12 billion loan for its
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purchase of syngenta ag. to bison gentle earlier this year in a deal that would transfer warm -- transform it into the world's largest theucer of pesticides -- company's first purchase since spinning off its industrial businesses to focus on clients and technology. he offer, $53 a share in cash. ge buying to european companies -- two european companies to use 3-d printing technology to build parts for jets. that is your bloomberg business flash. mark: let's get to one of the
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best-performing stocks in europe today, the best-performing stock, fresenius buying a spanish hospital group for $6.4 billion. highlightingion the acquisitions under stephan sturm. he joins us now for exclusive interview. good afternoon, sir. thank you for joining us. stephan: good afternoon. you're not hanging around, are you? you've been on the job for two months, you're making a multibillion euro deal. this highlights your international ambition, doesn't it? stephan: it does. around for almost 12 years now, acting as the cfo before. an integral part of this strategy development in the
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past. being a ceo for two months sounds like a bigger change than it actually is. i've been part of our thinking and deliberations on expanding our helio's business. -- helio business. we've gone through a fairly detailed process. the spanish market is very attractive. mark: are you still there? i think we've lost him. i can hear mark: one more try. you say thebad spanish market is attractive. what other european markets are attractive to you? where else is there potential m&a in the eurozone? stephan: we are now focused on
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properly integrating the largest ever deal in fresenius's history. we are not wasting too much energy on further m&a beyond. the discrimination of private hospitals -- vonnie: you just got back your investment-grade debt rating. how might this purchase impact that? werean: first of all, we -- out.e: you just cut got --ntly not destined to hear the answer for the moment. we will try to get the ceo of fresenius back shortly. mark: we will try to get back to stephan sturm a little later.
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still ahead, we will look at the stocks moving in the early u.s. session, including goodyear tires getting an upgrade at deutsche bank. this is bloomberg. ♪
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vonnie: looking out at the midmorning midtown manhattan. mark: this is bloomberg television. tonie: let's head straight the markets desk. julie: the lowest read on that number in 6.5 years. the smallest expansion in the services industry. all three major averages higher, but i believe that is actually all three major averages have now turned lower.
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we've got the dow off by about 27 points, the s&p off about three not points and the nasdaq is now barely lower, down 1.5. we've seen this turnaround in that isn averages as number came out. financials are one of the most heavily weighted groups in the s&p. haveials and industrials also followed that group lower. utilities telecom are higher. energy also higher. even though oil prices have turned lower today.
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potential for ongoing losses in its pennsylvania long-term contracted to have been concerns over the past month or so over these contracts. goodyear shares have been rising after that stock was raised to buy over at deutsche bank. theanalyst there says company is poised for significantly increased cash payouts to shareholders. the company should benefit from up tariffs.mixe the company raised at morgan stanley. the shares are up 2% as the price target is raised to $80 a share. termsta points from the
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conference indicates there relative tightness in the highest regulatory land rig market in the u.s.. mixed in terms of individual movers come up mixed overall for the market as we now see a bit more of a negative tone here. we were up earlier, we've been down, one of those days. check out the equity board. xx europe 600 -- that is the equity board. highest we have not seen since january and the four days of gains were the most were about -- look at the currency board. sterling, highest level against the dollar since june 29. sterling also is rising against the pound.
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the euro is falling against the pound, the pound is rising against the euro. the pound is down against the yen. it big day for the ecb. we are expecting an extension of the stimulus program. will we have some source of fiddling with the qa program as well? rights are in companies like and lyft wantber to change the way we get around. will they also change the auto industry? ♪
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vonnie: live from bloomberg rolled headquarters in york and london, i'm vonnie quinn. -- world headquarters in new
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york and london, i'm vonnie quinn. mark: and i'm mark barton. >> flights resumed at london city airport after demonstrators blocked a runway to protest expansion plans. travel was disrupted from just before dawn until early afternoon. it ended after police arrested nine people. black lives matter claimed responsibility for the protest on social media. in the u.s., two new nationwide polls show the race for president is tightening. hillary clinton leading donald trump 48-42. the two polling within the margin of error. fox news says it has settled gretchen carlson's gender bias lawsuit. they've agreed to pay carlson $20 million. roger ailes stepped down as chairman and chief executive of
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fox news in july after carlson brought her case. statement that a she is ready to move on to the next chapter of her life. now owns mores victories in grand slam matches open anyone else in tennis' era. for williams, the ultimate goal is three more victories and winning the tournament, breaking her time with -- global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. something on the sharing economy. we will be doing something on the sharing economy all week. the idea that the job market is now being really impacted by the sharing economy many industries
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and see results, one of those is ng industry and the auto industry more generally. more are four times ridesharing app downloads than car sales in u.s. monthly. we are seeing a drop off in car sales. there is auch to say correlation between ride apps and a drop in car sales at this point? :: what we going with that fourfold increase, you need to build out the suite of uber vehicles. by 2018, you will see a 3-5% underlying headwind. we are seeing many new services come into the market. , now lyft.
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have never heard off offering me 50% off my first ride. lin: it will be challenging for those new startups because scale will be an important factor. mark: how well-placed is the auto industry to deal with shared mobility? will we see more deals between these shared mobility players? colin: absolutely. gm took an investment in lyft. they now participate in the sharing economy to some degree. will it give them an edge in selling all these vehicles to build out these fleets? has a smallota stake. a lot of large players are partnering at this point.
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mark: can we talk about tesla? we've been focusing on the stock like you have. lowest 12 month price target, $160. you've got the bulls and the fundamentalists versus the true believers. tesla? you so bearish on below the $201 we are seeing right now. we look at near-term catalysts that could correct it. if we look at the second half of the air, profits will be a big focus. we got a lot of hype with the model 3 orders in the beginning. now, we will see payback with the fundamentals coming in. margins will be under pressure s coming upthe model
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are lower priced, so we will see margin pressure from that. you have with the recent filings that there may be more capital raise and people are worried about cash flow. long-term, we are read about how profitable the model three will be. -- we are worried about how profitable the model 3 will be. i think their production target for 500,000 by 2018 will be hard to achieve. in the near term, we are focused on the second half. vonnie: you are one of only five people believe there is something to this company. you are in the minority.
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colin: i guess i'm in the minority. a camp thatarly believes in their vision. i think what they are trying to do is great. i don't think the rest of the industry will sit on their hands. bmw, mercedes, porsche, audi are s over theing ev' next fears. the economics are still very challenging -- the next few years. back to your wonderful report on shared car ownership. two thirds of apt outlets globally in emerging markets. downloads globally in emerging markets. despite the lower level of car ownership. vonnie: a lot of the growth is coming from developed markets, particularly china. colin: it is a big long-term
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risk. with two thirds coming from the emerging markets, it is a risk that it may slow their. that's it may slow there. thank you for joining us today. talkingyst colin langan to us about shared car ownership. australia looking for opportunities in the u.k. in the post brexit world. talk to industrial and trade minister about what hopes he has that's what he hopes to find. ♪
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mark: this is your global business report. vonnie: a done deal -- u.k. brexit chief david davis tells parliament there is no turning back now. he tells britain's not to worry. gm makes a bold move that could transform for that -- factory production. withan intense to build 3-d printers. --nie: immigration reform the system is broken, but republicans and democrats can't agree on how to fix it. is there any hope for progress? the uk's secretary of state for brexit has made his first comments in parliament. there is no turning back. at the end of the process, britain will be out of the european union.
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>> there will be no intent to stay in the eu. no intent to delay. no attempt to engineer a second referendum. several parliamentary committees and say they will investigate various aspects of brexit. mark: enbridge has agreed to buy spectra energy. for stock transaction value for $28 million. ge is buying two european companies to use 3-d printing technology to make parts for jet engines. for a total of $1.4 billion.
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ge is already the biggest customer. factory orders in germany signaling momentum in europe's 20% jump inomy -- export orders. time for our quick takes where we provide context and background on issues of interest. immigration in the u.s. is broken and a politically divided capital does agree on this issue. the question is, what can be done about it? 11 million people already live illegally in the u.s. and are remaining in the country after their visas are expired. said they should be allowed to stay in 2015. in june, he was from court was divided over president barack obama's executive orders that would have shielded as many as 4 million unauthorized immigrants
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from deportation. an appeal court ruling says obama overstepped his authority. she wouldinton says enforce existing immigration laws and provide a pathway to citizenship. has proposed "real immigration reform," including building a wall between mexico and the united states. reagan was the last president to win passage of major immigration reform. in 2012, republican candidates focused on deporting the and documented -- undocumented. that november, hispanic voters cast 71% of the ballots for mr. obama. democrats are more or less united on immigration while congressional republicans are split. security is the only issue that needs to be addressed. yet, there are conservatives who
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approve of offering a path to legal status not citizenship, including house speaker paul ryan. fears thatleadership fighting immigration will complete the alienation of the growing number of hispanic voters. that is your global business report. had to for more stories. mark: britain may be at the back of the q4 a post brexit trade -- of thehe u.s. tradefor a post brexit deal with the u.s. steven ciobo joins us now. you've just come out of a meeting with the international trade secretary. what do you discuss? steven: it warm and cordial conversation. this lot of political alignment between secretary fox's view and
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my view. you certainly saw that the g20. we had a chance to talk about what it might look like. the trade relationship, financial relationship with brexit. there is still work to be done. i wanted to reinforce australia's desire to make sure we are able to take our relationship in terms of trade to a stronger platform in the future. mark: why have you come out in your sporting evidently -- enemy? steven: there are strong historical ties between australia and u.k. we are in a position to build off that. we have high levels of investment between the two countries. the u.k. has a stock of $500 billion in australia. has $350 billion in
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the u.k. we can continue building on the relationship we have. long do you envision striking this deal with britain taking? steven: it is difficult to say for sure. it will be determined by the type and nature of the discussions that the u.k. has with european union. those two things will impact on each other. suffice to say that are starting points have a lot in common. pro-free-trade and both ambitious in terms of having a conference of trade deal in place. -- comprehensive trade deal in place. it will take until after article 50 is triggered? steven: that's correct. positionis not in the
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to negotiate until after such time they have formally exited from the european union. we are respectful of that but we will make sure we are in a position to have some important parliamentary discussions. i'm confident today's discussions with secretary fox and lord price are important precursors --at are important precursors. mark: we need open, free trade to live global growth. there is some examples of australia blocking trade. the power network in new south wales -- is that a conflicting signal that on one hand, you are promoting free trade but on the other blocking investment by china? steven: there is a very big difference there. we are pro-free-trade and australia is putting forward a number of policies to make sure -- is front and
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center. we put in place free-trade agreements in the past three years with the north asian powerhouse economies like south korea, japan, china. we've done a great deal recently on a comprehensive strategic partnership with enough for -- with singapore. we have said no to some foreign investment where it is contrary to australia's national interest. since 2001five times and on average, we received about 1000 applications the year. we have said no five times and we've had 15,000 meters and yes. that's when we have said yes. there's a lot of aspiration on our part.
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i've had a number of conversations with the eu trade commissioner. in very warm and cordial conversation with cecelia. we've had fairly mature and discussions that we have fairly mature discussions underway. if that goes well and we have alignment in terms of the scope and study my hope we are in a position to have a free-trade negotiation commence in the first half of next year. vonnie: what do you imagine the sticking points will be between the u.k. and australia? steven: we did not get into a sector by sector analysis. we had a conversation about where we see free trade agreement could possibly be between australia and the u.k. point, a point that was reinforced by the prime , both countries are very outward looking in terms of trade.
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we want to engage with the world and make sure as much as possible we have free-trade beacons around the world. that is really important when we session i an increase want to make sure there is a focus on being the beacon for free-trade. -- give ourfficult viewers the difficulty in striking a trade deal to get investors never viewers as sense of what faces britain in the next fears. steven: these deals take quite a bit of time. our free-trade agreement with china was eight years in the making. that was under different placing different levels of importance to dealing the deal.
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we moved into the top of securing that deal. as i were able to do it relatively quickly. -- that's why we were able to do it relatively quickly. mark: good luck. good to see you. steven ciobo, the australian trade minister. vonnie: much more on trade ahead. finland'sar from finance minister. ♪
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vonnie: you are watching "bloomberg markets." cut its gdp this year saying it will grow 1.1%, down from a 1.4% forecast back
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in june. the finance minister described the growth rate to francine lacqua. cuts haven't decided on for next year. context of the competitiveness factor. the good news for the finnish year's economic growth is now expected to be positive 1.1% according to the ministry of finance. , the bank released its forecast for 1% growth, double thatreviously expected -- is not brilliant, but it shows structural stagnation is beginning to be over.
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-- it isrning the page not easy, but we have consensus that we have to restore our competitiveness. in thesame time, invest sectors with more potential for future growth. francine: item has a question. -- adam has a question. you see the issues in that context of tax competition or regulatory competition? ollie: excessive competition would not be beneficial for europe. it's important that we don't overtax our companies. in finland, we've done some improve our taxation.
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that will lead to results for the whole of europe. would hope thei u.k. government would not try to enter into a race of tax competition. mark: finland's economy minister speaking out on bloomberg television. joins us to talk about opportunities in the global bond market. ♪
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vonnie: it is 11:00 a.m. in new york and 11:00 a.m. in hong kong. mark: 30 minutes left in the trading day in europe today. you are watching the european close on "bloomberg markets."
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we take you from detroit to dublin and cover the stories and u.k. in saudi arabia -- in the u.k. and saudi arabia. the riskier the asset, the better the performance. the latest markets outlook from aberdeen's chief investment manager. vonnie: volkswagen is buying a stake in navistar, looking to gain a foothold in the u.s. heavy truck market is this too much of a gamble? m&a. day for bey


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