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members offering praise to mr. trump and his legislative agenda. the president listed trade deals completed during his recent international trip. "the wall street journal" reports they do not have tapes that may have been recorded with former f.b.i. director james comey. the white house says the president would address the possibility the tapes exist when he is ready. revisednistration's travel ban has been blocked by a second federal appeals court. the ninth ciruit in san francisco backed up the previous ruling the president's executive order targeting majority muslim countries discriminated on the basis of religion. jeff sessions will testify publicly to the senate intelligence panel tomorrow. the attorney general what answer questions about his role in the firing of former f.b.i. director james comey. sessions requested a public event. bloomberg will have live coverage of mr. sessions testimony beginning tomorrow at 2:00 wall street time. global news 24 hours a day
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powered by more than 27 journalists and analysts in more than 120 countries. i am alisa parenti. this is bloomberg. "bloomberg technology" is next. ♪ ♪ caroline: i am caroline hyde. this is "bloomberg technology" from london. coming up, the tech selloff goes global. investors weighing the sector's biggest names. we will analyze every turn of the worst two days contact this year. uber ousts its head of business. we have the inside track on the surprise exit. he joins us at the launch of
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london tech week for a bloomberg exclusive. lead, stocks follow around the globe led lower by tech shares. biggeste, it had the decline in almost a year since june 27 of 2016. the slide continued in the united states. some of the largest firms posted the biggest declines including apple, netflix, and alphabetic. oliver renick joins us from new york. you my firstbring one. i am digging into the terminal. 9317. i am looking at the slump in european stocks, down 3.6%. i'm looking at the slump in the u.s. nasdaq in the blue line. we see the biggest two-day selloff, $230 billion of market
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value wiped off. asia is being hit as well. big players, apple, netflix. this seems to be worldwide. >> it is not pretty. when you look at what happened overnight, your came into the u.s. today. we saw a repeat of what happened friday. i think what happened is it is not just about technology or the fundamentals of these companies . i think it is about a reversal that is unique given how far some of these companies have gone in the past six months. we had a first reversal in the equity market at the beginning of the year. then we saw investors looking to growth. we saw investors looking for momentum. companies build up momentum over the past six months. now that trade unwound.
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it is taking down tech companies that had done very well over the past six months. invest in strategies more than companies specifically. that is breaking down a little bit. caroline: it is fascinating as to why the unwind starts here. morgan stanley saying they have further to go. i'm interested in if we could see not just a correction but a air market. chart.gnals my next in64 6423. this shows how far we came before the turnaround. close toology stocks 50% reaching 52-week highs. 1995ve not seen that since
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and 1997. after those two years, down 20%. are we about to have a bear market? >> i love that chart. i like it because that signals what has happened and to what degree. it is nice while it is working and painful when it does not. in the tech sector in particular, it has not happened many times before. there are a lot of things that have not happened since era. familiare signals look --imately, the mental mental fundamental picture is different. valuations are below where they were. there was not a lot of fundamental backing to the selloff. we don't see demand for iphones or products. that was not the case.
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it was a few things that coalesced into this moment in at theeople looked investing they have been doing and said it does not make sense. i will kick it off with my chart. this is breaking down the losses. in white, semiconductors. blue, the growth index for the russell 1000. gray, momentum. orange is straight up tech. that is telling us the specific selloff. semiconductors hardest hit. you can see where tech got hit. you can see the momentum and growth badly hurt. what is most interesting is the fact at the end of the day the s&p 500 only down about 20. worriedthose people about concentration, they got hit hard today.
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the market has been able to shrug it off. that is important for underlying strength. caroline: we will see if earnings managed to be a supporting factor going into the next quarter. brilliant reporting, oliver renick. ahead atg announcement the e3 gaming conference kicking off tuesday. microsoft is targeting hard-core gamers with the new version of the xbox. its smallest and most powerful ever. it is designed to work with a new generation of tv sets as well as with games that offer more realistic scenes. we will be live at the conference with the c.e.o. and the nintendo america president wednesday at 5:00 in new york, 2:00 in san francisco, and 10:00 p.m. in london. uber ousts its senior vice
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president for business. where uber can go from here. exclusivehe show, our conversation with the london mayor on keeping innovation growing in the u.k. capital and his relationship with president trump. this is bloomberg. to offera may decided that. it was wrong for a number of reasons. it was wrong because of him changing the long-standing policy on refugees and a host of policies and views he has. ♪
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caroline: after years of
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watching silicon valley innovate, wall street is ready to unveil its own answer. more than 30 banks are teaming up to form a new peer-to-peer lending service that will soon be offered to about 80 million banking customers. like appleetitors pay. uber has decided to part ways with the head of business, a male michael, after internal probes revealed a series of misdeeds. the embattled ride-hailing giant held a six hour board meeting to discuss a variety of issues including workplace them --nt and of leave a leave of absence for travis kalanick.
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and ericeide newcomer, welcome to both of you. this follows eric holder's report on the series of scandals. is emil michael leaving a big deal? >> it is a huge deal. this is travis' top confidence, a great friend of his, and sort of the guy that helped the company raise more than $10 million in strike a deal in china and make partnerships with automakers like daimler. the hugely important executive who has been a central figure in many of uber's scandals. it is a big deal the board came to this decision. overall, things at uber are crazy right now with this report supposed to drop tomorrow. caroline: crazy indeed. it seems emil michael is fighting talk saying he blames the board of directors and the
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legal team. your expertise focuses on corporate governance. this is the right step to be taking? should they be pushing for travis kalanick to be taking a leave of absence? >> i think the personal issues travis has been facing have been significant for him. it may be a good time for him to step back. now with the leaving of his right-hand man, you have several open positions. for these to remain open while he is taking a leave of absence would leave management and turmoil because there would be nobody steering the ship at the time. caroline: talk about these independent board members being called for by the eric holder report. it feels as though perhaps they are too hard to fill at the moment. how independent is the board compared to other companies? founders and company
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leaders have a lot of control when it comes to the boards. >> correct. the dual structure for control of the company has been around since the 1920's. it has recently become more prevalent at technology firms, especially in silicon valley. the way the dual structure works is you have two different classes. one class of stock has significant voting rights, more than the other. perhaps the other has none. sharesclass b voting have a voting right of 10 to one. the other only have a 1-1 share vote. power tos significant those who hold the class b shares. those are the managers, travis, and those who were founders of the company when the company began. caroline: eric, he said this is a crazy time at uber. we are hearing what could happen
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if they are asked to have more independent board members. what about the potential for travis kalanick to step aside? we know he is under personal pressure. the poor man just lost his mother. >> the funeral was on friday in los angeles. it has been a hard time for him. puts theg we have seen decision to take a leave of absence on his shoulders. he would need to decide himself. the big question is who would lead the company. we reported there could be a management committee of top executives. but there is not a key person that could take over. there is no chief operating officer, no chief financial officer. they do not have a clear number two, to take the reins. advising when you are clients you represent, when we see such a company gearing up
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potentially in the foreseeable future for some sort of ipo, how crucial is it to ensure we have clear corporate governments -- governance? how much does uber need to do? >> there have been roads paved by facebook, etc., regarding the dual corporate structure. this is not unusual. investors have seen it before. when you are guiding a company as to what to do, yuma -- you want to make sure everything is fair and equitable and to keep the concerns of the shareholders in mind. what youect to uber, would want to see is more independent directors join the board. act in directors must the best interest of the shareholders. as you add more shareholders -- more independent directors, the actions of the board become more focused on actions that benefit the company as a whole.
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that is not to say the founders acting with these class b common shares are not acting in the best interests of the company. the argument has always been that allowing the founders to maintain control over the company will allow the company to continue to push forward on the business plan which is the basis for why everyone has invested in the company in the first place. it is a very delicate balance. having more independent board members is a very important step. caroline: we will see how that continues to unfold as we get more news of the eric holder report. newcomer has been following this story for us. nanette heide, thank you. thousands of tech professionals are gathering in london for the launch of technology week. the major hurdles facing the sector in the u.k. capital. that is next. a feature i would like to bring
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to your attention is our new interactive tv function. you can watch us live. you can send our produces a message and play along with the charts on air. this is for bloomberg subscribers only. check it out at tv . this is bloomberg. ♪
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caroline: the democratic representative of illinois communications for engagement act. the legislation has the same twitteras an infamous typos sent by president trump seeks to have them recognized as presidential records. it would prevent a president from deleting tweets or other social media postings. it is not the first time the representative has taken aim at president trump. another, he introduced
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act also known as the mar-a-lago, a nod to the president's private club are treat --retreat in florida. london technology week has officially kicked off. the tech extravaganza is touted as europe's largest showcase for technology. since its launch in 2014, it has included more than 700 events and welcomed delegations from around the world. joining us to discuss is someone who is no stranger to the local scene. he was the chairman of the marketing group and vice president and general manager of skype. we know each other well. it is great to have you here. is one of the founders of tech week. talk about how important it is to ensure we are showing
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ourselves off that technology in london as a hub still exists and gets talent. >> london tech continues to go from strength to strength in terms of investment, talents, and startups being created. we are also in an uncertain climate the election and upcoming brexit negotiations at the top of the agenda. a week for celebrations. excited to kick it off today. but some challenges we have to address. caroline: talk about the survey after the election. the key concern is getting talent into london. >> the day after the general election, we asked a lot of questions around the position on party's immigration talent, third hardy sponsors for visas. the consensus for the community
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is strongly against the anti-immigration approach, wanting to make sure we get access to skilled migrants weather from the e.u. or beyond. i think a real wake-up call. theynk we had 75% saying are unhappy with the current policies and they need to change. the same sort of theory we are hearing from the mayor of london. are 4000 applicants now? >> we are about to hit 5000 around the world. caroline: having come back from silicon valley, that is often slightly less bigger pace in london. we don't have the foundation of cash. they have to go to the u.s. for money. is that changing? >> i think it is. last month, i had a showcase. we brought together angels,
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private equity funds to talk about the state of london tech in terms of investing. where is it going with article 50 being triggered? i think there was cautious optimism. we don't want to compare ourselves to silicon valley. we are five or six years into it. we are seeing funds being raised . britt hoberman announced a $60 million fund. big tech companies are investing. it is still a challenge to raise money where you are and whatever stage you are in, but the money is there in london. if you have a great business and are a strong leader, we should not have it's a difficult to get that. caroline: i spoke to the c.e.o. of improbable today who managed to locate $500 million from softbank. he has headquarters in london. he has branches in san francisco. he's not moving anytime soon.
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there is still the viewpoint that when you are an entrepreneur that if you really want to make it, go to silicon valley. do you think that still is the viewpoint of phosphor nerves? -- entrepreneurs? >> i think that is still the viewpoint but it is starting to change. i have seen big exits from london. i think the message coming back is five or six years ago, you had to go to silicon valley if you wanted to have a good exit. but not anymore. i think that is an encouraging signal. we have seen a couple of unicorns fail spectacularly. yet london is still on track in terms of the investment, capital, and vibrancy of the community you saw this morning. caroline: you will be sticking with us. thank you for digging into all of the london tech scene for us. he is going to be discussing more with us about the tech
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scene. london tech week does not stop here. our exclusive conversation they are conscious later this hour -- with mayor khan is coming up later this hour. towill discuss if it is time change the outlook for big cap techs. if you like bloomberg news, check us out on the radio. this is bloomberg. ♪
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alisa: i am alisa parenti in washington and you are watching "bloomberg technology." let's start with a check of your first word news. maryland and washington, d.c., are suing president trump. they claim the president is
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violating the constitution by accepting foreign payments through his businesses. today's announcement joins a january lawsuit filed in federal court. theresa may is telling fellow tories i got us into this mess and will get us out of it. her government faces uncertainty following last week's election results that cost the party its parliamentary majority. police detained hundreds of anti-kremlin protesters across russia, including the opposition leader. he is russia's most prominent opposition leader and presidential hopeful. he called on supporters to defy official refusal to permit rallies. will meetime minister president trump in washington on june 26. mr. trump said last month india's participation in the paris climate agreement was contingent on new delhi receiving billions in foreign aid. ties between washington and new delhi have prospered under the previous u.s. administration. is vowingo's governor
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to turn the territory into the 51st state. the island voted for statehood in a nonbinding referendum the spy a boycott and low turnout that raised questions about the vote's legitimacy. the u.s. congress must approve any changes to the status. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. i am alisa parenti and this is bloomberg. it is just after 5:30 p.m. in washington. already 7:30 tuesday morning in sydney. we are joined by paul allen with a look at the market. good morning. >> good morning. it is back to business in sydney. the asx was closed on monday for the queen's birthday holiday. trading resumes today. it is the first chance for stocks to react to the significant tech selloff now in its second day across the u.s.
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in australia, we will have the business confidence survey later on. dragon.eye on net it has been a bumpy year. it will be out with first-quarter earnings later today. this is an online internet games company. it will be interesting to see how the market reacts in the context of the tech selloff. nikkei futures looking weaker. that is what we are watching around the region today. i am paul allen in sydney. more from "bloomberg technology" next. ♪ ♪ caroline: this is "bloomberg technology" from london. i am caroline hyde. let's return to our top story, the selloff of tech stocks.
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at the heart of the selloff is pressure on big cap tech stocks that have previously seen massive gains in the market this year. he is in analyst at rbc and covers some of the biggest tech firms. he joins us now from new york. always great to have you on the show. i'm looking at a note you put out on may 18 saying valuations are more robust, saying having climbed from 15 to 17 times they are more robust. do you stand by that? >> we have had a major rally in the sector, large cap consumer tech, not including apple, microsoft, and tesla. other names have participated in the rally. , theig internet four stocks are up 20% year to date. earnings estimates have risen so the multiples have not been that egregious. if you step back, i know the
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stocks are up a lot, they came up from the trump trade off. we talked about this at the beginning of the year. these stocks traded off a hefty 5% to 10% last year on the trump election. there is a false floor. the rally may not be as strong as it appears to have been. caroline: ok. the likes of moreland stanley has further to go, should we expect more losses? >> i don't think we have had a fundamental catalyst that has taken the sector down. we have not had new regulatory risk to the sector. we have not seen competitive shifts. we are seeing portfolio positioning. that can take the sector down further. my point is if you look at the valuations, you still have facebook and google trading at 24 times earnings for almost unrivaled growth. facebook is doing close to 50%
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earnings growth. google has done consistently 20% earnings growth for seven years. i think valuations are still relatively reasonable. none of these are dramatic entry points. if the selloff continues, we could have dramatic opportunities. they are not there yet. caroline: fascinating. you have outperform on amazon. you have outperform on facebook. could hit asbet high as $1050. i want to focus on netflix. i have recommendations up on netflix. i'm still seeing most analysts are saying to buy the stock. only three are saying to sell. the price target remains just above $160. analysts starting to
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recalibrate? do you think there needs to be more substantial catalysts for why we are seeing the selloff rather than profit taking? >> i have followed this for almost 20 years. there is a herd mentality. i have participated in that from time to time. i try not to. there is this unfortunate prices andstock targets moving up and down. we see upside to the netflix stock. none of these show 20% material upside with the exception of facebook. that is the number one pick in the space. if you look at the last two days of the selloff of the major names, the stock that sold off the most is netflix. there is rationale behind that. it has the least valuation floor. the multiple is higher because the company is deep in investment mode as they expand internationally. you should expect the stocks to
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hold their prices the best in the tech selloff, probably facebook and google. about 1% trade-offs only. netflix will trade off 3% or 4%. expect more of that in the future. caroline: chipmakers seem to have sparked this and then came the tech giants behind it. some of that seems to be vindicated looking at valuations of semiconductor makers. do you agree? have we got too heady when it comes to semis? >> i don't cover the semi sector specifically. i won't comment on this. how are we set for the rest of the week? when do think would be the right
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time to start seeing real opportunity to buy? >> you do have one event in the middle of this week. the fed open market committee decision will occur at the end of the day on wednesday, 2:00 eastern time. we will know what the rate decision is. our guess is most people would not want to buy in front of that. we may very well have a continued trade-off in the best-performing to date. we may have a reversal in some of those for another day or two. then we could see a bounce back as we get the uncertainty over the rate decision out of the way. the next catalyst has to be earnings. we will not get major earnings news for about a month. we could be in a position where large cap techs that have outperformed could trade sideways or trade-off modestly for the next month until we get into earnings news when we get
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more visibility on the rate decision. caroline: rich pickings come the 15th and then it is all about earnings. thank you very much. coming up, our exclusive interview with london mayor sadiq khan. how he expects brexit to impact the london tech seen. this is bloomberg. ♪
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♪ caroline: back to another top tech story. after a rocky few months, uber is getting ready for changes. emil michael has parted ways with the company after the board recommended his removal. perspective, you have just stepped down from
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being on the board of dialogue semiconductors, a big player in the german tech scene. as a man who knows the role and responsibility of board membership and corporate , what do you make of what is happening at uber? >> they are at a difficult time. they are starting to reach out and appoint independent directors. someone from nestlé has joined the board as an independent. maybe one or two others. they will play key role in terms of helping to steer the ship. the investors have a lot of money at stake. we should not be having trip up after trip up like this if they have been working with the management team. it is a tricky time. i think they need fresh voices to come in from a board position. i know they are making key hires in the management team. francis from harvard business school is coming in.
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from a strategy point of view, i think that is great. that is what the company needs. it will give a shot in the arm to the team in terms of how they get out of the situation and get on the front foot because they have been on the back foot too long. caroline: this travis kalanick have to go? seeart of me would hate to him go because he has been there from the beginning. he talked about getting leadership coaching after his rant was captured on video. i hope he stays around to some degree. when you lose a founder, it is hard for the people who have been there from day one. they will be disappointed. caroline: you have been in the situation yourself when you had to fill in. or 13 years ago, i came in as a later c.e.o. for a mobile messaging startup. the current c.e.o. was doing a good job but starting to get out of his depth in terms of growing the business. the investors wanted somebody to come in to take it to the next level. i think uber is behind the curve
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on that but that is what they need to be doing. caroline: give a global perspective. are we seeing an impact in london in terms of brand? when you travel to different countries, how does it impact? >> i think uber is still held in good esteem. people use it. the brand is somewhat tarnished after the six months whether here or in other parts of the world, probably particularly in the u.s. that can be recovered if they turn things around and do both things. a lot of people use them and love them. they are an important brand. many of us want them to do well. it is recoverable. shaw, great to have you with us. founder of tech london advocates. london tech week is upon us. it kicked off today. mayor sadiq khan has big lands -- plans. vision for tech
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innovation and his relationship with president trump. >> i am excited. it is the biggest london tech week ever. this is your -- europe's largest tech festival. it shows london is open to entrepreneurs. since brexit, we have had companies from facebook to google, snapchat to square, announcing record investment in our city which shows the confidence they have in london. london tech week will see more than 300 events across london, more than 55,000 visitors from across the globe coming to london because they recognize we are europe's tech capital. caroline: talk about the vision you have for technology helping adopt london as a city. >> we are a small city. we have to use technology to deal with issues from transport to how we deal with the issues of climate change.
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the global disability have, access toose two have transport and better jobs, better skills as a consequence of technology. the great thing about london has been our ability to attract venture capitalists. the great thing about london tech week is we have a massive connected business campus, the largest in europe, making sure we can help startups incubate and flourish. it is important for people around the world watching this to recognize the ecosystem we have here that will help you flourish and thrive. caroline: you are hiring new team members to drive the focus forward. >> i have learned from other great cities across the world. what i have advertised for is
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london's first ever chief marketer. we need a chief digital officer focused on making us better useected and how we can open data to allow the private sector to pioneer. how can we can make sure local authorities across london are more savvy using technology which will be cheaper but also means better services for consumers. we have to learn from others. believer in that. caroline: why do you think the concerns around brexit have not put off i took news in london? >> three words are really important. "london is open." i don't want the world to think because we voted to leave the e.u. we will start -- stop being open-minded and become inward focused. the world must recognize that is not the case. london was one region in england
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that voted to remain in the e.u. we recognize the contribution it makes. one of the things i'm doing is negotiating with the government a different deal from london if we can. in the meantime, my message to the world is we are open to talent, innovation, entrepreneurs. is onethe reasons london of the greatest cities in the world is for 1000 years we have been open. that is not going to change. the key thing is to make sure the government recognizes we need a flexible deal. peopleciate and respect in other parts of the country voted to leave the e.u. one of the reasons was concerns around immigration. parts of the country do not want immigration. clinton voted to remain in the e.u. we need immigration and talent. the government has to recognize london contributes hugely to our
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country in terms of revenue raised, in terms of economic growth. i want us to carry on being the success story we are. we need to be able to attract talent. caroline: able to do that in the current political environment? >> i hope theresa may and the cabinet will recognize the results of the general election. government has -- the country has rejected the form of brexit put forward by theresa may. the government has to recognize that or they will have to deal the consequence. the consequence is businesses choosing to leave which is no good for the government or london. caroline: you were referencing an old adage that was david cameron's. too many tweets make a twit. what about the polite version of the relationship with donald trump? my priority -- i don't have
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time to deal with tweets. my views on donald trump have been consistent. may decidedheresa to offer him the red carpet, i said it was wrong for a number of reasons. on because of his muslim ban, from for him changing the long-standing policy to welcome refugees and a host of policies he has. i said the red carpet was not the right thing for donald trump. caroline: that was our exclusive interview with the mayor of london. u.k. prime minister theresa may in the french president plan to lead a joint crackdown on tech companies that fail to remove terrorism related content. the move means the u.k.
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government is considering the introduction of legislation to force net giants such as facebook and twitter to improve monitoring extremism and hate content. it is a priority for both governments. britain's election campaign was interrupted by two deadly whiles where more than -- more than 200 died in france in 2015 and 2016. a quick programming note. we will have full coverage this tuesday on bloomberg television and radio of attorney general jeff sessions' testimony before congress. coverage begins at 2:30 eastern. this is bloomberg. ♪
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caroline: let's bring you a top story in corporate news. general electric shares fall after the company announced jeff
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immelt is stepping down as c.e.o. amidst activist pressure. he will be replaced by john flannery ending his tenure in which he reshaped the powerhouse. during a facebook like chat today, he encouraged his staff to finish what his successor started. >> we have a track record we can be proud of. we have a window in the future where we will be better. we have to build on our strengths. we have to make sure we are known as an execution company and deliver for all constituents, including customers and employees and especially shareholders. they only company at the end of the day. employees, where the vehicle to get there. caroline: last month, we spoke become af.o. who will vice chairman of the company. here is what he had to say about g.e. overall. >> we are a global company. we serve global customers. we have a global workforce. that is the company we are and
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that is the company we are going to run. caroline: mcdonald's is looking for summer help through "snapplications." use snapchat to reach potential employees. the fast food chain has 14,000 locations in the u.s. amazon is considering selling cars in the u.k., putting pressure on europe's biggest dealers. amazon is trying to fill the gap as customers shift away from traditional dealerships. amazon has been using italy as a test market with limited sales. you can hear about apple's outlook for the car market as we are more of our exclusive conversation with tim cook on "bloomberg technology" this tuesday. we heard about the home pod. now we will hear his outlook for
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apple's move into the auto sector and growth in china. that does it for this edition of "bloomberg technology." "bloomberg technology" is live streaming on twitter. weekdays at 5:00 in new york, 2:00 in san francisco, 10:00 p.m. in london. that is all for now. this is bloomberg. ♪
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♪ announcer: from our studios in new york city, this is "charlie rose." charlie: we begin this evening with developments following james comey's testimony yesterday. earlier today, the president responded to questions during a press confident -- conference with the visiting romanian president. the president accused comey of lying under oath to congress and insisted he failed to prove collusion or obstruction of justice. in a tense exchange, president trump said he would be willing to offer his version of events under oath. preside


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