tv Bloomberg Markets European Close Bloomberg July 17, 2017 11:00am-12:00pm EDT
from new york, i am vonnie quinn. this is the "european close" on "bloomberg markets." ♪ nejra: here are the top stories we are covering. even with stocks at record highs, is it time for investors to start taking on more risk? we will talk to a simon smiles of ubs, who say the ultra wealthy are still hoarding too much cash. are we seeing similarities to the year 1998 in stocks? does that mean a repeat of the dot-com bubble is coming? we will speak with doug ramsey. and brexit secretary david davis is back in brussels for more talks with michel barnier. the rights of e.u. citizens are expected to dominate the conversation.
wherehave a look at european equities are trading now. under 30 minutes to the close of trading. the stoxx 600 not going anywhere too far. of 1/10 of a percent on europe's equity benchmark. mixed distribution between industry groups. telecom stocks outperforming, but also materials doing well. that after the better than expected. energy not doing too badly either. on the downside, real estate, industrials, and financials lagging. overall, the stoxx 600 pretty much unchanged, with a slight positive bias. we also keep a close eye on sterling. up three fourths of 1%. it is snapping a three-day rally. we did see cable hit a nine or 10 month high friday.
interestingly, the pound is faring better now at this second round of brexit and the decisions then at the first round of talks. that is what this chart is showing. the reason we are seeing sterling weakness is there have been signs of scored in the u.k. government -- signs of discord in the u.k. government. now i want to look at e.m. fx. you have some people coming out and saying that em currencies will -- e.m. currencies will better weather volatility. hurty what tends to currencies is the speed of rate hikes, and at the moment, it looks like we have a gradual path. this chart says volatility continues to be low, the jpmorgan emerging market volatility index. julie: in the u.s., not seeing
much movement. any gain for the dow and s&p would mean a record close. the nasdaq earlier touched a record on a closing basis but has not been able to hang onto the likes ofith facebook and tesla declining. it is the beginning of earnings season. we got the big banks friday. there are quite lofty expectations for earnings up through the balance of the year. look at the bloomberg. what we have is a forecast for earnings per share in blue versus the trailing 12 month earnings. 1.20 per share, about 1.13 last year. the gap between the two is the largest we have seen since 2008. expectations quite lofty going into not just this earnings seasons before the balance of the year. one earnings -- what
one company that did not come out so well is black rock. revenue missed estimates. ceo larry fink telling bloomberg it was driven in part by lower performance fees. also, weaker securities lending driven by less antennae activity -- m&a activities. elsewhere, looking at the information reported that amazon web services is said to be discussing developing software for data centers with vmware. fed ex.ownside movers, the company saying its information systems may never fully recover from the june cyber attack that recently and that revenue loss
could have a material effect on financial results. tesla pulling back on two different stories. "stareports out of the tribune" that a crash happened in central minnesota while the car's autopilot function was engaged. also, elon musk reiterating at the national governors association summer meeting over the weekend that the stock price is higher than we have any right to deserve. in other words, people are selling the stocks a bit today. little nothing like a humility. that is julie hyman. let's check in on the first word news. courtney donohoe has more. courtney: americans feel good about the economy but not so good about trump according to a new bloomberg national poll. 58% say they are moving closer to getting their career aspirations, but 55% say they viewed trump unfavorably.
voted for theho president say he is doing a good job. senator mitch mcconnell put a vote on the reform bill on hold because they'll a republican john mccain is recovering from unexpected surgery. mcconnell is struggling to come up with the votes he needs the past legislation. the war in afghanistan killed a record number of civilians the first six months of this year, according to a u.n. report this year, which blamed the majority of the deaths on bombings by insurgents. the numbers can never fully convey the sheer human suffering of the people of afghanistan. tomorrow, british prime minister theresa may will remind her cabinet they need to keep meetings private. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries.
i am courtney donohoe. this is bloomberg. nejra: thanks. coming up, progress is the word of the day in brussels, where a second round of brexit negotiations is underway. >> for us, it is incredibly important we make good process. we need to examine and compare our respective positions in order to make good progress. ♪
jamie dimon unloaded on everything holding back u.s. businesses, saying it is an embarrassment to be a u.s. citizen traveling the world and that the u.s. needs to get its act together. earlier, "bloomberg daybreak" spoke with blair effron, got his take on what jamie dimon said. have: today, you would gotten into my world of m&a. we got into the year with certain projections saying it would be the biggest year for m&a. it is not. a lot of that is based on certainty of decision-making, confidence, and where we will go next year, three years, or when you make investments, you want to have a good tailwind following that investment. i do not think there is enough confidence today that we have broken out of the 2% growth world, therefore, getting these
reforms is important. i would finally say there is also a frustration that if we do dialogue getting the going by fall, you start running into the election counter of 2018. notd: you mention it is clear we will break out of 2% growth. how do you account for the two things you said? hand, markets are at all-time highs, but we are at less than 2% growth. what is the disconnect? blair: we are all trying to figure that out. alternatives for investments are low. there is general stability and there are pockets. the world is actually a pretty stable place. if not a growing place robustly, it is a stable. brazil and argentina finally attracting outside capital. again.growing 1.5% you mentioned china earlier. there is a sense globally that we are in an ok place, but that
-- not the kind of place we want to bnp are we want employment and wage growth. employment and wage growth. david: if you are going to advise trump today on the one thing he should do to increase real growth, what would it the -- what would it be? blair: exports. 9% of our manufacturing base is for exports. you go to germany. they have almost 30% of their manufacturing base for exports. it helps create jobs. we are not doing that. any of us is all for fair trade and everyone playing by the same rules. we do need trade and we need to be in the mix. we do not want to be in a position where japan and the tradeut together a
agreement over cars, reducing tariffs over japan's cars by 10%. fundamentally, remaining our position globally is essential. david: talk about the practical pressures this slow growth places on a small company. for example, procter & gamble. they are in the news now. does this slow growth put pressure on procter & gamble because if you cannot grow faster because overall gdp is not growing faster? inir: procter & gamble is the news for a different reason, i imagine. but more generally, i think we are not getting topline. you are getting more productivity below the top line, which means cutting back on investment. able to have that margin to reinvest in the business so you can get growth. but if you do not believe you have the underpinnings of
growth, it is hard to make that decision. vonnie: that was blair effron, centerview partners partner and cofounder. the themecking with of political risk, it is time for bread is the -- exit talks take two. theclock is ticking towards march 2019 split. joining us from brussels with a look at the state of play is bloomberg european government reporter ian wishart. so we have heard a lot about progress, getting into the substance of the matter. how much of that happened today? ian: that's right. they have been demanding progress on both sides. have we got any? not a lot. this is the first time they have really been discussing anything really in the three months that the u.k. has activated the cost to get out of the e.u.
they are discussing things about how to protect the rights of e.u. citizens after brexit, and the brexit bill, the money the e.u. once the u.k. to pay. i do not see any sign of progress whatsoever yet. bita: position papers are a of a sticking point. the european union says it knows where it stands on issues, but britain does not have those yet. what happens there? ian: the e.u. has posted nine position papers on things like citizens right and also on how much it once the u.k. to pay how much it wants -- how much it wants the u.k. to pay, whereas they see the u.k. side being a bit of a shambles. .ut nothing really of substance a lot of that derives from what
we have been hearing. divisions in the cabinet are making it difficult for theresa may and david davis to come up with any concrete idea of what their ambitions for brexit is. scord coming through from chancellor philip hammond, on the one hand saying it could take years, whereas david davis saying it could take months. does that increase the urgency of getting this done by the end of summer? it affectsot think the urgency. i think both sides are really aware it is urgent to get a deal on these preliminary issues, citizens rights, and the brexit by september-october. only then can they start talking about transitional deal. they can only start talking
about transitional deal once they start talking about what u.k. once for life outside -- what u.k. wants for life outside the e.u. vonnie: what is theresa may's strategy right now? ian: her strategy is to say to the e.u. what we have said all along is the u.k. wants to get out of the single market, get out of the customs union, but we want a really good trade deal with the e.u. that sounds easy and straightforward, but she has the twin problems of her own cabinet ministers not sure if that is youright shaji and the fee saying we can see you want a trade deal, but there are conditions attached. really, in these long hours in brussels negotiating, that is what they have to nail down. european reporter
♪ live from bloomberg world headquarters in new york, i am vonnie quinn. nejra: live in london, i am europeanic with the close minutes away. let's talk u.k. assets. we have been talking about the latest developments in brexit talks. i want to talk about the gilt. this is also about boe policy. u.k. investors gained a 2% loss in the past month. really, british bonds were the
past months' worst performers. a lot of investors still finding gilt appealing. standard life going long on the two-year rates versus the 10 year. i have the u.k.-german spread, the 10 year yield -- the 10-year spread. some are saying this may narrow as data out of the u.k. may stay the boe's hands. vonnie: i want to point to the currency. 1624, youok at g #btv will see the second round of talks has begun with sterling in a better position against the u.s. dollar. sterling well below 1.27, whole fiveow 1.26, a
figures difference. nejra: interesting, bearing in mind the bilt-bund spread. sticking with the prospects of a boe rate hike, bloomberg spoke to a dartmouth economist. >> i think not. we see a slowing economy. the labor market now looks to be a problem. real wages have fallen month i months since that decision last month and are now a negative. the economy is the slowest growing economy in the g-7 and e.u. 28. we expect following consumer demand and retail sales. and there is huge uncertainty over brexit. actually, it is more certain that negotiations are complete
chaos. this absolutely is not time to do anything to rates. movean we expect the next to be, once again, down. jonathan: i said that just the think notnny, but you necessarily they should or should not, but they will hike interest rates. well.o think they you have seen communication from the bank of england and also points on these slow down. consumption has been soft in q1, but if we are not talking about rate hikes now, when? hikesis talk about no from the bank of england until brexit is over. if we have that risk of a cliff edge, it seems an oxymoron to talk about how it is about idea to hike now because of brexit. brexit has not happened. that is what the bank of england faces.
if you look at the numbers from the wages, the last three months had solid growth in the private sector. those three months -- i know it is a small sample -- will be 4% annualized see the data is not as bad as some people say. a law of officials in the boe tend to see the same way as jordan. , allave carney, mccafferty sort of pointing to a need for some kind of policy change. what these think they are not getting? comment think the last was not true. private sector wage growth went .rom 2.4% a month ago to 2.9% that is a rapid decline. there is no evidence to tell you to hike. we have heard full comments from some of the members of the mpc will have backtracked rapidly.
i think the chances of a rate hike in august are nil. to say that uncertainty over brexit has actually diminished, that is simply not true. we have seen things in the auto sector, maybe these people have bets on they want to encourage people to follow that debt, but if you are sitting on the mpc, this would be a disastrous thing to do. if they do do this, they will quickly reverse it. vonnie: -- was dannyt blanchflower. equity firm kkr is preparing for a better future, promoting to executives, scott nuttall and joe bae.
henry kravis and george roberts will remain as code ceos and cochairman. aedit suisse is working out plan that will focus on investing in its most profitable areas. the bank moved up a strategy meeting in june from the usual time of late august. credit suisse says the new plan should drive the bank's valuation higher for 2018. at wheret's look european markets are trading. the stoxx 600 pretty much flat, not moving anywhere far. 5/10 of 1%, some of it probably down to weaker sterling. this is bloomberg. ♪
you can see a fair amount of green in parts of western europe. we have seen some decent gains. gains of more than 1% in norway and luxembourg. the u.k. up .5%. some of that could be down to weaker sterling. we're seeing the pound snapping three days of gains. this after it reached a 10-month high on friday as well. signs of discord within the u.k. government. this as brexit negotiations have resumed in brussels. euro dollar pretty much unchanged. this is the dollar overall recovering slightly. still holding near that 10-month low. in the fixed income space we're seeing yields move lower. both in the core and privilegery. you can see spain's yield down there. italy's down by about the same. the 10-year guilt yield down four basis points. some metals better than expected. china data gold up .5%.
and as we have been seeing, not today, of course, but generally yields move higher on bonds in europe. and also with the prospect of growth improving, not just in europe, but globaly. there's been a bit of a rotation. this chart is normalized as of december 30, 2016. so this is year to date. european investors favoring cyclicals again. rotating back into cyclicals from those defensives. if we look at industry groups today, the stock 600 after three days of gains, a bit of muted trading. we're up about .1% or .2% on the benchmark. materials outperforming. that on high metal prices. underperforming we have real estate and industrialists -- industrials. >> you can see the c.b.o. index is stillwell below 10. and the double index also weaker
at 9520. the canadian dollar is interesting. we've had a little bit rebound in oil prices. mainly following the bank of canada's decision to raise by 25 basis points last week. we've seen a strengthening of the canadian dollar. just a little bit weaker in the session. generally that was a big figure move. let's move to global macromovers for a little bit of a broader survey of what's going on out there in the world. the top markets you can see are mostly in europe and then of course china is lower interestingly after that g.d.p. data came in a little bit stronger than normal. all right -- or than expected. let's get to stocks here in the united states. >> the dow and s&p 500 once again on pace for record highs. earlier the nasdaq had been. at that time theerps the top stops for the -- at the time, these were the top stocks for hat.
microsoft also getting a pop after bank of america-merrill lynch raises their price target. look at alphabet turning slightly lower. earlier the stock had been higher. it will be interesting to see what happens here. all of this of course plays into the fact that the tech pullback has all but disappeared. if we pop into the bloomberg and take a look at this, this is a year to date chart of the nasdaq in blue. the 50-day moving average rising, telling us that the buyers are in control. we did have that period of bumpiness and it charted out as something that could be called a diamond top, a period of uncertainty up and down. other analysts out there were looking at this as a head and shoulders pattern. relative to the diamond top. it did initially break down into a lower level. now higher. the question is whether or not there's a pullback that will then result in another move down or if we're on the way to all-time highs. time will tell, of course. but if we take a look at another
chart in the bloomberg of the s&p 500, this chart may suggest that there could be some more volatility ahead in the month of july. 0-year average of monthly moves -- 30-year average of the monthly moves for the s&p 500. this is july. we see that over time the s&p 500 has tended to pop higher and move lower. in fact, it is said that it's very clear that this seasonal pattern is very strong. that the spike up tends to drop. we're looking at a tremendous spike up for the s&p 500. up more than 1.5% right now. the question is, whether or not we are going to see some sort of a pop and then drop for the s&p 500 as has happened many julys in the past. >> that's something we can ask our next guest. thanks there to abe gale doolittle -- abigail doolittle. u.s. stocks hovenering around record highs. how long will this s&p rally last? it's the question we keep asking. joining us from indianapolis is
legal group's c.i.o. he's also the core investment fund. you turned bullish back just more than a year ago. and you're still bullish. but with a little caution. what are some of the red flags out there for you? >> well, we're not that cautious, quite frankly. within our tactical funds we've got the latitude to shift net equity exposure between 30% and 70%. today we're at 67%. which is pretty remarkable, i think, given how far we've come and how high valuations have gotten. so certainly i guess we are concerned about valuations more than anything. but quite frankly in terms of just market action, we like the, for lack of a better word, the uniformity of this move in the sense that you've got large caps, you've got the russell 2,000, you've got transports, you've got the new york stock exchange financial index. all breaking out to new heights.
closing at new high it's last friday. we like to see a lot of disparate groups and different capitalization tiers of the market making new highs at the same time. we are intermediate term bullish. >> so at what point do those new highs become a little heady? >> what we're looking for, i mean, what typically occurs in the last phase of a bull market is fracturing of the market where you start to see, you know, typically it's the small cap and the transportation stocks and it will spread to other cyclicals. but some of these groups in the past have been bell weather industries that have topped out before the dow and the s&p. we'd like to start to see those lagging before we got very cautious on the market. we're just not seeing it. i certainly thought we'd start to see it here by midyear. i mean, coming into the year we thought, you know, maybe midsummer we'd be at 25, 50, 2,600. so we haven't quite gotten there.
but what's impressive is just, again, how sort of cohesive and uniform this strength is at current new highs. >> so you say there's a little time to go before this bull market really reaches its peak. but in that case, how would you advise investors to prepare for the bull's last rights, as you so nicely put it, in terms of portfolio positioning? how do you position the portfolio for that? >> we're sticking with leadership areas like technology and financials and interestingly enough, i mean, consumer discretionary is not normally a place where you'd put a lot of assets later in an economic cycle. in the last phase of a bull market. but those groups, and i'd be talking homebuilders, hotels and leisure, auto parts, i mean, very often those are thought of as early cycle industry groups to play. but they're actually looking very good, they've had a pretty
good markdown in the last couple of years. almost dating back to the q.e. tapering in 2014. we see pretty good relative values that are reasserting themselves momentum-wise with onsumer discretionary. those are the areas we're focused. if you want to play this last phase and these final phases can get pretty wild and woly and can be very profitable. i'd recommend sort of looking at how well the entire u.s. market is holding together. as long as you see this breadth of new highs with cyclicals and defensives, small caps, large caps, most of these groups either at new highs or within a percent orp two, that means the market is internally healthy. when you start to see things narrow, where it is led by more than just the fang stocks, and people have made a big issue about to what extent that handful of stocks is accounted for the year to date gains, i don't see it. it's not imbalanced yet.
the what not by fur cated like it was -- bifurcated like it was in the middle of 2007 or in 1999 prior to major market toms. we just haven't gone through that phase. i have to believe in an eight-plus-year bull market, that distribution phase will take some number of monthses. four to six at a minimum. >> one of the things that's also driven this equity rally does of course has been global growth and the pickup in global growth. not just that, but how synchronized it's been globally. when you look outside the u.s. as well, how much of a close eye do you keep on china and are you concerned at all that that could in any way pose a risk to the u.s. equity rally? >> you know, always concerned about that, just because of the quality of the numbers that come out of china or the lack thereof. but so we look at market based indicators. industrial commodities i think are a pretty good gauge of what's going on in china.
and industrial commodities had been very firm since the spring of last year. there's been a tremendous rise in industrial commodity prices. not so much in oil and the foods and grains, things of that nature. so i think that's a pretty good monitor of what's going on there. always a concern because of the shadow banking issues and the debt that's been accumulated during their expansion. but don't see a reason yet to get real concerned about china. and we're certainly encouraged by the growth we're seeing out of europe. in terms of the number of european countries that all of a sudden are posting g.d.p. growth on par with the u.s., if not higher. very encouraging. i think that's what's given some life to the cyclicals. >> and i want to ask what you're doing as part of your global fund. but i'm a little bit curious as to why everybody's cheering synchronized global growth. it's not as if we're going gang busters here in the u.s. we're probably talking about a one handle for the second
quarter. >> yeah. the quarter to quarter g.d.p. growth can get funky with inventory adjustments. i tend to like to look at just year over year, real and nominal g.d.p. growth. you're right. we're not going gang busters and that's true in europe as well. i think it's relative to expectations. europe is outperforming expectations. and we also pay close attention in that regard to expectations on these economic surprise indexes. these have come way down. we had a flurry of surprises near year end and in the first quarter. second quarter, relative to expectations, was a little bit disappointing. so you sort of mark down the frequency of these economic surprises and lowered expectations. that's a good thing, i think, if you're invested in a more cyclical part of the market. there's a little bit lower hurdle over what's to jump in the second half of the year. so that's why we'd favor cyclical areas over defensives
like the consumer staples, which are ridiculously expensive. and the same is true of utilities. so more beta in the portfolio, which again, that's sort of nonconventional for a late cycle bull market. but that's where we see the values and the leadership right now. >> thanks to doug ramsey there very much for joining us. all the way from minneapolis. >> let's check in on the news. >> russia's demanding that the u.s. return the embassy's country houses outside washington and new york. the obama administration seized the houses at the end of the year in retaliation for election hacking. russia calls that a breach of international law. and hopes to resolve the dispute at talks today in washington. president trump is preparing to shake up his legal team and the changes may not stop there. as investigate vegses into his campaign's ties with russia heat up, president is likely to put his long time attorney into a less prominent role. that's according to a person familiar with his thinking.
plus president trump is considering what to do with his communications staff. in south korea, new president is following through on campaign promises to pursue dialogue with north korea. moon's government has presumed resuming talks on military and humanitarian issues with kim jong un's regime. that comes after north korea signals a willingness to consider moon's overtures. in venezuela, opposition leaders say more than seven million people cast symbolic vote against maduro's plan to rewrite the constitution. the symbolic vote, no legal impact on that. but that could pressure maduro to withdraw his proposal. global news 24 hours a day, powered by more than 2,700 journalists and analysts in mo more than 120 countries. >> coming up, tesla c.e.o. is apparently driving down shares of his own company. find out what he said that may be spooking investors. this is bloomberg. ♪
>> live from london and new york. >> this is the european close on bloomberg markets. tesla's shares are down today by about 4%. c.e.o. elon musk spooking investors with comments he made about his company at an event this weekend. he said, quote, i've gone on record several times saying that the sale price is higher than we have any right to determine -- deserve. it reflects a lot of optimism about where tesla will be in the future. and there's another story out of the midwest today. joining us with more on all of this is bloomberg news detroit bureau chief, david wesm. stock is definitely off its lows of the day.
dropped about 3%. and there is this report of a to teng accident in minnesota, details are still a little sketchy on that. but what are investors reacting to for the most part? >> i think they did react in part to what musk said over the weekend. when he said the company's overvalid. it's not the first time he said it. when tesla's value surpassed that of general motors, he shortly after that said he thought his own company was overvalued. particularly compared to g.m. there's some reaction. you saw shares open low this morning. when they started to dive more steeply, though, was around 10:00. that's around when the news story came out about this accident in rural minnesota, where a model s crashed with someone using the -- saying they were using the auto pilot software, which is like a driver assistance program. it's not a self-driving car but it helpses you correct. if you're veering out of lane and that sort of thing. >> the star tribune is reporting this and saying that the driver and four passengers were
slightly hurt. so we'll wait for more information and confirmation on that. meanwhile, back to musk's comments. he has a way of sort of saying the shares are overvalued without sounding like he really believes that investors are misguided, if you like. he sounds humble and somehow what he says doesn't make it sound like he doesn't believe in the company. >> he certainly believes in what he's doing. he's got this vision. but you look at the value they've got, it's so high. there's such a big premium on it. it's based on growth in several different markets, where he's playing. battery stores, the electric cars, model 3 has to really hit it out of the park and not have any issues with production. they've got to get battery production, which has been an issue for the model s and the model x. they have to get that right. i think even elon knows that he's got to do a lot of things perfectly in the next six to 12 months to really justify a valuation like. this and then sustain it for quite some time into the future. >> yeah.
david, i've got a chart here of the tesla share price. on the 6th of july we saw it drop below its 50-day moving average after a triple blast of bad news. it has stayed below that, this after it hit a record high close on june 23. after an almost 80% gain in 2017. if i look at the function on bloomberg, i can see that analysts have six sells, 10 holds on the stock, eight buys. what are analysts saying now about where this share price should be going and what it needs to sort of sustain these highs? >> you've seen some long-time testables like morgan stanley who has got an little bit more bearish on the stock. i think we've seen in the last couple of weeks, with some of these newest events you just mentioned, they in and of themselves didn't say that tesla is way overvalued. but they kind of sent a reality check for a lot of investors. when they had the issue with sales, sales weren't quite as good as people thought.
partly because they couldn't produce enough batteries. partly because a lot of people just waiting for the model 3 and not buying the more expensive cars. that woke investors up to the focket that this company is new to the fact that this company is a new company. there could be some revenue risk there. i think those were a couple of factors. this accident in minnesota, the person is saying that the car just took off. it was unintended acceleration. auto pilot doesn't really do that. the action in florida auto pilot didn't see a truck in front of the car. but it doesn't accelerate on its own unless there's a serious malfunction. that in and it -- of itself, does that say there's going to be a big series of accidents with auto pilot? i don't know. but it does wake up investors to the fact this this is a young company with new technologies and new to manufacturing and there are risks and you really have to weigh that in against
all the hype we've seen from the past six month or so. >> our detroit bureau chief. thank you so much. time for the bloomberg business flash. a look at some of the biggest business stories in the news right now. in london, a judge has set the trial date for four former barclays executive accused of conspiring to commit fraud over the bank's 2018 fundraising -- 2008 fundraising. they will go on trial in january of 2019. they've indicated they will plead not guilty. the c.e.o. of scandal rock signal jewelers are stepping down. he's citing health reasons. he's been accused of misconduct. and the company faces allegations of sexual harassment and talking customers' diamonds with lower-quality stones. that's the latest on business flash. >> coming up, a battle of the
>> it's time now for our monday global battle of the charts. that's where we take a look at some of the most telling charts of the day and what that mee phone investors. you can ac cease -- and what they mean for investors. you can access these charts on the bottom of your screen. >> i'm taking a look at the slough of chinese economic data that came out overnight. of course when we woke up this morning, due to retail sales, industrial output and g.d.p., all crinesed better than economists had expected. those here of course are in blue, yellow and white. all except g.d.p. which i left off so we don't get confused. what does this mean for china's debt problem? that's the biggest concern for investors when they come and wake up to this data. this is good news, better than expected g.d.p. is giving china
some leeway to start unwinding some of that debt. we also spoke this morning to head of international fixed income. he's saying there's little evidence of when this story begins. for now china's cost financing remains low, as long as this economy continues to grow and beat expectations, china's debt problem is going to be ok. you can find that online. >> i think it's over to you. >> thanks. we've been talking about the equity rallies's relationship to the bond market and tech stocks. so i guess i wanted to wrap that all together and bring you this chart which looks at the new bond proxy. when we talk about bond proxies, we don't normally talk about tech stocks. you the nasdaq has shown a tiretwlink -- link with bond yields than utility stocks. it's moved in the opposite direction of 10-year treasury yields in nine of the past 11 days. a streak of negative correlation that hasn't occurred since september. the relationship's been so
strong that tech links to yields over the stretch, as i say, has surpassed even that of utility stocks. so that's what's interesting here. >> this is a tough one, i am torn. i think your chart is amazing. i do think that i'm going to ward today's winning ticket to taylor. because i think probably didn't talk enough china. to so there you go. congratulations. >> thank you. >> and coming up thursday, don't forget, we are going to follow all of the e.c.b. policy decisions followed by that news conference. that's coming up thursday on bloomberg television. ♪
from bloomberg world headquarters in new york. here are the top stories on the bloomberg and from around the world that we're following. uber has faced its fair share of scandals this year. we hear from their head of west coast business on how the $69 billion company plans to pick up the pieces. procter & gamble faces a proxy fight for a board seat. a deeper look and trends and activist investing with morninging -- with morgan stanley. and k.k.r., private equity firm named for its founders, is preparing for a day when those leaders are no longer at the helm. an inside look at the company's succession plan. before we get to all of that, let's check in on the news. >> thank you. president trump continues to enjoy overwhelming support from the people who voted him in. but they're less enthused with hi