tv Whatd You Miss Bloomberg September 24, 2019 4:00pm-5:00pm EDT
elevated risk between the sectors versus the index. certainly i think that is a driver for the factor. caroline: nasdaq off by 1.5% today as we see in the line of fire from a regulatory perspective once again the big social media names. -- chipmakers in the line of fire. aboutt: the index off 3.25%, the most since late august. nonetheless, it feels different this time because there is something more to it. thes a case of the pile on, negative headlines. joe: a company like shopper fight getting destroyed over the last few weeks, i don't think they are in the lineup regulatory action. nonetheless, they were so hot and are getting creamed.
caroline: abigail, what are you watching at the close? abigail: the technicals on the tech heavy nasdaq. this is a roughly 1.5 year chart. the range, the complete range. we had the last bit of the rally, the fourth quarter volatility. triedct that the nasdaq to touch down onto its 100 day moving average in yellow. you can see that has happened before. thelast time that happened, time before that. the biggest point, all-time highs, buyers are not very enthusiastic. suggest we will be sideways for a bit longer with stocks.
sentiment, risk off you see that showing up into buying bonds. the 10 year yield is down about nine basis points. we are waiting of course for that press conference from nancy pelosi with a formal inquiry into the impeachment of trump. this is the one-day move on the three-month month 10 year, down now 12 basis points. we are inverted by 28 basis points. we have jumped by almost double here today alone. we do know that after inversion, typically you get a quick re-steepening, then a recession hits. but theot there yet negative basis points certainly catches my attention. i am looking at the
largest etf tracking the price of gold. if we look at a chart tracking the flows, investors added about a billion dollars last week and this week, they have already added another $700 million. this is typically seen as a safe haven. investors rush into it in times of turbulence. we could continue to see more inflows. joe: still with us, credit suisse chief equity dilute -- equity derivatives strategist, and bloomberg's sarah ponczek. what would you look towards next in terms of pessimism, i don't want to overstate it. we keep thinking we will break out to new highs, it doesn't really happen. what are the things you are looking for that will determine the next direction? andy: the answer always comes
back to the fundamentals and the data. the things we looked at about whether that could persist going forward, historically, for you to get it, you need to see a pickup in economic growth. until we see that, i think the market will persist in trading sideways. scarlet: hd supply will be separating into two publicly traded companies. it will separate into facilities maintenance and construction and industrial businesses. again, this will be a tax-free spinoff. this will be completed by the middle of fiscal 2020. in the meantime, just to go back to the broader markets. the economic data was not very impressive today. consumer numbers in the u.s. disappointed. german business confidence also not so great. there is just this feel of softness. our people talking about
recession again or is this being put aside? when people talk about the economy when it comes to the u.s., they are talking about slower economic growth. yes, a fall in confidence today but it is still relatively high. you might see confidence trending lower. at the current moment, people don't look at the current moment and see it pointing to a specific recession. saw that with german iso numbers this morning. continuing to see week data overseas, strong data in the united states. slowing global-- growth to bring the u.s. lower or for you start to see perks of
it higher overseas. caroline: we have seen again the bid for bonds back on when it comes to sovereign bonds and treasuries. how are you seeing this across asset correlation? for bondsally, a bid and a selloff in stocks? mandy: with the august correction, not just across august,t we had in equities, rates, gold, asset classes, the highest correlation over three years. showing how much focus is on the underlying economic fundamental. joe: what changes that? what gets us out of this range? is economicieve it
fundamentals. to we didn't see that bid correlation. when it is more macro, more about economic fundamentals, that is when you see the bid to volatility, correlation, and asset classes moving together. as a comparison, the last time we have seen such elevated levels of cross asset was the brexit vote. scarlet: let's talk about stimulus, the thing that will keep us afloat at the very end. the pboc perhaps not coming in as strong as some expected. about perhaps also shy talking up the need for fiscal spending. the fragility when it comes to the global economy.
see concretedo moves and europe toward fiscal stimulus, that would be a game changer. what european governments are relying on is monetary stimulus. if we do see concrete legislation. that would be a risk on positive sign. santander, the spanish-based lender, a big player in latin america and america, 1.5 billion euros from santander u.k., approving a tencent per-share dividend. accounting principle that describes what seems to be a permanent reduction in assets. isther or not the ppi again engulfing the company, we will dig into those details.
we will get nike after the bell. one of the concerns about nike is that it will be affected by fx. sarah: if you look at the dollar's relative levels, it is very strong. if you want to see the fx earnings, especially for multinational companies like nike, you were -- you are going to see a big move in relative levels of the dollar. if you are looking at data out of the u.s., how much stronger , a scenario where the dollar moves much lower. mandy, i want go,
to get your perspective on oil. it has sold off quite a bit after that attack. it is not much higher than pre-attack. macro conditions which on a day like this would mean a decline versus ongoing tensions with theoretically would keep a bid under the price of oil. are seeing awe lasting impact as a result of the supply discussion is in the versushe demand for puts calls. last week, calls on oil was trading at a premium for puts. retraced inoil has terms of prices, that inverted skew, that is a result of the supply disruption risk. scarlet: we will keep an eye on
today, one of the worst days in a month for the s&p 500. joe: the question is, "bloomberg technology" --the question is, "what'd you miss?" caroline: president trump says he will release the transcript of a call with the ukrainian leader after calls for impeachment grow. u.k. lawmakers reconvene tomorrow. neumann steps down as the ceo of the company as they look to salvage the ipo. joe: president trump under fire pressuring the ukrainian president to investigate vice president biden in return for aid to the nation. he said he will release the transcript tomorrow. this has renewed calls on impeachment, increasing pressure on house speaker policy. 45 is set to speaking about
minutes. -- speak in about 45 minutes. mr. biden: congress should demand the information that it has a legal right to receive. if the president does not comply, if he continues to obstruct congress and flout the law, donald trump will leave congress in my view no choice but to initiate impeachment. that would be a tragedy, but a tragedy of his own making. forlet: for vote --joe: more, welcome bloomberg news congressional reporter anna edgerton. it feels like something really shifted today. there has been a contingent of democrats calling for impeachment for quite a long time. what is it about this story in this moment that seems to have caused a shift in momentum? anna: really two groups of
people i would look at. one is a group of freshmen democrats who represent districts previously held by republicans. they were hesitant to come out in favor of impeachment because of political risk. a lot of them came out last night and said this allegation regarding the call that the president had with the president of ukraine and the refusal to hand over the whistleblower complaint, those are impeachable offenses. , houseer group of people nancy pelosi and her allies. the fact that nancy pelosi herself is showing signs that she is moving closer to supporting this in supporting having a vote on the house floor, that is where this becomes very serious. the buck stops with her. if she gets behind this process, it is probably going to happen. romaine: as we saw during the clinton impeachment hearings,
one of the reasons why pelosi had slow walked this for so long, she tried to protect some of the districts that were little bit more purple. has that idea changed? has that narrative changed? there was a really interesting comment from a representative who represents one of those districts. she said, please don't drag us into this. what i am seeing from the conduct of this president, what he has said publicly, not just allegations, and the white house refusal to cooperate with white house -- with aggression committees, it is her constitutional responsibility, she swore in of, that she has to support this impeachment
proceeding. because there is no other way to hold the executive branch accountable. she said today, i hope my constituents understand that. she said members of districts like hers need to be out there in front of the messaging battle. we can leave these two progressive members who represent the safe blue districts. these need to be the people who are the most hesitant to take this dramatic step and make sure they are conveying to the american people why this is the last resort. something that must be done. end in theoes this senate? anna: the house is responsible for conducting the impeachment process but it is up for the senate to remove the president from office. that is another obstacle for nancy pelosi to as a tape. tothe senate is not going impeach the president, it is
another acquittal for him. we had some really interesting statements from senate majority leader mitch mcconnell, not saying that he's ready to abandon ship right yet with the trump presidency. he criticized democrats for politicizing the process but he didn't exactly defend the president. it looks like mcconnell and some others are holding their fire for a find out what happened and what the whistleblower is alleging. somene: just to bring you breaking news, nike out with their earnings report and looked like it eat on most of the main metrics. stop closed at a record high back in july. a new record high. number, $.76 was
a verdict we will respect. we will respect the judicial process. i strongly disagree with what the justices have found. i don't think it is right. but we will go ahead and course parliament will come back. caroline: johnson said he is prepared to deliver brexit by the end of next month. the pound rallied on hopes that maybe we would get an extension or we wouldn't see a sudden exit. but what really changes here? here? certainly the eu has even less reason now to perhaps abide by the game of chicken that boris johnson would like them to. >> there's a lot going on. supreme court ruling, which is unprecedented, the possibility theoris johnson resigning,
queen speech coming up, but fundamentally nothing has changed. reaching a deal with the eu, issues like the irish backstop. it looks like what we will get on october 31 is another extension. our supreme court frequently weighs in on huge cases. talk to us about how rare this was that there was a u.k. supreme court decision that really held such high political stakes. >> this is unprecedented. nobody saw this coming. unlike the united states, which has a written constitution. britain does not have a written constitution. what this means, when the supreme court intervenes, it intervenes because it is interpreting a written document. for the supreme court in britain to intervene, this is seen as a
political act, not an act of interpretation. the fact that they intervened, and so forcefully, effectively accusing the prime minister of misleading, even lying to the queen, it is unprecedented. romaine: at the end of the day, some people will argue that the fact that you don't have this written on paper in regards to , some sliver of a window for boris johnson to move ahead with some of his original plans. he can still sort of pushed forward with some of the tactics in the first place. that is exactly what he will try to do. the position that he will leave for anber 31 and not ask
extension is what he is committed to. this means he has to work against a parliament members of his own party have no confidence in him. caroline: for many in the theness community watching, issue that whether there is a soft brexit or resilience for asset prices high, who could was over if press johnson to exit, notably of there was a labor jeremy corbyn-led government. how do you see that unfolding and whether it really is a negative impact for certain assets and economy in the u.k.? stacie: there is a lot of fear about jeremy corbyn taking over. arguably, some of the pathways have already been increased.
you have the possibility of a labor government taking over as a caretaker government. jeremy corbyn could step in as the leader of that caretaker government until there is an election. the fundamental question is who could deliver a deal. arguably, jerry corbin -- jeremy corbyn is in no better position to deliver a deal than boris johnson. re-work.ng, we work ceo adam neumann stepping down in a move to salvage an ipo. this is bloomberg. ♪
president joeice biden says he would back impeaching president trump if the white house refuses to comply with congressional demands for information about his interactions with ukraine's president. in biden spoke to reporters wilmington, delaware, today. mr. biden: with such a written -- continuing to obstruct commerce -- obstruct congress and flout the law, president trump would leave congress know choice but to initiate impeachment. that would be a tragedy, but a
tragedy of his own making. mark: earlier today, president trump said tomorrow he would release a full transcript of a july call with the ukrainian president. nancy pelosi is expected to announce that she is beginning impeachment proceedings against the president. in an address before the united nations general assembly, south korean president moon jae-in promised to achieve security for north korea in order to achieve denuclearization and peace on the peninsula. translator: we will continue dialogue with north korea and make our way toward complete denuclearization and permanent peace while maintaining cooperation with u.n. member states. mark: the south korean leader also called for an international peace zone between the koreas. brazilian president jair
bolsonaro is dismissing what he says are media lies about fires in the amazon. he says the rain forest is not being devastated. president bolsonaro told the yuan general assembly that many fires occur naturally in the forest during dry weather. he did also acknowledge that some are intentionally set. widespreadrew contention against his policies on the environment. brazilian leader added, "the amazon is not being devastated nor is it being consumed by fire as the media increasingly says says."ncreasingly jeremy corbyn told the media today that the ruling by the supreme court shows prime minister johnson's contempt for democracy and the rule of law and he says it is time for johnson to leave office. mr. corbyn: government will be
held account for what it has done. boris johnson has been found to have misled the country. this unelected prime minister should now resign. mark: meantime, the speaker of saysin's house of commons parliament will resume deliberations wednesday at 11:30 a.m. global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. crumpton. this is bloomberg. romaine: nike reporting its latest earnings. beatingeps and revenue the highest analyst estimates. let's welcome in sarah halsey to break it down. a few months ago, nike missed, the first miss we had seen on a quarterly basis in about seven years.
they seem to have bounced back. what has allowed them to get back on track? the real call out was expansion of gross margin, 150 basis points, far better than analysts expected, and far better than nike expected just months ago. they said they were able to achieve higher average selling prices in the quarter and that is important. they were not having to markdown or two pay promotions. they also said it came because they were able to sell strongly through their stores and websites. nike taking a little more control of its brand. joe: is there any sign that the trade war or tensions between the u.s. and china generally is hurting them because that is a crucial market for them in terms of manufacturing and sales. sarah: we didn't really see any callouts. nike does a fair amount of manufacturing in china.
they say 25% of their global goods come from there. a lot of the goods are made in .hina they didn't take their guidance down today and we didn't see any weakness in geographic markets. caroline: when you look at the revenues, they were up 10%, they say, on a currency neutral basis. clearly, fx was somewhat of a headwind. how do they navigate this being such a global business? sarah: currency is something they have said previously that we would have to have an eye on all year. not quite as strong as they were expecting in the corner. nike is a global business. i think they are used to navigating through roller coasters on that front and i expect they will continue to do
that successfully. other huge corporate story that we have been tracking all day, wework's adam neumann stepping down as ceo with two executives being appointed as co-ceos. let's bring in analyst jeffrey lang bomb. what is this going to accomplish? obviously, they need money, there are all kinds of concerns. but does this take them some step toward righting the ship with adam neumann departing as ceo? jeffrey: it is impossible to determine how much of the investor pushback and reduction bevaluation -- those may now addressed. the underlying business, the , andtch in lease duration
what the valuation to the company. romaine: he even said in his departure that there has been a lotch focus on him, but of the reticence was not just that the company wasn't making money but how there was a clear path. jeffrey: the question of how they can exist in a recessionary environment, how they managed to exist if they can't grow as rapidly, access markets and credit lines, and it also still comes back to the same point which is what is the proper valuation for a co-working business. that for themnow to get the credit line of about $6 billion, they need to have a
quote unquote successful ipo where they raise $3 billion. what would get them to that $3 billion and invest as they wish? to what that comes softbank is able to take a right down. the market will tell you what it is worth. what they are willing to accept will tell you whether or not they come forward with it, whether they pulled back, then come back again down the road. caroline: thank you. let's bring you some breaking news. nancy pelosi, speaker of the house, is telling democrats that a trump impeachment inquiry is going to start. the momentum today for the democrats has seemed to have mantle, the july 25 conversation with the ukrainian president, who president trump will be speaking with again tomorrow. more on that after the news
caroline: breaking news again. the speaker of the house, nancy pelosi, has told democrats in a closed-door meeting that the house will begin formal impeachment inquiry into donald trump. this is according to a lawmaker in the room. joe, educate my naive british brain. the last time we talked about a each meant -- about impeachment was clinton. with the senate the wrong way wired for this, does it matter? romaine: i think symbolically it matters. democrats have to get the votes in the house of representatives to impeach him. but then, the vote has to go to the senate and then two thirds for chardy tour -- two thirds
majority to remove him from office. this is more about a rebuke to the president rather than removing him from office. joe: this is going to now be the story every day. one of the things that trump's critics and a lot of the frustrations of the democratic party, obviously, if you remember the clinton impeachment, it was the number one story for weeks and months. opportunity, nonstop for whether trump abused his power. romaine: going forward, you have to wonder, is anyone going to investigation,he then the other thing, what is the reaction function by the president himself. this could take us down a very
different path. keeping an eye on it. we will bring you all the updates. we will get trump's transcript call with ukraine. we will now turn on to the regulatory world, the vaping scandal under fire from u.s. regulators. keeping devices out of the hands of kids from an unexpected place. the biggest makers of electronic cigarettes, said its devicesp keep of minors.hands joining us, a professor and chair at the stanford university school of medicine. thanks for joining us. has sort of gotten to
prominence because of this regulatory gray area that exist it in order for it to survive, do you think it is capable of closing that sort of regulatory notholes to its benefit and getting itself caught up in the process? >> juul is kind of between a rock and a hard place. the biggest commercial threat to juul is the proliferation of copycat devices which sell the consumables -- and this is the main profit, selling the nicotine pods over and over -- at a lower price. they would like standards of purity and good manufacturing that would be beyond the financial ability of many startups in the vaping segment. has a other hand, juul challenge because it has triggered an epidemic of nicotine addiction amongst american high school kids with
about 5 million high school kids using juul in the last 30 days. -- all the more reason they want to ban flavored electronic cigarettes. all of their application is well done, there is no doubt it is still responsible for a huge upsurge, they could be denied and taken off the market. joe: it is interesting, your description of that model. it sounds like razor blades, gillette, hewlett-packard and printer ink. with those companies, if there was a substandard substitute on the market, it doesn't create this massive health care that regulators need to get involved -- health scare that regulators need to get involved in. dr. jackler: let's not forget
that juul itself is creating health concerns. we are seeing not just acute illnesses but also we are concerned about the effects of vaping over 30 years. if you start smoking as a teenager, you won't get emphysema or lung cancer until you are in your 40's or 50's. these devices, some of them are true counterfeits. they say juul on them and act as a they are juul some act as proprietary linkage of the pod to the device. many others of them are simply competitors. very hardul is trying to suppress competition in the marketplace. nearly $40 billion. veryadult smokers are price-sensitive. if a pack of marlboro's in america is eight dollars, a juul
pod that delivers the same nicotine as a pack of marlboro is four dollars. these knockoffs do the same for two dollars. so, children, teenagers have limited discretionary income and they will downgrade to limited brands. caroline: already we are seeing some of the knock on effects. we understand they will be restructuring in terms of staff. the pressure is clearly mounting. from your perspective, is there anything that could eventually take them off the market from a health perspective. yes, nicotine addiction is something that is very worrying but it can still play out the case that it helps people cut out cigarettes if nothing else. ae there negative effects of juul aside from the nicotine
addiction? dr. jackler: there is no question that the acute effects appear to be oil-based extracts of thc and cbd, which is marijuana. the cdc has not come out with the comprehensive investigation nicotinees appear that products have risk of lung injury. any regulation should be category wide. what we are seeing is bursting of the youth fascination with juul. it is one thing to tell a teenager, if you vaped, 30 or 40 years from now, you might get sick. if you tell them, you might die next week, it might get their attention. juul is starting to become uncool. teen fads, they are never long-lasting and you can count on them as a business model forever. the number of adults using juul, it seems to me that most of the
joe: house speaker nancy pelosi telling democrats that she will .egin an impeachment inquiry bloomberg news congressional reporter anna edgerton joining us with the latest. the biggest deal right now is that policy is presenting this to her house caucus as something that will happen going forward. she has not given details on what would be included in articles of impeachment. she will make an announcement at 5:00, in about 10 minutes. we will be looking for what will be in the content, if it would
focus just on these ukraine allegations and the whistleblower complaint, or if it would bring in other things that he houses investigating such as the president's taxes come of the mueller report -- taxes, the mueller report. romaine: there are different committees now, is this a consolidation or will there be separate tracks? anna: we have found out that there won't be a select committee. they are not going to establishing specific up of people. it will be a continuation of these committees, probably the judiciary committee that takes the lead on this. caroline: thank you. we know you will be busy from 5:00 p.m. let's talk about tackling climate change. it is on the top of the agenda for the u.n. general assembly this week. be targeting net zero missions by 2050. joining us, the global head of
sustainable finance at city global insights. how do we get there? >> it is extremely difficult. that is one of the things we tried to show in the report today which everyone can find. we moved to pretty extreme scenarios like 100% of new vehicles being electric vehicles in new markets by 2050, 2030, really doesn't make much of a dent in emissions because of follow-on consequences. increasing wealth levels in emerging markets, we will just move a lot of the legacy internal combustion engines over to emerging markets. even for big pushes for one point 5%, 2% efficiency in the industry segment, we can only get to about halving emissions. joe: from a policy perspective,
what could governments do that would give us the best shot, within what is possible in your view? where itk it depends is in the world. certain parts of the world like scandinavia are a long way ahead of this where already half of vehicles are electric vehicles. other parts of the world are still building vast amounts of coal-fired power stations. some parts of the world are still expanding quickly, increasing levels. we can see the financial sector needs to put instruments in place that will offset the attractiveness of costs. i think the one overriding thing is unified carbon. -- it is taxing out the legacy stuff, whether it is power stations or internal combustion engine vehicles.
scientists continue to narrow this window of opportunity. i'm just wondering, do we have enough of a runway here? >> there's a lot of different targets and the longer we leave it and the closer we get to the carbon budget, the costs and the closer we get climate change start to go up. we are all coalescing now at 1.5 degrees. at the moment, about 50 gigatons of co2 equivalent a year, that gives us between 10 and 15 years before we hit the carbon budget. don't forget, when we hit the carbon budget, we have to go to net zero then. the point about starting to act now is that we slowly trajectory to the carbon budget and by
ourselves more time. it depends how fast you want to get rid of your car after we hit it, basically. things stayeffects, in the atmosphere for a long time. caroline: do you think any of the commitments being made this week will help? >> absolutely. huge commitments coming out of the private sector from corporate's which really change things. massive commitments from investors with trillions of dollars of capital and commitments coming out of countries. it will make a difference. caroline: i like it. thank you. the global head of sustainable finance at citi global insights. romaine: we are going to have live coverage of nancy pelosi's statement at 5:00, followed by the republican response at 5:30
>> breaking news on bloomberg television. just moments from now, house speaker nancy pelosi is do to a statement regarding a potential impeachment inquiry into president trump. she has met with democrats this afternoon. more than a dozen democrats have recently called for impeachment of donald trump on reports that president trump asked ukraine's president multiple times to investigate joe biden's son. good afternoon. last tuesday, we observed the anniversary of the adoption of thti