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tv   Street Signs  CNBC  July 31, 2019 4:00am-5:00am EDT

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i'm willem marx. this could be the first time in more than a decade markets await today's blockbuster federal decisi decision credit suisse shares jump as the bank emerges from three years of restructuring with profits beating the second quarter but the ceo says the future is uncertain. >> it's a tough environment, and our outlook is i consider
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relatively mixed loyal shares on track for their worst day in nine months after top line growth misses the mark in the second quarter don't miss our interview with jean-paul agon at 11:30 central european time. and apple shares jump in after-hours trade after beating expectations and returning to growth in the third quarter but iphone sales miss estimates. a bit of a mixed message in the european markets the xetra dax performing relatively well as is the ftse mib in italy the cac 40 in paris and the ftse in london in the red it's the thick of earnings season in europe a lot of these numbers being driven by what's going on in those various markets. as we talk about some of the companies that are in focus in
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the thick of therapyings season, you have major reports from the financi airli airlines airfrance-klm up strongly after posting a 15% rise in quarterly operating profit l'oreal over here in the far right corner for me is trading near the bottom of the index after posting weaker than expected growth in second quarter. let's start with credit sweeuis. they have beaten expectations with the highest quarterly result in four years the lender said they have healthy levels of client engagement
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carolin roth is in zurich where she spoke to the ceo what did he have to tell you >> it's difficult to find a fly in the ointment in credit suisse's results shares are up 4%, investors clearly rewarding the bank for the performance of the last quarter. it's not always been this easy for the bank it's been through three years of painful restructuring. it seems like it's now able to enjoy the fruits of that very difficult labor. and credit suisse has now been able to hit its return on tangible equity target earlier than the market had been anticipating almost 10% this year that was the target. that's what they reached it depends on revenues going forward and the outlook, like for any other business out there, is difficult given the volatility we're seeing, the lack of visibility when it comes to trade wars, brexit, and that is reflected in client
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confidence, specifically in the bank's key profit driver another issue is falling interest rates they have fallen a lot already this year. what is it going to do to the net interest market in the wealth management business that's a key question we discussed earlier on my bigger question was what are you going to do next you've done the restructuring. you've done it pretty well the market is rewarding you for this there are some reports out there that he may be interested in the top job at the imf let's see what he had to say >> potentially only interested in my own job and continuing in my own job that's my number one priority. look, it's been, as you said, tough. i think we've had tough exchanges, not just on a personal level, but just because the situation was tough. it's pleasing for me to see things so much better, to see
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people smiling around the company. that's when it gets interesting. people were worried when i arrived because i was not seep as a growth manager. people didn't know i could do a restructuring. now we need to show growth that's an exciting proposition >> so he wants no other job than his own. i should come back to the results and point out global markets did surprisingly well. fixed income was up 11%. equity sales up by 3%. that's better than some competitors because we're still in a very difficult trading environment. back over to you >> i will run our viewers through some other bank numbers. bnp paribas reported a 3% rise in net income which speeded expectations they got a boost from lower retail costs and strong performance at its corporate and investing banking unit the capital ratio came in above
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estimates. as the fed gears up for an interest rate cut or what many expect could be a cut, bnp paribas will prepare for a future that involves lower interest rates >> interest rates have been low for a while. that's why we continue our adaptation that's why we stepped up the adaptation in this quarter to make sure we're ready in that environment to have a bottom line to grow >> the ecb clearly sees a need to make lending easier, to stimulate the economy. you posted a 9% rise in corporate banking revenue, 8% rise in loans. is the economic picture in europe not as bad as feared? >> if you look at what we saw in the second quarter of our loan growth, if you look at the retail up 4%, if you look at corporate banking, it's almost double digit there'ses a s a demand we have to see if the ecb will announce if that will taper off a bit.
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but growth is there. it might be slower, but it's there. that's positive. >> that's banking. let's talk about insurance swiss re's net profit fell in the first half of the year but still beat expectations. claims from the ethiopian airlines crash and the grounding of the 737 max pushed up costs as did severe weather events the reinsurance giantposted a loss in its commercial insurance business carolin roth also had a chance to talk to their leadership. what did they have to say about this environment >> the cfo of swiss re talked to us a short while ago he said, yeah, it's not been the easiest of environments for the reinsurance business you had a number of man made and natural craatastrophes. the boeing impact is still there. they took a charge of roughly 1$120 million in their pnc business visibility on that perspective is not very great because the
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planes are still grounded. but apart from that we have the corporate solutions business, which has been loss making the company is tackling that they're working on a turnaround strategy and hoping that business will be back to profitability, back in the black come 2021. but one of the big issues that kept the market busy was swiss re's plan to ipo its reassure business the ipo was planned for earlier this month, but it was shelved why? because of difficult market conditions, lack of investor demand, institutional demand and probably that had something to do with the weak performance of some of the other ipos we've seen in the london market. my question to the cfo is what is the plan now? what are you doing next? will you try to list it again? could a pe company come to the rescue >> the plan right now is to run this business. we think it's a strong business. it doesn't fit perfectly in our capital model that we have in switzerland.
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but the asset itself is a strong performing asset i think we'll wait and see how markets develop. we have no intention of going back for an ipo in 2019, 2020 could be another story we'll also do what's in the best interest of shareholders we've explained our midterm objective is to deconsolidate that that means moving down from where we are at 75% ownership to below 50%. >> it's worth pointing out that shelved ipo puts into question the second trench of the share buyback program that the company announced and started earlier this year. i asked the cfo are you going ahead with that? he said we have not made a decision yet we'll make that decision come the third quarter. potentially bad news for swiss re investors there back over to you the swiss national bank posted a jump in first half profit thanks to lower global interest rates that spurred an increase in stock markets and helped boost the central bank's
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equity assets. the value of gold holdings rose as the price of the precious medal got a bump amid the dovish noises from the central banks. the u.s. president, donald trump, has again criticized the federal reserve ahead of what suspected to be the first rate cut in more than a decade. trump reiterated his view that the fed's leadership made some mistakes in the past >> the fed move far too early, far too severely, puts us at a disadvantage fortunately i made the economy so strong that nothing will stop us but the fed could have made it a lot easier i would like to see a large cut. i would like to see immediately the quantitative tightening stopped. it should be stopped for them to have done quantitative tightening and also higher interest rates simultaneously, i think it was a big mistake. >> cnbc spoke to several fed
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presidents in the lead up to today's decision they shared a variety of views on a possible move to ease policy >> i think we're a little tight on the funds rate. not too much but a little bit tight. the global safe real interest rate short-term is about zero. >> on the basis of inflation alone, acould feel confident in arguing for a couple of rate cuts before the end of the year. given that the economy is quite strong, given that i do think that inflation is going to be close to 2%, and given that the growth in the economy is satisfactory, i think that's an environment where you don't have to take a lot of action. we have the global head of investing at blackrock the comments in response to some of those phrases from mr. trump, rather skeptical from what i could judge. we've seen expectations for u.s.
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rate cuts really move lower the last few months. the fed is expected to cut tonight. do you expect further cuts down the road at what point could we see interest rates increase again? how far out is that? >> that's a long way into the future given how volatile things have been over the last nine months we had huge turnaround in expectations in q4, now the consensus is widely towards a cut. for us, where we invest, this is a positive kind of tailwind. we have seen positive moves in gold when you have lower interest rates, the opportunities for owning gold declines with commodity prices benefiting from this as well, it is an encouraging environment for our funds. >> so you got gold there at a
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six-year high. pushing what might be the third straight month of gains at the moment we're july 31st. i'm wondering when you look at its performance, is that the safe haven asset all held up to be given the implied volatility in the equity markets, particularly in china and the u.s. >> i wouldn't say safe haven assets have tohave zero volatility we're in a low volatility environment. i think gold has always been a story of wealth for thousands of years. i dent son't see fundamental ch in that. gold is going to continue to have that role what i've been fascinated by is seeing well established, well regarded investment managers, hedge funds and a reportity ivf products coming out talking about gold we're seeing strong flows into physically backed etfs
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gold prices today are not extraordinarily high relative to the cost of production most gold mining companies are profitable but not making -- or not as profitable as producers are who are making extraordinary levels of profitability. >> we're talking about it as a safe haven asset, in terms of real world, what are the forces at play here in terms of supply and in terms of demand for gold? >> when you think about gold, it has two roles. first, it has the role as a currency, a means of exchange. that's where you have this safe haven asset quality coming from. then you have a role as a commodity. when you look at it as a commodity, it's all about supply and demand when you look at demand for gold, it's healthy demand. supply is the area that is the driver now
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we've seen yun underinvestment o gold mines for many, many years due to financing in the gold market, and that's restricted the ability to build new capacity the prospect of future supply replacing supply eaten away every day is not there as well from a supply side point of view we have a strong foundation for the gold market. >> that reduced capex, is that something you've seen elsewhere in commodities that you think will help to support commodity prices even if there is a potential downturn in demand >> i think there's two ways of looking at that. it can be seen as reduced capex. we like to look at it slightly differently. we look at it as capital discipline the mining companies, including the gold space, have been much more disciplined in the way they allocate capital for many years now we saw a boom in capital expenditure since then you've seen this yun
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investment into new supply across all commodities, including gold most recently we've seen a high level of transparency by the mining companies in terms of investment decisions they're makingpromises to investors that they won't good on the spending splurge they went on before and we'll see a much more disciplined approach that is likely to increase retur returns but also reduce supply growth last friday we had data out showing the u.s. economy was down more than 2% in the second quarter. numbers this week showing consumer confidence in july rose to the highest level this year investors will be waiting for payroll numbers on friday. wages are rising higher than core inflation, faster than core inflation. given all that, when the fed starts talking about it being data dependant, the idea of a cut given that context seems a
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bit strange to some people would you say that's fair? >> i think there's an area for debate all parts of the market are an area for debate. what we've seen is this massive shift in expectations around interest rates going back to q4 of last year, i think the consensus was for four rate increases in 2019 we're in july, we have not had one. now we're looking at the very high probability of a cut in the very near-term that has been a significant change maybe we start to see expectations of additional cuts have a lower probability than a few months ago i think we'll continue to see, as data comes through, positive and negative expectations move around in the normal fashion trying to anticipate too much of that is difficult to do with any accuracy >> you talked about quantitative easing, you talked about the u.s. and fed, i'll talk to you about china a few moments if that's okay.
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first half pretax profit at lloyds fell 7% and missed expectations the bank booked an additional 550 million pound charge related to payment protection insurance. the biggest mortgage lender predicted further returns for the full-year and said further charges like the one i mentioned would dampen its ability to boost capital. assets under management at man group rose 5% in the first half despite outflows of 1.1 billion pounds adjusted profit rose 3% over the period and beat expectations man group says it entered the second half of the year with good performance fee earning potential. and l'oreal posted weak growth in the second quarter with wavering demand and shifting beauty trends in north america. julianna tatelbaum joins us with more details on those numbers.
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>> well, as you can see from the share price reaction in l'oreal investors are disappointed with this update. sales growth disappointed for the quarter it was weaker than expected driven by the drag in north america. wins again we saw strength in china, in luxury, but what we're seeing at l'oreal is a real polarization between segments and between regions. luxury and active cosmetics continue to see strong growth, double digit growth. we are also seeing double digit growth in aipac in china but developed markets continue to lag and divisionally we're seeing professional products and consumer products continuing to lag. those are the more mainstream mass market products investors are disappointed in north america. l'oreal announced a share buyback of 750 million euros what is interesting about the buyback is not the size.
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this is not huge for l'oreal but it's interesting that it's coming now when shares are trading near all-time highs, there's concerns in the market around luxury stocks, growth stocks, but l'oreal making the decision to go ahead with a share buyback here questions moving forward today will be around north america and the outlook for that region. l'oreal is not the only company in the space to be reporting weaker results we heard from gucci, a slightly different segment here we saw a mess there. a big step down in kering stock last week. is there something cyclical going on in the north american market the other question is on china and whether the growth they're seeing is sustainable and whether l'oreal is seeing signs of slowdown here i'll sit down with jean-paul agon at 11:30 cet and catch that interview. if you have views on the
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earnings you've seen this morning, get in touch with us on twitter, @streetsignscnbc. coming up, airbus beat second quarter expectations and backs its guidance for the year. more on the planemaker's second half challenges after this short break. ♪ more, more, more
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welcome back to "street signs. we have a huge number of corporate earnings across europe this wednesday airfrance-klm's operating profit rose more than 15% in the second quarter as ongoing cost cuts helped to offset higher fuel prices we her so much about that. the company expects its fuel expenses to rise to 550 million euros for 2019 that is lower than previous estimates. the group said the retirement of the a380 will result in 400 million euros worth of writedowns adjusted operating profit at airbus rose 72% in the second
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quarter and beat expectations. the group said increased production of the more fuel efficient a320 boosted its financials in the first half that's a theme across the sector the french company backed its full-year view but the ceo warn the about delivery and cash challenges in the second half. sticking with ways to move around, aston martin swung to a loss in the first half on the back of weak performance where demand fell nearly 20% the british carmaker posted a pretax loss of 78.8 million pounds in contrast with a more than 20 million pound profit it was proud to report in the first half of 2018 weak demand and a challenging environment prompted the automaker to slash its sales forecast. and second quarter earnings at solvay fell 5.2% against the previous year, that still beat expectations
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higher prices helped to offset a fall in volumes which the company blamed on headwinds in the outtoauto and oil and gas sectors. and lafareholcim has seen a rise in net profit the building supplies company benefited from lower costs and favorable market conditions in europe and the firm saw oversalt sales decline. they achieved a 30% reduction in debt lafareholcim said they were building for growth at full speed confirming targets for 2019. taylor wimpey confirmed its full-year outlook and announced a special dividend for 2020 but the third biggest home builder has seen a slight drop in pretax profit thanks to higher costs. the group has warned that margins this year will be lower than in 2018 coming up on the show, u.s. and chinese delegates hold their
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first day of renewed trade talks in shanghai. they're back at the table those two sides. president trump goes on the offensive against beijing once again. we'll have the latest developments for you when we come back after this break when i was diagnosed with breast cancer, i went straight to ctca. after my mastectomy, i felt like part of my identity was being taken away. my team made me feel whole again. cancer treatment centers of america. appointments available now. cancer treatment centers of america. we carry flowers that signifyn why we want to end the disease. and we walk so that one day, there will be a white flower for alzheimer's first survivor. join the fight at alz.org/walk.
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welcome back to "street signs. i'm willem marx in london. markets await today's blockbuster federal reserve decision with the central bank poised to cut rates for the first time since the financial crisis credit suisse shares jump as the bank emerges from three years of restructuring with profits beating the second quarter but the ceo says the future is uncertain. >> it's a tough environment, and our outlook is i consider relatively mixed l'oreal shares are on track
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for their worst day in nine months after top line growth misses the mark in the second quarter don't miss our interview with jean-paul agon at 11:30 central european time. and apple shares jump in after-hours trade after beating expectations and returning to growth in the third quarter but iphone sales miss estimates. if you're invested in british equities this morning, you may not be happy they're trading lower on the ftse 100 we have a positive start to the day's trade in germany that's trading a third of a percent higher in france shares are up more than a tenth of a percent on the cac 40 similar story to the german situati situation, the ftse mib up a third of a percent earnings driving a lot of those moves. let's check in on the currency
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markets. the pound is continuing to hover around the 1.21 mark it's slightly stronger against the dollar today the dollar is weaker against the yen. the euro trading weaker against the dollar the dollar there against the swiss franc very, very slightly higher a lot of focus on what's been happening with the british currency because of the language coming out of the boris johnson administration about the very real possibility of a no-deal brexit currency traders seemingly taking a view that this is much more serious than the past and analysts talking about the fact there has not been a pricing into the currency of that possibility, that is something that might change according to quite a few analysts over the coming weeks and months leading up to that october 31 31st deadline let's check in on the markets on the other side of the pond the s&p 500 looking to open slightly higher. the dow jones also looking to
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open more than 76, 77 points at this stage, the nasdaq looking to open higher it's been a bit of a mixed week so far for the u.s. equity markets. trade talks between the u.s. and china have ended in shanghai steve mnuchin and robert lighthizer saturday down with vice premiere liu he yesterday and this morning china said only when the u.s. shows enough sin ser cerity and faith can we achieve anything in talks. meanwhile president trump thinks china would like to wait to see who wins the election in 2020 and then work with a democratic successor. >> china has taken out billions of dollars a year from our
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country. with the tariffs, they had the worst year they've had in 27 years. companies are leaving china by the thousands and their prices are coming down. i will tell you this, china is dying to make a deal with me whether or not i'll do it, it's up to me it's not up to them. >> if those thousands of firms are leaving china it does not seem to have affected the manufacturing sector elsewhere the services sector grew at the slowest pace in eight months our guest is still with us have you seen indications that efforts by chinese policymakers, the pboc over the last six to
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nine months are beginning to bear fruit >> i think the most positive thing is the shift in financial policy in the economy. the massive increase in total social financing that was a huge boost to -- first of all, to liquidity but also confidence. for us, as you know, investing in the commodity space, seeing that kind of injection of capital into the economy, the increase in spending projects, infrastructure, et cetera, that all bodes well for commodities demand we have taken it positively. >> just to drill into that, so you're saying what they've done so far means that commodity prices in terms of the demand side of the equation should remain at least stable >> i think what they've done is taken away a large component of the uncertainty that existed when we were looking at the prospects of china a year ago, things were slowing down
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trade talks had a negative impact on the economy. the fact there's been an injection of capital, liquidity was made availablehas increase confidence from a year ago >> when we talk about changes to trade flows because of these ongoing tensions, that doesn't really impact commodities in the same way does it or does it are there areas where you have seen massive changes from as sst "b," "b" to "c," "c" to "d"? >> the biggest shift is the introduction by china on the rules around the exporting waste to the chinese economy china has been the biggest recipient of waste, whether it's plastics, scrap, so on and there are rules to blockade that and stop that from happening. that was a huge shift. we've now seen that echoed
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elsewhere. so that's a large component of whether it's the metal scrap going into the economy and could get reused or whether it's plastics and waste and so on that's the biggest shift in commodity markets, where we have seen where is this scrap going to go come 2020? that's a major challenge for the global economy >> china is a huge consumer of energy over the last few decades. is there any impact on energy prices going into the future that qulour syou're seeing frome efforts from beijing to try to support the economy there? >> i think biggest component around energy in china has been the shift to try to have a cleaner more efficient economy, domestic economy we've seen a whole range of policies coming out to consolidate industries, remove inefficient production china is incredibly positive
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towards a green economy. you look at the roll out of wind, solar capacity, the move towards the electric car these are huge trends happening at a faster rate inside china than elsewhere in the world. >> so you're saying even if beijing does work to support the economy in china, that doesn't necessarily help energy prices because of the way they're moving away to renewables. >> there's a difference between energy prices and electricity prices being coal and oil. there's a differentiation between the two. the main shift across the chinese policy is out ofy ment necessity. you have an environment there that is not the cleanest china has to do something about that for risks around domestic unhappiness across the environment that people are living in. that's the major challenge for the chinese to resolve >> hang around for a few more moments. puma shares hit a record high after the sportswear
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company posted a rise in second quarter sales and lifted its outlook but the ceo said the brand is carrying extra inventory in preparation for u.s./china tariffs we've had a few earnings reports in the food and beverage sector campari had a 6.9% rise in organic second quarter sales the drinks company benefited from the rise and popularly of some drinks and the strong demand for tequila analysts are pointing to a potential upgrade in campari's outlook for the year shares are trading lower today campari's ceo said the company would stick to its guidance and that the full-year results will hinge on how it performs in the second half of this year >> we're pretty much firing on
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all cylinders and our business momentum is good we think our full-year prospects would more reflect how we performed in the second quarter. q4 is a big quarter for a lot of emerging markets russia, brazil, argentina, which can be volatile. we can sticking to our previous guidance chocolate and cookie sales helped to push mondelez to a beat on quarterly revenue. the u.s. snack giant raised its full yooe full-year guidance. and yum china beat on the top and bottom lines shares were flat after the kfc and pizza hut operator warned sales growth would moderate in the quarter. your latest research indicates shifts in the food industry,
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including a shift to healthier foods. we talked briefly about oil, in the context of a rise in global population and finite resources, people always talked about what that would do to the oil price what it would do to the oil industry what does it do to the food industry >> that's a great question what we've done at blackrock with regard to our exposure in the space is to think how the sector is going to evolve into the future what we realized over the last few years is there's far less interest in people thinking about crop prices, investing around that. more interested in thinking what the future looks like for the way we consume, how we consume so what we've come up with on my team, we're seeing a lot of interest in this it is a very rapidly growing space. we've seen some successful ipos of people producing burgers that don't contain meat
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lots of positive earnings results from companies the approach to thinking about nutrition. so what investors and society is demanding and we're seeing regulatory pressures to try to create a healthy life. we're seeing food being delivered in a different way, whether it's the delivery companies or people going to restaurants. our nutrition exposure is trying to deliver for our clients the best pos asible outcome around that what would that >> what would be your top three trends in that space >> healthy living is one of them the delivery element is another one. you can't not talk about that. and where does that go to, whether it's the supermarkets changing how they deliver products and how we get hold of the products or whether it's the
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take-home delivery ones. and the third is thinking about what goes into the food. the ingredients, nutrition behind that, going towards a more organic and sustainable future, thinking about what does it take to produce a kilogram of meat what is the impact of that on the environment? how much water does it take? how much emissions are produced? do we need to do that? maybe consuming less would be kinder to the environment. all of this is an evolution but it will create tailwinds of growth for some companies and be disruptive for others. >> thank you very much for staying with us for those 45 minutes. coming up, move over iphone. apple returns to revenue growth driven by its wearables and services offerings more on the results next moving is hard.
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welcome back to "street signs. i'm willem marx in london. operating profit at samsung has more than halved in the second quarter compared to a year ago
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this pushed shares lower the results were broadly in line with guidelines from earlier this month memory chip purchases have plunged. the firm says this has impacted its outlook and will delay plans to return money to shareholders. a return to growth, record revenues and better than expected profits in the third quarter have driven apple shares 4% higher in after-hours trading. josh lipton has the details. >> apple reporting and besting expectations as for q4 guidance, apple seeing a look between 61 and 64 billion. analysts were looking for 61 billion. gross margins for the company in q3 came in at 37.6% as expected.
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iphone revenue $26 billions that was down 12%. keep in mind that it is less bad than the prior quarter, in q2 revenue was down also. services revenue is up 13%, but apple is quick to emphasize in a year-ago period they had a one-time litigation setup. so if you normalize from that, it's up 15% from a year ago. services margins in the quarter, 61.4%. wearables up more than 50% and mac revenue at 5.8 billion this quarter greater china revenue, 9.2 billion that's down about 4% in q2 greater china revenue was down 20% i had a chance to speak briefly with tim cook. we talked about the apple iphone franchise.
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people are holding on to iphones longer i did ask cook whether his company's trade-in is having a material impact on that cook said it was a key part of the improvement and that the trading and financing program were key to results in china. it was an important part of what we did in addition to last call cook saying that we were going to ignore the fx changes and lower the price. so that combined with the trade-ins and the financing programs as well as the government stimulus, all these things mixed together explaining the negative 20 going to negative 4 in china. skied about the potential tariffs coming his way, whether he shifted his supply chain in response to those possible tariffs. cook telling me he has not saying we made no significant changes. keep in mind for us our products are made everywhere. you look underneath the hood, you have a significant amount of silicon coming from the u.s. displays coming from japan and
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kore korea. the aggregate looks different when you portion it out by country. howard hu joins me now kindly from new york where he got up very early to be with us. thank you very much, professor hu, thank you for your time here can the iphone continue to grow at rates that we've seen it grow in the past? >> this is the major concern that i have. if you look at the growth of wearable and services, all of these are essentially still tied with the iphone itself and the revenue we know from the iphone itself is dropping. and we don't know exactly the number of iphone sales because they stopped disclosing that number already but going forward, looking from china to other fast growing regions, in terms of wearables, it's clothes compared to other
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competitors. so there's a long-term shadow being cast over apple in this regard >> the company reported a 12% decline in iphone sales in the most recent quarter. the sales are heavily reliant on this longstanding product. is the challenge by just making incremental improvements to the iphone and its universe, if you will, we're not going to see new growth open up with a new product that changes the game in the way that the ipod or ipad did? >> yeah. when i talk to executive and senior managers i always remind them it's so important the health of your core business is still healthy and it's important to build up the next growth engine this is the challenge of apple by looking at what they have been doing over the last few years in terms of invasion, most of these are incremental whether it is about launching the apple card, providing banking services, that's still tied to the iphone
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whether it's acquiring the intel operation on 5g modems, that's to improve and beat the deadline in terms of launching the next 5g iphone. all of the major innovation that we see traction inside apple continues to strengthen and puts core perception on the iphone. apple needs to branch out, much like going from "b" to "c," providing cloud based services, much like microsoft, just selling software and moving to the cloud. apple is reaching a tipple point that it requires itself to reinvent and move into a new business model >> i'm not asking you to make this argue but is there an argument to be made based on precedent that that kind of innovation, that kind of transformation and revolution cannot be carried out by the current ceo, tim cook >> oh, my gosh this is such a hard and tough
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question but fundamentally what we see is when companies are capable of making these major shifts, there tens to an top overhaul at the top management team. if you look at microsoft, it's the current ceo, an outsider, who made this major shift. you look at dell computer, its major reinvention is taking the company private to change dell from selling pcs to private solutions. apple is a homogenous team, the next ceo, jeff williams, insides would say he looks exactly like tim cook it's hard to tell what's going forward, but a major shift coming out from the current management team would be hard to see in the foreseeable future. >> thank you very much for your time this morning.
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appreciate your time. the democratic primary race for the u.s. presidency pulled up to the motor city last night. ten hopefuls locked horns for the first of two debates in the midwestern city. jay gray was there to watch. >> reporter: from the start, the ten democratic hopefuls took aim at president trump >> donald trump disgraces the office of president every single day. >> reporter: and each other. >> you don't know that, bernie >> i do know because i wrote the damn bill. >> reporter: much of the focus on the two progressive senators standing at the center of the stage. the other candidates labeling them out of touch and unelectable. >> folks, we have a choice we can go down the road that senator sanders and senator warren want to take us with bad policies like medicare for all, free everything, and
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impossible promises. >> reporter: but the front-runners on night one stood their ground >> you know, i don't understand why anybody goes to all the trouble of running for president of the united states just to talk about what we can't do and shouldn't fight for. >> reporter: the back and forth continued over health care, immigration, gun control, the climate and other hot-button issues the only topic all ten seemed to agree on -- >> anyone on this stage tonight or tomorrow night would be a far better president i promise no matter who our candidate is, i will work my heart out to beat donald trump >> reporter: but right now the debate continues over just who that candidate will be the debate continues tomorrow 689 the ten candidates on stage will include former vice presiden joe biden, who leads the other contenders by double digits in most polls senator kamala harris as well as former hud secretary julian castro, both who challenged the front-runner in the first debate
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let's stick with the u.s. and check in on how the equity markets there are shaping up ahead of the open in new york. you can see the s&p 500 is being called 4 points higher at this stage. the dow jones looking to open up almost 70 points higher. the nasdaq, all of these tech companies in focus during the last week, almost called 32 points higher. no doubt we'll be watching closely what happens to that apple stock on the back of those numbers. that is it for today's show. i'm willem marx. "worldwide exchange" will be coming up in just a few moments time olay ultra moisture body wash gives skin the nourishment it needs and keeps it there longer with lock-in moisture technology. skin is petal smooth. because your best skin starts with olay.
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it is 5:00 a.m. here at cnbc here is your five at 5:00. time to think different. a major shift at apple is putting the apple on the back seat for a faster growing and possibly more lucrative business it is decision day at the fed. investors await word on what could be the first rate cut since the great recession. it's not just the fed. do not forget earnings on this final trading day of the month, we're more than halfway through reporting season with the single busiest day still on tap. your money, your vote. democratic nominees sparring on

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