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tv   Countdown  Bloomberg  July 20, 2016 1:00am-2:31am EDT

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>> to be able to throw donald trump over the top in the delegate count tonight with 89 delegates. congratulations, dad, we love you. anna: donald trump takes it. supporters look to move past .issteps in cleveland president erdogan's crackdown widens. merkel and may. the uk prime minister will head overseas. plus, another round.
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a higher cash bed. a very warm welcome to countdown everybody. i am anna edwards. manus: breaking news. anna: six a clock in london, 7:00 in amsterdam. where the business is based in the netherlands, saml is europe's largest semiconductor maker. third quarter revenue at about 7 billion euros. so estimate was 1.7 billion, that sounds very broadly in line for maybe a touch shy of that. the most bullish estimate for the third quarter. the ultraviolet
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lithography system, which increases capacity and speed. agreed to buy microvision for about $3.1 million. this is a part of th customers,s for the samsung electronics and intel, these chip manufacturers, that they will increasingly use the technology. certainly that revenue looks to be broadly in mind. $354 million in the second quarter against an estimate of three when $7 million, ahead of the second quarter. manus: we are waiting on the revenue numbers, expected $5.2 numbers, expected $5.2 billion. let's have a risk radar look. slipping, the s&p coming back on global equities commit adding $4.5 trillion post brexit. and we have the korean currency
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and therefore you, a bit of a developing market for you, as the fed potentially comes back into play, more statistically likely to raise rates this year. falling the most in two weeks, perhaps a little more dollar strength, housing data. samsung future says the currency datea is 1139. currency is 44.78. and supply is down 2 million $60,ls, prices will hit and it will rise. that is what pioneer is saying at the moment. anna: anna the surprise indexz, on the back of that surprising data out of the u.s.,.the housing market seeing retail sales, payroll looking stronger. all of that adding into the gained momentum we have seen. manus: a red-hot headline across the bloomberg terminal. they come out of the second quarter, net income at $1.7
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billion. that is one of the first european banks to report. anna: let us get the bloomberg first word news. here is rosalind chin. rosalind: donald has told supporters he is going all the way after formally securing the nomination. announcement,is which put him over the line. they're looking to get the convention back on track after the opening day was rocked by questions over whether melania trump plagiarized. after sales and profit were cut, the cloud business -- that is after adjusted platform of doubling the earnings. the ceo has been changing the focus because of productivity services, and traditional software, slums. the turkish lira is trading at an all-time low, deepening concerns about the fall of from
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last week's failed coup. moody's is looking at a credit rating. weredentral bank loaer by 8.75% yesterday. italy and the european commission they be quite close to an agreement on how to aid the country's banks, that is according to someone speaking to bloomberg, describing the ongoing talks as productive. > the most important> thing as the time, for obvious reasons, to stay calm. nton,ind: gawker's nickd e went into chapter 11 to avoid paying $140 million, subject to hulk hogan, after the wrestler won the case on a sac state.
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tape.x powered by more than 150 journalists and analysts, you can find more stories the bloomberg top . manus: rosslyn, thank you very much. juliette saly is standing by. bouncing around $45, emerging-market currencies on the move, how is it playing out? what we're seeing is a bit of a reversal of what we saw yesterday. that really solid rally coming through on the nikkei yesterday. it is weaker today. having an impact on the overall regional index, which has been tracking lower although it is flat the moment. we are seeing quite a lot of weakness in commodity stocks, mining coming under significant pressure, all the energy sector hazard to pick up. as you said, crude in focus. we are seeing weakness on the korean currency, and that is weighing on the cost.
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have a look at this really solid rally coming through in hong kong, led by lenovo group, up by a most 5%. we are actually seeing the msci hong kong index on the verge of entering a bull market. it is now up 20% from those loads we saw earlier january. new world development has risen on expectations of the fed will hold off on raising rates. they are up by about 37% since january. and also we have the macau casino stocks up 76% in the period. overall, a bit of a mixed picture in the region, and we are certainly seeing that weakness from japan weighing on the regional index. having a look at some of the other movers can i mentioned lenovo group and of course nintendo coming up today. manus and anna? anna: juliette saly joining us in hong kong. asml saying that they are causing the share buyback plan
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for a few quarters, amid that takeover we mentioned of hmi. manus: breaking news from sap, confirming the full-year forecast, critically important, total revenue comes in at 5.24%. 5.22 percent is what we're looking at. that is a beat. 27.6%. operating profit, again a very comfortable beat. this is operating profit, $1.52 billion.the estimate was 1.45. let us talk to caroline hyde. she is standing by to break down the numbers. caroline, it looks like the challenge is working as quarter, about rebalancing for mcdermott. and the cloud business, break it down for us. what is the first take, the red headline? sales, andn terms of in terms of operating profit, manus, seeing sales climbed some
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5%, all about the cloud computing area. this is the company desperately trying to shift away from license-based money coming in to subscription-based, which is a little less profitable, but perhaps more tenable in the long-term. they are seeing clouds christians really ramping up, up 41% in terms of growth. that is really managing to show growth versus the competitors. remember, they're trying to tackle the salesforce, the new kids on the block. they are managing to pump out the sf next week. this is what is really selling. and notably, their striking deals. they are worked out they need to work with microsoft, developing apps and tools you would use while you're on the move, on the go, using android or microsoft devices or apple devices, all of these need to be used on the go. and getting access to your clients, to your marketing
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tools, via the cloud. this is all about flex ability. they are saying they're sticking seeingtargets cloud, growth of 6.8% in 2016. so we are seeing real growth for sap, managing to clawback, from what many feeling was too slow on the uptake when it canst cloud. anna: now their dominating. anna:caroline, also delivering them from microsoft. caroline: exactly. this was the same, the same last earnings season and this earnings season, if you make it work with cloud computing you generally are a winner in the technology space. we just saw yesterday. big blue ibm also showing growth in cloud computing. and microsoft too rosen after our trading, being pulled about, showing once again that shifting productivity to the workspace, and notably the cloud, is really
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paying off. have a look at my screen and we can dig into the actual numbers of microsoft. we saw sales rise better than expected, $22.6 billion for the fourth quarter sales, that was more than expected, up from 2%. we will see real ramp up in revenue next year. you will see some 3% growth in the following 2017, and 6% growth in 2018. you may feel this is a story that is going to continue to improve. microsoft notably showing stocks increase. this is the cloud business doubling, more than 100% growth in that space. the pc market doing better than expected. that is what they are shooting away from, pcs losing sales, we want to work from our tablets. the destruction in the job cuts, taking a $1.1 billion charge re, but they are managing
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to get out of the license and into the subversion business. those shares traded higher. manus: caroline hyde with a very latest on sap and microsoft. later this morning, caroline will have a talk with sap ceo. anna: also on the heels of her first cabinet meeting, uk prime minister theresa may has a packed day ahead. we'll take you through her day ahead, because it is a full 100 jobs data due at 9:30 u.k. time, along with the new chancellor philip hammond, getting a snapshot on the month after the eu referendum. and she is in parliament for her first questions as premier. manus: and the start of a two-day european trip, attending a trip with german chancellor angela merkel at 4:30 u.k. time. and she meets hollande in france. derek how fitting is our guest, derek, she has a very packed
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agenda. some of it is theater. some of it is about setting the tenor and tone of brexit negotiations. have we all then lolled into a false sense of security? apart from currency, have they in, because we're back at pre-brexit levels. derek: there was always going to be some pullback, in terms of, well, triggering the article 50, going forward. and you have a prolonged period of negotiation. and you're always looking at 2.5-3 years before anything actually changes. yes, you have this uncertainty. the reality is that nothing actually is changing, for quite a period of time. 02 on theare at 131.
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dollar this morning. derek, you were surprised by the mpc not moving. where does it go for the pound? : we see it lower, i year-end target of 124. they will of course act on the first of august, but all this being said, i think the next phase is going to be about the actual macro economic impact from this. and certainly, i think the most extreme period in which we are probably going to get the worst element of that is data from the third quarter and perhaps into the fourth quarter. certainly, the sentiment readings we have had across-the-board tell you we are going to see some pullback in activity. and i think that couples with -- do not forget the broader global situation -- and our forecast of 124, it is not just brexit. the markets have to readjust to the fact there are broader developers that are going to
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become far more important perhaps to the direction of the pound, than the day-to-day developments. manus: what are those? because you talk about the world, we have the msci world index here. it is beginning to lose momentum, back pre-brexit, losing momentum. 3, you want to have a look at it. whatof your consideration, are the big proponents of risk when you look at the world? derek: we are a little bit dubious of this risk appetite recovery. and it is fueled, in part by central bank expectations, the bank of england will ease, boj easing at in a month. ecb will extend qe, and the fed is on the sideline. and you have growth in the u.s. better than expected. well,n't forget china as the growth story we had last friday for example, unexpected. but i think all of that could
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unravel, or a lot of that could unravel quite quickly. , we don'te, the boj expect anything significant at the july meeting. given the fact that over the last week or 10 days we had this big debate over helicopter money, the next big step, i think there is a lot of optimism price into dollar-yen at current levels and that will unravel quite quickly. anna: will get more of your thoughts on japan in a moment. sticking with the u.k., when we look at the underlying reasons to cut rates, and of course a lot of it has to be guesswork that we don't have the data, the sentiment indicators that you mentioned, but we don't have the data. do you see the benefit of cutting rates? kate barker, talking to my colleagues today at the most recent meeting, she said that we should not be cutting rates right now. she said with a population that is not as young as it used to be, we are starting to learn a little bit about how we incentivize people to save money actually, if you cut interest
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rates. and if you do this over a prolonged period, keeping them so low. derek: obviously, on the rate side of the story, you have borrowers and takers. there will be the impact. certainly on a macro scale, there is a net benefit from it. but obviously, given the fact that rates are where they are, particularly you look at the yield curve in the u.k. and the move that we had since brexit, in terms of the 10-year gilt yield, it has been very considerable. part of that was the expectation of the bank of england would move. certainly, 25 basis points the bank of england, even if they did 50, i don't think it will have a massively beneficial impact, given where we are globally. but i do feel that they have to at least meet what the market is inspecting at this point in time. and of course, they have a mandate, why they are waiting for the inflation report in august so they can explain.
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alpennyderek howel stays with us. anna: up next, a former officials is the boj should end the japanese to enlist debate. we will explain what he meant there. the 6:30 u.k. time, we have chart of the hour. and we had up to cleveland, ohio the days three of the of republican convention. ♪
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manus: it is 6:21 in london. beautiful day in hong kong, 1:21, hang seng is trading up 9/10 of 1%. rosalind chin is with us. welcome. miller willnus, sab discuss growing investor pressure for a higher cash bed from ab inbev. that is according to people familiar with the matter. they say fund managers have
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complained that the 77 billion pound offer is less attractive following the plunging sterling. this drop the two biggest shareholders, getting a sweeter deal of other investors. microsoft gained in extended trading after sales topped estimates, thanks to the cloud business. third quarter revenue was up, with cloud users doubling. the ceo has been changing to clout and productivity services, as traditional software sales strength. the bulletin shares are trading lower in sydney. the world's biggest mining company is inspecting iron ore production to be flat this fiscal year. it also says capital spending would drop by 34%, after petroleum output fell last quarter. unilever has announced it is buying dollar shave club.
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the terms the deal were not disclosed, but orange of fortune magazine, it is worth $1 billion. clubly held dollar shave is on track to post $2 million in sales this year. buyers deciding whether or not to raise for monsanto a second takeover,$55 billion and the offer was inadequate. but it said it was open to further talks. the risk is that monsanto could choose another suitor. a german rival, over a potential alliance. and that is your bloomberg business flash. anna and manus? anna: rosslyn, figured much. a former obj economist says they should correct two big lies next week. should add more stimulus and scrap unlimited policy space, achieving 2%
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inflation target in about two years. he said the market will lose trust in the central bank if it continues to remain so bullish. derek, you have artie given us some clues as to your fairly relatively low expectations about what they will do. what you go along with this analysis, that they need to step away from its commitments around all of these comments they have made around unlimited policy space and how quickly they can get to the inflation target? derek: it is a tricky one. i see both sides. in terms of the 2%, target i agree. . i can also see governor kuroda's concern, sending a signal to the markets, perhaps giving up on that goal. ux, of course, the whole the deflation mindset that exists in japan after 20 years of mild inflation. for the boj to throw in the
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towel and abandon these commitments because they feel they are unrealistic, could have a very powerful impact on expectation for inflation. i can see both sides. isertainly getting to 2% very unrealistic. we should not discount the fact that getting to 1% and maintaining that for a. a. period of time. manus: we have a chart about the fed holding's of the treasury. comparing that to the bank of japan, and this leads to two big lies, the bank of japan owns about one third of the total market of debt. they're going to run against the buffers, in terms of the ability to continue to buy. one of great debates. derek: you know, japan has massive assets abroad. and i think taking of dollar yen, that is probably the
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problem. the fact that we have this massive investment in income surplus on the current account side of the balance of payments, and what happened during the period of the evaluation was a lot of these investments become surplus, that get converted back to the japanese yen. it wasn't conversant because of the movement dollar-yen, yen was growing inside. but once the terms, the psychology has shifted. now more and more of those incomes are conversant back into the japanese yen, over 4% of gdp, that is really a big element of support. anna: just briefly, if we get no move, no new moves from the boj, what happens to the yen? derek: if we are trading 106, i think we will get back. alpennny from
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bank of tokyo stay with us. manus: is the special relationship strong enough to secure a lucrative trade deal between the u.k. and the u.s.? we discussed that, next. this is bloomberg. ♪ [hip hop beat]
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♪olympics 2016, let me get you on my level. ♪ so you never miss a moment, ♪ ♪miss a minute, miss a medal. ♪ ♪ why settle when you can have it all? ♪ ♪soccer to wrestling. track and field to basketball. ♪ fencing to cycling. diving to balance beam. ♪ ♪all you have to sa♪ ♪ is, "show me," and boom it's on the screen♪ ♪ from the bottom of the mat, ♪
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♪ to the couch where you at? ♪ ♪ show me the latest medal count♪ ♪xfinity's where it's at. ♪ welcome to it all. comcast nbcuniversal is proud to bring you coverage of the rio olympic games. anna: welcome back. x: 30 here in london. 7:30 in london or paris. your new edition of daybreak is available. let us take a look at some of the top stories that have made it into this morning's, edition. the cover story manus. manus: donald trump locked in. after a very sort of theatrical moment in cleveland, where his son gave the nomination, what took them over the top. i think that is the phrase that was used. . he is the 2016 u.s. republican he has enough votes to be there. with son donald, jr.
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and paul ryan, the other thing that caught my attention, they had a mock trial of hillary clinton. crowdthey whipped the going guilty, guilty over a matter of issues. anna: and also in this edition of daybreak, the continuing focus on turkey. turkish president erdogan, we resigning,iversities big questions over moody's. and we talked about yesterday, barack obama urging his counterpart to respect civil liberties. and we see the lira in the market. manus: i love the story, that sab miller, potentially the shareholders saying go back. sterling is back. 11%. go back to anheuser-busch. we want a better deal. that is really fascinating, for
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me, in terms of the pressure of institutional shareholders, and in terms of what brexit really, really means. anna: this is of course related to the fall of the pound we have seen. another round. i like the way we did this in the headline. obviouslyrosoft advanced over 4.2% over last night. as caroline said earlier, this sets the tenor. techech, and old reinventing themselves. dicget your clients to trade. rally, stock market beating estimates on sales. you had a nice line. the whole tech space seems to be galvanized in this quarter. anna: certainly, a lot of folks on the cloud. let us get out to caroline hyde. she has been looking at the markets for us and has an update from berlin. caroline: near a three-month high coming out of the msci
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asian-pacific. we have to be kicking off of the stock market, because we are getting so tentatively close to the year-to-date high. take a look at my bloomberg. msci, wedig into the have been ramping up, very close to that all-time high we saw back in april for the year. 134 is where we trade. asian stocks pushing higher to three-month higher. positive earning reports really driving desire, from some of the world's's biggest company. you were talking microsoft. we have numbers from ibm yesterday. all this helping to drive forward. notable that one area not driving forward, that continues to be the turkish lira. but one helping to fuel this intimate, oil, seeing it was higher at the moment. this is as stockpiles come down. on my screen, i am currently showing you of uti in the blue line, slightly above the $45
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mark. but notably, the white line, crude supplies dipping. as the demand balancers to retake itself, we can start to see demand help the drive towards stabilizing the oil markets. until we see opec actually pull back from production, as many analysts say, we will not see a significant pop above $50. we are seeing oil traded back today, helping drive stocks higher. i leave you with the one qe weakness, the turkish lira. have a little look on my bloomberg. i'm showing you really now what is happening with the turkish lira, since the coup. spikes seen record high versus the dollar. we are seeing the lira near record lows. that weakness, that pressure being felt, particularly after moody's the rating company
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says we can be cutting to junk territory. there is your wrapup. asia trading higher. asia trading higher. oil trading higher. manus: caroline, thank you very much. let us stay on that focus, moody's, well, they have a decision to make in with her to downgrade not following the failed coup attempt to let us get out to yousef, you have a spectacular retrospective on the turkish lira. yousef: absolutely, manus. so, flirting with record lows against the u.s. dollar. but historically, what kind of impact has movieody's had? you can pull this up on the bloomberg. you're looking here is the last time moody's made a decision was in 2013, that was an upgrade. three years and two months
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before that decision, the currency depreciated 16%. three years and two months after the decision, this accelerated to 39% in the negative. perhaps counter intuitive by any measure, underscoring that perhaps that is not the best indicator or precursor as to which direction the currency go from here. but bear in mind we did get a note from barclays. they expect investors to drop $3.2 billion in turkish bonds, is moody's does followthrough the downgrade. anna: the movie lose -- moody b lues. yousef, thank you. staying in the middle east, iran is exploring a return to international debt for the first time since 2002. we spoke to the economy minister, whose ministry is at the forefront of securing the access to the global financial system. now, the groundwork for
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issuing bonds in various iranian debt securities in the international markets exist. and i'm certain the situation will also improve in the future. we have certain like billions of dollars with agreements with different countries for financing iranian projects. manus: the u.s. t secretary of stae john kerry said it would be a deal with britain. despite the special relationship, which both he and the foreign secretary boris johnson say remain strong. secretary kerry: i think it is clear that no previous administrations, in either of our countries, is going to alter or undermined the bonds that we have. boris: the special relationship between the united states and the united kingdom remain strong and vital. and we continue to advance new
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mutual interests, and tackle shared challenges. anna: ryan chilcote has been watching this with interest. ryan joins us now. good morning to you. what more did carry have to say about -- kerry have to say about trade talks? ryan: a little bit of a nuance, s was saying, you can actually do a trade deal if you are part of the eu, the bloc. that is right. it is not easy. and there is another issue there, of course the u.s. cannot do a trade deal with the u.k. before it understands what the new relationship is going to be with the eu. mike forman haveh said this, if they still have
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the ability to call the shots, or if the new relationship with the eu will keep that agreement in brussel. kerry maintains we can have a berlin or discussion. not like he is sort of kicking the can down the road, or smacking the brexiteers in the face. there is room to begin the process. and in fact, it already has started. we know that mike froman has spoke with the administrator. but you know, clearly there is already a conversation, just a they cannot do anything in ink yet. manus: we know what obama's message was that we go to the back of the cue. that america brought into the country before the referendum. boris johnson, the theater these we just saw there, he was at the foreign minister's on monday. u.s. and you can relationship,
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housetrained was it to see boris johnson talking about foreign policy in the middle east. not something we're used to seeing impaired we see him coming down on a rip cord, holding flags. i think a lot of reporters on the difficult. that was clear during the press conference. he could not get away from questions about his gaffes. at one point during the brexit campaign, he said that it was president obama's part kenyan ancestry, why he was saying bad things about the u.k. and why they needed to stay in the eu. he calls hillary clinton a sadistic nurse in a mental institution, going into this. and he was asked about both of those yesterday. and he said, always comical boris, of the insults that he made, way too long to make an apology. everybody have misconstrued what he meant to say in the first case. but he made a go at it.
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he made an effort to appear as an international statesman. and i think that is really important. there is a message here, of the u.k. is trying to get out, we want to appear like a global power outside of the eu. so boris johnson is on his way to the states to talk about the islamic state, at everybody at yesterday's talks, boris, john kerry, and also the saudi foreign minister, uae foreign minister, all of them in brussels with me, and the day before yesterday, the governor playing and flew from brussels to london, so the u.k. to make the point that we matter. it is not only brussels and more. anna: and the airplanes made it very ryan: boris had trouble getting off the ground. there was questions how far it will go. a little bit like john kerry yesterday. everybody in the landscape is having trouble. john kerry working in for his first meeting with theresa may, slammed his head against the door. [laughter]
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anna: not that kind of headache. ryan: better than almost crashing. manus: boris johnson coming to 10 dowling street, that special relationship. [laughter] anna: ryan chilcote with the latest on the translating policy. the european head of global market research at the bank of mitsubishi still with us. this theater around trade talk, we are looking at the imf dropping global growth estimate, down to 3.1%. it is a small piece of the pie. is it shrinking after the straight deals? meanwhile, the pie is shrinking? going forwardly, we moved further down the road of protectionism. that hit international trade more, the volume of trade globally has been basically trending weaker, since it in 2010. so there is a real need to turn around. so you know, i think certainly the imf figures there is really
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nothing hugely catastrophic. although the downgrade for the u.k. was the most significant one of the major economies. manus: let a circle back. there are headwinds in emerging markets. when you sat down on the set does before 6:00 a.m., we checked where the dollar-lira was. this is the interesting point. just a little bit away from the record low. this is the chart that yousef was using your we went to rip the currency. currency,xt for the one of the worst performing over the last five days, that and the argentinian peso. is it purely political? derek: yes, an awful lot of what is negative about the moment, and even before the attempted coup, was the political risk. that really came to the fore after the resignation back in the beginning of may of the front minister. and that change the investor
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focus, much more significant on policy. focus, much more significant on policy. the consensus of the market was that, i think, obviously given what happened during the obviously given what happened during the weekend, we will have to change that considerably. i go back to what i said about the pound earlier. this is another country, obviously a lot of differences, but they both have substantial accounts. and that brings this into context, on the course of what is happening globally, my view is that the global environment is not going to remain as favorable as it is now. and that means the lira comes even more pressure. anna: on the kindness of strangers. compare turkey. on the one hand, you might expect em to expand on the coattails of turkey. but those looking to leave might go elsewhere. where do you see that story heading? derek: again, a lot of what happened in terms of the
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fallout, the depreciation of these currencies, was a big part related to commodities. therefore, a very important story on what is happening in china. and the other element was monetary policy in the u.s. and again, i go back to why i'm not particularly positive. and i think we go into more volatile unfavorable market conditions, because i think both of those stories are going to change. now, perhaps the fed story is changing already, starting to see the markets come back to the fed raising rates this year. just cannot buy into this idea that we're about to see this kind of sustained improvement in the data that we have been having over the last month or two. and i think it is stimulus-related. but the impact of stiglitz is becoming less and less. manus: that is the thing. up the dollar- i have a basket. this is the worst were on record. they got away with it. they managed to devalue, and
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nobody looked, because we were far too busy looking for the one-month volatility on cable. but this is significant. the basket just seems to be settling down. if you are going to review your lira trade, and you are not come as about global stiglitz and chinese to kilis, where are you in terms of the yuan? derek: i think it will break 7. i think that is the story for the second half of this year. you know, it is incredible that this is happening all without any kind of focus on china. i think partly perhaps it is the communication that is better, that was after the initial period of evaluation in august of last year. anna: seems to be a few themes on the dollar strength perhaps to talk about. enny stay with us. manus: up next, we're going to
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have to cleveland, ohio. it is day three of the u.s. republican convention. and we checked in on u.s. futures ahead of the jobs data, on the month of the eu referendum. later in the day, we speak to sap ceo bill mcdermott. this is bloomberg. ♪
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anna: welcome back. n.50 in london and cleveland, republicans gathering for the convention. donald trump has told supporters he is going all the way, after officially securing the republican president nomination. his team has been looking to get the convention back on track, following accusations of plagiarism and his wife's
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speech. he spoke via video, saying this is just beginning. mr. trump: together, we have seen historic results, with the largest vote total in the history of the republican party. this is a movement. but we have to go all the way. margaretoomberg's joins us from the national convention in cleveland. the to see you. tell me this. did day two get back on track. his son took them over the top. there was a mock trial. very theatrical. margaret: it was very theatrical. and they are hoping this begins the turn it all around. of course, opening night and most of the day that followed were really preoccupied with the controversy over whether melania trump had plagiarized michelle obama. n foror distractio for
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donald trump. emily began to see a night two, both the consolidation against hillary clinton, which may help to unify. and also, a very heartwarming moment where donald trump's r.,ldren, led by donald, j took in over the top. ald: it is my honor to be able to throw donald trump over the top in the delegate count tonight, with 89 delegates. and another six for john kasich. congratulations, dad. we love you. yeah, so there you have it. anna: hearing from his son, very excited. what do we expect on day three? margaret: so, the third day is really all about buildup to the fourth day, which is donald
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trump's big speech day. we will see his vice presidential pick, who is now secured his nomination as vp, mike pence, governor of indiana. but we might see is the tying up of loose ends, with aggressive rivals. ted cruz, and by video, marco rubio. both senators who look to secure the nominee himself, now trying to go at hillary clinton. manus: our senior white house in cleveland. derek halpenny's lead researcher at bank mitsubishi. i just love the way that americans do president elections. i will take you back to something slightly more dry, which is we are next. you are skeptical about the euro growth, and u.s. growth. group economic, this is the highest since 2014 -- anna: 2015.
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manus: it is all going well in the u.s. trend growth is 2%. we had one rate hike. brexit was annoying. no worry. all good in the u.s. derek: obviously, the data has been very good. in particular on the consumer side, real gdp could be north of 3% in q2, mainly driven by consumption, which could be over 4%. personal consumption growth of that magnitude is unsustainable. and, you know, if you look at that chart, every time you have a surge like that, it does tend to retrace. in other words, it is unsustainable. and i do think that the second half of the year, we have just been watching the trump convention. there is going to be, i think undoubtedly, some concerns with regard to the political outlook.
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and it does that result in a continuation of reservations, in regard to business investments, pullback in hiring? i think there is a reasonable chance. anna: we spoke with j.p. morgan asset management, who said actually there is some concern about the politics, concern about protectionism. he was saying some of that will republican,d by a if it is donald trump as president, an expectation that a republican president would be beneficial to certain asset classes. he talked about stocks in particular. what does it do to the dollar? how does it function? weaker global picture, perhaps meditatps better data? derek: in the short term, if it does come in as it is, i think it is generally dollar-supported. i think going into how the markets play clinton versus trump, you know, of course there are segments of donald trump's
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policies that you would argue are certainly dollar-positive, in terms of his view on the federal reserve, removing janet yellen from the chair. you know, that could be argued that quantitative easing concern to be something from the past, could be a tighter fed policy going forward. also, tax policy for the potential of repatriation from abroad. he is spoken of that. and that money back to the head there are you know, dollar-positive elements from his policies. but looking at his policies, they are all over the place. there is so much we do not know. and i do think the uncertainty of that would trump the potential dollar-positive. manus: excuse the pun. anna: derek, thanks for spending the last hour with a. great to get your views. nny.k halpe manus: it is may's big day.
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it is her first prime minister question time and the u.k.. and that is before heading to germany. anna: meeting with germany's angela merkel. what will they talk about behind those closed doors? this is bloomberg. ♪
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>> to be able to throw donald trump over the top of the delegate count tonight with 89 delegates and another six for john kasich. congratulations, dad. we love you! manus: trump takes it. the tycoon has officially won the republican presidential nomination as supporters look to move past missteps at the convention. tensions in turkey build. crackdownerdogan's widens, in the lira nears its all-time low. the uk prime minister we'll head
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overseas to meet the german chancellor later today. plus, another round. sab miller faces pressure from investors for a higher cash bid from ab inbev. you are welcome. it is "countdown." i am manus cranny. anna: i am anna edwards. it is just past 7:00 in london, which means we've got some news coming through. -- luked man group ellet will succeed manny pimco appointing man group plc's a manual roman as ceo. big ruse from the houses of pimco and man group. manus: it's all change in the fund management industry.
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dealing with the world of zero been percent rates, how do you navigate that? let's get into these markets. we've got a little bit of a lift. equities came in this morning, just coming back ever so slightly. london and paris indicating a little bit higher. you see a little bit of a turnaround in the price of oil. indicated it's just on the cusp of 10,000, 9999. anna: we have seen a bit of a turnaround in markets. let's show you where we are on the msci asia session. it was weaker than this a few hours ago, now up 2/10 of 1%. commodity stocks had been weaker. well,as turned around, as as you see in the nymex spot. below $45 per barrel. we've seen the oil price drop last week.
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all of that is putting a floor underneath the oil. we've got the korean won, as well, the korean won dropping, merging markets, turning a little bit more negative on global growth, and all of that building towards a stronger dollar story as we talked about. manus: let's have a look at the bond board. we've got another story. you saw the rally in treasuries. yields will fall to 0.9%. 1.55%, and he is saying the treasuries still have juice in them. 1% is possible very soon. stockton says, not very likely. i moderated a conference yesterday, and the disbelief in the room in terms of the ability to sustain that kind of position of some -- of -0.3%.
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manus: anna: replace douglas many roman will replace douglas hodge. hodge, managing director and senior advisor. roman had almost 30 years of experience in the investment industry. he will be based in newport beach, california. manus: luke ellis, if you go to his bio, you can see the backtrack. man group president until today, chief investment officer, head of multi-assets between 2010 and 2013, and he was managing director of financial risk management between 1998 and 2008. anna: just in the last couple days, we've been talking at bloomberg -- our colleagues have been writing about how alley liance sort of pivoting their hiring from the bill gross era.
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board members site alternative investments. it seems they are overhauling staffing at pimco, something of the theme over the past few days. that's according to a member of the german insurance board. manus: let's get the bloomberg first word news with rosalind chin. donald trump has told supporters he is going all the way after formally securing the republican presidential nomination. the announcement in his home state of new york that pushed him over the line. trumps team has been looking to get the convention back on track after a opening day rocked by questions over whether melania trump plagiarized michelle obama. fourth-quarter revenue was $23.6 billion. that was after an adjustment by
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azure. the turkish lira is trading close to an all-time low as a purge of the country's institutions increases concern about the fallout from the failed coup. turkey's central bank lowered its overnight lending rate by 25 basis points to 8.75% yesterday. italy and the european convention may be close to an agreement on how to aid the country's banks. that is according to competition -- the eu competition commissioner. she described the ongoing talks as constructive. >> the most important thing in this time is, of course, for obvious reasons, to stay calm and see what results will come out of the conversation that we have with the italian authorities. gawker media cannot
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extend bankruptcy protection to its founder nick denton, a u.s. court has ruled. the company went into chapter 11 to avoid paying a $141 million case.ion of privacy global news 24 hours a day powered by more than 2600 journalists and analysts in 120 countries. find more stories on the bloomberg at top . anna: thank you very much. let's stick in asia and go to juliet sally who is standing by. we were saying things turn more positive towards the end of the asian session. yes.tte: certainly, things have turned around in the last couple hours, and we are seeing the regional index back near three-month highs, levels we have not seen
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since april 21. a lot of the heavy lifting is being done by the asx 200. that market, up by 6/10 of 1%. also, a very strong rally we have seen in hong kong. stocks on the hong kong index, poised to enter a bull market. they are up 20% from the lows we saw in january. a lot of the good work is being done by the property developers and casinos. aboutshares are up by 76%. there has been weakness in thailand -- taiwan and mainland china. we switch out of the nikkei 225, which i performed the rest of the reason -- region. i will show you some of the other big numbers we've seen in the region. lenovo is the best performer on the hang seng. there are reports it is going to come out with its own pokemon go-like game.
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nintendo, which has had this huge rally on the back of pokemon go, little profit coming down today, and bhp billiton, coming out of -- under pressure after cutting its iron ore forecast. another reason for the good rally we have seen across asia today in the latter part of the trade, strength coming through in the chinese running the, up by 2/10 of 1%. it's crazy when you've got profit-taking, a move of 12 been percent -- 12%. it is still up i 67.5%. manus: i have yet to download. i have yet to start playing. juliette saly with the latest on the markets. theresa may in the united kingdom has only been on the job for a few days, but britain's premier has had to hit the
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ground running. she is due to hold her first today before traveling to meet germany's angela merkel. anna: with us as emma ross thomas and tim crawford. welcome, both of you. a bit of set piece theater for theresa may. david cameron, for all of his pluses and minuses, he was always somebody who enjoyed "prime ministers questions" and all the brouhaha that goes with that. what are we expecting today ? emma: she absolutely took no prisoners in the trident debate, really exploited the divisions of the labour party and went for her opponents. i think we will see more of that. that will be interesting from a style point of view. i would expect questions on brexit obviously and questions on what has been one of her biggest challenges, the
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acquisition of arm. that was a bit of a bit of the test. there has been a u-turn on her position now and her position before she took over as p.m.. anna: it's fascinating insight into this new government's attitude. they talked about industrial strategy, theresa may talking about preventing predatory m&a, and then you get the crown jewel of the u.k. technology industry being acquired. we talked about how the negotiations went from the fronts of turkey to may's door. she was involved in some of the conversations. manus: as far as that is concerned, i wonder to what extent the japanese have played a blinder on this, and that they have committed to building up the workforce in the united kingdom. favors part of currying from a political point of view. do you think she is going to get questions on her appointment of boris johnson? we saw him with john kerry being
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questioned in front of the global press. issue trying to dip their hands in blood? what is behind the boris appointment? emma: it is a strategy to put the brexiteers in charge of brexit. anyone can survive those kinds of questions and wriggle out of them with some degree of charm, boris johnson is the man. john came to his defense, which is interesting. anna: let's get you on the subject of arms or the subject of the first few days of this administration, anything of note? what is the focus for you? many people want clues and where brexit goes. tim: first of all, it's probably been a very good week for them in terms of investors. you had a lot of investors come butot just for the arm deal
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to buried property deals going down. , andg is everything clearly, is keen to show that the u.k. is open for business. for these deals. good timing from softbank. manus: this is the argument. softbank is doing a deal, and they are paying a lofty premium. it's not benevolence that is motivating them to do the arm deal. are you part of the chorus that is fair --hink this we have been loath to into a sense of false security. the ftse mid-cap is a. the world hasn't stopped. where are you in the sterling trade camp. tim: from a neck it point of view, it's going to be very much that sterling has driven that. that is why we have seen the ftse rally. i think that will continue for a while. i'm not in the camp that expect
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to see the ftse crash down. there is a fundamental reason why securities have been revalued, and that is purely currency. from the point of view of the currency itself, at these levels, it has probably done the majority of what it needs to. it's a question of, have the other currencies been able to catch up? anna:anna: what do we expect to see from theresa may on her reappear into her -- european tour? one of the first trips you would make would be to berlin because of the importance of that trade relationship. emma: she's not sending boris johnson. she is doing it herself. obviously, there can't be nitty-gritty negotiations at this stage. merkel has been clear on that. if each of them comes away with a sense that the other is a woman they can do business with,
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that will probably be successful. she will probably get a rougher ride in france. anna: she goes thereafter. anna:thank you very much, emma ross thomas. tim crawford, and equities investor at hermes. manus:manus: up next, the charm offensive begins. boris johnson works to strengthen ties with the u.s. we will discuss what was said during the john kerry visit to london. this is bloomberg. ♪
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anna: welcome back. ."is isanna: "countdown 7:18 in london. i'm told if you look closely, you might see a spider on the camera. until we get go the start of the european equity trade. here is juliette saly. juliette: thank you.
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romanhas named emmanuel as its next chief executive. he will replace douglas hodge who presided over the departure bill gross and a plunge in assets. roman has been ceo of man group, the world's largest publicly traded hedge fund manager, since 20 and was previously at goldman sachs. to miller's board will meet discuss growing pressure for a higher cash bid from ab inbev of. that is according to people familiar with the matter. he 77 billion pound offer is less attractive following a plunge in sterling. the currency drop means sab miller's to figure shareholders are getting sweeter deals than other investors. microsoft gained an extensive trade in the u.s. after sales and profits topped estimates thanks to its cloud business. fourth-quarter revenue was $22.6
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billion after adjustments. changingla has been productivity services as traditional software sales shrink. sap has reported results that topped analyst estimates. operating profit was 1.5 2 billion euros. that is as the company put a weeks or to the are behind it and closed more software deals despite the political turmoil in europe. we will be speaking to the ceo of sap bill mcdermott later this hour at 7:50 u.k. time. a sales forecast trailed analyst estimates. europe's largest semiconductor equipment maker said third-quarter revenue will be 1.7 billion euros lower than the 1.7 4 billion euros projected. the company seeks to convince clients such as intel and samsung to upgrade machinery.
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rise,a pokemon go-fueled that's on nintendo's market value more than double, shares have slumped in tokyo. at one point, they saw the biggest intraday fall in 26 years. techcrunch is citing an unidentified person close to the plans that said they will postpone the launch in japan. manus: a little bit of breaking news. this is movies on the u.k. banking sector -- they've moved outlook on the u.k. banking sector. they say there are uncertainties out there. they talked about solvency ratios. of course, there are countercyclical buffers. this is moody's saying to us that they expected the banks profitability to come under pressure. negative outlook.
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that debate will be next week. dividendho is paying a has the view that they may have to halt that process. that is movies latest view on the banks. anna: let's stick with u.k.. boris johnsonary has launched his charm offensive, hoping to strengthen ties with the u.s. he said there were exciting opportunities with secretary of state john kerry. >> after we completed our extrication from our treaties of the european union, what i want to see, and i believe on this, you and i are at one, john, is more britain abroad, more of a u.k. presence on the world stage , and i think we now have a very exciting opportunity to achieve that. manus: for more, we are joined by ryan chilcote.
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tim crawford is an equity manager over at hermes. ryan come it's interesting that john kerry wants to see a deal done between the u.k. and europe before the u.s. counts it out. they are having for luminary discussions. that's right. john kerry pointed that you can't do a deal until the u.k. leaves. he's encouraging preliminary discussions. we know there have been discussions. mike sherman spoke with the outgoing trade and business secretary. that is hopeful come if you think about it. ago, we hade months barack obama during his visit ahead of the referendum that u.k. would go to the back of the queue. it looks like the u.s. is moving away from that. the political obstacle for the u.k. getting a trade deal with the united states is going to be the fact that neither of the candidates in the united states are keen on free trade. you've got hillary clinton, not
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a big fan. donald trump, not a big fan, despite it is the republican party that had been pushing the obama administration to start those discussions with the u.k. donald trump is not in sync with those guys. anna: thank you very much, ryan chilcote. tim, let's come to you. we've talked you about the geopolitics. what is the secret for you as you look at the markets, near its all-time highs? what do you look for in terms of stocks that will deliver? citi got a great story , doing research, saying it's all about return on capital. tim: i typically would agree with that. that has increasing return on investor capital, that .s going to be a strong driver that is definitely one of the
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things we like. on a higher level, it's buying good companies that are exposed to structural, long-term themes that will continue to do well regardless of brexit or any of the other geopolitical things. manus: we've got sap, nice beat for them. we are going to talk to bill mcdermott later. caroline is up that interview as we speak. they topped out in estimates. that is the software and clout story. they are struggling to get clients to upscale their orders. what does that tell you? what are those stories telling us? tim: if you take asml first. extremeall about ultraviolet, which is a next-generation technology. it has been a question for them of getting the technology up speed so the productivity rate of these machines, will
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basically make it financially feasible for the customers, which includes the likes of intel, to put it into production. it has been about getting that right. we are starting to see signs of that. the headline numbers may not look great for asml. margins are good, but more ev sales will lower margins. there will be a wrapup -- ramp-up. that is a good sign. clearly, they are going into 10-millimeter seven-millimeter. coming back to sap,, it's interesting to see sap and microsoft, how they have evolved. these guys are struggling with competition from smaller cloud-based players. both sap and microsoft are getting traction. they have acquired businesses. anna: thank you so much, great to get your analysis.
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tim crawford, european equities portfolio manager over at hermes. that will do it for "countdown." manus: london is up by 30 points at the moment. we've got bill mcdermott. that is the conversation in the next 15 minutes. anna: this is bloomberg. ♪
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."y: welcome to "on the move it is 7:30 in london. i am guy johnson. i'm alongside caroline hyde over in berlin, which is where theresa may is going today. may meets merkel. europe's two most powerful leaders size one another up. can they see i to i on brexit that is the big question? timko poaches ceo many roman after three years on the job. he's going to californi


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