Skip to main content

tv   Street Signs  CNBC  February 21, 2018 4:00am-5:00am EST

4:00 am
welcome to "street signs. i'm joumanna bercetche these are your headlines lloyds pretax profit hits a record but comes in short of full-year forecasts. shares trade higher as the british bank unveiling a 1 billion pound share buyback. glencore's revenue comes in at 20 5 billi$5 billion they reduced net debt by $3 billions and shares are in the green of orange, as they report their
4:01 am
first annual home market revenue rise in anyone years. and headwinds for iberdrola. the stock sees red after full-year earnings miss expectations failing to offset a proposed dividend increase i will speak with the chairman at 11:00 cet all right. it is pmi extravaganza this morning. we already had pmi numbers out of germany an france both were disappointing. just getting in the flash composite pmi numbers. let's look and see where those came in. the february composite flash pmi came in at 57.5. the forecast was 58.5. we have another miss here coming in it's not that surprising after what we saw coming out of germany and france a bit
4:02 am
earlier. so definitely the numbers have begun to drop a bit. we're seeing that in services and in manufacturing as well a little bit disappointing there. the euro has come off a bit on those news let's look at how european yields are doing the currency dropped a bit i would expect there to be movement in fixed income as well, particularly as the bund was trading above 60 basis points, and it looks like bunds are about 3 basis points stronger there we go. ten-year bunds, 4 basis points stronger back around 70 ten-year france is 2 basis points stronger. catching a bid on the back of this disappointing pmi data. i'm joined by david owen from jeffries international i would like to start off by talking about this pmi data. q4 for europe was a strong one it appears as though q1 of this
4:03 am
year, the momentum is slowing down do you think that's fair >> it's difficult to read into the surveys. at the moment there's a huge disconnect between the survey evidence and the hard data, and that disconnect has gotten bigger since the financial crisis the market themselves were subjecting this the pmis at the moment were consistent with 1% gdp growth quarter on quarter. q4 came in at 0.6. so we're seeing positive momentum behind the eurozone we think eurozone will surprise. >> so don't read too much into the data points specifically >> yeah. we have the european commission survey next week as well that is a slightly more reliable survey has more history, more detailed. doesn't tend to get such coverage because it comes later in the month that's often a more interesting survey i would highlight the disconnect between surveys and hard data have gotten bigger because the
4:04 am
new normal is much lower a reading of 57, 58 in the pmis is no longer consistent with what we saw pre crisis >> let's drill down into individual countries do you get the sense this recovery has been broad based or is there a disparity between some core countries and peripheries? >> it's broad based recovery in the sense that most countries now are enjoying gdp growth. some from an incredibly low base italy has been the most obvious example of that. italian gdp disappointed again in the fourth quarter. there's substantial pent up demand within the eurozone germany is still a pivot germany is a running a huge account service. it's ran down some of these excess savings germany would surprise clearly on the upside. that would help the eurozone more generally
4:05 am
i'm looking at germany more closely than other countries >> sticking with germany, the grand coalition talks, and with spd, does that change your view of what happens to this notorious german surplus >> on the fiscal side, yes if germany is running a budget surplus, it's got a corporate sector, it has a household sector in surplus. if they start running down the budget surplus that would give a boost to the eurozone. at the moment the account surplus in germany has been the ecbs qe. and foreigners being substantial net sellers of german bunds. reallocating into u.s. fixed income and the uk gilt market. if we get a situation where germany invests more widely in the jerusalem, that wieurozone,p the eurozone will grow close to 3% this year and germany will
4:06 am
provide that help. >> what do you think of the gdp forecasts. >> 2.3% growth on average was put out there, which we think is too low. we have to see what the hard data for q1 brings out peter pratt has the option of revising up the gdp forecast he's also now focused on this super core inflation which in germany hit 2% last summer that gives them a communication style to talk about the exit as we go towards september. they could talk about super core inflation picking up they can talk about revising up the gdp forecast, if germany in particular steps up to the plate. >> i get the sense you're bullish on europe and more hawkish on ecb policy.
4:07 am
>> we did think there was a good chance they would raise the rate in december. >> this year >> yes this december. at the moment there's a correlation between the deposit rate and if they stop doing qe in september they can raise that to 1.5, but it looks like they want to taper in the fourth quarter. but they will raise rates by the timemario draghi exits next year >> that's not priced in. the market is not accounting for a december depo rate hike. >> the eurozone -- the currency is less relevant, but if today's pmis, the start of a trend, our views about eurozone will fundamentally change
4:08 am
at the end of the day if we get a situation where eurozone is still surprising on the upside, clearly mario draghi will want to -- his legacy will be i've taken the eurozone from a recession of financial crisis, i've done qe and have raised interest rates >> almost like janet yellen. >> yes >> let's talk about legacy mario draghi has to step down next year. we got the new vp announced. do you think that has bearings on policy or some steps they'll decide to do >> the interesting thing to us is the two key people communicating the ecb policy beyond mario draghi is the vice president and peter pratt, the chief economist. they always did the job of providing keynote speeches after every press conference, doing interviews, if you went on and read the speeches, they put it into context what the ecb was trying to achieve. we'll have to see what happens communication will be key.
4:09 am
i'm hoping that their communication doesn't suffer from the departures. phillip lane is still in play on being chief economist when peter pratt steps down next year we just don't know it's normal horse trading in the eu >> certainly lots of moving parts. it looks like fundamentally the data is strong thank you very much for joining the show that was david owen from jeffries international i just want to bring your attention to a couple of coca-cola flashes. we can see coca-cola q4 revenue came in at 7$7.5 billion it reports strong operating results for the fourth quarter it achieves or exceeds the full we're guidance sees capital expenditures 1$1.9
4:10 am
billion. the one-time net charge of 3$3.6 billion for tax charm charges. they have beaten their own targets there. let's look at how european markets are doing. we were just talking about those disappointing pmi numbers. we also had earnings, let's not forget about that, which has pointed to a bit of weakness in the first hour or so of this trading day. stoxx 600 composite is down 0.5% a weak start today don't forget we also had a weak u.s. equity trading session yesterday. somewhat pulled down by those weaker than expected walmart earnings let's switch to individual indices and see what the picture is like. sea of red not pretty amongst all of the four majors. today somewhat surprisingly, ftse 100 is the leader, relative leader, down only 0.25%. xetra dax, cac are down 0.5% or
4:11 am
more ftse mib is down 0.6%. some disappointment in the data. those pmi flashes underwhelmed switching to sectors, the laggard -- i should say the leaders are basic resources, up 0.3% telecoms up 0.3% doing well on a day when everything else is not doing that well. you can see the cyclicals, technology and retail are underperforming. oil and gas down 0.7 % in line with some moves we're seeing with wti and crude down 1% or so as well. let's look at yields in this environment we cannot talk about markets without talking about what's happening in fixed income. ten-year fixed yields, 2.90 level. let's look at the ten-year gilt,
4:12 am
1.55 in about 15 minutes we'll get the pmi numbers out of the uk. ten-year japan still low at 0.5 basis points no fireworks there bunds have rallied about p b3 bi points this morning. lloyds banking group has missed expectations despite posting a record full-year pretax profit of 5.3 billion pounds the bank announced a share buyback of 1 billion pounds. the cet 1 ratio was 15.5% before distributing capital. the job is not done. that is the message from hsbc's group chairman mark tucker speaking to cnbc he talked about the impact of fed rate hikes and gave his outlook for growth. >> general consensus is two or three times, and we would think that's probably right.
4:13 am
we would see 25 basis points hikes two or three times this year getting up to 1.25, 1.50 towards the end of this year >> as chairman of hsbc, what do you worry about most when it comes to global growth >> in terms of the factors of the biggest concern, they would be macro factors macro geopolitical factors across our businesses. in the individual territories. so there's nothing in a sense of -- in a micro sense these are macro factors that all of us have to deal with. whether they are issues in the middle east, concerns in -- geopolitical concerns in europe, whether we have brexit all of these are issues we deal with i think none of them are in our view insurmountable for the
4:14 am
group. >> that was mark tucker from hsbc coming up, orange says it is open to consolidation as it reports a first sales increase in france in nearly a decade more after this break. (nadia white) the moment a fish is pulled out from the water, it's a race against time. and keeping it in the right conditions is the best way to get that fish to your plate safely. (dane chauvel) sometimes the product arrives, and the cold chain has been interrupted, and we need to be able to identify where in the cold chain that occurred. (tom villa) we took our world class network, and we developed devices to track environmental conditions. this device allows people to understand what's happening with the location, but also if it's too hot, if it's too cold, if it's been dropped... it's completely unique.
4:15 am
(dennis woloshuck) if you have a sensor that can keep track of your product, it keeps everybody kind of honest that way. who knew a tiny sensor could help keep the food chain safe? ♪
4:16 am
4:17 am
welcome back to the show quick headlines out of germany the german union ig metall says volkswagen wages will increase 4.3 from may just a couple weeks ago the german unions and employers came to an agreement on these wage increases and the expectation was that the two sides agreed to a wage increase of about 4.3% from april and so clearly volkswagen is to be a part of that as well interesting timing with so much focus on eurozone pmi data let's not forget about inflation. as our previous guest was saying, super core numbers for germany close to 2%. it will be interesting to see whether that wage inflation
4:18 am
starts seeping into german data here let's move on and look at some of the corporate news driving earnings this morning. glencore has reported what it has described as its best results on record after posting full-year marketing earnings above guidance profit also came in line with expectations net debt fell 3 billion pounds to just over 10 billion pounds spain's iberdrola posted worst than expected full-year net profit the spanish utility company announced a share buyback of 745 million euros. we'll have more on those results later this morning when ignacio galan joins us. core hotels beat expectations by posting a 10.1 increase in like for like operating profits for 2017 with ebit hitting 492 million euros cost cutting and strong demacndd
4:19 am
fed strong results and first half pretax profit at barratt has risen 6.8%. the uk home builder has raised its dividend to 8.6 pence a share. in france, atos has opened lower despite an increase of 2.3% in organic revenue growth it's digital business helped sales grow 10% to 12.7 billion euros. the it services group announced operating margin for the year at 1.3 billion euros. sticking with france orange is trading higher after posting its first sales increase in france in nine years during the fourth quarter the french telecoms operator said it remains available for consolidation talks in its home country. overall fourth quarter results
4:20 am
came in line with expectations with core profits and revenues growing. at this point happy to say nick nilson from ubs joins us on the line we're coming up to the end of the earnings season in europe. we did have a bit of that equity shakeout a couple weeks ago. do you think the worst is over for now, and going forward the momentum is there in european equities >> people were focusing on the correction, the rise in volatility, they were not looking at the earnings season so much. and it's been a pretty good earnings season. a net 13% of companies have beaten in q4 that quart hear tended to be a weaker quarter. so european companies are delivering the goods in terms of this profit recovery we're only at the beginning of year two of this earnings recovery in europe the u.s. is much more mature in
4:21 am
the cycle, but there's a long way to go. we would argue the fundamentals are well placed and sure we'll get wobbles which we had, that technically driven correction in the past couple of weeks, but we see value in european equities >> how would you describe the environment here more of a value or growth environment? >> more value. if you look at what's happening, we have enough economic growth out there. european gdp numbers are strong. pmis at or close to record highs. there's enough economic growth you don't have to pay out for the growth stocks. you can buy the value stocks, cyclicals, and we are seeing rising bochbd yiend yields. our preference is banks, energy, autos, construction. mainly cyclicals those are the ones outperforming year to date all the sectors have outperformed to cyclical and the defenses has underperformed the
4:22 am
markets. >> so it appears investors share your view then what do you think positioning is like in europe after the selloff a couple weeks ago >> people got overenthusiastic we were highlighting that bullish sentiment was at a seven-year high at the end of january. we were highlighti ining some o those risks. i think some of the excess euphoria has come out of the market we can see that in data we have from hedge funds, gross leverage was extended up at ten-year highs at the end of january. that's come down i think positioning has modestly reversed from where we were at the extremes i think people are less positioned, less overweight in equities less risk on as it were then that he were at the end of january. that's probably a healthy correction to flush out of the
4:23 am
market >> earlier in the show i was talking about the stronger pmi numbers, slightly weaker for this month, but generally speaking the data in europe has been strong. growth is picking up it's a double edged sword because we've seen a rebound in currency as well what's more important for equities in is it growth or the euro currency? >> that's the trade off. that's why we would certainly focus on the domestics in europe rather than the exporters. we are having very strong growth, economic growth in europe that's where just about half of the revenues for european companies come from. you have large exposure overseas 20% of sales roughly to the u.s., about 30% to rest of world, which is mainly asia. clearly those are areas that will get hit by the stronger euro so our preference has been quite clear through the second half of last year when we saw the euro strengthening to go and be domestic plays that's where a lot of the economic growth is and also where you avoid any of the
4:24 am
currency head wind we think this year the stronger euro takes maybe 3 percentage points off european earnings >> we started this conversation off by saying europe is a couple years or a year behind u.s. equity markets does that apply to small caps as well when you look at the valuation opportunity for european small caps versus the valuations you get with the russell? >> definitely. we kind of forget until 2017 we had effectively six years in a row with no earnings growth in europe the u.s. was delivering steady earnings growth. we did have the eurozone sovereign debt crisis in the second recession after the financial crisis that the u.s. avoided. that's made things slower to recover in europe. last year was really for the market as a whole the first year of profit growth so i would say both the large caps but also at the smaller caps and the mid caps you have got this big lag between the profit cycle in europe and the
4:25 am
profit cycle in the u.s. most of the small caps will be more domestic, they'll be less exposed to currency, more exposed to strong pmis so in general that's an area we would favor. >> nick, thank you very much for bringing us the latest and your views on european equities nick nilson from ubs seems to be quite optimistic about the investment opportunities. the swiss financial regulator says it is investigating whether several of the country's banks fulfilled their regulatory requirements in their dealings with venezuela. there could be possible links between certain banks in relation to money lawn undering cases. accusations including putting money in banks including in switzerland.
4:26 am
venezuela claims to have raised 7$735 million after the launch f its petro, the oil-backed cryptocurrency president maduro celebrated saying petro is a solution to the country's problems north korean officials canceled a meeting with u.s. vice president mike pence at the last minute. mike pence was in south korea for the olympics the north pulled out after pence criticized its human rights records. the most successful olympian has added another gold med toll his haul after winning the biathlon mixed relay martin kincaid has three golds now. south korea added to their medal
4:27 am
collection address its woms its track speed skaters won gold italy and netherlands got the silver and bronze. norwegian olympians have collected 30 medals between them, they have 11 golds, 11 silvers and 8 bronze germany has 11 golds canada is in third place, the netherlands fourth france is fifth. pushing the united states out of the top five coming up, fresh charges and a guilty plea in the probe into russian meddling in the 2016 election why the son-in-law of a russian oligarch with ties to former trump officials is in the spotlight after the break.
4:28 am
4:29 am
4:30 am
welcome to "street signs." i'm joumanna bercetche these are your headlines
4:31 am
lloyds pretax profit hits a record but comes in short of full-year forecasts. shares trade higher as the british bank unveils a 1 billion pound share buyback. glencore's revenue comes in at $205 billion. they reduced net debt by $3 billion. and shares are in the green of orange, as they report their first annual home market revenue rise in nine years and the fizz goes flat for coca-cola. fourth quarter revenues decline, but the drinkmaker looks to capitalize on u.s. tax reform despite having to take a one-off charge of $3 billion all right. we are just getting the uk data. i've been saying for 50 minutes
4:32 am
we're getting the uk pmi numbers, i obviously mean the uk employment data, which has come in weaker than expectations. let's look at what came out. the average weekly bonus came in at 2.5% from december. december was 2.6%. and output per hour also came in slightly lower than expectations as well. so it appears as though the average hourly earnings have come in lower than estimates and the december number. people were hoping for a bit of a pickup there we also got the public sector net borrowi ining numbers. 11 opinion 6 billion the poll was 11.1 billion. slightly wider than expectations there is always seasonality with the january borrowing numbers because of tax receipts. the currency is off a tad on the back of that somewhat
4:33 am
disappointing data the brexit secretary, david davis, says britain won't plunge into a mad max world after leaving the eu speaking in vienna, davis insisted the government will work closely with eu regulators after brexit >> we will continue our track record, meeting high standards after we leave the european union. i know for one reason or another there are some people who sought to question these are really our intentions they fear that brexit could lead to an angelo saxon race to the bottom, britain lung eplunged ia mad max style world. these fears about a race to the bottom are based on nothing. not our history, not our intentions, not our national interest labor leader journey corbyn called for a soft brexit
4:34 am
approach saying britain must have a customs relationship with the eu corbyn has been under pressure to clarify his stance on brexit. speaking to cnbc, hsbc group chairman mark tucker says he sees a lot of uncertainty around brexit >> the most significant thing for us in brexit is being able to look after our customers, to be able to guide them through a journey and the brexit journey there's still many uncertainties. the december agreements were positive discussions can go into transition and longer term trade agreements but there's still a way to go. our role is to guide our customers through that at the end of it, when brexit happens, we must be able to support our customers, european customers. we cannot support those customers from the uk. that will be banned under the
4:35 am
agreement, so we must support them elsewhere we'll move those jobs to france, where we have a very something can subsidiary we havehave 10,000 or so people our french subsidiary. instead of the center of europe being the uk, we'll rebranch a number of different countries out of france. it's a fairly simple process for us i think it's where the jobs go the job here is servicing eu nationals. we'll move those jobs. again, the urgency for us is not as great as it is for others who don't have the european subsidia subsidiaries >> so you will move the jobs to paris, 1,000 jobs. >> we haven't -- we have given up to 1,000, rather than 1,000 my sense is that it would probably be less than that but that sort of number. >> as chairman of britain's
4:36 am
largest bank, anything you want to say to prime minister theresa may about how to ensure a smooth transition >> i think they have a very difficult and challenging job. i think they get plenty of advice i think the advice is better done privately than publicly >> but if you had a chance to talk to them, what would you say? >> we spend time with all of the senior leaders of the countries we operate in. again, those are much better private conversations than public >> so you have been talking to prime minister theresa may >> i have. >> given fears of a brexit, do you think london can still remain one of the world's top financial institutions >> absolutely. it's -- london is a world class center, difficult to replicate in many senses it's -- that's happened over many, many, many years i think it will take many years for that to erode. in the meantime we have to be
4:37 am
positive, constructive, we have to find ways to ensure london and the uk remains a world class financial center the government and i think the regulators both understand that. >> i'm pleased to say callum pickering joins us on the show to discuss all things uk we were just listening to mark tucker there he was saying they're actually thinking about moving 1,000 jobs away from london to paris because of some of the uncertainty in brexit. do you think this march summit will be a make or break time as far as businesses are concerned? >> yes i think that may and davis are under increasing amounts of pressure if the summit at the 22nd the eu and uk signal some transitional arrangement is in the bag, markets will relax a little, not break that glass just yet. >> i've been reading your
4:38 am
research, you have a grid of various probabilities of brexit, no brexit, so on does anything you have heard change those probabilities >> no, and i would stress the line that the uk followed of softer and softer terms for brexit is consistent with everything we heard over the past couple of weeks mr. davis yesterday bringing down problems between the uk and the eu, i see a 75% chance of a soft brexit. what we need to be thinking about, all else equal, leaving the eu will reduce uk potential growth just by how much depends on how hard the brexit is inside the eu, the uk manages about 2.1% growth per year
4:39 am
i think that speed limit could come down to 1.6, 1.8% in a soft or semisoft brexit a hard brexit, 20% chance would be much worse than that. >> we were talking about jeremy corbyn, he gave a speech yesterday saying it's essential that the uk have some form of customs union with the eu. how do you think financial markets would react if there were a possible change of government here? >> i see a 15% chance of a corbyn government before 2022. the policies jeremy corbyn would follow, increased intervention, more financial regulation, increased regulation in the market would further dampen potential growth and add to brexit risks in terms of the reduction to long-term potential growth for the uk. >> let's talk about the bank of england. we had a somewhat surprisingly hawkish meeting a couple weeks ago with a cemented three extra
4:40 am
rate hikes over the next few years. do you think they were right to do that? >> the uncertainty is not affecting the economy in a major way. while we have not seen acceleration in growth since brexit, the supply side of the economy slowed down. that means now the uk is at close to full employment on the labor and capital side inflationary pressures are building demand is exceeding supply growth the bank of england are worried about inflation risks, and this tightening is a result of those inflation risks. >> so do you think they go in may? if they do, is this a signal they'll hike every six months? >> hike every six months seems consistent with the inflation risks. hiking in may seems to about what the market is expecting and what i'm expecting before the february inflation report, mark carney and the mpc knew that markets were pricing in the chance of a may hike, if they didn't think they would
4:41 am
hike in may, they would have simply steered markets away from that so they didn't steer markets away is a thumbs up from the bank of england that they'll hike in may. >> thank you very much for joining "street signs" today callum pickering joining us. i was talking about the coca-cola earnings about a half hour ago we have to issue a correction. the coca-cola fourth quarter earnings we flashed and mentioned are not new, but were released on february 16th. our data provider has actually issued that apology. so our apologies the coca-cola earnings did disappoint, came in about 20% lower than expectations. new charges and a guilty plea in robert mueller's investigation into russian meddling into the 2016 election. a lawyer with ties to former trump campaign officials is in the spotlight.
4:42 am
tracie potts is in washington. there's been so many tweets, so many stories on this particular story unfolding over the weekend. what is the latest now what can you tell us about the russia situation >> a couple of things. the latest is that the white house is now pushing back at this idea that president trump is doing nothing to stop russia from interfering in the next election the midterms coming up at the end of this year the president's spokesperson says that not only are they doing something, but they have directed agencies to do so as well the president has -- and that the administration has talked specifically about russia and pointed to russia as being responsible for this int interferen interference the fbi testified they got no direction from the administration the white house says they're working with states to make sure their election systems are secure and working with vendors to do the same the criticism comes from the fact that after the latest
4:43 am
indictments, 13 russian nationals indicted by the mueller investigation, the president instead of talking about the russian interference blamed democrats and continued to say that there was no collusion with his campaign, focusing on that aspect and not focusing on whether or not russia was trying to influence this election. that's where the criticism comes from you mentioned that latest charge against a london lawyer who was working with members of the trump campaign, rick gates specifically, he's charged with lying about his communications, e-mails and phone calls with the campaign as both of them were working on behalf of the russian-backed ukrainian government >> one question here are there any signs that the mueller investigation is moving closer towards president trump's inner circle or president trump himself? >> definitely moving closer towards the inner circle, we can tell that from the indictments
4:44 am
and from the interviews that they're doing. but how soon this may wrap up, if it may result in any more serious indictments, that we don't know the person most eventually charg recently charged, this attorney, we don't know what he is being charged with the documents did not specify that. the gun control debate continues to rage on in washington videos showing gun owners destroying their firearms are going viral online gabe gutierrez has this report >> reporter: as she watched the horrifying images of the parkland shooting, amanda higher of connecticut said she needed to do something. so she destroyed her handgun >> i hope some people are inspired that they would go out and do the same thing. >> reporter: in north carolina mike russell handed over his ar-15 to law enforcement
4:45 am
he bought it as a hobby but -- >> as i see more and more ar-15s being a part of mass shootings, i don't want to be a part of that. >> reporter: on social media some gun owners are getting rid of rifles and posting pictures under the #onelessgun. >> i will make sure this weapon will never take a life >> reporter: it all started with a facebook video, viewed more than 17 million times of a self described responsible fun owner, so moved by the florida shooting he sliced his ar-15. >> now there's one less. >> reporter: the nra called the a. >> reporter:-15 the most popular rifle in the u.s., owned by 8 million americans. it's customizable, accurate and versatile but become the weapon of choice in mass killings marcos avalon is a certified nra instructor who says banning a.
4:46 am
>> reporter:- ar-15s >> i don't see where the solution is coming from that >> reporter: tonight there's a renewed debate from gun owners themselves and whether the right is worth the risk. a civil rights group is suing the trump administration officials over detention of imgrant childrimmigrant children the administration declined to comment. it's the latest immigration related controversy amid a debate between the white house and congress about a policy to overhaul immigration elsewhere, coming up investors are requiring roadside assistance as aa shares break down we get under the hood of the issues next. your brain is an amazing thing. but as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall.
4:47 am
thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. the name to remember.
4:48 am
4:49 am
welcome back to "street signs. let's check in on markets and see how things are looking starting with foreign exchange the theme is one of dollar strength as it has been for the
4:50 am
most part of the week. euro/dollar off a tad, down 0.1% dollar/yen is stronger, up 0 opinion 2% aft0.2% cable is below 1.40. european markets this morning, they are not looking that pretty all of them are trading down it's a bit of a gloomy picture as far as europe is concerned on the back of those disappointing pmi prints, but also some underwhelming earnings reports out earlier. xetra dax is the underperformer, down 0.6%. ftse mib having a grim day, down 0.92%. the dow looks like it will open up about 43 points lower in today's session. and the s&p about 4 points
4:51 am
lower. yesterday's results were pulled down by walmart whose earnings came in quite disappointing. it's a breakdown in dividends for roadside recovery group aa they announced they will lower payouts to shareholders to 2 pence a share per year the move was to help satisfy the board that the profit and free cash flow can enable a change in policy broadcom's ceo says nxp shareholders owe him one after qualcomm sweetened the deal. broadcom has an offer on the table to buy qualcomm for 1$121 billion, but a condition of the deal was that qualcomm not raise its offer for nxp. however the ceo says his offer pushed qualcomm to go higher for
4:52 am
nxp than it would have otherwise. another twist in the at&t time warner merger saga. a judge denied at&t's request to see communications between the trump administration and the justice department on the deal this ahead of a trial to decide the fate of the $85 billion merger in march. at&t argued that the justice department's recent decision to sue to block the tie up was politically motivated. but the ruling said the company didn'tprove selective enforcement. sgloe acti elliott advisers disclosed a 5% stake in fidessa. shares in fidessa are continuing their climb in today's session with temenos announcing a 1.4 billion pound takeover deal. and softbank's vision fund looks to get more money. there are early talks about
4:53 am
investing in the private equity fund which aims to reach a total frund rai fund-raising target of 1$100 billion. the fund has gotten cash from other middle eastern sources arjun joins me on the set with more on this story it appears like a lot of middle east investors are piling around softbank >> the interesting thing with the middle east sovereign well funds have not had a huge portfolio of technology holdings softbank's invested in the likes of uber, grab, the ride hailing services, they bought arm, nvidia, chipmakers so these sovereign wealth funds looking to invest in softbank is a play in getting exposure to the fast-growing technology plays in the world and those companies that softbank feels will be key players when it comes to changing the transport
4:54 am
infrastructure around companies and enabling the next generation of robotics and artificial intelligence that's what we're seeing with the middle east interest in softbank >> do we have any idea about how they are looking to finance this potential stake? >> at the moment there's no clarity. the comments made to reuters by the ceo of the fund were about early interest and talks to invest in this but there could be a number of ways raising debt in order to pay for that at the moment there's no clear idea >> is there an indication that some of these investors will be pushing softbank to go into s certain industries or expand more >> softbank has really plowed money into perhaps what some people see as competing companies. you see the likes of uber, for example, but it has the singaporean version of uber, grab it has investment in didi in
4:55 am
kind that. you say why is softbank looking at all these ride hailing services what you're looking at is softbank trying to find ways to create giant, giant plays across infrastructure uber and these other companies are not just taxi companies, they are changing the way transport is done in many markets. that's where softbank's strength is softbank is able to get many of these companies into the japanese market but also by taking some of this middle east money, they can get those companies in which they're invested into a fast growing technology space of the middle east that's what we're seeing with the early investments and system of the direction softbank has moved the vision fund in >> it's a way for the middle east to get exposure into these
4:56 am
companies. >> that's right. this gives them the chance to get into that play in those fast-growing tech firms. >> thanks for joining us and explaining the latest with softbank softbank is a keynote speaker at the mobile world congress next week arjun will be there and karen tso. the dow closed below 25,000 in yesterday's trading seg, pussio, pulled down by walmart it's seen opening down in a couple hours time, but all of that may change. that's it for today's show "worldwide exchange" is up next. i love you, basement guest bathroom.
4:57 am
your privacy makes you my number 1 place to go number 2. i love you, but sometimes you stink. febreze air effects doesn't just mask, it cleans away odors. because the things you love the most can stink. and try febreze small spaces to clean away odors for up to 30 days. breathe happy with febreze.
4:58 am
4:59 am
5:00 am
ending the streak. stocks pointing to a mixed open on wall street after the dow and s&p 500 snap six straight days worth of gains. betting big on drugs what amazon just did that could deal a blow to pharmacy stocks and clean up in aisle four walmart posted its worst day in 30 years what's the next step for the company? a top retail expert's take on that it's wednesday, february 21, 2018 "worldwide exchange" begins right now. ♪ good morning welcome to


info Stream Only

Uploaded by TV Archive on