numbers and sales in the u.k.. it is a tough one because all of the data is stacking up to support the taper momentum. jobless claims falling. bernanke says there is no sign of a bubble. >> this is the picture. a lot of these futures. some of them are unchanged. we have a little bit of u.s. data later. david, you spoke with the danish finance minister. >> that's right. spoke to her and we discussed how far she is prepared to go and what she is prepared to do to counter rules from the european commission that could undermine financial stability here in denmark. >> thank you very much. we'll have much more from david throughout the day. >> you're also watching shell. it is down.

>> what we have got here is the fourth quarter significantly below recent profitability. warnings for the full year. it is a double whammy. there are two parts to -- one is going down into the ground. and one is actually selling the product. they have got issues on every side. exploration costs are rising. the value of the aussie dollar is a challenge for them. we have a new c.e.o. $4. billion. not as they expected. >> we'll have more on that story. down from 3.8%. jon, this is exciting for china mobile. they are starting to sell iphones today in china. >> 763 million subscribers over china mobile. they now can go out and buy the

iphone. if you look at the queues outside the shop today, there were not any. >> they have all goran online. >> -- gone online. >> it is not exactly new. the bigger issue is the china mobile has got it and you have a massive subscriber base to penetrate. >> all on iphones all at the same time. >> manus, what else are we watching? >> stoxx 600 closed down for the first time in five days yesterday. you're going to get a little bit more indication of the state of the u.s. housing market. housing starts. consumer sentment will also come out. the u.k. forward guidance. in the u.k., there is a 60% possibility, probability that

the m.p.c., monetary policy committee, mark carney, will shift their guidance at the next inflation report next month. that is a hefty percentage. anyway, we'll leave it there. equity markets are undecided at the moment. the big shock is what's happening with shell. we'll have a look through some of the other equity stories there. equities are just opening that little bit better this morning. don't forget the dax was at a record yesterday. closed down on the day. there is a structural shift in terms of what will happen in the u.k. in terms of guidance. there we go. royal dutch shell. there is an a and a b share in royal dutch stair. this is u.k. listing, down 4.4% on royal dutch shell. so that is going to be a pretty big drag. oil a substantial component on

the ftse 100. let's have a look across. shell down 4.28%. 21 pound give or take a pence. to top line in case you hasn't tuned in. royal dutch shell, profit warning for the fourth quarter. they are talking about challenges, expenses. they are talking about the value f the aussie dollar as well. that is breaking news. you b.p. down over 2%. ironically, perhaps with a little bit less geographic exposure and structural exposure than shell, is up .8%. let me take you back to the banks. we have a note on banks this morning. this is quite interesting as we go into reporting season. the banks in europe have been the best performing industry group since the start of 2014.

they are saying if history has anything to say about it, down they go. they say deutsche bank, the value has been overdone. nordea is their buy. the value is good relative to their peers. santander, they say get ready for more disclosure in spanish banks. you know what? we'll leave it there. no point in trying to stuff a turkey and tell you about the dollar. >> let's not stuff the turkey. rule on bank capital has potential spark problems in denmark. what can be done to avoid it? david, this is related to denmark's mortgage-backed covered bond market? >> exactly, francine. this covered bond market is four times the size of the sovereign

debt market here in denmark because basically the debt ratio is 33%, 34%. very small. now the problem that they have got is that there are rules being formulated by the european commission at the moment on bank capital. the covered bonds aren't afforded the highest liquidity status. the banks that hold these bands represent about 75% of the liquid assets would have to sell them down a level of 40%. that would mean they would have to dump the bonds. it would also have economic implications. the economy minister i spoke to has been traveling around europe and just came back from berlin and i asked her what she is doing in order to counter the potential of these rules coming in from the european commission. >> for us, it is very important

that the danish position is well understood in some of the most important european countries. because worst case, if the commission comes out with a delegated -- that reopposeds, then we need people to say well, maybe we should reconsider. >> so in short what she is saying, if the european commission comes out and rules against interests of denmark, they are going to go to the allies. they will see if they can get the support to change to european commission's ruling. that won't come out until june this year. >> thanks. here is a look at what else is oming up on "on the move." shell profits below expectations. what is causing the downturn. china mobile, will sales take off? and details on the gambling

tycoon has already made $3.5 billion in 2014. stay with us. we're "on the move." ♪

>> i'm francine lacqua in london. this is "on the move" on television, radio and streaming on your phone and tablet and from bloomberg.com.

shell says first quarter profits will be significantly lower than recent levels. they said the results will be impacted by weak industry conditions and hire exploration expenses. manus cranny is here with the latest roundup. manus, the stock fell from 3.6% at the open. >> it is a double hit for shell. they have a new c.e.o. and he -- he is barely there a week. he is tallying everything now before the results were due. they have a strategy. get it out there and get it dealt with. since 2004, which is when they had their reserves scandal, there is a bit of speculation that truth and reconciliation before gets going for the rest of the year. it is double hit. from the drilling sood of the business, this is where they are hit tongue expenses. 3 -- on the expenses.

it is a double punch for shell. higher expenses and lower volumes and the language that they are using is quite interesting in that they are saying this is not what i expected. earnings for the full year at $16.8 billion. they also sense a weakness in the australian dollar which i've been talking about consistently. you have seen that moment numb the aussie dollar. natural gas is down in aussie dollar interprets. that is something to think about. a couple of other aspects are the challenges. shell has underperformed its pierce over the past year. -- peers over the past year. c.e.o.s trying to get a handle on it. australian workers earn $163,000. how do you keep a lid on those

expenses? that is a challenge for the oil industry. the keep a lid on expenses and deal with challenges like that. i asked where do you put your money? in b.p. that has litigation written all over it. irony is there is one little gainer there. called total. it is hard to choose an alternative. banks and miners might be the beneficiaries of money switches. fran, back to you. >> thank you. robert duke is joining us. he is a global strategist. robert, great to have you on the program. talk to me about the energy sector. you don't look at specific stocks but you think basically looking at shell, this is a shell problem, not an energy sector problem? >> what i've seen is r-the results of the numbers today

seems right. manus mentioned the problem earlier on. there has been a huge diverge ens within the sector. i think the numbers here, they seem very specific. there is not a clear industry -- it -- the earnings risk and the idea that that is -- that performance within the sector will continue. >> the stock is down 3.2%. >> worried about other companies throwing up surprises like this in the next couple of months? >> i think last year, we saw a lot of multiple expansions. stock prices across the s&p in the u.s. and the u.k. advanced more quickly than we have seen through the earnings. it is days like today that make

you take stock and question some of those multiples. i think this year is going to be one where we focus on visibility. focus on the growth normalizeation. it is an environmental thing where risk assets in particular deliver more -- returns. >> a little bit more dangerous. 2013 was boosted by cheap cash. you say we're going back to fundamentals. the risks and headwinds for investors that buy on a whim? >> yes. last year was about normalizeation, expansion, whichever way you want to think about it. this year it is about delivering. it hasn't started so well. >> how do you look at the industry groups? shell, we had a profit warning today. it is not an industry trend.

are there trends in technology or retail that you look at and want to be part of that story? >> sure. i think manus was suggesting alternatives earlier on. it is not something that excites me terribly much. it is interesting. risk assets. did very well. equity assets did very well. one that didn't, copper. if you think of copper as being perhaps a bellwether for growth, it is down. year-on-year. so i think some of those industries which are less -- to typical growth are more attractive. >> you identified five main investment themes for 2014. some of them are on currencies and some are on corporate profit. what is one that you most uncertain about? >> most uncertain, one of the

interesting themes on the profit hare is probably a longer term -- what we can see quite clearly in the u.s. wages, average wages and productivity have been divergent since the 1980's. that is a story that has led to a very low share in the labor take of g.d.p. and a high share in corporate profit share. those two things have reached an extreme and are likely to converse. that is not the best argument for convergence. corporate saving, one of the results of this doesn't help governments out of fiscal austerity. they really need to be investing. governments need to be encouraging corporates to invest. on the flip side, what we saw yesterday from osborne about inflation increasing -- and

increasing the minimum wage. i think the way out of austerity in this many ways is paying people with a higher margin -- more and that is not good for profit sharing. it is another headwind for corporate earnings. >> thank you so much. robert dukes there. -- jukes there. a $1.1 billion bill has listen voted on by the senate. president obama is expected to sign it. economists expect bank of england governor mark carney to change forward guidance next month.

and u.b.s. is said to being bonuses to investment bankers in asia by 10% for 2014. bonuses could exceed $2.5 million in the region. so this is the picture of what -- one of the biggest movers, shell. down 3%. this is after it said refining, higher exploration cost also hurt fourth quarter earnings. they said they will be significantly lower than recent levels of profitability. let's have a look at some other big oil companies. that is the picture for some of its competitors. total gaining .4%. this feels like a stock-specific problem. coming up, more than twice the

u.s. population in subscribers, china will start selling the iphone. we'll have what it means for apple coming up next. ♪

>> welcome back to "on the move." i'm francine lacqua here in london. china mobile starts selling the iphone today after six years of negotiations. for more on the latest let's go

to beijing. what finally brought the china mobile users, potentially 760 million subscribers, to apple? >> well, i think on both sides what you have is a desire to stem a decline in the market share in the world's largest wireless market. china mobile has seen its share of subscribers in this market decline to about 62% from 72% in 2009 when its rival china union come introduced the iphone. at the same time, apple has seen its share of the smart phone market in china decline to about 6% from 10% two years ago. so both of them are facing a decline in market share. >> so how is the reception when iphoned hit the shelves today. there were no big queues and that is kind of what we were expecting.

>> yeah, there didn't seem to be as much excitement as people might have expected. we sent reporters to three locations in beijing and shanghai and each of the locations that we went to, there were only about six people waiting when the doors opened. tim cook did appear at the shop at china mobile headquarters and handed out some autographed phones there, but at other locations things were fairly quiet. >> is this china mobile partnership going to give a boost to iphone sales? if you look at the possible subscribers, it is 760 million. because the iphone is already available, it could be kind of insignificant. >> certainly apple will get a bump. analysts that we have spoken to at hsbc or i.b.c. seem to be forecasting about 10 million units sold through china mobile this year. china mobile did claim they had about a million preorders before the device went on sale today.

>> what are some of the hurdles that apple is still facing in china? >> well, there are a couple. probably the biggest one is price. the hand sets here cost over $700, which is very expensive to your average chinese user. another hurdle it also faces is the chinese preference for large large displace. in china many people don't own a tablet and a flat screen tv. a lot of people buy one device for all of those purposes. what they want is a mobile device with a large screen. the iphone is only 4 inches. every other device that china mobile sells is alarminger than hat and most are larger -- larger than that. most are 5 inches.

when tim cook appeared at the store today, he took some questions from commerce. the first question he got from a customer is will apple release a large screen device and tim cook said they don't like to talk about their future projects. >> interesting. thank you so much. he also autographed some of them. our technology reporter from beijing. here are some other companies we're watching out for today. google is diversifying into contact lenses. smart ones. it is testing lenses that measure glucose levels in tears. the project is part of google's secretive lab and couldard the challenge s of diabetes. nokia is looking to replace their former c.e.o. michael elop. nintendo revised their

forecast. we'll have more. keep it right here on "on the move." ♪

>> welcome back to "on the move ." i am francine lacqua at bloomberg european headquarters in london. we are 30 minutes into the trading day. let's see how things are shaping up. this is the picture for the indices. we are a little bit on the higher side. still hiding for the second week of gains. investors are weighing reports from america. this is the picture for the euro dollar. currency is one we are always watching out for, especially data coming from the states. currently 1.3604.

president barack obama will speak today about the national security agency's surveillance rogue ram. it is a long-awaited response to the uproar set off by edward snowden. mass cranny has more. tell us about the latest revelations and what is the scope of its data collection? will makes like obama an announcement on what the panel has advised. he will take it up to congress. have a look at this, the guardian. today, they released the data, the kind of scope of data that has gone on. 200 million texts for day. -- per day. everything he can get its hands on. you name it, this hoover sucks it up. toma has been on the phone cameron, angela merkel. she knows a thing or two about

the united states of america. the issue about this, he has got these transparency issues. that trust could cost businesses, the brand names you see on the bottom of your screen. at the essence here, the telecoms and the operators out there do not want to lose business. they do not want to hold the data. they do not want to hold the data. that is the critical issue. they say, go find a warehouse or a third-party. will obama go for that? access, a very critical issue. the review panel, it was suggested that if you want access to the data, you have to go to court. it looks like obama is going to step away from that and make sure that security comes first. i think what you have got is the other challenge from some of

these brand names. they have launched a website. you can go online and look at it. they lobby for the right to be where thesclose agencies come to them and ask for information. >> you mentioned access. what are we expecting from obama? just sort of i am saying. i think the feeling seems to be that he is going to shy away from having to apply for warrants. it is the number one priority to reject the united states -- to the united states. i think those free campaigners that want to push government , as it were,ride judicial permission, we will wait and see on that. it is about trust, transparency, and if you wrap that up in the same phrase as the fbi and the cia, that would be something. accu.

>> manus cranny with the latest on the nsa. shell shares are dropping after it said fourth-quarter earnings would fall significantly low expectations. a specialistre is on shell and the energy sector. thank you for coming in. shall was a little bit of a bombshell this morning. we were not expecting it. orit company-specific problems that could spread to the industry as a whole? >> it is mainly shell. it is a big surprise, the first time they have done this kind of profit warning two weeks before results since the reserves scandal of 2004. so it is a big surprise. are facing areey the problems that everyone is facing in the sense that oil but returnsigher, are not. they have got to figure out how to get their returns up. shell seems to be having a harder time than most.

>> in a nutshell, fourth-quarter earnings were hurt by low volumes, higher exploration costs. are they managing that in a different way or worse than competitors? >> they have had some problems. they have a strong presence in nigeria and they had security issues there. in the u.s., they got burned a bit by the value of their assets because gas prices fell so much. the australian dollar is rising. there are a couple of things. there are the same problems in the sense that return on their investments are not higher than when oil price -- than what oil prices were. at has got to be frustrating for investors. >> you have been speaking to analysts all morning. what have they been telling you? >> they are very surprised. the average analyst estimate was about twice what shell says it was going to be. everyone has been taken aback, not sure.

they also missed estimates in the third quarter. .here is a new ceo >> i was going to ask about the new ceo. >> he has inherited a bit of a mess. how bignterested to see that burden is going to be. do analysts think he is the right man for the job? you almost have to be twice as good as if you were a normal ceo easing yourself in. >> he has two weeks under his belt. he started at the beginning of the year. he got the job because he did a really good job in the chemical division. he turned it around when it was really struggling. they are hoping he will do the same thing for the group as a whole. >> is there one thing that surprises you most? the stock rice fell some 3.5%. is there anything where they could have done a better job at it? >> it is hard to say. the reasons why were the reasons

you would expect things to miss expectations. a combination of lots of things from all over the world. it was a big surprise that it was so far off what people were expecting. >> thank you so much the bloomberg energy reporter. onto something completely different. las vegas high rollers get perks from all of the casinos. this year, the new nightclub in the bellagio unveiled a perk that blows the others away. a table with $250,000. don johnson shows bloomberg why it is worth every penny. >> inside the bellagio casino at the exclusive nightclub, one of the most expensive tables in the world. >> wow. i like this table. >> absolutely gorgeous.

>> part of its value is the view. 1200 water-spraying robots. almaslast 460 feet, high as e thio. the cost? $40 million. inside the club, the fountains are made of champagne. it is the most profitable club in vegas per square foot. the average table costs $8,000 a night. this one? $250,000. what makes it different? this red button. >> here we go. >> set off these fountains, $10,000. the number of people who reserve this table in 2013? two. >> not bad. that red button, $250,000. that is a very expensive night. you can watch the full program

done by trish regan later in the program. staying on gambling. a casino tycoon has become the richest man in asia. estatetook a real developer for the number one number onefor the spot. if you look at casinos, a cable that costs 250,000 dollars. you understand why they are becoming the richest men in the world. >> there is a name for the casino business right now. it is booming and macau is seven times larger than las vegas is right now. richest man in asia, one of three major casino operators in macau right now. 90% of his revenue is coming from macau. it is a good time for him. trend for casinos going to continue? >> it seems to be tied to the chinese tourists. they are the ones that are flocking to macau.

all over the world, they are trying to cater to and draw in the chinese dollar. everyone is trying to get the chinese consumer. macau is the closest place for them to go. benefits from the rise of casinos. is it the luxury makers in the london casinos? >> no doubt. luxury is having a boom much like the casinos. it is uncertain economic times. realtor --e former richest man in asia, has been selling off some of his assets to make investments into europe, where he sees opportunities. there are only $100 million apart. >> it could flip to the other side. >> i certainly expected to flip. lui has a fantastic business right now. in tough economic times, entertainment assets seem to do very well. >> are these two gentlemen competitive?

>> that is a good question. they share a very similar path. i suspect maybe. they are both chinese nationals. their families fled after the chinese revolution. i would assume they know one another, what whether they like one another is another story. -- thank you so much. coming up, we will have plenty and the dataell coming out of the u.s. later today. ♪

>> i am francine lacqua in london. this is "on the move" on bloomberg television and streaming live on bloomberg.com, your tablet, your phone, and any windows phone as well. china mobile start selling the iphone today after six years of negotiations. by aore, i am joined partner. it is great to have you on the show. talk to me about apple. we were expecting people to go to buy the apple iphone today. it did not really happen. >> there are already 42 million phones on china mobile's

network. they have about 700 million subscribers in china. whole bunch of people who wanted the iphone could not wait for apple to negotiate with china mobile. it just went and bought one. there are some online qs. i think they sold about 1.5 million in pre-orders. this was a deal that everybody was waiting to happen for so long. it has kind of dragged on. >> some of the first questions that people ask, are you going to make a bigger phone? this is what the chinese consumer wants. he says, i cannot tell you because that is top secret for the moment. if they are going to make it in china, who they have to rethink about what that market wants? >> it is different. the galaxy note does exceptionally well and in korea, where they use a bigger phone. they probably will, to some degree. apple is probably the only tech company that can standardize a very limited group of products.

because their products are so good, we kind of take what they give us. and the fact that there are 400 -- 42 million phones out there. the interesting thing is the battle between apple and samsung in china. let's see how fast apple can rise up. i am curious about this start up in china, the apple clone, in many ways. down to their founder dressing like steve jobs and thinking he is steve jobs. >> we do not know whether it will actually work abroad. the chinese have their own domestic phone makers. >> they hired a google executive and now they are launching and rolling out regionally. it will be interesting. they are one third of the price of an iphone. they look almost identical, but they run android instead of ios. they kind of acted to make it look much more like ios. >> we had the story today about

--gle, contact legend lenses, measuring the glucose in your eyes. we will talk about intelligence in a second. what is the one thing you are focusing on? >> we have very little particular powers -- predictive powers. we are really bullish on security investment. there are all of these web applications that are being hacked. target, neiman marcus, household names. we backed a couple of guys who left a very large linux company. security is one. we are interested in the future of health care and consumer technology. i think there is going to be a and thisumber of apps google diabetes contact lens is one thing, that will merge technology with health care and i have no idea what this market is going to look like in five years. it would be like trying to figure out what social

networking will look like in 2000. hopefully security will give us the merkel phone. we are looking at to struggling companies now. nintendo has revised its forecast to a net loss of ¥25 billion. they also cut projections for console. software sales were far below expectations. and a pc slump is turning intel's first-quarter revenue to fall short of estimates. office fell short of expectations. these are companies that are far away from the sexy trends that you are talking about. technology,and security and technology. >> the biggest theme is mobile. intel is classically a very good company. it is a manufacturing company on one end and a chip company on the other. if you look at the growth in our industry, it is not the pc industry anymore. intel is 100% tied to this industry.

every phone out there pays a royalty back to qualcomm. and then arm. if you pick up your ipad -- to be fair, apple makes its own chips nowadays. >> can intel not switch that things,f they focus on help with the technology, health care, monitoring of glucose levels or heart rates? >> intel was supposed to do this. the last 10 years, they were supposed to make the transition to go from a pc-centric company to go to a mobile-centric company. if you look at their products, they are really not competitive with arm. that is intel's big failing. they do go to all of the big electronic shows and they are a bad hardware company when it comes to building these products. what they do well is build semiconductor chips and sell them back to people who turn them into products. they should have bought arm 10

years ago when they were reasonably inexpensive in anticipation of this mobile market and they did not. this is the sad story. every time our industry goes through a shift, and we are clearly going through a shift, the laggards get left behind and there is a whole list of these now. >> it is an industry that goes so fast, you have to make sure that you are the frontrunner. >> every single shift. >> "the pulse" is coming up about 10 minutes from now. we are joined by guy johnson. we will be talking shell, nsa, technology. >> we have some great tests on the shell story coming up. we are going to give you some analysis. the bulk of analysts still have a buy rating on the stock. what will be the story after we digest the news? 17 days into the job. did not take him long. we will analyze all the events. the security story that you have been talking about, security will end up being a big part of

all of our lives. acknowledge he will have to adapt back quickly. who are going to be the winners and losers? what are the implications of that was to mark we will discuss that. we will talk about what is happening with apple and china. it is fascinating that these two countries have been -- have this kind of love-hate affair when it comes to technology and security. china mobile will be selling an awful lot of apple phones, products that are designed in america, made in china. the venn diagrams crossover in so many different ways. will apple make china work? we will talk about that. what kind of challenges is it going to face? we have great guests coming up on that subject. the next couple of hours are going to be fun. and ryan is going to be there. >> that is always fun. and he spoke with paul mccartney. "the pulse" about 10 minutes from now. final thoughts are next. ♪

>> two teams faced off yesterday in an nba basketball match set in london. it is part of the organization's attempts to go global. the brooklyn nets beat the atlanta hawks. ryan chilcote was there. >> the brooklyn nets are on the road. this is no ordinary away game. they are facing off against the hawks. it is a home game for atlanta,

only it is in london. it is the national basketball association's 8th regular-season game in england and the latest franchiseep to take a global. >> we look at some of the assets that we have. brooklyn itself, a global brand. now we are at a point where we want to further leverage it and ultimately monetize it. >> the nba is already going global. the nets owner is russian. one of the nets players is from russia. two others are from europe and the hawks roster includes a german, a mexican, and the league's first macedonian. kevin garnett may be the biggest draw, but his chinese-made shoes and the millions behind them are the business. guatemala over, air jordan. here comes anta. they are designed for a global audience. at least in europe, the soccer

players do not have much to worry about just yet read and basketball be as big in russia as you are tall? >> it is big in russia. just not as big as soccer. have one fan does who has so many fans of his own, it is hard to get a question in. >> i cannot stand here. nets won the game, getting the team -- the most expensive team in history off on the right foot. but the battle is just getting started. >> looks like fun. ryan is really good for being so tired today. now let's look at shell, one of the biggest losers on the stoxx 600. they said fourth-quarter profits would be significantly lower than recent levels. higher costs and lower volumes. that will hurt fourth-quarter

earnings. we are back in a couple of minutes with "the pulse" with guy johnson and i. we will be talking about shell, nsa, and technology. ♪

>> 17 days into the job, shell's new ceo issues a profit warning. >> the iphone hits the shelves at china's biggest carrier. than 700 access more million potential subscribers. >> and the nba returns to london. we get to talk to the most expensive team in basketball history and its owner, mikhail prokhorov. good morning, everybody. welcome to "the pulse." we are