u.s. equity markets made record highs last night. >> and nine month high, the obama administration calls for the iraq later -- iraq waited be more inclusive. i will take you to the turmoil in iraq and what it means for oil. l'oreal's acquisition is just getting started. the world's largest cosmetics ofpany announced acquisition a u.s. cosmetics maker last night. but it is just the beginning. >> that is what we are watching today. european markets just opening. european equity markets are set to open higher. a combination of things.

china committing to a 7.5% growth. we did not make a a deal about it yesterday. overnighthe market seems to be much more focused on the commitment to 7.5% growth. christine lagarde also saying , the ecbeuropeans should start to consider large-scale government bond purchases. here in the u.k., we will get retail sales at 9:30 london time. in terms of some of the stocks we are focusing on, we will get jobs numbers in the u.s. let's look at how the u.s. futures are indicated because this is where the real focus is. record highs last night, 1950 on the s&p futures. that is ironic then itself.

thiscompanies that, why i morning as we go through the roll call, rolls-royce are doing a billion-pound buyback. they sold some of their assets last month. in terms of engines, they sold more than 4000 by 2023. kingfisher, if you are thinking about diy, you have credit suisse saying it is too early for them to change their view on the stock. it is outperform. earlye uk's only at the stages in the secular recovery. it is only getting started. get yourself out there. in terms of mortgage equity releases, it is still negative in the u.k. people are not taking money out of their maria does so we are still where we were back in 2008.

-- imaginere we were where the has a market would be if we started taking equity out of homes. here's the fed impact. not just in stocks but also currencies. the dollar is dropping. this is the dollar index. it is making a one-month low. lower. fx volatility is it is not doing too much against the euro. dollar.the new zealand these guys produce to their gdp numbers last night. they missed estimates but the view is that the new zealand central bank will have to raise rates. but this currency is going to break its record high. this is year to date. it gives you a sense of where we are in the latter part. is that the new zealand dollar is going to break its

record highs that it made back in august 2011. that is according to the options traders. let's pick up on the top themes investors are focused on today. it seems as if janet yellen has given a green light to buy risk assets. >> i think that's right. there were some concerns going into the meeting yesterday that, with the inflation rate picking up a little bit in the u.s. that she would be more hawkish. at the end of the day, she wasn't. the words you heard were quite common for the markets -- quite calming for the markets. >> the s&p 500 is at an all-time high. the stoxx 600 in europe is at

multiyear highs. what can stop equities in their tracks? yieldsversal in the bond , bond yields falling considerably but i do not see that happening. and that kind of environment where you are near growth environment and people are anticipating, i think that would hurt the market. but at the moment, we are still in the fairly early stages of an economic recovery in europe. it is more advanced in the usa. but this time around, there will be a longer cycle that we have seen in the past. cycles last three to five years. but this is a low growth cycle coming out of a major crisis, this could be a longer one. rates the low interest are going to persist for the majority of the major economies. >> yes, that is the message that misses yellen was giving

yesterday and that the ecb is giving as well. >> the bank of england, where are you with the rates debate? >> it depends on the growth of the u.k. economy and what is happening with the housing market. the statement about intentionally having rate rises earlier than people anticipated coming in the interesting thing is it makes the u.k. slightly less attractive than it was before. ecb still being more accommodative, which means it will put pressure on the euro versus other currencies. the remarks from mr. carney put pressure on sterling. if you are an international company operating in the u.k., clearly your overseas earnings will be depressed. >> so are you changing the types

of company that you are holding? >> slightly, yes. our u.k. fund. has been reduced we have. put more international earnings back in again. last year was more about domestic earnings into the early part of this year because the return of growth in continental europe. because some of the currencies are starting to return a little bit, looking to play more international themes again. >> here is what else is coming up. ready, set, buy. l'oreal's chief executive says he is just getting started with $5 billion in acquisitions so far this year. has a new handset competitor. and sci-fi meets reality. wewill begin to the right --

will dig into the rise of artificial intelligence.

>> one stock we are watching today is rolls-royce. it is buying back a billion pounds worth of company stock after agreeing to sell energy

assets to siemens. second biggest maker of commercial aircraft engines. it intends to use persists -- proceeds from the sale for the buyback. iraq is still driving markets. a look at the latest developments in the country. what is the latest on the ground and how our markets reacting? >> oil is up against today, close to a nine-month high. it is on the rise since tuesday midmorning. that is when we saw investors getting concerned about iraq after a few days when many of them thought that they had thedone the selloff or buying of oil. now of the fighting right is focusing around a refinery. control --ged control of it has changed several times. right now, the iraqi government

is in control. have video ofou the militants in control of it yesterday. the refinery provides products to the north but also to baghdad. it is now under government control. good for stability in the refined oil market, for gasoline within iraq itself. ofnwhile, you have the likes exxon and bp starting to pull some of their personnel from the oil fields that they operate at in iraq. but generally speaking, when it comes to physical supply, there hasn't been any change in the last week and a half to the supply picture. quarters of the oil is in the south of the country. it remains safe now. >> president obama met with congressional leaders last night. was there any sign of the president shifting his stand? >> a couple of days ago, we were

talking about the possibility of airstrikes. isthe obama administration planning airstrikes, they are not letting on to that. in fact, the message seems to be a political one at the moment directed at the iraqi prime minister. the obama administration saying he needs to be more inclusive with sunnis in the government. we even heard senator feinstein saying that perhaps it is time for him to go. maybe he isn't the person that can unite iraq he's right now. -- unite iraqis right now. he has been there since may in 2006. that was a very different period, very sectarian. that's when you had 200 bodies a day showing up having been killed in sectarian shootings and kidnappings. this is his third term. he has been a for eight years. he turns 64 tomorrow. in the last election, he was

elected not by a broad coalition of sunnis, kurds, and she is, but mostly extremist she is -- extremist shias. has been very slow to be inclusive of sunnis in the country. that is important because sunnis make up 35% of the iraqi population. if they want to eliminate or neutralize the sunni extremist, they will have to get sunni moderates on board. at the moment, that is not happening. >> thank you. let's chat about today's hot topics. if you bought the stoxx 600 oil index in the past six months, you would be up by over 3.5%. best performing industry group on the european stock 600 for the month of june. you are overweight oil majors.

companies youil like, how do you differentiate within the sector? >> it is the big oil makers that we do like. we like the companies that have strong dividend yields. these companies have got roughly number five percent yields. we looking for companies that have high yields with goods coverage ratios. all those big names, we think they are ideal for the current article is -- current marketplace. we think high dividend yields will be sustainable because they have the mantra of discipline. these companies were very inefficient in the past. they are now putting measures in place to make sure that is not away.t capex doesn't go

from your standpoint, from a neck we fund managers standpoint, what is the best case/worst case scenario when it comes to iraq and the possibility of oil disruptions and the price of oil going through its nine-month high? >> that is a tough one. at the moment, it seems containable. it seems that most of the oil in iraq is in the southern part of the country and is not being affected at the moment. the good thing this time around is i think you would have had more of an impact on the markets and the oil price. because of the impact of shale gas in the u.s., that has changed the geopolitical dynamics. so you do not have a huge push up in oil prices you might see. >> for the decline in stock markets you might have seen. is that monetary policy are

central banks? >> it is partly the low-interest rate environment we are in. some are also desensitized about these things. >> should mario draghi be desensitized? >> not really. there are always events going on. i have been managing money since the 1980's era in back then, we had bombing campaigns. we had two gulf wars. -- theree been lots of are always crises going on at some point in time. crisis going mini on in spain. they were knocked out of the world cup. but you are overweight spain. germany doing better than spain. spain has had a good year. it is pretty much at an all-time high. >> that's right. we are overweight for different reasons.

spain is all about the domestic recovery that is coming through now. unemployment is stunning to fall marginally did union labor has fallen which makes it a more attractive place for investments. we like domestic plays within spain. germany is a different story. germany is an export powerhouse for europe. because of the actions by the ecb two weeks ago, they were and fairly and squarely to contain the euro. continue but it was starting to impact on inflation, potentially bringing inflation into europe. the consequences of the ecb's action to reduce the risk of deflation is to stabilize the currency or to get the currency down. who benefits mostly from that is germany. it makes them more competitive for exports.

that means all their international earnings will improve. in the first corner of this year, we had a situation were earnings were being downgraded because of the strength of the euro versus other currencies. we think that has a chance to reverse as the year progresses. >> that makes a think of the two new members of the mpc. they are both saying that something is amiss if spain can borrow at the same rate as britain. do they have a point? >> parley. -- partly. the german bond yield is incredibly low at the moment whereas the sterling rate is set off. money policy committee actions are relative to the u.s. there are two different factors. >> thank you so much for coming. let's turn to our bluebird exclusive.

-- bloomberg exclusive. avatar -- what did he have to say to you? l'oreals right, announced last night the acquisition of nyx cosmetics based in los angeles. it is a way to compete with mac by estee lauder and to reduce sluggish sales in north america that they have seen in the first quarter. with the ceo on the sidelines of the consumer goods conference in paris. he said it is good for north america but also for europe. >> the market was sluggish itself. is a contrasting situation. on the one side, the luxury business is doing well.

the market itself has been really flat due to may be different reasons. sales have been reduce sluggish. you are right. so this will definitely help to boost our sales. it will not be the only thing. we also intend to increase our market share to grow organically. but this will be a serious up. >> it is almost the end of the second quarter. how bullish are you on europe? >> i am confident. the marketrowth of like in china, of course, but it is positive. us,very good thing for l'oreal, is that southern europe is back. southern europe has been very difficult for six years. spain, or jewel, italy, greece

were very tough. these were countries where we were very strong. it really impacted us the last six years. in the first quarter of 2014, the market was flat and we are positive. it means that this could be a growth region. also coming the other countries in europe, we are doing pretty well. we have an amazing success in germany. we are doing very well in u.k. positive. us is a >> region do you still>> forecast market growth of 3.5% to 4% this year? are you committing that l'oreal will exceed this forecast? >> yes. i think the market will probably be between 3.5% and 4% as i said before.

i don't see any reason why it should be very different from that. it is our ambition to fund the market each year. semi is go by fast and some less. but the ambition is to grow our market share every year. we will see you in two.

>> just a check on what is happening in equity markets today. stocks rising across europe. investors digesting, analyzing what they federal open market committee and what janet yellen had to say last night. the news of peas markets across the world. the msci world index touching a new high. the s&p 500 at a new high yesterday. gains across europe today. gains entrance to the tune of .8%. germany all-time high, up by .8% as well. and the ibex in spain. dots, theed on the dots representing forecast for interest rates. but the economy is picking up. the fed is not so worried about

inflation. amazon unveils the fire phone. we break down the big bet after the break. . .

>> welcome back to "on the move." we are 30 minutes into the trading day. manus cranny is here at the touchscreen with three stocks to watch. >> let's kick it off with rolls-royce. they have got a billion pounds in their pocket and they are going to do a share buyback. siemens just over a month ago confirming. saying, they are not going to do any more acquisitions. they say it is a good move. darty, this is a french company. read tax profit eight estimates.

let's just hope they deliver. kingfisher likewise staying in that dtiy space. credit suisse reports that they have outperformed and that stock. we are barely getting started. still, i leave you with this stat. we are not taking the same amount of money out of our mortgages to do things to our houses. we are still in negative territory. get ready, u.k. back to you. >> thanks. here are the bloomberg top headlines. global equity markets higher after reassuring investors that rates would remain low. janet yellen said monetary stimulus will continue after and until the central bank achieves its goals. >> the committee believes that economic activity is rebounding in the current quarter and will

continue to expand at a moderate pace thereafter. are said toecutors the broadening their investigation of the foreign exchange industry. the justice department has been asking banks and clients how chargeles teams customers to exchange currency according to two people familiar with the probe. this is the first indication that prosecutors are investigating sales practices. set to parliament is swear in a new king. felipe succeeds his father juan carlos who is stepping down. the new king will face a series of challenges as he attempts to restore the reputation of the monarchy. -- takeover console sold takeover tussle continues as ge presents new details of the bid. alex webb joins us now from munich with more. how are ge shareholders reacting to this?

>> there does seem to be a growing sense that perhaps immelt is bending over too much for the french government. analysts have said he has to be careful. it is the second trip to try to make a pitch to lawmakers and the french union. he has to tread a careful line. >> what is going to happen with the offer itself? how might the ge offer be tweaked? >> there are three possibilities. they could extend the deadline for alstom to make a decision, which is monday. they could increase the cash component. the third element, which might be the most likely, is they make more concessions or other tweaks to it. they might offer to give alstom the rail signaling business. they might just take a stake in the businesses which they are less interested in. things like the grid. those are the likely moderations, changes that could

be made. >> it is all as a result of french politicians squeezing more and more out of the likes of ge and siemens. have french politicians got what they wanted? siemens first made that formal offer the other day, a spokesperson for francois hollande came out and said, we still want further improvements. this morning there was an interesting comment from the finance minister, saying that france has got some great improvements here. he spoke very much in the past tense. we have got until monday for the deadline to be met. >> are we close to an end game or not? we can say we are getting close to the end of the second act. it is possible that alstom seeks to continue negotiations, they accept oath offers in some way,

but then will be moving into things like the antitrust considerations, whether the european union will allow various forms of the deal to happen. ge will probably have to bring in people like the french tolear company and try please the european commission. >> thanks, alex. and talktch gears technology. amazon jumping into the smartphone market with its first-ever handset called the fire phone. joining me is francisco geronimo, research director at european mobile devices. good day to you. this phone seems to be about putting the web store and other amazon services directly in front of the customer. is it enough to sell the phone? >> i think amazon has a very good opportunity to shake up the smartphone industry, to disrupt

the way we shop on mobile devices. i am afraid the device they launched is not providing the experience and the disruption that everyone was expecting. >> where is it lacking? >> it has some direct links to their services, to the store, but i was expecting a much deeper integration with their own website, with some of the features. and probably a much more competitive price. >> $199 for a two-year contract. >> quite expensive device compared with other devices from top brands and manufacturers. they launched their first tablet and they disrupt the market by slightly changing the business model, not attempting to make money on the hardware but making the profit on the content. >> they don't try to make much

money on the hardware for this. >> it is quite a high-end device and the price is quite expensive. the competitive price, the premium handset that everyone was expecting to be launched at an affordable price, it is not happening. this is a very conventional price. >> who are they competing with? we had a guest that said it is not competing with the likes of .pple, samsung it is competing more with other retailers. is that true? >> i don't believe that is the case. i believe they are positioning the hardware against the main players in the high-end of the market, with a very premium price. if they want to compete against the other retailers -- because this is the biggest online shopping mall in the world -- if they want to compete with other retailers, they could have done

much more. i will give you an example. if we intend to buy a product firefly, wee the recognize the product. when i am at any other store, if i want to buy the product, i could get it from amazon straightaway. i could get alerts when the product is cheaper or when it becomes available. a much deeper integration with their core business will be extremely dangerous for other retailers. they are -- >> maybe this is just the beginning. didn't the deputy vice president say this is just the beginning? >> i hope so. opportunitytrue to disrupt shopping on mobile devices. they did it on laptops. they changed the way we do shopping online. they are the only company in the

world -- there is no other company in the world selling hundreds of millions of products with very competitive prices and being able to reach such wide range of consumers with a very powerful brand. i expect to see new versions of devices at much lower price points and with much better integration. the price segment they are targeting at the moment is one of the least interesting for newcomers. plus price the $600 5% in 2013.sed it only represented 20% of the total smartphone sales in the world . under $200 grew 90% in 2013 compared to the previous year and is expected

56% by 2019. it is quite bizarre that amazon started to target the low end of the market but decided to go to the premium segment, competing directly on hardware against apple and samsung. we don't see much on the services and on the additional features to attract users to buy the fire phone. >> you are underwhelmed. >> i was expecting a lot more. if for those who are tracking the market like myself and reading the comments from other analysts, everyone was talking about how good amazon shakeup the smartphone industry. >> your home nation had a bad

start. >> in 2004, we also had a bad start. we got to the final. further. can get >> at least you are not spain, you are still in the world cup. >> it is a shame. they are out. i hope portugal does a bit better. >> will you be supporting england tonight? >> absolutely. >> thanks, francisco. francisco jeronimo, research director at european mobile devices. the revolution, after the break we had to the lab where it is underway. stay with us. we are "on the move." ♪

>> this is "on the move." time in london 8:44. robots have toiled alongside workers in factories for years. as demand has increased, so most their abilities. caroline hyde is live from the imperial air real robotics lab in london. over to you. >> thank you very much indeed. i am joined by george whitehead, partner at octopus who is investing in all these new technologies, all these startups. in the area of robotics, it is about commercializing these innovative ideas. is that the biggest challenge when you are trying to find new

ideas? >> it is one of the biggest challenges. investors are going to be finding from academic institutions, they are finding they have got a brilliant idea but the more you look at these companies, the more you realize the idea is the starting point. the next question is, how are you going to manufacture it? how are you going to distribute it? what is the marketing strategy? what is the business model? that takes an enormous amount of skill and people. a lot of this is about finding the right people to attract around these ideas. >> who are the success stories so far who have managed to , the businesses who are making it work? >> we have seen lots of interesting ideas. one company yesterday was a business called -- a property portal that has done extremely well. now worth well over $1 billion.

when we first saw it, it was a very early stage business with a handful of people. these are inspiring stories. runningsterman who was the company, we backed him at another company he had done extraordinarily well. the next company came up. the idea was early stage but it was all about the people. we think you can develop another one of these things. we think you can adapt as the company needs it. >> give us a sense of which management companies you have seen recently that might not be already,estor's mind but you have been really impressed. >> there is a couple that spring to mind. called why plan is doing last-minute evidence. you can get an app to plan these events.

he has done next ordinary things. some companies you see, they promise things and they don't deliver. regis is one of these guys who doesn't just deliver. he outperforms every single time. something we have noticed from our best entrepreneurs, he has got this magnetic quality about -greatat attracts a people to quit their jobs and work for a business that is going places. >> if you could give us one trend that you would say put money in, is it apt? >> we are seeing quite a lot of interest in internet of things. we are seeing certainly a lot of interest in apps. the peaking of a sector is a wrong thing to do. if you are looking for companies like we are, the bunnies that are worth less than $10 million and you are trying to grow them to the more than $100 million, those companies are very rare. , whatever ittor

might be, is the wrong way to go. the right way is to find the teams, the people who have that inspiring magnetic quality, who have the ability to grow those kind of companies. we back them, the people. >> it has been wonderful speaking to you. nice to know there are still people behind all that technology, all the robotics. there is still some concern that robotics are coming. more on that and elon musk bosh concerns about robots becoming partly human in a little bit. now, back to you in the studio. >> thanks, caroline. if you believe in robots and artificial intelligence are going to take over the world, they might be able to match the power of the human brain, jessica howard reports. >> the human brain, it is one of the most powerful machines around. simulating a single second of 85,000ivity needs almost

processors. >> the brain is a multi-scale complex entity and we have to look at all the different levels of detail to understand it. >> there is still so much we don't know. like how to fix the brains of dementia patients. how to harness our subconscious. and why we dream. >> human brain project is a ten-year effort to advance our understanding of the human brain and develop new treatments for medicine and new technologies aced on the brain. we are generating more and more data about the brain in laboratories all around the world. until we bring that data together and see how the pieces fit together, we won't have a coherent picture of how the brain actually functions. >> scientists from across europe are using decades of research already done on brain function to build a working model of the brain and simulate it on a

supercomputer. it is an enormous task. they have got 10 years and more than $2 billion to try to make it happen. >> the long term is to have an exdo-scale supercomputer. this is an extraordinarily fast supercomputer that would be capable of running a simulation of the human brain at the level of individual cells. >> there is one problem, the technology. it doesn't exist yet. if scientists are going to simulate the brain, they need a computer that is 35 times faster than today's two per computer. that is as powerful as 100 million laptops. if the project set to last 10 years, it may be a while until we start to see results. until then, it is bound to cause a few headaches. to the break, we leave you with a look at the

biggest gainer on the stoxx 600. it is rolls-royce. we are back in two minutes. ♪

>> "the pulse" is coming up at the top of the hour. guy is joining us with more. earlier we heard part of your chat with the business secretary. >> u.k. business secretary. >> yes, not the u.s. >> he was promoted, or demoted

depending on your point of view. i talked to him. pound is trading at a five-year high this morning. i got the sense from him that he would rather see the bank push on the macro prudential rules, aowdown what is clearly housing market bubble in certain areas but he doesn't want to push the interest rate story that hard just yet. >> we do have a serious problem in parts of the housing market. the bank of england has other mechanisms to deal with that other than interest rates. >> and he is weighing in on the ge-houston bid. -- ge-alstom bid. the industryat minister is an impressive character, which i thought was interesting. many people have described him in other ways. britain has had a whole series of takeovers by foreign

companies which have caused return. cadbury's sparked all this. we have the astrazeneca story. that has gone away. i asked whether he thought the french were acting appropriately and the way they were handing the alstom story. >> the rhetoric in france shouldn't detract from the underlying reality, which is the same reality we haven't a u.k. that is not to say there are instances -- the issue you mentioned about alstom in france is one. we have had this issue in the u.k. where we have been concerned about the potential impact of a pfizer takeover of astrazeneca. the way we dealt with it is by engaging with the company, pfizer to secure long-term commitments. awaye event they have gone , at least for the time being. clear there was a national

interest. >> let's face it, the lib dems are going through a torrent time in the polls. they came in fifth in parliamentary elections. they are polling below double digits now. >> it is not a question about the leader of the party. he said he supports him. i asked whether he would be the business representative going into the next elections. he wouldn't be drawn on that. there is clearly a question mark about the leadership of the lib dem party. >> the credit of the economic rebound -- >> his party -- he has got to fix that. if he doesn't, they will have a very difficult time in the next general election. we will see what happens. it will be an interesting year. for the british economy and the political story. >> what is coming up today? you have a big interview.

>> do we really need an intelligent washing machine? i will just lead you with that question. >> i don't but some might. "the pulse" is next. look out for our exclusive interview. see you tomorrow. ♪

max said frenzy. stocks surge and the dollar falls. janet yellen says rates will remain low. >> l'oreal goes on a shopping spree. the ceo tells us that he is just getting started with billions of dollars in deals. >> caution from cable. france must play by the rules in the battle for alstom. good morning, everybody. ."u are watching "the pulse we are here in london. i am guy johnson. >> i am olivia sterns.