anthem is on the verge of buying sigma. matt: and other quarter, and other slow down for mcdonald's. the new ceo has a lot of work to do. olivia: and it is one of america pass oldest and most iconic companies. levi's. i am olivia sterns. matt: i am matt miller. we are half an hour into the trading day. we saw a mixed picture at the open. unchanged, a 8/100ths

of 1%, i guess unchanged is fair. , while the dropped nasdaq gained a little bit. 1/10 of 1%. very slight. olivia: a similar story, it feels like summer. stocks moving sideways all year. matt: finally feels like summer. olivia: some of the top stories. mcdonald's is singing the blues. they missed analysts estimates. u.s. sales were down 2%. is working on a turnaround plan that includes reorganizing management and cutting costs. encouraging news for

the u.s. economy. the fewest number of americans in 40 years filed for unemployment last week. jobs have been rising. kerry -- john jen kerry is on the hill before skeptical lawmakers. phil: ernest munis and the secretary of the treasury is part of the page right now. vote toh to not undermine this deal. the primary concern from all three that you will here today is that it is a strong deal and it cuts off iran's path to nuclear weapons. democrats, guys.

the republicans will not join on board with this. they need to make sure that any veto stands. and also the politics. marco rubio is on this committee. questions,ave strong trying to make a political point about foreign policy that they can take to iowa and new hampshire. it is going to be very interesting in the senate. they are saying that backing away from an iran deal would be a mistake. ceo ishe bank of america shaking up the executive ranks. the cfo is out at the end of the month. he will be replaced by paul did off rio. mike mayo says the shakeup isn't

enough to cure what ails bank of america. >> i don't believe they have proper oversight. there isn't the right tone set at the top. there is not one forward-looking financial target. we need something to holds management accountable to. moynahan and thompson are said to be at odds about where to make investments. dunkin' donuts says it's prices could rise when minimum wage increases. governor andrew cuomo backs the , most new yorkers could probably afford slightly higher prices at dunkin' donuts.

olivia: it has a low income consumer. i definitely agree with you on sensible. next hour, athe blockbuster quarter for general motors, profits doubled thanks to surging sales. we will have details from the interview with the cfo. mcdonald's has reported another quarterly sales slump. a return tomising growth is just around the corner. we are looking at the train is this. cost cuts are helping them beat estimates. i want to give you some breaking news on pearson. was inrted that pearson

reports to sell the financial times. others wanted to buy it. springer may have been one of the businesses interested in buying it. now they are saying they do not want to buy the financial times group. sale, which could bench them $1.6 billion isn't going to go through to axel springer. it will be interesting to see who pops up and becomes the bitter. olivia: it is in talks. with whom? we will continue merger talks with anthem, near a deal to buy cigna. it would be the largest in the industry. megadealbe the second

announced this summer. olivia: both potential acquisition was are expected to face hurdles. york, and now in new also, david balto. explain to us the details of what this tie up would look like. between anthem and sigma, it is looking like $40 billion. the offer we have heard is around one. 87. 7.1.8 the second of the big types that we have seen out of the big five players. , from a bigthrough

five into a big three. olivia: does and some really want cigna? anthem really want cigna? been talking for over a gear at this point. up over who was going to help lead the company. we have been able to help that is going to be in charge, at least initially. we are waiting to see those details when it does get announced. this has been an ongoing thing. david, itme bring in is there enough competition in this market? will he get to a point where

there are only three health insurance companies? david: the reason the affordable because was passed was there is not enough competition. having two less health insurance companies is that news. this leads to higher premiums. matt: are we going to see this which thinks of obamacare as the centerpiece of the leadership, try to break up or stop these mergers? david: absolutely. that piecemeal investiture's don't work. the best alternative is for the agencies to go to court and block the mergers. olivia: i want to pull up some charts that will help viewers

understand the extent. this is what you are looking at now. the number of members. this is what it would look like if the deal goes through. up. and humana tying complicate the cigna and anthem deal? >> absolutely. it makes it much tougher for each individual deal to go through. >> when we look at these companies, a combined anthem-cigna, there are dozens of health insurers around the country. -- comparenfirm that

that to generic health companies, i am curious to know how it compares to other places in the industry. david: during the debate over obamacare, there was a tremendous record provided about competitive conduct in the health industry market. that is why obamacare was passed. allowing these mergers would be a giant step backwards. these markets are more concentrated than other health care markets. david balto, thank you for joining us. we said before that axel buy, butisn't going to that is because according to

that is because -- is going to buy them. ♪

over to see the biggest movers. to take you to the airline industry. we start with ual corp. shares are nearly at 4%. it is going to slow down its growth by no more than .5%. this is in addition to a buyback of $3 billion for all of their shares.

southwest airlines has posted a 7.3% increase. 9th street airline's quarter of profit. air is reporting record second-quarter results. up.vegas sands is it is interesting to see what the difference of one penny will do. ofy came in with a loss $.60. they say the news is encouraging for macau central casinos. they are raising the price $60.t to $65 from are soaring right now.

they are up nearly 4.5%. they came in at $1.1 billion, beating estimates by a huge margin. that adjustedys $1.29, beating analysts estimates. that means it is doubling the results from a year ago. matt: it is interesting to point out that it is not a member of the dow jones transportation index. 20 companies, it seems a little silly to say that. it is down 10% year to date. transportation stocks haven't done well. olivia: their interesting.

i want to get back to the breaking news. nikkei is going to buy the financial times. $1.3 billion.is what else can you tell us? tell you that there has been a lot of speculation this afternoon. this is a premier business media group in japan. the amount that we've heard is $1.3 billion, that is slightly less than what was predicted. that amount was one billion pounds. it would have been overvalued at that price, it would have been 40 times the last earnings that we got in 2013 from the ft

group. there was speculation that it could be axel springer. k --ve now heard it is the nikkei. back to you. olivia: thank you so much. shares of pearson are trading up by 2.5%. shares are on fire this morning. the company reported a second-quarter profit of $1.1 billion thanks to soaring truck sales. earlier, i spoke to the cfo about the blockbuster earnings. >> our performance has been driven by our performance in north america.

expectations for the second half of the year will be the better than the first half of the year. from a global perspective, south america proves to be very challenging. results in the second quarter our relatively flat, versus last quarter. area thats clearly an is challenging. and china, we will continue to have to react to a moderating industry. , based on ournt performance in the first half of the year, that we will continue to do that. >> revenue was expected to be over $40 billion. i know it huge chunk of that was due to currency issues. >> that is correct.

year over revenue is down. if you exclude the currency, revenue was up. we have been able to offset the fx impact. exchange has been a head wind, but when you look at it from an overall perspective, we have been able to offset that. matt: are you going to be able to continue holding rising power in the u.s.? they are offering rebates of over $10,000 on the trucks. will that bring your prices down? >> we will be competitive in the market. our truck sales have been doing exceptionally well this year, also our midsized pickups.

we will continue to compete. pricing has been relatively benign for the year. we expect to see that continue. because of the strength of the market, our products that we are , and we are confident in our project -- our product lineup and in the launches you will be seeing later in the year. you, thesee ask currency headwinds, is the idea of janet yellen lifting interest rates a headache? >> we are in a global economy. there has been an interest rate in the u.s., it it is something we have been expecting and planning around. at the end of the day, you have to manage volatility in a global market. part of that is that you build

where you sell. matt: that was the general motors cfo. not -- i mention you did i notice you did not mention the recalls. matt: they raised the amount of the fund that they have to pay victims. that was an issue that is pretty much behind them. -- issue of recalling cars when you look at the bloomberg terminal, you see headlines going by that companies are recalling cars. it means they found a problem and they are going to fix it for free. i don't think it will be an ongoing problem. olivia: interesting. matt: guess what we will talk about when we come back? olivia: we will be talking about

ferraris. how is the luxury carmaker planning to expand? matt miller will explain. ♪

matt: harare hopes to unlock value by selling 10% of its shares to the public. they want to bring revenue up to $11 billion. they want to raise money in the public market? chrysler, he bought he was telling people that the market cap was far too low. it is in valuing ferrari at all.

to $20 billion in -- 20 billion euros in market cap. did you ask the general motors cfo what he would think about the merger? matt: not again. maserati is going to stay with chrysler. now they are more a part of the fiat group. olivia: thank you so much, this has been fun. i will be right back. ♪

olivia: welcome back, i am olivia sterns. the story that is breaking at this hour, one of the best names in financial journalism is

getting a new owner. the financial times will be sold to nikkei. allow pearson to focus on a slowdown in the core education business. it is a deal that would create the biggest health insurer in the u.s.. them is near a deal to buy sigma. there was another big takeover in the health industry, when at tna agreed to by humana. president obama will head to kenya. he will visit ethiopia. he signed a bill that lets some african countries sell goods in the u.s., judy free.

on a stop carter is in iraq right now. once a progress report on the efforts to settle conflict. it will be his first visit since he took office. -- those time of your are some of your top stories. staple, buteen a the rise of yoga pants has been its biggest challenge. we will tell you how much the trend is hurting the company. then in the railways, they are feeling the slump. we will talk about how the company is cutting costs. generating more than $6 billion in sales, what will q2 look

like? mcdonald's has dropped for the seventh quarter in a row. -- is pledging a return to growth this year. shares are bouncing around this morning. let's look at the turnaround plan. thank you for joining us. nicole, let's start with you. look at the numbers and see proof that the turnaround is not working? the numbers didn't shock the market with the stock being flat to up. a pipeline is 12-18 months deep. so we have to take that into consideration. what do you think of the turnaround strategy?

we get excited when we hear he is testing out kale. >> he has been given a gift. it should be first and foremost, the strategy. and aligning with franchisees is an important strategy. olivia: we will get back to that issue. jennifer, what do you think? can they turn it around or are they the victim of a broader trend in the market? >> if they go back to the core of what they are good at, innovating around the core items, they have an opportunity -- regainn growth growth. but they have been focusing on things that aren't registry dink with customers.

resonating with customers. the premium items, the s, how dopice latte they strike a balance? >> the right balance is innovation and technology. to reduce the friction for the customer. when it comes to the menu, i agree. stick to the core. burgers, fries and a milkshake. >> or innovate around those. do you agree with nicole that there is an opportunity in the mobile app? >> absolutely.

the opportunity is there. that is the way the consumer is progressing. unless they can deliver on that, they will have trouble attracting new ones. how important is this goal of re-franchising? it sounds like an extraordinary proportion of stores that have been franchised out. >> not necessarily. in the short-term, it makes investors happy. in the long run, they have to get the brand contract. it is more important to focus on the core. thatlobal strength, steady first. olivia: how about the financials? , but theya big hit saw margins.

the lowest in seven years. >> it will be hard for them to commit to a full turnaround. a $2.5 million per store volume, and they had the best margins they have had in a long time. they need to stop the loss of sales and steady the margins. we are looking for a steady-state, less volatility. a have a hold on the stock at $95 price target. >> it will take longer than most people expect. the last time they faced a turnaround, they were able to overcome the challenges. there is no reason they can't do that again. there are changes that need to be made structurally, it could

be hard to do. olivia: 24 hour breakfast, does that fix everything? >> no. olivia: it's got to help. thank you so much. i appreciate both of your time. still ahead, it has been nearly two months since we had record highs. ♪

olivia: welcome back. we are one hour into the trading session. and headrt with europe

over to nejra cehic. corporate earnings are still in focus today. let me start with the stocks we have been watching. starting with credit suisse. they have earned better than expected, beat analysts expectations. banking profit fell. the shares hit their high of more than a year today. at one point, they had the highest level since 1998. bp because itg has been leading energy shares lower. at the beginning of the day, we saw the equity benchmark gaining .

what has actually happened towards the end of the day, we have seen a decline. that is because energy shares have been pulling this benchmark lower. finally, taking a look at the euro. stronger against the dollar. actually, they could lose faith in this as a reserve currency. >> thank you very much. stocks are close to the flatline today. that seems to be a bigger claim than jobless claims. about 4/10 ofup 1%. seven of the 10 sectors of the s&p are in the red. the biggest loser is the

utilities. up by .5%.is boost tois giving a the health care sector. is at full throttle, up 17%. reported q2 earnings that beat. bank of america upgraded the stock to buy from neutral. flipside, united rentals is the biggest individual loser on the s&p. its revenue forecast to $5.8 billion.

the company has not been doing well at all this year. olivia: thank you so much. in the meantime, here is what happened in asia. up on the back of strong earnings reports. seng is in the green, ahead of tomorrow pass manufacturing data. cell at the close. as far as trading tactics go, that is as easy as it gets. it turns out that selling at the close is a great way to make money in china.

that is thanks to a pattern analysts have spotted. apply that to the shanghai composite, it generates a return. compare that with an 8% return on the buy and hold approach. now a look at some of the top stories. shares of caterpillar are lower today. iny posted a 29% decline second-quarter profits. the company has been hurt i falling commodity markets, that led customers to reduce their purchases of heavy equipment. reported second-quarter profits that benefited from unrealized gains in its portfolio.

union has taken on hollywood. it has issued an antitrust complaint against disney and other studios. that movieoncerned licensing deals restrict access. those are some of your top stories. the u.s. stock markets can't make it across the finish line. the s&p 500 got into record nine times this year and failed to hold it through the close. kelly, why does the s&p seem to be stuck on the final yard line? is an uninspiring market. earnings are projected to

decline this quarter and the next quarter. the market is trading at its highest key in years. investors are saying, why should i buy? olivia: what could make us pop through the ceiling? kelly: a lot of people are saying the fed. we could see that as a catalyst for going up or down. right now, a lot of people are saying that the market isn't going to get more inspiring this summer. olivia: i would think that investors would be a lot less nervous. riskse seen a lot of big dissipate. green is no longer holding over us. the chinese market seems to have stabilized. a lot of big near-term risks have been taken off the table.

they are nervous because they see a market that can't move higher. you are right in saying that a lot of the issues are out of the way. that also means we can't have a relief rally. they are very nervous because they see a market that can't break through decisively. up a chart's pull that we made that shows the percentage of days when the market couldn't break through the 20-30-ish market. there you have it. that is shocking. haven'tocking that we -- that we have been in such a tight range. : it is frustrating for investors. if the market is not moving, how

do you make money? you can't make money on the long side or the short side. olivia: we are finally seeing trading volume in equity markets closer to what you would expect to see. the dog days of summer. better.bly won't get kelly bost, thank you. levi's.ead, they have withstood the great depression and world war ii. its biggest battle now, yoga pants. ♪

olivia: welcome back. i am olivia sterns. levi is a brand that we all know. warshave survived through and depressions. thatt could be yoga pants finally does the company in. that is the cover story of bloomberg businessweek. tim higgins wrote the story. how much trouble are they in? : they are doing great in the global market. in the past year, jeans sales has decreased. it is on a one-to-one basis. jeans are as many

being sold as yoga pants. asy set out to create a pant appealing to women. olivia: i didn't realize that companies have directors of technical -- what are they doing to compete? tim: they opened a lab in downtown san francisco and they have these men and women working on the future of denim. level,t into the fabric what makes something comfortable they talkedient, about ways to use lasers to contour the fabric in a way to make it look more appealing on a woman.

techniquessed other to make this material look and feel like traditional denim, but be more stretchy. olivia: are they going to look like jeans? or are they going to look like jeggings? they don't want to create something that doesn't look authentic to the levi's brand. holding them up, i couldn't tell which one was the new and which was the old. woman to try jeans on as a secret shopper, and she was blown away by how comfortable they were. normally it is hard to find the best fit. she took it right off the shelf and it fit. nearly impossible

to find the perfect pair of jeans. note clear, the problem is that people are buying -- is the problems that people are buying less jeans? or are they buying less levi's? leggings have become the thing that you where to all of the activities that in the past, you would have worn jeans to. they are still popular for going out in the evening, but it is getting back to the thing you where when you need to wear something that isn't work clothes. ceo,a: they have a cool what is his strategy?

tim: in the past, they have focused heavily on men, they have done well. focus on a turnaround plan, it has gone well. this year, if he is successful because of the women's jeans, he may have his first time in 20 years that the company will have that. i am looking forward to reading your cover story. it is out on newsstands and online. thank you. of union, the ceo specific -- union pacific will join us here. we will talk to him about his efforts amid a big slump in cold prices. ♪

♪ olivia: it is 11:00 in new york city and 4:00 p.m. in london. in this hour, we are looking at planes.

here to talk about falling gas prices, and when a federal probe into gas pollution means. union pacific revenue is down nearly 10% but cost cuts are helping the bottom line. we will hear from ceo lance chris in a few minutes. uber takes on new york city and wins. company learns some valuable lessons about overcoming regulatory hurdles. good morning, and welcome to the bloomberg market day. i am olivia sterns. scarlet: and i am scarlet fu. olivia: let's look at where markets are trading right now. it is a mixed picture, not a lot of movement.