bloomberg television. >> we are going to take you from detroit to cleveland and cover stories out of frankfurt and paris. economic data breaking in the u.s. so let's get right to julie hyman. julie: existing home sales is what we are talking about the month of june coming in higher than estimated in annual pace of 5.5 7 million homes being sold. the between existing home sales -- aew home sales existing 1.1% increase here again to 5.5 7 million that is the highest level in nine years for home sales. sign for positive residential real estate. closings of 1.1%. seasonal1.9% before

adjustment and the median price of an existing home up 4.8% year-over-year to $247,700. this number coming in better than estimated. today does not necessarily belong to macro. in more belongs to micro and corporate earnings that have been coming out. the ecb decision to not raise rates, notwithstanding. that has not seemed to disk -- to derail u.s. stocks. the dow and s&p have been pulling back from yesterday's record close. was good to big corporate stories we are watching. general motors posting record earnings. they beat analyst estimates for earnings per share by 22%. sales of 11% and the company attributed part of the beat to better pricing. those shares are rising today. we heard from biogen. second-quarter profit coming out and beating analyst estimates. the bigger news is that the company ceo is departing.

over doubling in sales at the company. more recently, analysts and investors have been scrutinizing biogen's blockbuster ms drug. it is not growing as much as some anticipation. in the meantime he announced that $5 billion share buyback. we watching the chipmakers today. qualcomm and intel. both of them have had to cope with a slowdown in legacy businesses. qualcomm appears to be navigating changes a little more adeptly. the company is earnings estimates. intel coming out with some disappointing numbers. .etting back to health care we have a suit from the department of justice trying to block the acquisition of cigna

by anthem. we are expected to hear from the attorney general around 11:00 a.m. with more details of this. there's not much reaction and if you look at the other big deals where there may be a suit that -- it might bed that this was priced in since there have been talks about this pending suit. >> about 90 minutes away from the close of trading here in europe. speaking of things that are did notn, mario draghi go against expectations today. let's take a look at cross assets and see what is moving. the euro down here, you can see pretty much unchanged. we could -- we saw in rise during mario draghi's press conference. the ftse down 3/10 of a percent. cap 40 in france down almost 3/10 of a percent. no surprises out of the meeting today.

i wanted to show you the 10 year bond yield. german bund yields reach a four-week high a little earlier. as the ecb maintained its policy. the big story is that this bund yield dropped into negative territory for the first time ever last month. at the moment we are just above the red line so we are back in positive territory on this. taking a look at the euro, i said it was unchanged at one thing that is interesting to 10 --is the euro to implied volatility. -- he has a great explanation on this area basically had we seen any action from the ecb or any sign that there might be a change to the deposit rate or to bond purchases, which would mean that some bonds in negative territory at the shorter end of the would become eligible. we might have seen this curve

flattened. keep an eye on it are you a very good chart to keep track of. although you can see it is not changed too much at the end because policy was unchanged. wanted to show you the stoxx 600. .own 2/10 of a percent we have had fluctuation on this today and of course there are earnings playing into this which we will talk more about later. let's check in on the bloomberg first word news. president francois hollande demands to know why that you can he is installing on its exit from the european union. hollande called on the u.k. to start the process as soon as possible. the french leader said a delay could create a damaging uncertainty. hollande meets with british prime minister theresa may. erdoganey, president or t

-- the move comes less than a week after an attempted coup. n usill give erdoga government the ability to suspend rights. kong, a court has found a teenage protest leader, just guilty of joshua wong taking part in an illegal rally. two others were also found guilty. they could get up to two years in prison. in cleveland, donald trump will accept the republican nomination for president. he will do so one day after his bitter rival, ted cruz, was booed during his convention speech. the texas senator ended his speech without specifically endorsing trump. >> we will unite the party. we will unite the country by standing together for shared values. by standing for liberty. god bless each and every one of

you and god bless the united states of america. >> trump says if elected president the u.s. may not defend nato allies from attack. trump told the new york times before he took any action he would review whether the country being attacked have the filled its obligations to the u.s. global news 24 hours a day, powered by our 2400 journalists in more than 150 news bureaus around the world. i'm a lisa parenti. vonnie: some breaking news in the last few minutes. u.s. regulators will seek to block at not pass merger with aetna's merger with humana. loretta lynch will give a , which we at 11:00 will be monitoring. stocks are little changed. at not is up to tenths of 1% -- aetna is up to tenths of 1%.

to the ecbs get back decision. mario draghi says the central bank is ready, willing, and able to act in the aftermath of the brexit vote. draghi shared this assessment earlier and frank ferd. thatr assessment is financial markets have weathered the spike in uncertainty and volatility with encouraging resilience. readiness of central banks to provide liquidity if needed and our monetary policy measures as well as a robust supervisory framework have all helped to keep market drive contained. nejra: for more let bring in dean turner. in your words, it was rather a dell meeting. what would have

happened and what signal would it send to markets if mario draghi had announced changes today? dean: if mr. druggie ha -- mr. druggie had announced something more meaningful -- already being felt throughout the . clearly that is not the case yet. what little data we have in the u.k. and in the eurozone is pointing to things turning out relatively ok at least in the short term. that is consistent with the ecb. line with the in general market expectation for when we may see more actions on the ecb? dean: a lot is going to depend on the september forecast. our expectation is that the growth outlook will be weakened. for what it's worth we shaved about half of a percent from our forecast for this year and next. ist was suggest the risks

toward an extension of qe. vonnie: 10 year german bund yields went into positive territory after mario draghi spoke. what does that say the market was expecting? dean: i think the market was expecting pretty much what we got from today's meeting. most of these economists were thinking it would take time until we see the full impact of the u.k.'s decision to leave the european union. it does make sense the ecb stays in hold. clearly, what's going to be the focus going forward is those september meeting forecasts. vonnie: do mario draghi's statements have the same have to as they used to in the past? he does have that utility belt if you like. dean: i think markets are questioning the efficacy of central bank policies globally.

not just at the ecb. in answer to your question, doesn't mario draghi -- does mario draghi still have half for markets, i think that is still the case. some flexibility around the program going forward. clearly there is the issue in terms of the size of the qe program. you would expect to see some movement on that income quarters. vonnie: talk to me more precisely about that scarcity. ready, willing, able. is the ecb able to do much more if it does not make any changes to the t -- to the capital key? dean: i think one thing we have learned from central bankers is never be surprised by their creativity. .t is the case adjusting the capital key to be

one aspect of that. our expectation is that we will see further measures, whatever form that takes. we got a keep an open mind about it frankly. the determination of the central bank in particular the ecb in order to achieve its inflation target. unquestionable. what would be your first choices for the ecb? dean: clearly some mention today in the press conference about whether the program gets expanded into assets. i think that is probably a long way off. one of the things to bear in mind is the inflation outlook in the euro area is actually one that is increasing. we think inflation will increase close to 2% next year. that in itself will make it challenging for the ecb in order to expand its purchase program beyond what we would consider conventional assets. turner, thank you

for joining. coming up, a look at stocks moving in the early part of the u.s. session as airlines earnings season rolls in. southwest reported a miss on fair declines. ♪

vonnie: live from london. st. paul's cathedral. you're watching bloomberg markets. it's time for the bloomberg business flash. look at some of the biggest business stories in the news. mastercard has agreed to buy controlling stake in boca link. mastercard is paying $920

million for nearly 93% stake in the u.k. based payments processing firm. vocal link shareholders could executive hsbc and mark johnson released on bail. earlier this week he was ofested on charges manipulating the british pound to take advantage of inside information about a client. johnson is hsbc's global head of foreign exchange cash trading in london. more summer barbecues may be on the menu in the u.s.. began port production at a record high and it does not look like it will be slowing anytime soon. between the burgers come a ribs and porkchops, could get even cheaper. cattle prices hit a five-year low. your bloomberg business flash. julie hyman is looking at airline stocks. julie: we have southwest come

out with earnings and it did something it has not done in five years, it missed analyst estimates. not something southwest does very often but earnings per share missed analyst estimates by about 1.4% coming in at a dollar 19. it is something folks are not accustomed -- $1.19. the couple he saw declining there's for customers also paid above spot market rates for jet fuel because of advanced contracts. southwest was very good against hedging against a fuel rising. fuel has been falling. this is something that disadvantaged it during the quarter. shares are down by 9% and we see pressure on some of the other airlines as well. southwest revenue for each passenger flown a mile was down by 3.5%. the company is increasing capacity between 5% and 6% this year. that's something a lot of airlines have tried to increase the discipline on. cassidy increases this year. they want to have more pricing power.

american, delta, and jetblue are all trading lower. alaska air also came out with earnings and its earnings-per-share beat estimates. revenue missed but these shares are holding up relatively well up 1%. the european airlines. easyjet and lufthansa coming out with negative commentary and numbers. easyjet saying ticket prices are continuing -- depressed ticket prices are continuing. there has been a lot of turmoil in europe between the attack in turkey --he coup in the attempted coup in turkey. both of those stocks trading lower. coming up next, shares of pantheon are rising on the trading day. maker.g ingredients we'll speak with jim mullen next.

♪

nejra: you're watching bloomberg markets from london. vonnie: this morning shares of trading debut.ts shares opened at $25 after the ipo come up more than 16% at before 54. jim mullen joins us for an exclusive. congratulations. happy with the increase in price or sad he left some money on the table? jim: we have 20 more secondaries coming somewhere over the next few years. we are happy we opened at a good price. investors saw a nice uplift in return right out of the gate. we are very happy with how things open and the kind of

interest and volume we have seen. vonnie: was it the right decision to put off the ipo last year to go now? jim: it sure looks that way now. certainly the ipo markets when we were thinking, which was early october, they got a little choppy. pretty choppy ipo markets in january and february. a lot of talk about what would happen after brexit. it turned out the market settle down. we probably were out with the two best market weeks in a year. it helps to be a little bit lucky but it was certainly the right decision for us. mentioned some secondaries over the next few years you tell us more about that. the two big investors, we did in lbl with this company in march of 2014.

and so, those companies will need to monetize their stake over some reasonable period of time. vonnie: you were formed through a merger. how do you expect your growth to materialize? organically or perhaps through m and a? jim: a combination of both. a recent history is we have grown this thing nicely organically. .% growth rate we have accelerated that growth dramatically through a number of acquisitions. we think we will continue to have attractive acquisition

targets. nejra: we should mention that you make drug ingredients and are based in amsterdam. at the end of october you had almost $140 million of net income on sales of $1.8 billion. do you expect that margins will improve for this fiscal year and beyond? jim: what we told investors is we have gone on this roadshow, by combination of leverage throughout structure, growth of new product, some of the mix, we should seize margin improvement in the range of 150 basis points per year for the next few years. i think that is a doable target for us. vonnie: the products that you are excited about now? jim: the great things is i don't -- the great thing is i don't have to pick a product. we make 700 products for 400 different customers.

we much more products for customers than anybody else in the business. diversified company. we have a lot of exciting products we're working on the development that will come through and hopefully be approved and successful in clinical trials. i don't have to pick a favorite and that is one of the great things about running this business. very diversified. nejra: you have been in the industry a long time so i want to get your outlook on the pharma industry as a whole, given everything we have seen recently over the issue of tax inversion. do you expect more m and a in the industry and where? jim: i certainly think you will cm and a. the inversion regulations in the u.s. have slowed some of that down. inevitably you will see more of these companies really trying to get focused or combining to get more presence in certain areas. as long as the scientific innovation continues at the pace we have seen since i have been in this business -- i've been in

this business 30 years, there's no reason to believe it will not continue. we will see exciting new products and real improvements in health care. that momentum is going to carry the business. it is also going to create a lot of reshuffling for the industry. vonnie: tim up -- jim mullen, congratulations on the debut of trading.n -- patheon still ahead, senator ted cruz took the stage at the republican national convention last night. he did not get the reception he was hoping for. we will tell you why the crowd booed. ♪

nejra: beautiful summer's day in new york city. you're watching bloomberg

markets. let's check in with the bloomberg first word news. alisa parenti has more from our newsroom. >> the brexit vote may push the british economy into its first recession since 2009. economists have been flashing their forecasts since the vote last month and they now see two quarters of contraction this year. a car into a bloomberg survey to u.k. economy is likely to shrink 1/10 of 1% in the third and fourth quarter. in cologne lump or commit invest it or search for the jetliner that has been missing for more than two years. more than 90% of the designated search area in the indian ocean has been covered. scientists are considering the possibility that they have been looking in the wrong place. a u.s. warship will visit new zealand ending a three decade impasse over the country is anti-nuclear policy. joe biden is in new zealand where he accepted an invitation

to send a ship in november because the u.s. would neither confirm nor deny whether it arms,d nuclear power or new zealand rejected a ship back in 1980 five. hillary clinton is expected to announce her choice for a running mate this week. former president bill clinton reportedly back on. the former president has privately expressed his support for virginia senator tim kaine. mr. clinton reportedly believes the former governor's background will prepare him to be president. one of the most rapidly warming places on earth in the last half century. new research finds that the antarctic peninsula has old off in the past 20 years according to a british study published in the journal nature. the authors do not make a conclusion about whether their findings and what they could mean to the debate over global warming. global news 24 hours a day, powered by our 2400 journalists in more than 150 news bureaus around the world.

vonnie: discord disrupts the republican national convention. last night senator ted cruz took the stage and refused to endorse the candidate. cruz's was pretty much booed off the stage. party.ill unite the we will unite the country by standing together for shared values. by standing for liberty. god bless each and everyone of you and god bless the united states of america. vonnie: cruz spoke at an event in texas defending his speech and maintaining he did not say anything negative about the nominee >>. i assume there is a reason the truck campaign wanted me to speak. this am i speak before i gave it a new exactly what i was going to say.

i assume they reason they wanted me to speak as they believe my delivering that message would encourage people to come out and vote and they believed it would help. if they did not i was happy to get on a plane and go home. vonnie: ted cruz speaking in cleveland this morning. joining us now is kevin cirelli who is reporting all week from cleveland. the fallout from this, does it hurt ted cruz more than it helps donald trump? kevin: absolutely. the drummer last night with ted cruz who walked onto the stage with an opportunity to present himself as governor mike huckabee just told reporters as someone who would be able to unify the party and then he got booed off the stage. unfolding.f that i spoke with newt gingrich after the event concluded and essentially he told me this speech from senator cruz was not well-received.

trump's campaign manager came up to speaker gingrich immediately after while donald trump + was on the stage and said we need closure. newt gingrich was left scrambling trying to insert lines into his own speech to again try to provide the closure. all of the reports today, kind of a perplexed state as to why senator cruz would risk such political capital by refusing to endorse the party nominee and doubling down this morning and "rabid."rom supporters vonnie: i think we have a full screen of it in case our viewers missed this. donald trump saying, ted cruz got booed off the stage. but let himeech speak anyway. no big deal. conflicting accounts i guess of whether this was planned or unplanned. trump -- thek the

sources i'm talking with from inside the trump campaign, they reviewed the speech. ted cruz was offered an opportunity to speak. if the trump campaign had told ted cruz you're not allowed to speak unless you endorsed donald trump that would have been the story. at the end of the day, this is two out of three nights were the narrative has escaped the trump campaign. two out of three nights where the narrative has escaped. might one with melania and now the third night with ted cruz. tonight donald trump will address the convention and we'll have to see what he says. more drama in cleveland, clearly. >> what can we expect from trump's speech tonight? kevin: i think you're going to see a donald trump who is going to be number one, reading from teleprompters. a prepared speech he has been apparent for several weeks. he has drawn from 1968, the speech that former president nixon gave.

this is someone who is going to address the broader themes of his candidacy from immigration to trade deals to national security. i would expect a more measured tone. and someone who is trying to show more dimensions of himself at a convention that has given the media a lot to talk about. about trump's us comments on nato to the new york times. really sending alarm rippling through eastern europe. kevin: trump has said consistently for several weeks and months now. he has called it "obsolete." that oursentially said partners in nato are not paying enough money and he would like to renegotiate that. speech raising

questions about his positions not only with nato but with foreign policy. expect all of that in his speech tonight. vonnie: what is the consensus about mike pence's performance? kevin: mike pence was largely overshadowed by senator ted cruz but the contrast between senator cruz and governor pence was astounding. a lot of people within the convention hall found his speech to be presidential. vice presidential but also presidential. someone as a statement. the republicans i'm speaking with your in cleveland really say that that is a stark contrast between the states and quality of governor pence and what the performance that senator cruz delivered. when you look at should donald trump lose and you look at 2020, which clearly the underling from cruz was about 2020, already you see contrast in political styles. vonnie: thank you so much. masterup, elon musk's

plan for tesla. he wants to steer his company toward electric trucks. we will have the details, next.

vonnie: you're watching bloomberg. nejra: this is your global business report. bank stands central firm on rates for now. it wants to see how the brexit boat will affect the european union. vonnie: komatsu is optimistic about the mining business. it pays nearly $3 billion for joy global. nejra: fracking has been a boon

for the u.s. energy market but at what price? we examine if the benefits outweigh the negative. is weighingoat heavily on the european central bank. ecb policymakers have decided to keep their stimulus program unchanged saying they need to assess the economic damage inflicted by the u.k.'s boat to leave the european union. there is more evidence the vote is having an impact on the british economy. u.k. retail sales had their biggest drop in six months. date of the monthly survey was july 2 meeting some responses were received the week after the eu referendum. nejra: unilever reported second-quarter sales growth that beat estimates. the maker of ben & jerry's ice cream livered sale gains in dealing with and hair care products. the gains coming mostly from higher prices for its goods.

tells bloomberg the company is preparing for a tough year. >> if you look at the economic data you see a slowdown of investment. less job openings. you see reduced estimate for the u.k. economy. a high level of uncertainty like you see now. what business hates is uncertainty. >> a big takeover in the mining equipment business. komatsu has agreed to buy joy global. the price, $2.9 billion, 20% premium to joy global's closing price. joy global is the largest independent maker of underground mining equipment. the deal is seen as a sign, sue believes a recent commodities rebound will continue. at three of wall street as a biggest investment banks may get a much smaller bonus this year. goldman sachs, jpmorgan and morgan stanley have reduced the amount of money they set aside or employee compensation by 17%,

the most in four years. wall street firms have been .utting costs persistently low interest rates and stiffer regulation is hurting revenues. vonnie: we provide context and background on issues of interest. fracking has produced a flood of new energy in the u.s. and canada. the question is whether the cost and benefits can be balanced or other fracking presents a threat so great it must be banned. hydraulic fracturing was largely responsible for 54% increase in the u.s. output of oil and natural gas from 2008 to 2016 and made the country the world's biggest producer of the two. limits imposed by several european countries. canada's quebec province and hundreds of u.s. communities. commercial use a fracking was in 1949 in oklahoma

. the technique involves forcing water mixed with sand and chemicals into a well to create fissures and shell rock so the oil or gas inside can escape. advances in another innovation, horizontal drilling, came in the early 1980's and provided access to shallow layers of shale be underground. the expectation of shale formation in texas post large-scale fracking was economically viable. advocates of fracking point out abundant natural gas left many u.s. power plants abandoned. they note the u.s. energy imports and shared consumption recent years have harbored around 10%. the environmental risks of , opponents say, can be mitigated. not only offsetting the greenhouse savings but could outweigh them. the next say if force

regulations nationwide are required before operators would make investments that might curb environmental risks. you can read more about fracking and all of our quick takes on the bloomberg. that is your global business report. had to bloomberg.com for more stories. nejra: general motors is running on all cylinders. of the automaker posting a record second-quarter profit of $2.9 billion, beating analyst estimates by a huge margin. it is also raising guidance saying it will make as much a six dollars per share. a stock is up on the news, 3.1%. cfo chuck stephens spoke about the result earlier on bloomberg. >> we had outstanding results in the second quarter. really driven by strong performance in north america. another record quarter for north america. 3.6 billion in profit. continued strength in china.

continued strong net income margins. profitability in europe. nejra: for more on this let's go to bloomberg auto reporter keith norton. you heard the comments from the cfo, outstanding came up more than once. were these really outstanding results and why? keith: they were. absolute record for general motors. they have focused on profitability and that has helped them. they are doing very well in north america. that is where the bulk of these profits come from. they improved throughout the world. it very good quarter for them. nejra: you talk about the rest of the world as well. how did they do in europe? keith: in europe they made $100 million which is remarkable for them since that has been a quagmire for them for years. they are starting to make progress. what they are worried about is brexit. the u.k.'s departure from the european union.

they see that costing them about $400 million for the remainder of the year. vonnie: how will it mitigate that? there's also next year. keith: they are not quite as dependent on the u.k. as ford is for example it should not hurt them as much. they are as we see making progress in europe where sales have been increasing. strong operation in germany. they should continue to improve there. vonnie: talk about tesla's new plans. keith: the new master plan parts ux. it gets elon musk into every other aspect of transportation including semi trucks. this is an update to the plan he did 10 years ago that resulted x. the model s and model a sharing, autonomy and he has

solar city with solar panels on your roof. he wants to get into every aspect. what he has not explained as how he's going to make money from all this. vonnie: how might he? keith: that is the challenge. one profitable quarter so far. he has been to thoug -- he has n behind on liveries. nejra: i want to break some news. humana is boosting its year earnings forecast. also saying the judicial review of this morning's court case, the u.s. prosecutor is suing to block any kind of merger. critics -- humana cannot predict when the aetna transaction may close but it is defending the transaction as opposed to cigna saying they are not going to go counteractt going to

any suit from the department of justice trying to block the signal merger. him boosting its year earnings forecast. the stock is halted for trading. nejra: can we keep up the pace of upwards of 17 million annual sales in the u.s. a year? doubt there is greater that we will have another record year this year like we did last year. strong year but it does seem like we are peaking in the u.s. market. that will affect all of the players. gm going up because of fantastic earnings. tesla is falling because analysts are skeptical about its master plan. a little bit of a role reversal today. vonnie: keith naughton in detroit. the company known for its frisky is hoping to boost profits by brewing its own

craft beer. that story is next. ♪

>> japanese liquor company itsntory is launching ring in beer brand in hong kong. >> our focus is on building a premium position in asia including market like taiwan, korea, and malaysia. our target volume is to sell .50,000 liters by 2018 that would become the benchmark for expansion into china for which hong kong is a gateway. things standing perhaps in your way. we have seen changes in the industry.

shifted to ae craft beer. flavored beer is another. some have shifted toward whiskey and spirits. >> when it comes to overseas expansion, a boom in craft beers and bourbons are a plus for us. many people are not familiar maltsuntory plus premium see it as a product of japanese craftsmanship. , our brands are very popular. customers become curious. >> the past three to four years have seen changes in policy and planning from the government of shinzo abe. has that helped? abe -- therehat

.s a five polarization people either by luxury goods or cheap goods. sales have been increasing 12 straight years despite deflation, which is proof there is still demand for premium products. >> you export all of your premium products from japan. the japanese yen is all over the place at one point. 105.ack to 100, did you ever consider moving production overseas? >> that is a very difficult question. asian customers love products made in japan so we need to respect that. it is not as simple as moving a factory to china or korea just because of currency moves. the yen fluctuating from 100 to 140 and so on is a headache for us. >> what is the ideal range for the japanese yen? >> we are focused overseas for

growth so a weaker currency is important. about 120 to the dollar is ideal. vonnie: that was david inglis with the ceo of suntory beer. you can read more at bloomberg pursuits. draghii wonder if mario needs a beer. -- stimulus program unchanged as policymakers try to assess economic damage. we'll cover the market outlooks for europe, the u.k. and market risks in turkey in the next hour. let's have a look at the market reaction given the ecb's decision today. in stock market you see the stoxx 600 pretty much unchanged. it's like that across the various indices. the dax up 3/10 of a percent. a bit of fluctuation in european stocks today. let's take a look at how some other asset classes are doing.

we did see the euro rise while mario draghi was speaking. 996. the german ten-year bund yield touched its high in four weeks. down one basis point at the moment. again.y, below zero did go above zero earlier. 10 year spanish yield down four basis points. ♪

vonnie: from new york, i'm vonnie quinn. watching the european

close on "bloomberg markets." ♪ >> we will take you from cleveland to paris and cover stories out of frankfurt and istanbul in the last hour is what we are watching. ecb president mario draghi signaling essential bark -- bank will consider --when it has a clear picture of the impact of the u.k. vote to leave the european union. the union pacific chairman us.ceo joins >> turkey imposing a three-month state of emergency