scarlet: from bloomberg world headquarters in new york, good thursday afternoon. shery: here is what we are watching. scarlet: stocks fluctuating near all-time highs. corporate earnings have topped estimates, feeling optimism for further gain. the european bank keeps policy on hold. can we expect stimulus comes september? vonnie: from vehicle sharing to electric pickup trucks c. is this what the original tesla founders wanted? we will find out from ian wright. scarlet: julie hyman has been tracking the moves with stocks

holding near record highs. the ecb did exactly what everyone expected. wait and see. julie: still watching various earnings reports. stocks have taken a bit of a turn for the worse after rising to records again yesterday. the dow having an extraordinary winning streak now. we are seeing a pullback for the three major averages. earlier in the session, we saw stocks unchanged. it took a pretty sharp leg downward, not that long ago about 20 minutes ago. now, near the lows of the session. on the earnings front, on the one hand, we have pretty significant earnings wins. qualcomm beating estimates here seeing increasing demand from china.

if i billion dollar buyback and ebay raising its forecast for the full year. that's a $5 billion buyback. intel pulling back after that companies that company plus earnings had been falling. -- intel pulling back after that company's earnings have been falling. union pacific suffering as the company talks about a weakening outlook for demand for shipping things around the country, particularly commodities. smaller earnings losers we are watching today, smaller companies, but big losses -- interpublic group down 6% after its earnings missed estimates. sherwin-williams as well. and tractor supply down 3.5%. the company's results being hurt

by whether that's by the weather. -- being hurt by the weather. we are watching the new oil contracts rolling over here. also a rollover in prices, down 1.8%. despite what we got yesterday in terms of oil inventories, still declining but there is still concern about a glut in the u.s. also watching the u.s. dollar today in the wake of that ecb decision. little changed but a bit of a declining dollar. down about .2%. shery: let's check in on the first word news this afternoon. matt: tonight in cleveland, ohio donald trump will formally accept the republican nomination for president of the united states.

mr. comes appearance comes after rival ted cruz last night refused to endorse him in his convention speech. -- mr. trumps appearance. >> i addressed the convention because donald asked me to. he did not ask me to endorse. i talked on the phone with him and told him i'm not going to do it. matt: trump campaign manager says he isn't -- trump's campaign manager says cruz is in violation of his pledge to support the nominee. mr. clinton is privately expressing his support for virginia senator tim kaine. he believes the former governor's background will appeal to voters and prepares them to be president. police and brazil have arrested 12 people or plotting a terrorist attack during the

summer olympics. the group may be linked to an islamic state cell. wiretaps revealed messages that supported religious intolerance in the use of firearms and guerrilla tactics. in turkey, the parliament has endorsed sweeping powers for president or to one -- president hearderdogan. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. i'm mark crumpton. this is bloomberg. scarlet: european central bank holding its fire on rates today but mario draghi signal that policy are open to additional stimulus when they meet next september. mario draghi share his thoughts earlier in frankfurt.

>> following the eu referendum that you can referendum on eu membership from our assessment is financial markets have weathered -- u.k. referendum on eu membership. our monetary policy measures and robust regulatory and supervisory framework have all helped keep market stress contained. scarlet: here with us now, david lebovitz. the ecb signaling more easing if needed. extending qe in some shape or form would be the next logical step. david: exactly. the decision today was not necessarily unexpected given the bank of england's fate on hold.

they want to make your they have all the facts. and extension of the program is probably in the cards. if the ecb extends the asset purchase program, they will have to change the requirements for bond purchase eligibility. whether that is allowing purchases of bonds below the deposit rate from expanding the corporate securities there are a number of options they can take. scarlet: what would more of the same achieve here? david: the one thing that works well in europe versus the u.s. is the credit easing channels are more intact. in the u.s., the fed bought all the fed bought all these bonds and pushed rates to zero but banks sent it back to the feds. they can either make money and then that money out or paid the ecb to keep their money with the central banks. you are seeing a different

dynamic and we are seeing demand for credit being met with supply. shery: how disappointed were you that we did not see the ecb being more forceful when talking about stimulus? david: we felt this way for a while, but monetary policy seems to be pushing a little bit -- we are supposedly normalizing policy in the u.s. we saw the adverse reaction in japan earlier this year. i don't think the ecb wanted to be too forceful. when the economy looks ok and they say there is a need for much more stimulus, it can scare the everyday person. why do we need more stimulus if everything is on the right track? shery: what about fiscal stimulus? are we seeing eye fundamental shift happening -- seeing a fundamental shift happening? david: the biggest issue with

fiscal stimulus is it leaves a bad taste in everybody's mouth. the extension is government spending. people are very hesitant to see governments wrap up their spending. when we look at the issues plaguing the global economy today subdued global growth, a very discontent global population greeting some jobs through fiscal stimulus can not only bring back growth and inflation, but can call him the political conditions -- calm the political tensions we are seeing. scarlet: how is that quantified in the markets? david: because we have not really seen anything up until this went -- this point, it is difficult to gauge what the reception will be. the bank of japan is further out on the easing spectrum. the reason the markets did not like that as we've seen

monetary policy is not doing what the policymakers intended it to come it creates jobs and be temporarily raise your debt levels, theoretically, you are to gdp ratio could decline over time. shery: where does the bank of japan go to buy now? david: it would not be surprising to see the bank of japan wrap up their etf purchases focusing on that credit easing that has worked so well in europe. we also expect some sort of fiscal stimulus plan. if you decide to issue 20 trillion more agai yen, the bank will be there to buy it. does this have the intended effect? does it get growth back on track and does it generate inflation in a world where savings are dominating investments?

scarlet: pushing out the expectations of a rate rise here can we saw that in the net interest margins david: financials in particular are in for a tough year. the comparisons to 2015 are very difficult. we are seeing loan activity pick up. particularly on the back of brexit. but low rates are still hurting and that is a structural headwind to the financial sector. between this bid for the cyclical part of the market. people are betting on central banks keeping policy easy and doing more. you have seen earnings expectations surpassed by a lot of these companies and that is a good sign for the trajectory of the overall market. shery: when are we going to see the year-over-year growth? david: maybe first quarter of

next year. the year-over-year, are very difficult and that is what everyone is focused on, when is the headwind from energy in the dollar going to lessen? that applies to financials to an extent but the interest rate issue is one to project. shery: david lebovitz jpmorgan asset-management global strategist. scarlet: coming up, the battle for consolidation and health care -- in health care. you are looking at live pictures of president obama meeting with the kansas city royals in the east room of the white house. this is bloomberg. ♪

scarlet: exxon mobil making an acquisition, it will buy inter-oil come a deal valued at $2.5 billion. exxon mobil down .5%. a deal valued at $2.5 billion. the deal is subject to a two thirds percent inter-oil vote. shery: we have breaking news about pandora. $15 per share. an informal offer from liberty. the bid was not a formal offer but pandora rebuffed the deal.

pandora has gone to other buyers come including apple and amazon earlier this year. we are now seeing pandora shares down, dipping down for the whole week down for six consecutive sessions at the moment. pandora reports second-quarter results tonight. scarlet: the u.s. government is willing to stop two big takeovers in the health insurance industry. antitrust lawsuits against cigna and humana. the deals would consolidate the nation's five biggest insurers into just three. cigna says the earliest it still could be completed his next year -- is next year, if at all. zach tracer joins us.

zach: they said both deals would harm innovation, harm competition. the humanity all, they cited the effects on the medicare advantage market in particular. insurance sold two big employers and regional markets. there are some nuances as well. shery: they will go to court if necessary. what will they argue? zach: aetna will say that their deal is good for consumers and they have presented remedies. they will assess a bunch of medicare advantage business and this is enough to make up for any harm's this deal might cause. scarlet: this could tie things up in the courts for months, years? zach: humana and cigna book

about out and say this deal will not get done this year. cigna casting doubts on the deal . shery: are we going to see renewed pursuits for smaller players? zach: we've seen some pickle -- some people signal some interest. they worried about consolidation in the space. that would cast a shadow over any renewed deal pursuit. scarlet: was this what was expected to happen with the affordable care act or did this catch the government by surprise? zach: a lot of folks have said the a portable care act may have contributed to some of this consolidation. the government is making the case today in court that the affordable care act is about increasing competition.

to give people more affordable health insurance, better health insurance. the government says we need competition to make this market work. zach: the companies say we need pressure to desk we need size to negotiate with providers doctors and hospitals to get better rates. we can be smarter, more innovative things to make health insurance better if you let us consolidate. scarlet: what are analysts saying is the next step? zach: humana says they will fight. they have been laying out this case in terms of the best teachers and other arguments -- and them signaling they are open to a settlement. both companies right now pushing forward. scarlet: do they go ahead and propose that or move ahead with divesting those assets? zach: they will have to file

some responses in court at this point. they will have to settle with the doj. scarlet: david lebovitz zach tracer thank you so much for joining us. shery: a $15 per share offer for pandora. shares up 4%. pandora shopping itself to other buyers as well as apple and amazon. tomorrow, we have the pandora ceo. scarlet: great timing. shery: this is bloomberg. ♪

scarlet: the nhl's new york

islanders considering a move to queens. moving from brooklyn to queens. the owners of the mets and islanders discussing a deal -- shery: time now for walk the talk where we look at the pressure points of social change and where it is outpacing corporate america's ability to adapt. today, how the rise of anti-islamic sentiment is pushing u.s. employers to ensure muslims feel accepted at work. muslims make up just 1% of the u.s. population but account for 40% of religion-based workplace complaints. how can managers retain the talent of this growing population? joining us now, carol hymowitz.

what sort of needs do muslims have that need to be fulfilled in order for them to not feel discriminated against? carol: prayer rooms. the bout muslims pray three times a day during the workday. -- devout muslims. they want tolerance for the way they dress, whether they are wearing a hijab or prayer scarf. they don't want to be accused of being a terrorist for watching that -- for wearing that. scarlet: shery: it only becomes an issue when there are headlines that are disturbing. can you give some best practices of how this has played out and what happens when the companies adhere to this carefully? carol: sure. we've talked to horizon blue cross blue shield -- they've

brought people together, brought people together after the paris attacks last year to clear the air. people had a lot of questions. what doesn't mean to be muslim? do you support this kind of attack? obviously not. that was very effective. scarlet: oftentimes you get the community together within that company. how do you make sure you brought in it to others who are not in that community? carroll: you have to have meetings where you are inviting other people in. have lunch meetings, have questions answered -- what does it mean to be a muslim woman for instance? make sure you have meetings. shery: what's the level of acceptance right now?

carol: there are tensions out there. it is difficult for muslim employees interfacing with customers and retail spaces -- in large retail spaces because they might address the person and say what are you doing here, why don't you go home? internally, the company has more control over creating tolerance. shery: walk the talk. you can read more on the bloomberg. scarlet: coming up, we will talk to one of the cofounders of tesla. this is bloomberg. ♪

shery: live from bloomberg world headquarters in new york, i'm shery ahn. scarlet: and i'm scarlet fu.

this is "bloomberg markets." matt: republican presidential nominee donald trump appears to be catching up with hillary clinton in fundraising efforts. mr. trump raised more than $26 million in june, compared to $37 million for mrs. clinton. from also gave $47 million in personal loans he's made to his own campaigns since last year. a texas court has revealed a law -- the state will be left to require the photo id in november. a judge will consider alternatives for citizens who don't have them. belgium is celebrating its national holiday today under tighter security. following last week's deadly terror attacks in nice, france.

only 17% of americans say they are satisfied with how the country is doing one of the lowest satisfaction levels in the 15 year history of the survey which also found that americans view racism as the most important issue. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. i'm mark crumpton. this is bloomberg. scarlet: we are looking at the u.s. stock market with the s&p and dow retreating from record highs. the dow off by 75 points, the first decline since july 7, ending a nine-day winning streak. one of the biggest winners of the week has been technology shares which lifted the nasdaq higher yesterday, the best-performing of the three major benchmarks. abigail doolittle is live at the nasdaq where she is keeping an eye on all the big tech names.

abigail: today, we are looking at a bit of a breather for the nasdaq, down about 12% right now, really fluctuating between small gains and losses -- down about .2% right now. fluctuating between small gains and losses. the best earnings winner today ebay of 11.9%, having its best day in nine months. this after the company did beat expected quarter earnings and revenue estimates and also raised the full-year forecast. the bar was very low going into this quarter. analysts were looking for the company to maintain margins. instead we have rising revenues and susquehanna is thing the turnaround -- is saying the turnaround is gaining momentum. intel's shares down 4%, the biggest drag on the nasdaq as

investors worry about whether or not we are going to see a big slowdown in data center growth. this after the second quarter missed estimates for the third quarter in a row. intel is confident the second half will be the first half -- be the first half. -- beat the first half. scarlet: what else is keeping the nasdaq from rising at this point? abigail: a tesla shares down 3% after the second part of elon musk's big master plan was unveiled. somewhat of a bust. wall street analysts somewhat unimpressed. ubs surprised by the possible introduction of bus and trucks in the future -- buses and

trucks in the future. questions over whether or not they can produce electric vehicles at these levels. shery: elon musk's master plan -- is it a pipe dream or will it excel rate the electric car company to a new stratosphere? ian wright is a cofounder of tesla, now the ceo of a company that makes electric garbage trucks. thank you for talking to us. investors seem to be shrugging off this master plan, the stock is declining and you let the company about a decade ago. are you a believer in elon musk's vision? ian: it is not smart to bid against him. he's already achieved great things at tesla and space x. scarlet: do you believe these

plans are feasible? ian: there's a lot of stuff in that. there isn't a simple answer. some of that is great. he's taking the lead in the deployment of ev technology. we are pleased to see that he has picked up on heavy trucks and buses. we've been doing that for quite a while. the make a lot of economic sense. scarlet: you had to read through it three times -- what are the steps needed for him to achieve his dreams? what needs to happen first? ian: generally speaking, it's a good idea to get your core business pulling and a lot of cash before you risk a lot of

things -- is will be interesting -- it will be interesting to see these technologies ending up in micro-grid, commercial buildings -- there's a lot of applications for this technology in those places. shery: one of the problems with the details today is that we could not see anything specific when it came to details. how much cash is needed for all these visions. ian: a lot. i cannot comment in any detail. ian: where is he going -- shery: where is he going to get it? ian: you would have to ask cam. -- ask him. scarlet: how much cash is needed to make electric trucks a reality? ian: my company just makes the

power transfer trucks. we've built a technology over the last six years and we've invested $40 million into it. tesla already has a bunch of that technology, they are missing a few vital pieces like a range extender and multispeed transmission. those things can be built. the factory automation thing that is the much bigger price. scarlet: there's quite a bit on the to do list. if you make an electric sedan or suv as well as tesla does, does that mean you can make an electric truck or bus the same way? how much of the original blueprint can you use? ian: not much. quite different problems and he's talking about semi trucks long-haul trucks.

i would go so far as to say it will not work for those because you cannot carry enough battery. you can do maybe 100 miles but they travel 6000 miles a day. with a range extender, you can do it, but you do not save any fuel. in urban drive cycles, you can do, but they would have to scale up the technology to do heavier duty, less incandescence -- multi speed transitions. shery: how about output capacity? tesla has been delayed several times on getting those cars out there. musk explains it in a fancy way. an analysis of automotive production, blah, blah blah.

is it feasible to add other products when they are not even delivering what they are supposed to be delivering right now? ian: there's not enough detail in that release or in the public statements for me to really answer that question. it is difficult to make vehicles, they have done an awesome job so far in getting the model s out there. reliable vehicles, good vehicles. have there been delays? sure. it is new technology. there's a lot of work. scarlet: you are working with a very niche market with certain customers that are -- that want your product. is there sufficient demand for electric trucks at large? or do you build it first and the customers will come? ian: we have seen incredible demand from all over the world for heavy trucks, garbage trucks, transit buses delivery

trucks. anything burning a lot of fuel we are getting many queries every week. we cannot build stuff fast enough to meet the backlog. there is enormous demand. scarlet: you've said in the past that has left changed the public perception of electric vehicles. that tesla change the public perception. what still needs to be done? ian: go back to 2003 when we started tesla gm had just crushed all the ev ones. the model s is a lovely car. everyone i know wants one. they've done an awesome job of changing the perception. shery: do you think the plan to

combine tesla insular city at this make sense? do you think this is achievable? ian: i do think there is that technology crossover. a lot of the technology we have built, they have built for vehicles will find applications and buildings. as for the details, i have not studied the details or the finances of that. from a technology point of view it does make sense. scarlet: would this be in line with your vision for the company when you were a cofounder of tesla? ian: no. we were only trying to solve the vehicle problem. it did not occur to us that this technology would find applications and buildings. -- in buildings. when you start a company like that you have to be very focused on the goal.

the one advantage startups have over big companies is focus. if you can keep crisp focus on what you're trying to build and keep doing it until it is done that is how you succeed as a startup. shery: thank you so much for talking to us about everything from electric vehicles to elon musk's plan. ian wright, tesla cofounder and ceo of right speed. harold hamm says president obama has tried to destroy the u.s. energy boom. his thoughts on america's energy future, next. this is bloomberg.

scarlet: this is "bloomberg markets." shery: the gop national convention in cleveland is still underway. harold hamm continental resources ceo joined bloomberg earlier today to discuss his thoughts on the obama administration being anti-oil and how the president's policies have hurt his business. harold: all that has been done in this fight, this administration this president sent out to do us in. as i mentioned last night in their very own terms, they said they wanted to crucify oil and gas producers. that came out of his administration. you can hardly get any more direct than that. this has been done through his administration's efforts.

it continues to get worse. death by 5000 cuts. it all came from one thing. it put this administration back on its heels when they found out the potential we have today in america. when we talked about being first, we are first and production of oil and gas. we have turned it around but it has been in spite of this administration. >> if we see a continuation of president obama's policies what kind of regulations could add to costs in 2017? harold: all of it adds to cost.

these regulations have no bearing, no benefit. it makes you less able to compete in the world. we are competing on a global stage now. you mentioned lifting the ban on exports. that was a no-brainer decision. moving a refined product that we could not export crude oil -- we've got that passed but it was in a bill he could not turn down, the omnibus bill. alix: oil trading at $45 .55. could you see a selloff of another 35% this year or is 2017 different? harold: absolutely it is

different. continental, we don't chase price spikes. i don't see that happening. the fundamentals of supply and demand we have a demand of 1.3 million new barrels this year. that is strong. we had 1.6 million barrels last year. those fundamentals are very close together. increasing demand leads to balancing of the market. we've seen that happen after the second quarter of 2016. going into a period here, we will not quite have enough to

that's enough supply coming on from production. we will be pulling out of inventory for the balance of the year so that means higher prices. this will be predicted for the end of the year. shery: that was harold hamm. scarlet: breaking news -- the nhl's new york islanders considering a move to brooklyn to queens. this was a surprise given that the islanders owners had just said earlier this month that they expect to remain in brooklyn long-term and play in the berkeley center which they just moved into the season. that's last season. >> publicly, they will come out and support the current home. but come everybody knows the first year in the barclays in her was hardly a win-win proposition. you had many complaints about

obstructed view seating, the ice was not that great. the old owner surrendered business control to the folks at barclays. it did not seem to be shaping up as a workable partnership at barclays. if they can make modifications to the arena a big if because those things are not cheap perhaps there is a future. certainly planning for another arena somewhere else is certainly in the minds of the owners now. scarlet: talk about this potential new arena being discussed. where would it be? scott: it's hard to know if that would be a retail place -- the city has been looking to do something with the iron triangle . they're looking at a development , whether it be a mall or shops

or restaurants, hotels, they're looking at some sort of mixed use development anyway. perhaps an arena might make it easier to get this pushed through. a lot of people are looking at these big sports entertainment venues that will draw people when the teams don't play. shery: will this be enough to appease the fans and the team? scott: you would have to think this is a ploy by the fan base. they were not pleased that the team was moving to brooklyn, which is kind of a schlep. the attendance showed that they did not win over the fans in brooklyn and did not draw from the traditional fan base, so this would be easier for those fans, the long-term fans on long

island to get to while keeping the islanders in new york city team. they paid a premium for this franchise. they want to stay in new york city and queens would satisfy that. scarlet: you can check out the story online on bloomberg.com. this is bloomberg. ♪

scarlet: you spend more time at your job than anywhere else. here to discuss, rebecca greenfield. the first episode deals with jargon in the office. is this let's discuss this off-line, circled back orlene and -- circle back orlene lean

in? rebecca: words that mean something in the workplace that don't mean anything anywhere else. every group has their own jargon. the kinds of words you use with your family. usually you don't even notice when you are doing it. scarlet: tell us how this got started. you look at the historical roots of jargon. rebecca: it goes back much further than you would think. the 1600s when people were shipping merchants and they sent letters. that's high you send e-mails. you think that is a normal thing. scarlet: stemming from the thinking that it is an us versus you sort of thing. why do people hate it so much?

rebecca: if you are not in the group and you are using it it comes off as cliche or a bit jarring. scarlet: which phrase do you avoid the most? rebecca: e-mail sign-up jargon -- best regards. what does that really mean? scarlet: bloomberg's rebecca greenfield. you can listen to the game plan on itunes.com/gameplan. this is bloomberg. ♪

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scarlet: welcome to bloomberg markets.

from bloomberg world headquarters in new york, i'm scarlet fu. shery: we are covering the news from cleveland and beyond. stocks fall in government bonds retreat after the ecb fails to offer more stimulus. now the focus shifts to next week's fed meeting. scarlet: francis calling on the u.k. to start the brexit process as soon as possible. we will bring the joint news conference to you live. shery: and why publicly traded companies need to use a that of common sense principles for good corporate government -- governance. scarlet: julie hyman has the latest, including disappointment if you are long risky assets it

comes to the ecb decision to do nothing. julie: there's quite a lot of stimulus whether you are talking about europe or around the globe. if you look at u.s. stocks, we have a pullback. earlier, stocks were lower changed and then took a turn for the worse. we are seeing him a pause in that up momentum today. if you look at the groups on the move, materials are the biggest drag. only health care and telecoms are up right now but these moves have to do with underlying earnings movements as well, so the disappointment to some extent outweighing the session five. shery: mergers are a big part of earnings today. julie: we have gotten a lot of headlines on a mergers front. exxon mobil greeting to buy financial gas explorer enter oil. it is gaining assets in popular

new getting, and there had been a competing bid, so exxon will pay a $60 million breakup fee. we are watching these stocks as a result and we are watching shares of pandora today after the wall street journal reported liberty media made an informal offer to buy the company but pandora rejected it. $15 a share was the proposal. an informal proposal according to the wall street journal. andorra set to report its earnings after the close of trading. and we got a big headlines on health insurers today. health insurers in the news as the department of justice is suing to lock two big mergers in the health care industry. anthem's takeover of cigna and

aetna's takeover of umana. the attorney general says it would raise health care costs and reduce choices for consumers. that company raising earnings forecast. all companies say they are going to fight his lawsuits but should mention sigma set -- cigna saying these -- umana saying they do not know when the deal will close. we have a couple of cross-border deals with, to buying joy global. 19% gain and the other being bought by swiss company for $1.5 billion. all out of order, there's so much going on all the sudden. scarlet: thank you for that wrap

up of all the m&a and movers. let check in on the bloomberg first word news with mark crumpton from the newsroom. mark: the paris terror prosecutor says the man behind the wheel of the truck that killed 84 people last week had accomplices. he said the man had been planning the attack for months. five suspects are facing preliminary terrorism charges for their alleged roles. data from the phone show searches and photos that indicated he had an studying an attack and 2015. ivanka trump is introducing her father. she will try to sway female voters who have been reluctant to support him. according to a new survey, mr. clinton and mr. trump are both at 44%.

11% of voters are undecided. in a four-way pull, mr. -- mrs. clinton leads mr. trump. libertarian gary johnson is at 5% and the green party nominee is at 1%. 12% are undecided. jamaican sprinter and six-time olympic champ is saying bold says that the ban on the russian team sends a message that should frighten teams. an appeal was rejected by 68 russian athletes. bold condemned the doping problem that has plagued his sport, describing the crisis as really bad. global news 24 hours a day powered by our 2400 journalists in more than 150 news bureaus around the world. i'm mark crumpton. this is bloomberg. scarlet: the list of wall street firms protecting treasury yields will stay low is growing following a record-setting rally in bonds. charles schwab has joined morgan

stanley in predicting yields could set new lows in the months ahead. treasuries have benefited from investors searching for alternatives in a subzero world but could and improving u.s. economy change all of that? let's bring in the head of fixed income markets at raymond james. where do you sit on this debate? guest: we have benefited in the treasury markets from global events, so typically you would not think it would be that low at this point based on where the economy is. that is starting to reverse a little bit. whether the reverse is 30 or 40 basis points will depend on the numbers. but if you look at the spreads the flatter they are, it tells us there is still room to go down should an event change. it's just not happening. shery: are these high yield and risk free as investors think?

guest: as far as we know, there has not been a real test of the treasury credit quality, so the assumption is they are higher yield compared to any other sovereign debt in the world. as far as safety, we assume it is the safest in the land. shery: i want to ring in the inflation factor. if you take a look at my bloomberg, tenure treasuries are in the negative, the lowest since 1980. when you factor in inflation, where do we stand? guest: the economy starts to reinflate and inflation number start to go back up. it does factor against buying treasuries, but when you compare the treasury yield and the liquidity and safety of the treasury yield, it's almost how you would think of a negative rate interest on bond because it is the higher yield on a national basis but it is the safety and liquidity you get from that which is why this

flight to quality is happening. scarlet: against this act drop, we need to point out where people think this is headed. right now, traders have turned a little more hawkish in recent days. the odds of a rate increase our 44% and you get to more than 50% once you pass march of 2015. the numbers change are medically. 34% odds for march, and you don't see anything above 50% through september 2017. to what extent is the fed or central banks taking their cues from the pricing of odds versus the economic data you referred to earlier? guest: it is tricky to predict and the further you go out on each meeting, the margin for error increases quite a bit. what we do know is the fed is not likely to do anything next week.

after that it becomes a little more of a probability guessing game. if you pen most economists down and major players in the bond market, they are going to tell you they think there is at least one rate hike with the fed in 2016. that can change but it is better than a 50% chance in most people's eyes. shery: even if the fed focuses on a stronger u.s. economy, we see time and again the fed tens to react to market reaction and they don't move. what is the risk for bond investors? guest: it is not in the fed us mandate to pay into the markets and how they are going to react. it is actually happening and i would say the market and the fed are more in sync now than they have been over the last two years. this telegraphing of rate increases against the markets feeling that it shouldn't happen is a risk for bondholders.

the inflation gauge is still well within the fed target although that could change. as long as those conditions remain, we are at a favorable level for the interest rate. scarlet: the fund managers have boosted their holdings to 23% of assets, the highest may 3. how do you want to be positioned heading into next week's fomc. the fed may drop signals about what is to come or at least give signals about its thinking. guest: right and they have done messaging before and the market has adjusted to that. the best way to play this is not necessarily the 10 year. you can pick up liquidity and if you make a mistake, it's over in five years. that this is one where we are handicapping it against global events and not necessarily

domestic events and that remains to be seen how that is going to work out for the fed. shery: japanese investors think that because things went to below zero, that is forecasting what could happen with u.s. treasury. guest: there is a separation there because we have growth there with 150,000 jobs a month being created. that creates a different scenario than japan or europe. what we're dealing with is a moderately growing economy, trying to predict the yield curve aced on that is a difficult transaction. scarlet: thank you for joining us. shery: coming up, it is our mistry stock of the day -- our pick is headed to its best day this year after strong bidding on this product has been in a long recovery from last summer's messy divorce. this is bloomberg. ♪

shery: you are watching bloomberg markets. scarlet: let's head to our markets desk where julie hyman has the big reveal on our mistry stock. making a new palette the box office may be a growth tip for our tech. it has been a long recovery from last summer as he divorced. scarlett has it. shery: paypal? scarlet: ebay. julie: we are talking about the concert box office because ebay owns stub hub. that is one of the reasons ebay saw growth last quarter.

it also sort of tried to migrate to being a marketplace for hard-to-find items. here is the one year since the split with paypal. let's take a look at what it is doing today. it seeing its biggest one-day increase in nine months and hit a record high. it not only beat in terms of the second order analyst but raised its revenue profit forecast with second-quarter revenue up percent. this seems to be reassuring to investors who were unsure about its growth trajectory after paypal. if you look at how the companies business divvies up, it's a mostly fixed price business. it is mostly new things being sold on ebay versus re-sold things that were the original source of his mess. taking a look at some of the other earnings winners today

united rental shares are surging after the company's earnings beat estimates. improving rental rates. the maker of industrial products and domino's pizza coming in with earnings that beat analyst estimates. more people are ordering in. scarlet: i want to hand it over to matt miller who is driving -- you is diving into general motors results. matt: one of the leading stocks today is gm. the automaker raised its guidance and posted a record second-quarter earnings again. i want to get under gm's it in today's the numbers don't lie. the company beat estimates by a wide margin. this should come as knows a price. general motors has beaten estimates by at least 15% for five straight quarters in a row. one of the concerns for investors was slowing growth in the u.s.. industrywide as far as auto sales, which are expected to

fall short of last year's all-time record. if that happens, it would mark the first annual decline for u.s. auto sales in seven years. in the face of this, general motors was able to post north american income fueled by its truck sales. you can see gm's ratio of trucks to total sales and car to total sales including suvs and crossovers. american's reference for these cars is more lopsided than ever. the growth intro sales is key for gm as it battles for, which has been the pickup sales leader for nearly four decades. you can see ford is on pace to keep that title just slightly this year. it is not just about the u.s.. gm's international operations outsold north american

operations 4.5 million vehicles in total. it's important for them to do well in this world, and that can be a problem. in europe, where general motors has struggled to make a profit, the company did post earnings its first lacking in the market since 2011, but europe is going to have a bit of a problem because of the brexit. the plan to exit the eu could cost the company $400 million in the second half of the year. we will be following this stock throughout the session as it touches its highest level in three months. shery: thank you. still ahead, are stocks close to hitting the peak question mark this is bloomberg. ♪

scarlet: this is bloomberg markets. i'm scarlet fu. shery: i'm shery ahn.

u.s. stocks are trading from record levels, but they have been on a hunt since the brexit vote. but our valuations keeping pace with reality or are equities due for a letdown? what's join cory johnson and carol massar on the radio. carol: this is the bloomberg advantage and charlie reinhardt is with us he's ahead of portfolio management at mainstay investments. i have him at $82 billion in assets under management. the market environment is interesting. we have seen quite a run-up on the equity side and we also see the treasury side with rates staying low. does this market make sense to you? guest: i think it does. if they are looking at historical earnings, they think it is expensive. we think it is pretty reasonably

valued where it is today and the way we arrive at that is take the inverse of the pe ratio, subtract the feds measure of inflation and you get a real earnings yield near 4% that is close to the present average. cory: but you don't get earnings growth. we have markets at near equity -- near highs and we are still getting into this quarter, but we are going back nine months and earnings are just not rising. guest: if the expectations prove to be right, this is the fifth quarter will have negative year on year earnings growth. but we are getting closer to that day when good old-fashioned profit growth should turn around. we are anticipating in the second half of the year that we will be getting back to the days of having good old-fashioned profit growth. and that will follow into next year. cory: every year we hear the

second half is going to be better. ibm is a perfect example. the last two years, ibm has had a week first half and said don't worry, we are going to make it up in the fourth quarter. they missed in both quarters. they have said it is a big, important stock and they tell the market we fool you once, we for you twice, believe us this time. guest: what is different this time around is the isn survey is moving. where previously it had been decelerating, that is where the pace of the cyclical, manufacturing part of the economy, that's going in the right direction. the collapse in energy prices which have rebounded quite a bit, those effects are wearing off. we do have positive economic growth and low but positive levels of inflation which to gather are the revenue line for companies when you amalgamate them.

carol: but again, you don't think valuations are too high? guest: we are not anticipating p/e ratios to go higher. we are anticipating good old-fashioned growth. who knows what's going to happen in the next two months but over the next few years, we are likely to see total return growth powered by earnings. carol: what specifically? guest: it's not an individual sector. what we want to look at our companies that are good stewards of capital, that are returning cash to shareholders. carol: you like dividend. guest: i do. you can increase the port folio by having solid cash flow and revenue streams. cory: what do you think when the market at full value, dividend payers are the least likely to

expand earnings and that is why they are paying dividends -- so that you won't see real growth in the stocks and the opportunity to catch those earnings is not as likely for dividend ayers as other income? guest: companies paying dividends, some of them are growing reasonably well. we are not looking for robust growth, we are looking for a single-digit return environment. carol: if you look at the global equity space commie see a lot of money flowing into the equity areas. are there better opportunities overseas versus the united states? guest: if you look at international developed equities, they are less expensive and higher dividend yields. they have been beaten up a little bit but now that we are moving into another chapter, we hear prospects of more stimulus from the european central bank. they did not do anything the

last time they met, but they have said that they might. i think always, you need to be diversified and build a port will he or that can withstand multiples. we like global equities and we think there's tremendous opportunity in credit. carol: thank you very much. scarlet: thanks to carol massar and cory johnson at bloomberg radio. shery: we are awaiting the joint news conference between french president francois hollande and british primus or theresa may. this is bloomberg. ♪

[hip hop beat] ♪ olympics 2016, let me get you on my level. ♪ ♪ so you never miss a moment, ♪ ♪ miss a minute, miss a medal. ♪ ♪ why settle when you can have it all? ♪ ♪ soccer to wrestling. track and field to basketball. ♪ ♪ fencing to cycling. diving to balance beam. ♪ ♪ all you have to say ♪ ♪ is, “show me,” and boom it's on the screen. ♪ ♪ from the bottom of the mat, ♪ ♪ to the couch where you at? ♪

♪ show me the latest medal count? ♪ ♪ xfinity's where it's at. ♪ welcome to it all. comcast nbcuniversal is proud to bring you coverage of the rio olympic games. hohes w'oiithongestc? estc.thlais hotas hke hyson' at'ey llg ca h ke cwistomin biness rn fid , p cth boue.ju ddstus azetomimeag ywiourofias sgeh u'd ' yeastsereies ady heesev.or upde.'it'restn i, w c elanowp r ynebu ss. u'e e dry.oding uc pwiwirofi hthatpsusurs.in ascomcbune t bubufosssi. mark: from bloomberg world headquarters in new york, i'm mark crumpton. you are looking at a live shot

from quicken loans arena in cleveland, ohio. he likely nominee, it will become official tonight when he accepts the party's nomination. he's doing a live locked through of the arena at this hour. you see his daughter in red who will be introducing her father this evening. mr. trump doing a live walk-through. lot of the establishment republicans and those who have supported mr. trump through this entire process anxiously awaiting his speech tonight to see how he can connect with the american people, those people who may be skittish about voting for him and what he will say to get the electorate to come out and vote for him. this has in a very unlikely campaign from a very unlikely candidate raising lots of issues and lots of higher during this campaign and tonight, the nation and the world awaiting his speech to formally accept his party's nomination as president. a day after being food following

his primetime address former presidential candidate, ted cruz is defending his refusal to endorse mr. trump. speaking to a divided texas delegation, senator cruz said a pledge during the primary to give unconditional support to the party's nominee disappeared once the attacks became personal. senator cruz: i'm not going to get into criticizing or attacking donald trump, but i will give you this response. i am not in the habit of supporting people who attack my wife and attack my father. mark: senator cruz added that he is not voting for hillary clinton. mrs. clinton is expected to announce her choice for a running mate this week but clinton has reportedly made up his mind. the new york times reports that he has expressed his support for virginia senator tim kaine. he believes the former virginia governor's grown will appeal to voters and prepares him to be

president. in london, jeremy corbyn kicks off his campaign to head the opposition labor party. he lost a no-confidence vote last month and is promising a different and fairer, kinder u.k.. >> what is holding people back above all is inequality neglect, insecurity, prejudice and discrimination. in our campaign, i want to confront all five of these bills head on. mark: opponents say his campaigning against the brexit should elect the qualities to be prime minister. the islanders are said to be in talks with owners of the new york mets about building a hockey arena adjacent to the mets citi field according to people with knowledge of the situation. last season was the islanders first in the berkeley center. fans and the team's owners were

disappointed in that arena. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. shery: general electric is a great long-term investment according to the ceo and founding order of triumph fun management. earlier today, he was asked where ge is under the ceo's leadership. >> they made a decision that was earthshaking for ge, to get out of the credit business finally, and it was a brilliant decision it was a brave decision, it was very well-planned. when you take ge credit away from the rest of the business, the son finally shines on assets. probably the best collection of industrial assets on the planet.

those assets, along with a commitment to reduce overhead, stick with their left and not go into new verticals, i think ge is phenomenal and has an great for all investors who came in at that time. the stock is well above 30 now and we think it is a great long-term investment in here. >> as we look forward to a presidential election, we will have a new president one way or another. what does business need in leadership in this country in order for them to succeed and have growth again? >> this country needs to respect one of the fundamentals the united states was built on, and that is capitalism. the further we get away from capitalism, the further we get away from a growing middle class

in this country comprised of small businessmen that don't have to go through massive regulations in order to start up and run a business the better off we will be. that is where the employment grows in small to medium-size businesses, not the big companies. the egg companies are always figuring out a way to do things more effectively and more efficiently and reducing labor and that is their job. i'm not finding all with that, but it is the small business guy who hires people. the plumbing supply house and the painting contractor. we need more of those in this country and we keep putting regulations on them that makes it so difficult for them to start and grow their business. we need to bring back the trillions of dollars overseas

and bring them back in some economic way, and 8% tax or 10% tax, the highest i can envision. bring that money back and have investors here. that money is never coming back and as a result, we keep robbing ourselves of what our great assets right in front of us for the taking. scarlet: still ahead on bloomberg markets, we are awaiting the joint news conference of french president francois hollande and new british prime minister theresa may to begin. you can watch it on your bloomberg at live go. shery: and we still have the live pictures out of quicken loans arena. you're looking at donald trump and his daughter doing a walk-through at the republican national convention. donald trump is set to accept his party's nomination tonight

with the theme "make america one again." this is bloomberg. ♪

shery: you are watching bloomberg. i'm vonnie quinn. >> this is your global business report. vonnie: the european central bank stands firm on rates for now. it wants to see how the brexit vote will affect the european union. >> a japanese company optimistic about the mining business, paying nearly $3 billion for joy global. fracking has been a boon to the

u.s. and is -- u.s. energy markets, but at what price? the brexit vote is weighing heavily on the european central bank with policymakers deciding to keep their sales program unchanged, saying they need to assess economic damage inflicted by the vote to leave the european union. meanwhile, more evidence the vote is having an impact on the british economy. in june, retail sales rather biggest drop in six months. they fell worse than expected. the last day for the survey was july 2. nejra: unilever reporting second-quarter sales growth that beat analyst estimates. the maker of and in jerry's ice cream delivered sales gains in deodorant and hair care products. revenue rose or .7%, gains coming from higher prices for its good. the ceo said the company is

pairing for a tough year. >> if you look at the economic data, you see less job openings and the effects are starting to ripple through and a reduced estimate for the u.k. economy. when they have a high level of uncertainty, investment stays away. what is this hates is uncertainty. nejra: a big takeover in the mining equipment business with, to agreeing to buy joy global for 2.9 billion dollars, a 20% premium to their closing price yesterday. joy global is the largest independent maker of underground mining equipment. two believes a commodities rebound will continue. employees at three of wall street has a guest investment banks may get a much smaller bonus this year. jpmorgan, goldman sachs -- wall street firms have been cutting

costs and stiffer regulations are hurting revenue. vonnie: time now for our bloomberg quick take where we provide context on issues of interest. fracking to extract oil and gas from shale rock has produced a flood of new energy in the u.s. and canada. the question is whether the cost can be balanced or that fracking presents a threat so great that it must be and. fracking was responsible for a 54% increase in u.s. out put of oil and natural gas from 2008 through 2015 and has made the country the biggest producer of the two. environmental concerns have provoked a backlash. the first commercial use of fracking was in 1949 in oklahoma. the tech eight involves forcing

water mix with sand and chemicals into a well to create fissures in shale rock. advances in and other innovation horizontal drilling, came and provided access to shallow layers of shale deep underground stop the subsequent exploitation of the shale formation in texas proved large-scale fracking was economically viable. advocates went out that abundant natural gas has left many power plants in active and abandon coal. consumption hovered around 10% levels last seen in the 1980's. the environmental risks proponents argue can be mitigated. opponents say fracking is to hazardous to tolerate. they say it not only offsets greenhouse gases from fracking but could out weigh them.

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. ♪ scarlet: the joint news conference between the french

president and new british prime minister has just begun. we expect francois hollande to talk more than about the brexit, but about the plan to build a nuclear power proliant -- power plant in the south of england. this comes one day after her first premise or's questions and meeting in with angela merkel. president hollande: the unity faced with this terrible act is a lesson of history because during the course of the 20th century, the u.k. has always been at france's side and france at their side to face major dangers. i was with david cameron a few weeks ago for the centenary of the battle of these tom and during that terrible title, hundreds of thousands of british soldiers died for our freedom.

that is what unites france and the united kingdom. during the course of these many decades and centuries, there has been between our two countries a relationship that has become strong as testified by the hundreds of albums of french people who live in the u.k., who work there and find it there destiny as indeed there are many britons living in france, not just during the holiday time as tourists, but have decided to reside here. these ties will never be loosened and this is what our two countries have in common in the face of the challenges of the world france and the u.k. and members of the un's security

council act together and act jointly in the fight against boko haram and we are active together in the middle east in the levant, syria and iraq. we have this duty to ensure not just our own security, but the security of europe and to uphold values on a global scale. there is also defense cooperation that has been strengthened these past few years which covers what is essential, the nuclear deterrent. a few days ago debate took place in the house of commons and you heard once again confirmed the u.k. commitment for the nuclear deterrent which will lead to further new relations between our two

countries. the trade between our two countries -- [audio difficulties ] scarlet: we had a little bit of technical problems, but it seems to have been restored. let listen and again. president hollande: if you weeks ago, we wanted to give concrete manifestation to our commitments through an agreement signed in 2010. they took the agreement and both france and the u.k. have applied

fully and have indeed reinforce them. you yourself made it possible to have additional financial contributions over and of what has happened so there can the humanely and with dignity the treatment of these people who seek to go to the u.k. and cannot access that because they are not recognized with asylum status that can be granted in france which has allowed a number of difficult situations to be treated honorably. and there are u.k. commitments that have then respected that we will be strengthening with regard to minors and what was promised is now fully operational.

isolated minors who have families in the u.k. can be received. that is what we are doing together and we will continue to work together but the u.k. has taken a decision through the referendum. the united kingdom has decided to leave the european union. it's decision, its responsibility we accept that decision and we would like it to be reflect that in the best possible timescale to open the negotiation to establish what will be the relationship between the u.k. and europe. for france, the sooner the better in common interest. there cannot be discussions or pre-negotiations before the negotiations, but we can prepare this negotiation and understand your government that has just been formed needs this time, but

let me repeat, the sooner, the better in the interest of europe because france has this responsibility in the interest of the u.k. and the interest of our respective economies because uncertainty is the greatest danger because when economic players doubt what we will do, not what the decision will be but the conditions under which the u.k. will leave the eu and the relationship that will be maintained between the european union and u.k. there can be risks for the stability of the european economy and therefore for jobs and we are very vigilant and that is why i wanted us to have this

discussion and thank you very much for coming to paris and let me remind you that in they've either against terrorism, france and the u.k. have a high degree of cooperation and have managed jointly to exchange information in the past that has been extremely useful and we will continue to do that in what is part of a bilateral relationship between france and the u.k. and what will be the relationship between the u.k. and eu and the negotiations, i would like to thank theresa may for being in paris. thank you. prime minister may: i am delighted to be in paris this evening and express the profound relationship between our countries. i'm delighted to have this opportunity so soon after taking

office to underline my commitment of the profound friendship between our countries and our people. a friendship that has never been more important than it is today. a week ago france suffered another horrific terrorist attack and on behalf of all the british people, i offer our heart told condolences to all the loved ones of those so callously killed and injured in nice, including a small number of perdition casualties. these were innocent victims murdered by terrorists who want to destroy our democracy and our way of life. as the president and i discussed today, we must never let them win. last year, in the wake of the "charlie hebdo" attack we said to the world we would not let these extremists divide us. in november, after the devastating attacks in paris, british fighter pilots joined their french counterparts to attack and destroy targets in

syria. now in the aftermath of another attack, it is britain that will stand with you shoulder to shoulder as your great ally and friend. the intelligence and security cooperation between our countries is something that will always indoor, even after britain has left the european union. as i have said, brexit means brought it -- means brexit and i think we will make a success of it not just for the u.k. but our european partners. we will work to keep our people safe and stand up for our values around the world. we did so long before the european union existed and we will continue to do so long after the u.k. has left. that means it issue to our growing cooperation on terrorism, we will strengthen our whiten -- strengthen our defense relationship between our countries. britain brings a great deal to the table and we will continue to meet our naval operation and spent 2% of our gdp on defense

and spend .7% of national income on aid. this weekend, i made it, as you said, my first action as prime minister to pursue our nuclear deterrent. together with france, we are working on the next generation of military deterrent to develop the most advanced combat air system anywhere in europe. returning to our discussions on trade and economic cooperation i said to president hollande that i want written to continue to work and tuesday economic rose in both of our countries. last year, the value of our bilateral trade reached fifth 2 billion euros. we are one another's fifth largest export markets. french companies employ 350 thousand people across the u.k. and we are the fourth largest investor in france. this matters to both of us. as the u.k. leaves the eu, we

will have to determine how to maintain the closest possible economic relationship between our countries and it will take time to prepare for those negotiations. i understand the need for certainty and confidence in the market and that is why i have already been clear that the u.k. will not invoke article 50 before the end of this year. i hope we can all make the most of the next six months to prepare for these discussions in a constructive way and maximize opportunities for the u.k. and eu. i want to reiterate written means open for business, that french citizens and their eu counterparts can continue to work in britain and they are welcome in the u.k. to conclude, britain is leaving the european union, but we are not leaving europe and we are

not walking away from our friendship with france or our other european partners. britain and france are two allies that stand together looking out to the world fighting the values we share. as i said in my first speech as prime minister we share a firm belief in the values of liberty, galaxy and fraternity and together, we will always defend them. >> mr. president, did you mention a deadline or cut off date to notify article 50 and what will happen to the thousands of french people who reside in london or the u.k.? thank you. prime minister may: i think you just heard my speech. i think it is sensible to ensure the negotiations written to leave the european union art done in as calm and orderly a

manner as possible and that require some preparation to be made. that is why i have said consistently that we would not invoke article 50 before the end of the year. with regards to the french citizens living in the united kingdom, there is no change to the position of people living in the u.k. or british citizens living in france or other eu member states. in the future, i want to guarantee the rights to those people living in the u.k. and i would expect to be able to do so and the only situation in which that wouldn't be possible is if british citizens rights in european member states were not being protected. >> article 50 can only be invoked at the request of a country and, in this instance the u.k., so the discussion is

between the 27 and the u.k. and it is a mutual understanding that must lead to triggering this ross us as soon as possible. but we must mutually convince ourselves that it is in the interest of europe and our respective countries to open with a basis that must be prepared by the british government and i fully agree with that. as to the situation of french people living in the u.k. and britain's living in france, let me say the u.k. will remain a member of the eu for the full time of negotiations and nothing will change for our citizens. after the negotiations, the rules will fit, there is no doubt the french people who reside in the u.k. will be able

to continue to work there and the british people in france will continue to work there -- to work there and stay as they wish. >> that was a joint press conference with prime minister theresa may and resident francois lawn. reiterating a couple of -- francois hollande. they were reiterating some things that she said with angela merkel, that the u.k. will begin article 15, begin the process of leaving the european union. she said that french citizens can continue to work. >> we're just hearing francois lawn -- francois hollande. he wants to work on trade.