francine: the g-20 takes on the global ambition backlash. trump and terror, how much will politics play on the boj and fed decisions? controversy ahead of the convention. the today as the head of the committee resigns over an e-mail leak. clinton comes through unscathed. -- the long fight for survival comes to an end. ♪

francine: welcome to "the pulse." live from bloomberg's european headquarters or dime francine lacqua. let's get to the markets in a second because we have some breaking ifo data out of germany. this is some german axis. -- german businesses, 108.3. .t is better than expected the current conditions are also better than expected. what they do is go around and talk to german businesses. they ask how confident are you about the future guy: -- the future? brexit, also just after so interesting as we start to pile on data that gives us a glimpse of what the european economy will look like. germany business confidence, the ifo figure better than expected. we will speak to the ifo time ont at 10:15 u.k.

bloomberg surveillance. --ing up on the pulse is will be talking about the drinks maker buying grand marnier. the plans for that. we'll be looking at consumption around the world. as promised, this is what we are seeing on the market. european stock hovering around a one-month high after they recovered some of the losses since the cave voted to leave the u.k. union -- the european union. there is so much expectation. this is probably the understatement of the year. there is so much expectation on what governor kuroda will do at the near -- at the end of the week the pound. this get to bloomberg first word news with caroline hyde. caroline: welcome back, francine.

finance chiefs from the world's biggest economies escalating concern about sentiment. a meeting in china, members of the g-20 discussed renewed efforts to use this go -- christine lagarde said there was a consensus that more news to be done for shares to benefit from growth. bruised 10omber has people at a music festival in germany. the attacker was a syrian refugee had been denied asylum. he was allowed to stand the country because of the danger of returning home. an 18-year-old iranian german gunmen -- verizon is set to buy yahoo!'s core assets for $4.8 billion. the announcement could become before trading begins today in new york. the deal is said to include yahoos real estate assets with some intellectual properties to be sold separately.

yahoo! will continue to hold stakes in alibaba and yahoo! japan. uk prime minister theresa may to discuss-- preparations for leaving the european union. britain's only land frontier with another immune country. it follows chips to scotland and wales at sea -- as she seeks a u.k. wide approach to brexit. global news, 24 hours a day, powered by 2600 journalists in more than 120 countries. of course, you can find more stories on the bloomberg at top . i am caroline hyde. francine: welcome to what will be the busiest earnings weeks of the quarter. alphabet, amazon are reporting. europe, the themes are banks. we get an update from the troubled lenders, deutsche bank.

are things improving? getting out a heavy earnings pack. switzerland's -- reported a rise in first-half's profits. we spoke to the ceo in a bloomberg first word interview. >>, we wererth -- looking at low trading volumes. if there was good news related to brexit, it is that investors are back in the market trying to understand what to do. activity levels have picked up across the board. asia, europe, americans, we see clients being engaged, needing a lot of guidance. more to come friendly. -- more to come frankly. us,cine: here to join isabel. great to have young program. we have a huge week ahead of us

at central banks and a lot of earnings. how does that translate into your world. isabelle: you were right, it is a very busy period. when we step back and look at where the market is gone, i don't think anyone thought we would be in the market -- inflicted the post-brexit at 25, if i look at effects of volatility, it is due to compared to where it was. if a look at stock markets, they have retraced all of their losses and i don't think anyone expected it the ftse to be the best performer. caroline: -- francine: why is that? central banks and markets are mispricing risks because the central banks are there, or is it in relation to brexit? isabelle: that is a very good question. i think what is happening is you have investors sticking on piles

of cash. cash burger park it -- cash burns your pocket. byhink it has been helped cbp and the lack of supply. investors are starved for yields. corporate are not issuing, so it is sustaining the markets. our clients at the moment are asking what do you think the trigger point is going to be? -- we haveger point stress tests of banks at the end of the week. we know that central banks are going to be here and they are going to do their job to try and support the market. there is a bit of a wait and see and markets -- investors do not have a choice. they have to put money to work. on 12% moreitting of liquidity trying to make sure they are ready for outflows.

this is not materialized. francine: are you concerned about some sort of asset bustle -- asset bubble? it seems crazy in certain instances that europe paid to borrow -- or paid to hold some of the corporate bonds and when you have the ecb sweeping up so much, are you in risk of a inflection point? isabelle: the point you raise is valid. 1%.trades in yield below clearly, is cheap for corporate to borrow. i don't think if i please myself -- if i place myself in your shoes, it will change anytime soon because of the lack of supply. it is a great time for issuers to come out of the market. i think we'll see the market being supported -- supportive as it has been.

if you look at that, i think that is going to carry on. the question is what is going to be the trigger point, because what i find were some is the market being it mere and that's being immune to everything that is happening in the world. -- a market being immune to everything that is happening in the world. it is a wait and see mode, probably exacerbated by lack of break.ty and the summer in some ways, i would watch out for what is going to happen in september. i would expect hillary -- because if you look ahead, there is nothing that would stop uncertainty to come with all of the elections coming up. u.s. election, and then you have german, french. francine: thank you so much.

the managing director of ubs stays with us. we will be talking about liquidity and what the fed and the dollar can do. brexit and backlash. g-20 leaders hedging inclusiveness to counter the anti-globalization push back. the italian distiller buys up grand marnier. we speak to the ceo exclusively. the democratic national convention kicks off in philadelphia. another e-mail customer sete. we'll have plenty more on that. this is bloomberg. ♪

>> welcome back. let's get to the bloomberg business flash with caroline hyde. caroline: ericsson says hans bess burke will step down as ceo. the move is effective immediately. a search for a new leader is completed. as much as $6 billion has been wiped off the market value for nintendo shares in japan. the impact from the world why hit pokemon go will be limited. shares cannot fall more than 18% -- the correction comes after nintendo's shares almost doubled since the game's release. buy yahoosset to core assets. the announcement could come before trading begins later today in new york. the deal is said to include

yahoos real estate assets with some intellectual property to be sold separately good yahoo! will continue to hold stakes and alibaba and yahoo! japan. ryanair has warned it may lower its profit forecast amid weakening travel demands following britain's decision to exit the european union. ryanair says the uncertainty could lead to an 8% drop in fares. the net profit in the latest quarter increased 45% as growth upset declining fares. uk's bookmaker maybe facing a takeover. confirmed theye are evaluating possible joint offer good -- offer. the offer could be worth about 3 billion pounds. francine? francine: top of the agenda at the g-20 meeting in china this weekend was taking on the globalization backlash. finance heads of the world's

biggest economies outlined their growing concerns about a wave of anti-globalization sentiments. chief among those was the brexit vote and jim yong kim warned that the decision was -- he outlined its impact on global growth. >> we have wanted to give good information, good news to people for a long time, but forcefully we have to keep having to downgrade. it is understandable. we thought the u.s. was solid, the european union, the eurozone seems to be getting better, even japan seemed to be doing a little bit better. brexit was a big hit. we're still trying to understand exactly what the applications are. it looks like global growth will be disappointing again. francine: the world bank president there. isabel, when you look at g-20,

again, the emphasis -- we have been waiting for them for four years if not more. isabelle: absolutely. when you look at what is thatning and the life line central bank has put into the market to try and keep it contained, i don't think they are going to manage to do everything on their own. it clearly says that something needs to happen. there has been debate in the u.k. about what are we going to do? our going to cut tax rates to make it very attractive. there is very -- there's a lot of debate around that. i don't think it can carry on without any more action. how do you do it in a corrugated faction -- in a coordinated fashion? francine: it seems unlikely that china would fit into that. negative rates will go forever below zero?

i think lower for longer is clearly going to happen. bank of england was going to tighten rates. the fed was going to tighten rates. we had one rate hike which is so flat it was almost a case of you cannot not do it. they are going to be debating in the u.s. that i think the situation is slightly different. are you going to keep rates too low and are you going to damage the economy? in europe, it is good to stay lower. -- in europe, it is going to stay longer. francine: i would put deutsche bank, the more you have central bank action, unless you have structural reform. the more difficult is it for the markets to price things right. isabelle: there is some logic to that. central bank policy can carry on is inhis -- the problem europe it has been difficult for people to agree on fiscal policy.

now, you are going to add a layer of complexity, because with brexit, the u.k. can do more stuff on its own to remain. the pressure -- not to want to play the devil's advocate or to be a politician, if you look at what is been happening, they are trying to negotiate a deal where the major players, france, germany, holland, are under pressure with own electorate. that is going to be very tricky to get. we are going to see some tension and play. having back to your point, are we going to see lower rates for longer? if we look at switzerland, we can learn some lessons. caroline: on how not to do -- francine: on how not to do things? isabelle: negative rates up to 20 years. what we have seen for corporate issuers is the corporate spread has -- at some point investors said enough. you have one massive better out

there which can carry on buying if you want to. -- if he wants to. if it were to be lower, you can see it in europe. francine: are we going to see a dollar rally this year? isabelle: i think the dollar is one to be stronger. it is the reason -- there is no reason the dollar isn't going to get sugar. the wait and see policy is to carry on because we have u.s. elections. now we have so much turmoil around, i think the wait and see is going to be more so one of the things to take into account. francine: isabel, thank you so much for joining us. up next, the multibillion-dollar funds but no elections. we bring you the turkish prime ministers solution to getting the country back on track after

the failed coup. this is bloomberg. ♪

francine: welcome back. after turkey's failed coup , bloomberg crackdown has spoken to the prime minister. he told our editor that rating and is -- rating agencies were -- the rating agency's downgrade

was premature. >> the coup attempt had economic damage that has incurred on the turkish economy. s&p immediately decreased our rating and i think that was not an ethical stand. it was taking benefit of the situation. we are a nation which is overcome and big coup attempt. we have struggled to keep the moxie running and these such agencies should not be rushing into situations. they should not be deciding immediately. we would have to expect them to wait and then decide on this measure. this was something that was settling for us. the turkish economy did not deserve this if you look at the indicators. when you look at european countries, the debt is considerably higher than our debt. when we look at the gross national income and take a portion with debt, the death of turkey is around 30% to 32%. this is 116% in the european

union and in other countries it is ready to percent. when we look at the creek. , there is almost -- at the criteria, there's almost no country in the european union that is met this criteria, but since the 2009 financial crisis, turkey has a very smooth performance. the banking sector is very strong. is -- this istio almost double the 8%. taking into account all of these factors, what criteria do you have to reduce the ranking, reduce the rate -- reduce the credit of turkey. this does not base itself on any criteria. it is nine the article and political decision. --this is an ideology go ideological and political decision.

there has been damaged but i'm saying this to give you an idea the dimensions of the damage. when we had a crisis with the russian federation about the russian aircraft, there was some movement in our economic indicators. the movement and the coup attempt have been similar to that. it has not been a devastating effect on the turkish economy, affecting all economic values. this was not such a change. there was a miner decrease in the stock exchange. there was a simple fluctuation to the exchange rate and the interest rates, there's been some movement but these are all temporary. i do believe in the coming days, they will go back to their normal levels. francine: that was the turkish prime minister. we'll have plenty more of that interview. -- which have spread concerns that the president is now taking advantage of the upheaval to

neutralize his opponents. the prime minister saying that purge seems to be nearing an end . this is a picture for the markets in terms of what we are seeing in european stocks. this is the one thing we have been trying to figure out. it has been hovering around the one-month high come after last week. they cover -- they recovered a lot of the losses sent -- losses since the u.k. voted to leave the european union. this is the week of central banks because after pumping money into the -- global fund managers have become underweight shares in europe. they want to know what the boj will do and the fed will do. the dollar strength we are seeing weighing on precious metals and investors looking toward a lot of the central banks meetings. we are expecting some inflation forecasts for the u.k.. ceo --up next, papa rate his recent grand marnier

acquisition. changing paste. we'll be talking about cocktails -- changing pace, will be talking about cocktails. this is bloomberg. ♪

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francine: welcome to "the pulse." let's get to the bloomberg business flash. german business confidence deteriorated less than expected. it was stood the initial shock of britain's vote to leave the eu. a saudi company involved in the

biggest default is close to ending its --. they signed a deal with committee representatives. the company guarantees creditors will recover 40% of claims. a suicide bomber has wounded at least 12 people in a music festival in germany. the explosion follows another attack on friday night, in which an 18-year-old german gunmen killed nine people. you can find more stories on the bloomberg. francine: thank you. european markets higher this morning. let's head to mark barton for your check.

index, alltoxx 600 19 arising. that is the best winning run since may 27. it is 1.6% below 11. this is a lovely chart. global investors are fleeing from european shares despite the is relative to european government debt and u.s. equities. the sovereignis bond index yield versus the euro stocks 50 yield. 3.7 percentage points. the white line is relative to the s&p 500. what a wonderful chart.

lots of corporate news to tell you about. itsair warning it may lower profit forecast amid weakening travel demands stemming from brexit. there are risks. the forecastieved is steady, sending shares up 5.6%. executive isf stepping down after 6.5 years at the helm of the telecommunications equipment maker. the shares are up by 4.2%. francine: thank you. let's turn to beverage business and a spirits business added over 50 brands of beverages for takeover of french look or maker grand marnier.

quor maker, grand marnier. about slowingday growth, people holding back. economicnot much good news. has it impacted how people drink? big change.ot seen what we see is our core development market are still developing nicely. if you focus on our business, where the core of our sales is in developed markets, we continue to prosper. francine: if i feel richer or feel inflation is not too bad, on how manyslate

cocktails i drink, whether i go out or drink at home? >> millennials are turning to spirits. we are at the beginning of this craze for classic cocktails. we are well positioned for that. it is a question of generations. in our industry, people don't drink what their parents used to. cocktails were out for a file. we are coming back and starting with the new generation. a whole generation. on the other hand, millennials, what they are looking for is authenticity and craftsmanship. grand marnier feels

like a brand that is outdated. what do you do with the brand -- brand from your? >> it is a hidden gem. bland.great it has been around since 1827. is an iconic brand. it is in every top bar in the world. it is a key ingredient of classic cocktails. is a superior liquid because it is based on cognac. there is work to be done to get the dust off. thatve shown in the past we are able to do that. have you identified more synergies? >> we took over the sales on the first of july. we are selling it in our

subsidiaries. largee kicked off a on a globalrch plot scale. we will get the results by the end of the year. we will start seeing changes next year. there is one that is a unique piece of real estate. an incredible estate that has been in family hands for a long time. it could be worth 300 million euros up. the way we structure the deal is that the first 80 million after-tax and after transaction cost is ours. has brexit had an affect?

>> we have not seen that. i spent a weekend in london and was pleased to see a lot of orange all around. sunshine and a glass. summer in a glass. i don't think it will affect it. francine: what is your concern? there is a revival of these older fashions, these italian brands. there are things you don't have control over. >> we are exposed to translation, not transaction. the amount we export out of the u.k. is as much as we import into the u.k.. it is a watch at the end of the day.

the chinese market has slowed down a bit. imported spirits have only represented 0.5% of the spirits market. that is not what is going to move the dial for us. the slowdown is because there is less growth? >> the gifting and the high-end business entertaining. francine: you have an insight into how much people spend. certain competitors have to introduce smaller bottles. prison astill a real about owning or drinking a foreign brand. inwe are doing nicely africa. we are hurting in brazil. the premium import brands are growing nicely. local brands and going

for a hard time. francine: brazil, you think there will be a turnaround? politically it is a huge difficulty. you feel like you are impacted? do you get sold off because the markets are not sophisticated? >> we are not immune to it. francine: do people understand that? the share price suffers if something happens to italy. >> the analyst investors are london-based.

lastt our all-time high friday. francine: so people understand. much more ahead on bloomberg. are the security services across europe doing enough? .e discussed that the democratic national convention kicks off today. another e-mail controversy threatens to clout hillary clinton's week in the spot line. this is a bloomberg. ♪

francine: let's get to the bloomberg business flash. the shares lost about 4% during his tenure, compared with a 90% gain for the stoxx 600 for the technology index. nintendo said the impact from go worldwide hit pokemon will be limited. shares cannot fall more than 80% today.

the correction comes after nintendo shares almost doubled since the game's release. for rise and to buy yahoo!'s core assets. the announcement could come before trading begins later today. the deal is said to include the and somete assets intellectual property be sold separately. yahoo! will hold stakes in alibaba and yahoo! japan. iran air may lower its us or -- ryanaireakening may lower its forecast amid weakening travel. latest quarterhe increased 4.5%. william hill may be facing a takeover. have confirmed they

are evaluating a joint offer. about 3r could be worth billion pounds. francine: a suicide bomber has wounded at least 12 people at a music festival near germany. he had been denied asylum but was allowed to remain in the country. the explosion follows another attack overnight. talk about the security situation 98 europe and what the state of attack means for the government. thank you. onish we were speaking better circumstances. different attacks for reasons. anythinge not seen like this since the days of the

red army faction. this is something that has shocked the country. it affirms the worst fears about what might happen as a result of the open door refugee policy. say the horrible shootings on friday, the perpetrator of the attacks was a german nats -- a german national. there are important distinctions to be made in what is likely to become a heated political debate. francine: what does it mean for politicalkel's future. >> she is seen as the leader of the nation. as of last week, the opinion poll ratings were rising. there was a call to her to confirm she would run for a fourth term.

this has come up in a few instances in the last few months, was it the right thing to do? right now, none of her political trying toem to be make political capital out of it. seen as the only person who can fix this problem. francine: you have any eli view of what this means. when you look at the attacks in , does it mean it is giving more of a -- or are we sure etching that? it is playing into her narrative. there is this growing sense of despair. willingnesss of a to give the government the benefit of the doubt.

it probably will help her. taking more global perspective on this, and the dark speech from the end of last week. -- a lot of many dark currents going through the western world right now. ready toforces aren't deal with this. -- maybe theyaid need to be seriously vetted than they have in the past. it does feel like a lot of things are in flux right now. night, it only served to make things more uncomfortable. francine: we will keep a close a shooting in florida. what does it mean for donald trump's presidency? attacks plays of

into his hands? >> it plays into his narrative that things are out of control. it will see how -- it will be interesting to see how hillary clinton plays it out this week. this will be front and center for hillary clinton. we are seeing reports coming in from the u.s. for the shooting in a florida nightclub. of society out of control, security forces not being able to deal with this new environment, that is going to be the major question on both sides of the atlantic. francine: thank you for the update. we will look at another e-mail controversy causing headaches. this is bloomberg. ♪

francine: the company stories this. buy outis expected to the yahoo! $4.8 billion. in blue is a verizon. in white is yahoo!. this is the moment, very

briefly, before the.com bubble exploded, that you saw yahoo! in the sweet spot. you can see the difference. yahoo! selling their assets to verizon. the democratic national convention kicks off today. michael mckee joins us for more. great to have you on the program. the report -- another e-mail controversy is overshadowing the message. >> politics us down after the carnival last week. democrats kickoff, but the calliope music sounds the same. last night, the head of the democratic party was forced to resign after wikileaks released hacked from the servers

that show the party was pushing hillary and working against bernie sanders. it is a sticky situation. polls show donald trump closing in on hillary clinton. effort on her,of trying to unify their party. watching we will be the said this week. what are we expecting? we are not expecting anything. the question is whether they are going to give us hence about a near-term future move. futures point to no fed rate rise until sometime next year. with data coming in stronger-than-expected, the fed may want to reprice the market by dropping a hint about a rate increase sooner rather than later. francine: will they be watching what boj does? the correlation is so strong.

>> they talk to each other on a regular basis, but they will not coordinate any action. -- the bank of japan decision will matter because the bank of japan will affect the dollar value. if it gets stronger because the bank of japan does something to weaken the yen, that could do fedthing to decide when the will move. francine: let's check on the markets. there is a picture here for the stocks in europe. investors look towards central-bank meetings. european stocks rising. oil holding on losses. we had a figure in germany that was much better than expected. tom keene will be joining me from new york. we will talk to james bevan about yahoo!'s rise.

we have news out of erickson. strength.lk germany's this is bloomberg. ♪

francine: the g-20 takes on the globalization backlash. terror, how much will politics way on the boj and said this week? the dnc begins today as the head of the committee resigns over yet another e-mail leak. can clinton come through unscathed? verizon isverizon, said to be offering $4.8 billion for