vonnie: we are going to take you from los angeles to johannesburg and cover stories out of the u.k. and washington in the next hour. minutes of the federal reserve's last meeting dampening prospects for a rate hike, sending the dollar sinking. officials have pushed the odds of a rate increase this year back to below 50%. nejra: u.k. retail sales jumping more than expected after britain voted to the european union. sterling strengthening of the back of that data. self driving cars arrive in pittsburgh, pennsylvania this month, and uber is behind it. to the car service plans replace more than one million

human drivers with robotic ones. 30 minutes into the trading day into the u.s. julie hyman is on record watch again. although at the moment it would be difficult for stocks to move less than they are. so little change in the averages at the moment. the dow jones down five points. the s&p up half a point. none of them moving as much as .1% at the moment. a tight range after the release of the fed minutes yesterday led to this revised review that the fed would be on hold at least through the end of the year. despite this lack of movement overall, of course, there is movement with individual stocks. the big corporate story is walmart, raising its annual forecast, second quarter numbers topping estimates that u.s. stores, rising 1.6% last quarter.

that was above what analysts anticipated. target, whoowth at is falling for the second day, following their report. outside of equities -- and i will get to more movers -- you have to watch oil. rising for the sixth straight session. 46.67 for this hot streak that we have seen with oil. take a look at the bloomberg. the bear, mapping out in bull markets we have seen the oil complex in the last year. february, 847%gh drop in the price of oil, then a 95% rebound, 23% drop, and then a 20% rebound. and that has been only in the past week.

it has just been an incredible whipsaw back and forth for that oil price. nejra: we are 90 minutes away from the european close. let's have a look at where equities are trading. more games than perhaps we are seeing in the u.s. at one point, all western european markets were rising. the netherlands is up .7%. belgium is up .7%. sterling rallying .7%. the euro stronger as well, up .2%. i want to show you the stoxx 600 intraday. this looks like it is down but it is actually up .5%. gaining for the first time in five days. we had four days previous to this without any gains. now we are seeing a rebound from a two-week low. perhaps investors interpreting

those fed minutes as elvish. ecb account ofe their last policy meeting, where they were recently positive about the economic outlook. overall, some risk appetite in the european markets. i want to show you a. going back toex january, 2014. -- you spain. the ibex 35 index has fallen 11 points this year. the to-day moving average is at the lowest since 2014. not really a bullish signal on this benchmark. i want to talk about the ftse 100. up 10%, one of the best performers in developed markets. as to whetherion the rally has further to go.

we got into overbought territory this week, now stepping a two-day decline. some analysts are saying that it has further to go higher. now let's get a check on the first word news with alisa parenti. turkey has revealed just how broad the crackdown was after last month's attempted coup. the prime minister's 40,000 people were detained and over 5000 are still in custody. --000 turkish government government employees were removed from duty. more details are coming out about that $400 million in cash the obama administration provided to iran. the u.s. would not let the iranians take control of the cash until a swiss plane carrying three freed americans took off from tehran. president obama says the cash payment was not ransom. germany says the uk's future relationship with the european union requires a custom-made

solution, the deputy foreign minister telling bloomberg of the british will not be able to cherry pick the economic advantages. he says what is clear, the u.k. cannot expect access to the common market, unless it allows the free movement of workers. three american swimmers who say they were robbed at gunpoint in rio will be questioned by brazilian police today. two were pulled off of their .light by brazilian authorities they were released after promising to speak with investigators today. .o will another police are growing skeptical about their claims. ryan lochte is already back in the u.s. some interview, he changed of the details of his original story about being robbed. of a lifetime if you are a student of world war ii. the normandy tank museum in france is selling its entire collection, some of which was used on d-day in 1944.

more than 44 armored vehicles will be up for sale. 2013 andm opened in has not been able to draw enough of visitors to stay open. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. i'm alisa parenti. this is bloomberg. thanks. getting back to the july fed minutes which are fueling a rally in treasuries, the 10-year .as fallen some are calling it a dovish tone in contrast to officials like bill dudley, who is with us. komal sri-kumar is with us. he sees the 10-year falling to a record 90 basis point by the end of the year. you say the market is interpreting these minutes as dovish. extent, the market

is looking more for a rate increase this year than it was before the minutes. they seem to have a more divided view. why do you think they are so dovish? >> i think the fed members alternate between talking up rate and then others postponing. you had a set of contradictory messages from the numbers. the fed cannot get a consensus to raise interest rates. the second reason for the dovishness, they saw what happened when they raised interest rates last december 2016, and the global market created in january, and they do not want to have that ahead of the u.s. presidential elections and have the next three months of problems developing. so september is off. in the case of november, the

meeting to decide would be a couple of days before the elections in the u.s., so that is off. december, you are talking about a janet yellen considering then whether she would be renominated by the president-elect, whoever he or she may be. july,ecision would be august 2017, so you don't want to jeopardize that chance either. i basically see the fed stuck where they are. they should have hiked three years ago. they did not do that, so there is no way to get out of it. we have a is true divided fed, but we almost always have, that is the beauty of the fomc. some members are perhaps more equal than others. we are getting comments this morning from william dudley. he says the tide is turning as middleweight jobs continue to

outpace low-wage jobs. vonnie: making hawkish statements is one thing. acting on it is a favorite thing -- very different thing. they have been making hawkish statements since 2009, that economic growth in the u.s. would pick up. everyar that statement month, that inflation is headed toward the 2% level and they feel confident about it. has not happened in eight years. it is easier to make hawkish statements because they do not want you to think nothing will happen and go more into a speculative binge. but as the fed's credibility sinks lower and lower, these hawkish statements lose their staying. i know you are not

expecting a rate hike this year, but of course some are. let's say for arguments sake they could be right. if the markets are interpreting the fed's dovish, what pain could they be setting themselves up for? sri: if the fed hikes, as they did in december, i had not been expecting it, because i have been saying on tv prior that if they did that come it would cause the market calamity, which it did. so if they do surprise the markets, if they surprise position for the fed to remain where they are, and they you are going to have a big drop in equity markets. the expectation of recession in the u.s. in 2017, as the new president takes office, will be more prevalent. that is what they are facing.

the question is if they have the political courage to go through with that. they can raise it, but then they are going to backtrack, and then you are talking about a rate cut 4 to make up for that. williams'till have my mind from this week. should market be bracing for a new approach from central banks, whatever that may be, given low-interest rates do not seem to be working? komal: it will be the same tired approach that you see being pursued by the united states, ecb, bank of england, bank of japan, because they are out of ammunition. the fiscal side of it does not work in many countries. in the united states, we cannot get anything done in congress, so that does not work.

structural reforms are the only ones that work. take a look at japan. they have had a strong currency, exports fell 14% year on year in july. the only thing they have to do is allow for the integration of young workers, make a change in the competitive environment, but they are all politically difficult to do. the answer to your question is, if they were to rethink monetary policy, it is a lot easier to do than to implement anything along those lines. course, the bank of japan also preparing to reassess monetary policy in september, and of course, jackson hole to look forward to. komal sri-kumar, thank you. stocks rise after africa's largest bank reported better-than-expected earnings. we will speak to the co-ceo of standard bank.

this is bloomberg. ♪

vonnie: you are watching "bloomberg markets." i'm vonnie quinn. nejra: from london, i'm nejra cehic. julie hyman has a quick look at a stock on the decline. julie: we are talking harley davidson. the u.s. had sued the company over animation controls defeat device. it alleges they are violating the clean air act with its screaming eagle aftermarket power tuner. that is what the u.s. complaint is targeting here, and you can see the stock dropping after these headlines came out. now down by 6%. we will bring you more updates as we get them, and any comments

that we can get from the company. nejra: thank you. turning to emerging markets, south africa's benchmark index is gaining today thanks to strong results from standard bank, africa's largest lender. they reported quarterly profit that boosted higher interest rates in its home market. for more on the results, we are joined by the standard bank co-ceos sim tshabalala from johannesburg. thank you for joining us. great to have you. obviously, investors are liking the results with your stock rising. i want to talk about return on equity. as far as i understand, that declined. i wonder if you can get that figure to rise before year's end, and if so, how you will do that? sim: thank you so much, yes, return on equity is down to 14.4%. driven by the headline

earnings growth of 5% being slower than the growth of our equity, which was at 9%. we intend to climb into our target range of 15% and 18% roe by driving the continued generation of revenues. costs, allocation of resources, and in particular, capital, with a large measure of discipline. nejra: could you tell me more about the banks strategy in terms of expansion, acquisition? are you just relying on growth in africa, or elsewhere? give us more detail on your strategy. we have got operations in 19 countries on the african

intinent, representation several money and capital centers around the world including new york, hong kong, beijing, shanghai, and dubai. we use access to those markets to intermediate capitals and ideas for the benefit of the african continent. we are focused on growth on the african can't didn't, -- continent, we have no intention to grow outside of sub-saharan africa. through marketow proliferation. we have no intent of making acquisitions, although it appropriately priced with their bright levels of risk present themselves, we would pursue them. right now, we are focused on getting clients, improving liabilities, sales, and improving the digitization of our customers. vonnie: how have you been

dealing with south african rand gains, has it been difficult? youred to that, what is outlook from the monetary policy from the reserve bank? think -- the rand has strengthened quite a bit in the recent quarter. it had lost its value as a consequence of a combination of global factors, but also internal factors related to south african policies, in particular to these events from last year. it is now back to a reasonable level. we still run the risk of deterioration in the value of the rand, to the extent we face a possible ratings downgrade near the end of the year. but i think, with authorities working in partnership with would haveners, they

structural reforms, including on keep fiscalont, antitude, we could see avoidance of the downgrade. given where the rand is at the moment, there is less pressure on interest rate hikes. theill really depend on right cycle, what is happening in the rest of the world. vonnie: what consumer are you targeting? in south africa, we have pretty large market shares. the most attractive segment, as it is across the world, or middle income and upper income customers. ir transactional

accounts, you want to lend them money for home loans. africa, theouth middle class is still quite small, growing fast, and the most attractive middle classes are in nigeria and east africa. vonnie: sim tshabalala, thank you for your time. co-ceo of standard bank. ahead, t-mobile announces an effort to get more data hungry customers with unlimited calling, texting, and data. in the next hour, we speak to john legere. this is bloomberg. ♪

nejra: this is "bloomberg markets." i'm nejra cehic. vonnie: i'm vonnie quinn.

straight to the markets desk. julie hyman is looking at some deal movers. ina,e: let's start with alum the maker of genetic testing equipment. fisher is bidding $30 million for this company. lumina shooting up. we will let you know if there is any confirmation of this report. there is another deal that is done, global wafers, a taiwanese supplier of wafers to chipmakers agreed to purchase sun edison semiconductors. you might be confused. didn't sun edison filed for bankruptcy in april? this is the semiconductor wafer maker that spun off from the solar company in 2014. app is the best performer in

the s&p 500. the tech storage company up 14%. first-quarter earnings rising 59%, beating estimates. the stock was upgraded at susquehanna and jpmorgan this morning as a result. nejra: thank you. we have noble laureate and economist joseph stiglitz saying the eurozone should split up if it cannot go through reforms. this is bloomberg. ♪

avtk"0 vonnie: from bloomberg rolled headquarters in london and new york, i'm vonnie quinn in new york. nejra: i'm nejra cehic in london.

let's check in with the first word news this morning with elisa parenti. germany says their relationship between day euro some and the u.k. requires refinement. what is clear, the u.k. cannot expect access to the common markets unless it allows the free movement of workers. the british government wants to use a sugar attacks on soft drinks to fight childhood obesity. the money raised would pay for school sports and healthy breakfast clubs. their treasury report called for food and drink companies to work with the government to reduce sugar levels by 20% in products most eaten by children. in southern louisiana, the death toll from that massive flooding has risen to 13. floodwaters have damaged more than 40,000 homes. thousands are still living in

shelters. firefighters are battling a raging wildfire in san bernardino, california. the blaze has forced mass evacuations and destroyed homes it spreadsses as across 40 miles of the mountains and desert east of los angeles. exactly how many homes and to whom they belong remains unknown. firefighters are still trying to tally the damage as they battle the unruly flames. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. i'm alisa parenti. this is bloomberg. nejra: thanks so much, alisa. could a divorce from a single currency system be a solution for the euro's troubles? joseph stiglitz from columbia university thinks so. earlier today, he outlined his case to tom keene and francine lacqua. a look at what has

happened as a result of the euro, the rigidity it has put in, it took away the interest adjusting,ism for nothing in its place. europe has been well below even the u.s. we were the country from once the crisis began. we have done a better job in recovering. stagnant,asically growth for the last couple of quarters, .3%, .4%. that is not a good performance. what you have to contrast is outcome,g that dismal ,epressions in spain, greece and an alternative. of coarse a divorce will not be easy.

but it can be done in a way that is better than the current system. it would still be better if they put in place institutions that work. the question is will they do that? francine: if the euro brits apart, let's say there is something happened to the euro, germany and france want out. how many years of pain? six years of recession before we get into this utopian world you are talking about? ineph: the crisis began 2008. the market, with the euro, is not adjusting well. examples of countries with a flexible exchange rate, like iceland, responded well. admittedly, a small country. i think we are not talking about six years, maybe a couple years.

argentina, once it broke the tag the the dollar -- peg with dollar, began some enormous growth, beginning in 2002, 8.2%. right next to china with the fastest-growing country in the world. that continued until the global financial crisis. francine: you would argue for a breakup of the euro while at the same time a stronger banking union. ry? do the two mar would want a stronger banking union and doing the things that would keep europe together. the question is, is there enough political will within europe to do those limited number of that would make the euro work, make the eurozone return to the kind of growth it had. tom: you have a lot of critics.

we will talk about that later. many in germany are saying the same thing. this is a political debate. how do you respond to the genetic -- germanic tone of we came out of world war ii, we need to get the system together. to those whospond say we have to persevere forward with this program? joseph: i agree the european project is important, they have made enormous progress in so many areas. the question is, the timing and the pacing of a single currency. tom: how many laureates do you have at columbia? ,he three of you get together

different politics, and you say, i'm sorry, we have to move from one european currency. what is your prescription for the new euro? joseph: if they cannot get it divorce, and amicable probably dividing up into two or three different currency areas. there are ways which it can be done fairly smooth. one of the things they are to take advantage of his modern technology. we do not need to use those old uses of money. we can go to an electronic payment method. enormously helpful in helping to regulate the economy and facilitating that transition. once you have electronic money, you would be able to monitor much more closely what was going on. the itself would regulate destabilizing flows that have been such a problem.

that was joseph stiglitz, columbia university economics professor earlier with tom keene and francine lacqua. its announces the launch of fleet of autonomous cars this month in pittsburgh. we will take a look at the details of their deal with volvo. this is bloomberg. ♪

vonnie: you are watching bloomberg. i'm vonnie quinn. nejra: i'm nejra cehic. your global business report. here is what we're watching. cisco is cutting more than 50,000 jobs as it continues to make the transition to software -- that is more than 5000, in fact.

we will hear from chuck robbins on the company's new focus. vonnie: china is desperate for workers in one industry in particular. what is the nation doing to increase the number of airline pilots? than fives been more years since the disaster at fukushima and more nations are expanding nuclear energy plants. we will take a look at the quick take. the biggest maker of equipment is cutting 7% of its workforce. vonnie: 5000 positions will be eliminated at cisco. cisco is taking a $700 million charge for the restructuring. says the robbins company is shifting its focus. ck: we are focused on tighter coupling of security into the orchestration and cloud-based management across

the portfolio. there is a significant amount of innovation that the teams are working on for the next several quarters as well. it is not that we are ignoring one in favor of another. we just want to make sure our investments are commensurate with our growth opportunities. instead of online networks maintained on their own premises. the world largest food company reported a 3.5% in his in revenue. that was slightly less than estimate. nestle says there is very little inflation in europe. vonnie: retail sales in the u.s. on expect of the rose in july the month after the country voted to leave the european union. nejra: sales were up 1.4% last month. british shoppers bought clothing and shoes and the weaker pound

lead tours to buy watches and jewelry. airlines in china are desperate for pilots. almost 100 perre week over the next 20 years to meet skyrocketing demand. the winners are expatriate pilots who are being offered pay packages of more than $300,000 a year. offered airlines often to pay tax bills as well. vonnie: time for our bloomberg quick take. think theorld seem to planet needs nuclear power more than ever. the other half seems just as sure that now is the time to get rid of it forever. 446 operating nuclear reactors around the world. 63 more under construction. some countries like the u.k. are pushing ahead with expansion ochal while at glenn wants to close all nuclear plants by 2011. goals as ambitious

well in asia. india aims to supply 25% of its electricity from nuclear power by 2050. nuclear pioneers after world war ii envisioned an abundance of clean energy at a low cost. then came the reality of the dangers of nuclear energy. in recent years, nuclear power, which produces no greenhouse gas emissions, seemed poised for a renaissance based on worries of climate change, but anxieties were heightened after three reactor meltdowns at the fukushima plant in northern japan in march 2011. proponents of nuclear energy say accidents like the fukushima meltdown are rare, and reactors are getting safer, and that fossil fuels are responsible for more deaths. there are objections outside of the risk of accidents, like the high cost and environmental

risks involved in disposing of waste. the question is whether renewables like wind and solar energy will be enough to head off extreme global warming, or whether nuclear is no longer an option but a necessity. you can read more on the bloomberg. that is your global business report. bloomberg.com for more stories. just took a big step ahead in the race for self driving cars hitting the road. later this month, the ridesharing company will allow customers in pittsburgh to hail autonomous vehicles from their smartphones. max chafkin had the exclusive story in this week's "bloomberg blues -- businessweek." what is uber doing differently in this driverless phenomenon? it is kind of crazy, but they are just moving a lot faster. uber has been scrambling to hire

as many engineers, machine learning people, car mechanics as possible. i think most people thought that this launch was going to be at least a couple years out, maybe a decade. it turns out it is this month. isis important to say uber using safety drivers, a pretty narrow pilot only in pittsburgh, although it looks like they are opening up driverless car operations in san francisco and palo alto basically now. it is very exciting and will shake things up. they are also making huge investments in this. we are reporting that they are buying auto, a driverless trucking company, for what we think is almost $700 million. there is a $300 million deal with volvo to develop a driverless car. what is most exciting is the aggressiveness of it all. aggressive, as you say.

is it a risky bet? max: almost certainly. google, who has this great advertising business that prints money, uber's business is not totally figured out. they are still trying to make headway in the developing world, still trying to get to profitability, even in some u.s. markets. what is risky about it, in some ways, it may be a distraction. on the other hand, what the uber ceo told me is that this is core to their business. if they can get driverless cars right, and quickly, they can bring prices down, which would make it bigger than owning a car. he believes the per mile cost of taking an uber will be cheaper than owning a car, even if you are going a long distance. steal this did uber

out of the likes of tesla and apple? max: i think it was just a matter of audacity. google could have done this. the other thing is this super aggressive hiring. in december 2014, travis kalanick went to pittsburgh and hired some of the best machine learning experts at carnegie mellon, sending shockwaves through the city and university, and have been adding to it. now this is the result. vonnie: will google, tesla, apple now respond more quickly? is: tesla, for one, following their own path, which is starting with this souped-up cruise control, their autopilot, where you can have the car drive you on the highway, assuming your hands are on it. a luxury car-type feature. google has a really good business, so i don't know if they would want to move as quickly as uber. it, tesla hadbout

this accident a couple of years back in florida where a person died. that was bad for tesla. a highway investigation, dealing with a lot of negative pr. imagine if you were at googles internet advertising business and you had this accident causing all of this pr and liability problems. anhink google has a bit of innovator problem because the core business is so good. max chafkin, check out the story. pretty amazing. he is our technology reporter. in the latesthis edition on newsstands and online now. life is not too sweet at nestle. the world's biggest food company is planning to raise prices. can the new ceo turn the ship around? this is bloomberg. ♪

vonnie: you are watching "bloomberg markets." i'm vonnie quinn. nejra: from london, i'm nejra cehic. at nestle, products range from chocolate to baby food. prices are set to increase in the second half of the year after they saw continued weak sales growth at the start of 2016. andrea felsted covers the retail sector for bloomberg gadfly. great to have you. what we saw here was really the weakest first-half sales growth in several years, underwhelming in many ways, but the share price has been rising. is this because the cfo said that we hit the bottom in the second quarter? andrea: partly. the real factor is the new ceo coming in, he is from the health sector.

investors are really hoping that he will reinvigorate that part of the business, the nutrition and health business, and maybe ditch some of these low growth areas. nejra: so this is really about a shift in strategy. the hoax for the restructuring then, how realistic are they? will come in,k he if you look at the portfolio, something that unilever is also grappling with, getting more growth in these difficult times in developing markets, slowing emerging markets. nestle has their business in confectionery's, the u.s. frozen food business, ice cream. y to see if will marr they are still a good fit for the portfolio. vonnie: i was really surprised itkat is the only positive seller in there confectioner product category.

will nestle try to change the ingredients so maybe they taste different and are healthier, or will they just scrap some of the brands? andrea: i think they will go for scrapping some of the brands. today butl out kitkat said that other parts of the market were difficult. certainly something that a new chief executive with get. vonnie: where will they concentrate their capital expenditures? if they get rid of the ice cream and maybe u.s. is improved business, what is left? andrea: i think they will try to reinvigorate this focus on health and wellness, which they hope to get faster growth rates from. although that division actually slowed in the second quarter, so that does not bode well either. planning price increases in the u.k., will that happen post in brexit? it has to.

most of the foods are imported, so price increases are inevitable. they did particularly talk about coffee and cocoa. consumerstailers and will except that is another thing coming. today, we had them all -- walmart results. other stores were reporting same-store sales which were down. so on the one and you have food companies raising prices, the apermarkets talking about difficult environment to raise prices in. nejra: i am glad you mentioned walmart. despite what you said about asda, walmart topped estimates. some of theppears efforts they are making in the u.s. are working. unfortunately, not the case in the u.k. nejra: andrea felsted, thank you.

for more commentary, type in gads on the bloomberg. coming up in the european close, take a look at what is happening with european stocks. the pound is getting a boost after u.k. sales figures beat expectations. brent hovering near a bull market. 35 minutes away from the european close. stoxx 600 up .7%, gaining for the first time in five days. let's bring the stoxx 600 back along with the ftse, dax. you can see all the indices up there. switching it up to look at some of the specific movers. we were talking about nestle. you can see the share price. perhaps we cannot. it had been up today.

vestas up today after it raised its guidance and raised its allocation, saying second-quarter shipments and revenue beat forecast. has risen the most since july 2014 after reporting and improved capital position. good movement on the broad averages here. and s&p up about three points. more movement in treasuries. the vix is down below 12 again. still ahead, t-mobile is announcing a plan to lure more data consumers. we will be speaking to the t-mobile ceo john legere. this is bloomberg. ♪

>> is 11:00 a.m. in new york and 4:00 p.m. in london. i am vonnie quinn. >> live from london, i am nejr.:

you are watching the european close on bloomberg markets. we are going to take you from new york to london and cover stories out of brazil in the next hour. here is what we are watching. the u.k. consumer is looking strong for now, shrugging off any brands of anxiety to enjoy the biggest summer splurge in 14 years. vonnie: minutes from the federal reserve's last meeting. the odds of a rate hike about what markets are lying. t-mobile ceo john legere joins us. is at the start of a new price war?