caroline: pullback short-lived, it would seem. money on the sidelines. %.e s&p 500, up 1.3 bit comeg, tech gets a as it had been the most beaten up yesterday. scarlet: 23 or higher. energy the lone the geithner here. also to that -- lone decliner here. volume is notably higher than average as well, which is interesting because normally we see volume a little more sluggish and you tend to see a pickup with activity on the days when stocks decline. joe: treasuries owning pays off on days when stocks

tank. forail: we had big gains u.s. stocks, big rebound rally, but not so much for the emerging markets. the emerging markets index closed down fractionally. over the last 10 days, 10 days in a row, that is the longest losing streak since 2015, the worst since the fourth quarter of last year. was down ahead of the volatility. macro concerns around a trade war and everything else, including the fed. in white, the s&p 500, in yellow, the emerging markets index. rebounding from the big selloff last year, trading mainly in lockstep. in april, it started to turn down ahead of that pullback from the s&p 500 in may. liquidity and trade war

concerns. a bit of a recovery for both. the s&p 500 at >> the market recouped or than one third of the losses today. it is a good time to focus on the stocks most susceptible to a trade war. my colleague cameron created the trade war index. 25 stocks at least $5 billion in market cap and derive at least 15% of their revenue from mainland china. this revenue has really been beaten down. 11% from itsthan high three yesterday. a very diverse group. a lot of chipmakers such as nvidia, advanced micro. it also includes stocks like

tesla, apple, monolithic power systems. a lot of ground to make up before people are confident that this rebound is for real. s&p 500 bounced back after yesterday but the bulls for oil are still out to play. you'll see that brent slid 1%. that puts it in a bear market from its april peak. all of the u.s.-china trade tensions really does threaten to expand into a currency war. investors are worried about the damage this could do to crude demand. forecast.ent forecast.nt tobias reducing his

forecast, as we will discuss in a moment. curvethe yield conversion, of course inverting deeper into negative territory yesterday, he a lot of people worried about her session once again. james bullard made some comments today about the midcycle adjustment phrase. luke: it came off a bit hawkish and james bullard is one of the more dovish members. yield curve, all the adjustments we have seen during this risk off episode, when has never been a time they said they needed to cut rates longer. all they have said is that they need to cut rates deeper.

the prolonged cutting cycle. the market is still saying, for the dangers out there, the market is able to still handle them. based on the degree that you win holding treasuries on down days and you don't lose much on up days. is there anything in your view, should people be lightening up of those become big parts of their portfolio? kristen: in june, given some of the rhetoric around trade, we moved into a portfolio. we did extend duration, we did go long investment grade. right now, everyone is asking this question about the yield curve. we are talking a lot to our clients about what it means for loans. this yieldink of

curve inversion. themonth libor appear and yield curve down here. there are so many corporations and investors that have floating rate loans. if you can swap that out today and fix long-term debt at levels of 1.6, 1.7%, that is how we are looking at the yield curve inversion right now. caroline: we are going to get now to some earnings. disney, third quarter adjusted well belowr share the estimate. persted earnings significantly. this is trying to spend ahead of its rollout of disney plus. 20rd-quarter revenue,

.illion dollars shy of estimates as well. they are trying to -- scarlet: it is a good point. this was going to be a messy quarter in terms of results. bob iger points out that they integrated 20th century fox assets into the balance sheet. in terms of some of the theerent business lines, consumer-products part of the business, a big selling point. up 6.6% quarter on quarter. we see cable networks revenue up and the media networks business, 6.7 billion in revenue, a gain of about 9% year on year. joe: in the grand scheme of things. this stock has been on a monster

tear. with the mess -- even with , done quite well for investors. scarlet: when you look at earnings, and we mentioned how changed his forecast, what does that mean for you and how you recommend allocation? overall view is that it will be relatively range bound. we expected to trade in plus 10%, minus 10%. when you look at expectations going into the second half of the year, that is something that we felt the expectations were a little too --

and youions get lower have that situation now where you have surprises to the upside but with a lower bar. adjustmenting for an . caroline: now the turn of phrase everyone likes. your perspective from a global perspective. the u.s. is probably the most insulated from the trade war it started. is it u.s. equities or is it time to start going to emerging markets if we see a dollar weakness? kristen: it is interesting that we have these discussions in terms of all or none. we have been talking to our clients a lot about global diversification. when we have these situations where we could have resolution,

appreciation, you want to make sure you are balanced in terms of u.s. domestic equities and markets. we are looking at diversification across asset classes as well. scarlet: thank you both so much. just a recap, disney coming out with earnings. adjusted earnings of $1.35 missing the mark. analysts were looking for $1.75. revenue also coming in shy of expectations. fiscalbillion for the third quarter. --lysts were looking caroline: on its earnings per share line, saying, excluding certain items. rallied intostock the close as well so if you look at the drop of 4%, maybe not that big of a move. bell.s it for the closing

romaine bostick steps in next for "what'd you miss?" this is bloomberg. ♪

caroline: disney giving latest results and the third quarter underwhelmed. earnings-per-share missing the lowest of estimates, coming in at $1.35, down 20% year on year. we are seeing revenues falling. shares under pressure. , they wereord highs rallying before today. position for disney with $150. are you underwhelmed? >> i am. i think this quarter we knew ont, coming in, we spending direct consumer initiatives will

depress the overall results. i think the company has telegraphed that they will ramp up their spending on that division. every thing else seems in line with expectations. theme parks a little bit soft fairlystill seems to be strong. the studio was the main highlight. we knew that avengers end game would be the big driver. we are staying with our strong buy recommendation. romaine: we knew that this spend for the streaming service would be a little bit of a drag in the interim. once they finally get disney plus up and running later this year or into next year, do you think there will be an immediate

they will be looking for new areas to exploit new franchises

across the world. romaine: coming up, a relief rally. stocks bouncing back on the hope that the trade war won't get any worse but the currency clash does continue. this is blumberg. ♪

caroline: quick check on the latest earnings after hours. i'm kicking it off with disney. it missed not only on the earnings-per-share front. the lowest analyst estimate, but also revenue below expectations. member, a bit of a messy quarter, integrating 21st century fox. they had a costly flop of a movie they inherited, which hurt. falling theme park attendance and spending on the new disney

plus streaming services. romaine: you can see wynn resorts rising after hours. the second quarter net revenue billion, both1.66 of those beating the average of analyst estimates. macau operations on a ebita basis also above estimates. joe: check out the surge in match group, the owner of the soaring 16%.nder, tinder users up 37% year-over-year. they beat on revenue, earnings, investors love it. caroline: i wish we could stick more with match, but we are returning to trade. to fall pastyuan

seven yesterday. the move came after the u.s. labeled china a currency manipulator. secretary larry summers criticized. >> now declaring china to be a manipulator raises a specter of some kind of further retaliation, raises a specter of a situation where it will be more difficult on the grounds of pride for china to say yes to u.s. demands. caroline: let's bring in our bloomberg businessweek economics editor. we sort of saw potentially a dialing down of aggression from china with their fixing of yuan, but we traded back above seven anyway. it rings true from china's perspective that this isn't them

manipulating their currency but this is the trade war tensions forcing it weaker. upchina is trying to prop its currency, not push it down. thereason it weakened below seven threshold is that china briefly removed its manipulation. treasury said that in the announcement. they said, you guys have the foreign currency fire to boost your currency and now you are not doing that anymore. manipulationrrency when you declined to intervene? >> apparently it is in the treasury department's definition. they said they would be consulting with the imf. i don't see how the imf will look at this and say, let's go ahead and do that. romaine: what is the actual sort of path forward now that we have

this determination? it is either you go through the imf for sit down and have talks with china which i guess we have already been doing to some extent. what is the consequence of all this? >> to me, it is actually a step back because it is just going to anger the chinese. u.s.rry summers said, her credibility. just don't think there's a clear end game in the u.s. for these negotiations. thing or are bad they a good thing that makes the u.s. economy better? i think most people would say they are bad but trump seems to embrace the possibility of raising tariffs.

caroline: also, which you will make clear, the weakening of the yuan helped the u.s. consumer to a certain extent with the tariffs. peter: we have trump having two minds about what he wants. on the one hand, he says china will bear the costs of the tariffs. but, if that is the case, then there will never be any improvement in the u.s. trade deficit. the only way you get improvement in that is if china prices go up . joe: just in the last few days, .e had trump announcing tariffs how much further did this push a possible deal back? are these so big that it really blows out the water of getting

anywhere with talks? peter: that is the concern. the stock market bounced back today, feeling maybe this is recoverable after all, but it is hard to see how that happens. itn people get dug in, becomes a personal confrontation between xi and trump. neither man wants to back down. trade should not be personalized in that way and i'm afraid that is what happened. caroline: we thank you, bloomberg businessweek economics editor peter coy. romaine: let's have a quick check of the latest headlines. mastercard making its biggest acquisition ever, agreeing to buy a payments unit owned by denmark based net. nastercard is getting a electronic billing platform and

clearing services. the second largest shareholder says the recent authoring it -- recent offering is healthy. it lost value after an unexpected secondary offering came at a discount. a cofounder said it allowed early investors to solve -- to sell small stakes and doesn't see it as a negative. bonuses for equities traders should fall as much as 15% from a year earlier. their fixed income counterparts, you will see a 10% drop. coming up, the white house trying to respond to the most recent mass shooting but some republicans are warning that it may not be enough. why opposition to gun control could cost the party in the suburbs. this is bloomberg. ♪ ♪

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the fbi is launching domestic terrorism investigations into the mass shooting at the gilroy garlic festival last week. three people were killed, 15 injured. investigators say the shooter's motive aligned with ideologies. targets included religious organizations and members of both political parties. they also said the weapons used were obtained legally in the state of nevada. national security advisor john bolton today warned foreign governments and companies that they could face retaliation in the united states if they continue to do business with

venezuela. the trumpet ministration froze all venezuelan government assets in the u.s.. bolton spoke to reporters today in lima, peru. >> this is a very rarely used tool by the united states. we have only used it sparingly in the last half-century. now joins thatme exclusive club of rogue states that are subject to that form of sanctions. mark: the band blocks companies and individuals from doing business with sanctioned people. stripping statehood from the portion of kashmir. neighboring pakistan has said that could lead to war. itsa has again emphasized

support for hong kong's embattled leader carrie lam. commentary in the communist party paper says beijing backs lam and said the priority should be to stop criminal acts and establish order. the protests began amid demands that she withdraw a bill that would allow extradition to mainland china. global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i am mark crumpton. this is bloomberg. ♪ shootings over the weekend that left at least 31 people dead have renewed calls for gun control. some republicans are raising the alarm that opposition to legislation could draw disaster with voters they need to win to win the 2020 election. our next guest is a 20 -- is a republican donor and oil and gas

executive who supports donald trump but said that republicans are headed for extinction in the suburbs if they don't stop supporting the nra and the gun violence epidemic. thank you very much for joining us. talk to us about why this issue in particular creates, in your view, a real vulnerability for republicans ability to capture suburban voters. >> thank you for having me. in the last cycle, the republicans lost 40 seats in the house. if the republican wants to -- if republicans want to get those seats back and have a majority in the house, and also could voters in the 2020 election. i think the party needs to put some distance between themselves and the nra rather than just having a deer in the headlights look when it comes to gun violence.

romaine: why are folks in the publican party so resistant to this given that you have polls that most americans want increased background checks, gun control. the majority of gun owners want the same thing and even a significant portion of republicans side with this issue. it?not embrace dan: the nra has got the publican party in a sort of vice grip. the violence has become too much and we have reached a boiling point. i think we need to see common sense solutions that respect gun owners and law-abiding people's rights to own a gun but we have to come up with solutions. republicans continue to look like they are caught in the headlights and don't have any solutions. admit that it is a problem and

find solutions. -- i don't think the republican party has done enough. they distancecan themselves from the nra? parkland, governor scott said we will raise the age 21, wea gun room 18 to will have a three day waiting period, the nra rebuked him and he received stiff resistance. he is a republican governor put that forward in florida. it was part of a holistic solution. a little bit of additional regulation and common sense perhaps makes florida a safer place.

joe: i think, in 2016, there were a fair amount of suburban voters who didn't like hillary clinton, didn't like trump, maybe held their nose and voted for trump. besides the gun issue, are there other things the president has done that will make it a little bit harder for those same voters to pull the lever in his favor this time around? the roaring economy will make it easier. there are a lot of people who like trump's policies but maybe don't like the tweets, the tone, the style, but they fundamentally like where the economy is at. romaine: if you had the what would ear today you tell them to do? him to throwtell

the past out the window and he needs to be a statesman, a leader. he needs to respect gun owners rights, make sure that creeping regulation needs to be avoided at all costs, but at the same time this is an epidemic and we need solutions at leaders. i think that is who voters will support in 2020, someone who leads on the issue. caroline: thank you for the opportunity to speak with you today, ceo of canary drilling services. we want to mention that michael bloomberg, the owner of bloomberg lp, is the founder of and helps fund every town for gun safety, a nonprofit that advocates for violence prevention and other gun safety measures. coming up, barney's files for bankruptcy. the growing challenges for the brick and mortar. this is bloomberg. ♪

caroline: temporary look at what stories are trending. aboutal users are reading opioid distributors paying millions of dollars to settle claims that they helped fuel the opioid epidemic. this is the first process of state lawsuits. state and local governments are pushing back, with states wanting $45 billion in local governments pursuing their own lawsuits. a path to allow customers to have unlimited stays in luxury vacation homes and tell brands for a monthly rate. this marks the first time that the up scare leisure travel

industry has tried to put the subscription model to the test. tictoc on twitter has reported damethe fire ravaged notre cathedral, concerns over lead exposure. a group filed a lawsuit saying that authorities failed to protect people following the blaze in april. you can follow all these stories on the terminal, bloomberg.com, and at tictoc on twitter. has filed forys bankruptcy after being squeezed by rising rents and fewer visitors to the stores. they will be allowed to stay open while they look to sell a slimmed down business and negotiate with landlords. this was kind of a long time in the making. there were a lot of signals. i'm sort of curious about sort of what dan: -- sort of what

barneys meant to a lot of people. it was decidedly and unapologetically elitist and i wonder if that did it in? >> back in the day, it wasn't. it was a discount store for suits. he would go to bankruptcy auctions and things like that, buy cheap suits and sell them in the store. in the 70's, it became that over-the-top, extravagant sort of thing that brought in designers. they opened near wall street and that is where they started selling suits on the high-end. joe: they are not closing the new york store, right? kim: they are not. is this -- joe: is this store still viable in making money? kim: manhattan is the department store capital of america. you are seeing three store

closures this year. lord and taylor, henry bundle, and sac's closed its downtown business store. -- downtown women store. we are getting two more, nordstrom and neiman marcus. is there space for all these department stores? avenuee: madison tripling their rent overall. no wonder it is difficult. you wonder about the employees they have. getting out of chicago, certain cities, but how are they slimming down? kim: they haven't revealed much but they are certainly shrinking their store footprint which means a bigger focus on digital. there's a lot of competition in that space with the rise of far-fetched, other

companies that do it better than barneys. romaine: rick perry is the current owner. do we have any sense of who the possible buyers or financiers will be? caroline: what other billionaire? romaine: will they have that digital vision to take barneys into that next chapter? kim: we don't know yet but there are plans they have revealed previous to the bankruptcy. there are two more stores opening, one in the american dream all in new jersey which opens later this year. another one, down south at a really high-end luxury mall in florida. they say they will still go through with that. romaine: we will have to take a road trip. thank you for joining us. another brand considering bankruptcy, bumblebee seafood, the maker of all the canned tuna

you see out there. financial burden after pleading guilty to price-fixing charges. the seafood packager is looking at the process of a restructuring under chapter 11. canned tuna biggest maker out there. kind of a surprise. i didn't think you could go wrong selling tuna. caroline: i think it is too expensive. also there is this backlash from eight health expected if, it contains too much mercury. -- from a health perspective. it contains too much mercury. romaine: most canned tuna is a fish called skipjack, part of the tuna family. i didn't know that and i'm sort of outraged by it. caroline: all the time in the u.k. -- romaine: you still have chicken of the sea, starkist, you still

have options. caroline: a quick check on the latest fitness flash headlines. opioid distributors have proposed paying $10 billion. the first sign of progress in resolving state lawsuits. ree companies made the puzzle in talks with state attorneys general -- made the proposal in talks with state attorneys general. the biggest demand for a debt in april. aramco it is paying 2.7% more. a swedish payments and banking firm is now the most valuable european thin tech startup. $5.5 now valued at billion. dog.h

coming up, bringing some relief. china -- we will discuss the latest in asia ahead. this is bloomberg. ♪

caroline: as trade tensions escalate, intercontinental hotels are reporting a slowdown. the ceo spoke with bloomberg about the impact. >> we had a solid start to the year. a record level of signings and openings of new hotels around the world. that drove our net growth, the new hotel rooms, 5.7%. that drove revenue up 3% and profits up about 5% if you factor in some timings. it gives us the ability to raise our interim dividend by 10%. a real solid start to the year.

the excitement is the growth momentum we have in the business. record number of hotel signings. we are strengthening our existing brands. but we are launching new brands wellatwell streets -- at suites, and buying new brands. great momentum today and more exciting in the future. >> great to speak to you this morning. lots of positive things in the pipeline for you. i've got to ask you about hong kong because you do operate some hotels there. i wonder if you have seen any impact yet on business and what impact you will be bracing for? the demonstrations began, we didn't see any material impact in hong kong but we have seen a bit of a slowdown overall. that disruption and uncertainty will have an impact going

forward. overall, a small portion of our overall business. the biggest, one of uncertainties is the escalation in the u.s.-china trade war. pointed outjust some of the biggest moves. we have seen yuan stabilize a little bit today. you say you are outperforming in your chinese brand. are you concerned about any impact on the chinese consumer and therefore on your brand if we do see a continuing weakness in the yuan? i think any global chief executive who says they aren't worried about a trade war is not being honest. our businesses are principally domestic businesses now. our china business, we celebrated 35 years. 45 hotels open, 400 plus and development.

principally a chinese domestic consumer. as long as we are seeing gdp growth and rising wealth in china, which we know will happen for the long term, it is a great market for the long term. we want to make sure investor confidence in china doesn't wane. in the leisure space. was intercontinental ceo keith barr. china taking steps to weaken the yuan. the move came after the u.s. labeled china as a currency manipulator. here with the story is bloomberg's shery ahn. what does it say that the u.s. comes in with a slightly stronger fix? they come in this morning telling foreign companies not to expect a whole lot more yuan

weakness? does this signal anything other than them looking out for where the currency should be? shery: that is where the market took it. expectations were much lower than what was actually sent out by the pboc. despite the fact that the u.s. labeled china a currency manipulator, they did not go on the yuan freefall direction. you're looking at the chart of yuan direction and seeing the correlation. this in fact also shows you that, despite the fact that note perhaps the pboc is sending the signal that they are engaging in the currency war, but continued weakness in the yuan, still above that seven level, other currencies across asia and the world could continue to put pressure on them as well. offshore, 705.d

another development overnight out of australia was the reserve bank decision. rates, i ameir told. shery: it is interesting when it comes to the aussie dollar because we are approaching the level we haven't seen since the january flash crash when we were so concerned about growth in china. the aussie started plunging and we saw the aussie dollar start plunging around 3% after the last rba rate cut in june. this time, we are expecting a little bit of a pause from the because the economy has gotten much better, but because we have had some sense of stability when it comes to prices. stabilizationg so, perhaps, a bit more time for them to see how the june and

july rate cuts will affect them already. caroline: you've got to be busy because it is not just australia but it is new zealand, thailand, india. a lot of them looking at what the federal reserve did last weekend wondering whether they cut, too. shery: i am really trying to keep all of these interest rates in my head right now. reserveause the federal loosen their policy, that gives them a chance to react. m cutting tog the 1.25%. this would be the fourth consecutive rate cut. from indiaon coming very strongly with prime minister modi and the new governor of the r.b.i.. thailand as well could be cutting 25 basis points from 1.5%.

the general sentiment is the federal reserve is cutting companies asian central banks have leeway to cut, they have seen the global slowing growth trend and inflation not really being a problem so we are seeing this easing bias. fxoline: we will see how the manages to trade off the back of that when there is weakness. with more on the stories, don't miss daybreak australia and asia starting at 6:00 p.m. eastern time. joe: i will be watching the federal reserve chicago fed president charles evans speaking tomorrow about the economy. lyft reporting- second quarter earnings after the bell. "bloomberg technology" is next. joe: this is bloomberg. ♪ from the couldn't be prouders

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♪ chang in sanily francisco and this is "bloomberg technology." markets get a breather. apple, tesla, and cisco leading gains after the s&p lost value yesterday. the trade issue between the u.s. and china, where does it stand now? google gets an earful. people blast the company for requir