>> amazon angst, the company suffers its first profit decline as it battles its slowest ever growth rate for its cloud business. small-capr values, responsible for pushing the s&p over 3000. european stocks to near 2018 highs, can it last? the new we work affect. .hey try to save we work yft other unicorns like l and uber. i am alix steel. we made it to friday. it was a lot of earnings that came out over the last five days. here is where we stack up. in terms of absolute level to the s&p, we have not gone anywhere this week. the term within the market has

been interesting. not just value but also small caps. also industrials, also cyclicals. -- >> they wound up beating estimates, coming in at over 600,000. the earnings went up slightly as well. if you have a miss, you get punished. for global exchange. we will bring you today's market news from around the world, from hong kong to brussels to london. first, we start off in asia where china is firing back at the u.s.. mike pence's criticism of his actions against protesters in hong kong. he said "china's actions in hong kong curtail liberty rights." the foreign ministry blasted the remotes -- remarks and said

we hope they can get their own house in order. i was quite surprised by their response today. their response yesterday was much more consolatory -- consolatory from chinese news outlets. >> they accused vice president pence of line. they accused him of arrogance. --y said his speech was and the like. as you mentioned, they said the u.s. has to look itself in the mirror. to your point about consolatory tone, for all of the criticism, they said they understand there is room for cooperation and talked about the opportunity for a win win between both sides. while they are exchanging barbs, the trade negotiations are

continuing. despite the broader tensions, china's response said those trade talks have not necessarily run into a wall. thank you very much. we had to brussels where the fate of brexit hangs in the balance. boris johnson called for an election on december 12. >> if they genuinely want more time, they can have it. but they have to agree to a general election on december the 12th. alix: jeremy corbyn saying he will agree. decisionhas deferred a on the length of a brexit extension. maria. me now is where are we in dealing with an election for brexit?

europeans were supposed to come up with a decision on the extension for they were -- on the extension. they wer delay that until next week. -- delayed that until next week. they want clarity on the date of the election. this is a hypothetical. the election has not been called yet. they think the timing of the extension should really depend on whether or not we do get an election for a number of reasons. the europeans don't want to get caught up in u.k. politics. they do not want to be dragged into a very volatile u.k. parliament. they believe they have to get their half in order. and then, the european union will react to it. they don't want to force an election. they don't want to be seen as pushing for one or stopping one, either. you can see why the europeans at

this point are taking a step back. fairpoint. thank. return to london. barclays investment bank outperformed its peers in the third quarter. the outlook will be a challenge. interestthe current rate across europe and the u.k. and in the u.s. as well, and if we have economic softness, we need to put some caution against the 10% target for 2020. alix: joining me now it's the s stephania. the ceo said it will be unquestionably more challenging than last year. whether the corporate investment

banks outperform many of the wall street banks, for trading and banking fees, the banking fees team had the best quarter ever. enough not seem to be for this week for them to reach their target for next year. alix: thank you very much. amazon shares plummeting after reporting a third quarter earnings declining for the first time in two years. joining the is alex webb. all theto see declines time and we got used to seeing a profit. what happened here? >> the initial headlines are focused on the fact that they are spending a lot more to accelerate the pace of deliveries. that required more spending. the more concerning factor is the trends at amazon web

services. services division, which is smaller from a revenue perspective. only $9 billion of revenue. profitability of that unit accounts for two thirds of the operating total. was onin that division its slowest pace on reppert -- record in five years. there was a decline in profitability as well. that has been the good news for amazon over the past few years. the fact that might be slowing down a bit has investors being more cautious. alix: one of my favorite anecdotes is you really need cheetos in one day? this is probably over the next, walk us through what we learned, alex? softbank might have to write

down the values of its five and $7between billion. there were quite disappointing ipo's from uber. we don't know what the full ork situation wew is. in $8 billion. it is yet to be seen whether the impact of that will wash through. that will be a cause for concern in the months to come. thank you very much. another name that i am watching this morning's ab inbev. the world's largest beer maker wanted to tap into china's growth. that did not turn out so well. in chinain shipments and the u.s. cost profit growth's to almost grind to a

halt. china's economy is growing at the slowest rate since the 1990's. coming up, we will have much more on your morning trade analysis in the markets on today's first tight. -- first take. happy friday, everybody. this is bloomberg. ♪

alix: time for bloomberg's first take. vincent.e, is .isa abramowicz a lot of bloomberg. and stewart. with china.art

they will be talking on the phone today. i love the americanism that we got from china. get your house in order, u.s.. what do you do? >> the response from china was expected. it comes from the chinese foreign ministry. no big deal. that was the chinese press and mostly the global times. you had to expect a formal response. you cannot just let that pass if you were china. the good talk, bad talk thing, if pence is doing it, what vice president has had a meaningful impact on foreign policy? not very many, if any. we go back to where we started. we go back to the trade and the vice premier. we step it up in november. the market move is pretty good. >> markets do not care. they are basically having a catfight. we get it. i think it is interesting.

there was an important story taking a look at what would happen if the u.s. did rollback tariffs as join us he -- as back.reverted it is about the same as it was in 2017, before the tit for tat started. i think that is an important perspective that the best case scenario is just going back to square one, back in 2017. i think that that is actually really compelling that that is the best case at this point. >> i think we would need something more concrete and definitive before we see the markets rally based on any of this news. even with the plan for mid-november, i think that is priced into the market. i found is that with earnings, i struggle to see where we care. caterpillar ended well off of its lows.

if we care about that and we care about the perspective, not necessarily seeing it on a longer-term basis. >> i think when you are looking at earnings, there is a lot of pessimism baked in. caterpillar disappointed. boeing disappointed. they had some bad things out there. people knew this. even though they did downgrade those forecast, that had already been baked in. the question is how much is it going to deepen? >> what do you do in 2020 when 11% formates are 10 to next year? we are not going to get there. what happens? do we downgrade estimates or do we face the reality that the economy is going to slow? >> yes. that is a given. let me be the optimist. you had the data coming out from germany. is the worst over? you have cyclical value.

there is a narrative there. >> i think some of the worst can be behind us. when we look at 2020, we agree that some of the earnings estimates look lofty. especially when you look around the globe. in the u.s., we are more conservative. where we see the real concern is more just the earnings expectations that are baked in yenally, when you look at and europe. >> you said the narrative. >> you nailed it! [laughter] prevailingn't a narrative in markets, which is why you have had range bound equities. we have all these earnings and some of them have been really surprising and generating big reactions, i am thinking amazon. or twitter. the overall mood is flat. that is interesting. momentum etf's per ishares,

you can see exactly what happened. there is movement in there. >> the story keeps changing. look at the u.k.. y do not want elections. look at europe. we are declining but the decline is slowing so it must be getting better. i don't find that positive at all. i don't know what the president is going to do with hisn he is done with deal in china. is he going to turn to europe? does he start to talk to germany and talk about tariffs again? i would bet on it. that does not spell well for europe and we don't know where the u.k. will be at this point. >> one narrative that is consistent across the earnings is that the consumer companies are doing better versus those that are more business investing .

that is where we see the weakness coming. >> what about mcdonald's, which disappointed? >> or in bev. bev. >> it does not impugn the strike of the consumer. >> that is a narrative. >> what should the narrative be? i think right now, we are seeing the third quarter at its lowest point. hopefully we get better from here. for 2020, we are expecting roughly 5% earnings growth. one thing i would also know is that a lot of the things we are growthare in global exposed areas. energy, materials, industrials. ,f you look at the median earnings growth is roughly 45%. or 5%.s some -- four there is some underlying strength. we think this is the bottom in terms of the worst earning quarter we are going to see.

>> everything continues to sound like the industrial sector is going to supper. -- suffer. how much can the consumer continue to grow? it is based on revolving credit at the end of the day and credit in general. i always think that somewhere along the line, that rubber band will snap in the consumer will say no mas. i can't do it anymore. >> people point to the deleveraging of american households and say if you look at their ability to make debt payments, americans are in better position. homeownership has declined. lower.tgage is actually rent costs are not included in that. rent has increased at a much faster pace. if you look at health-care costs, those have increased at a much faster pace. if you look at education costs, those have increased at a much faster pace. at what point do those nondiscretionary costs start eating into the balance sheet

more than people are expecting? homeownership or rent costs do not factor into the feds calculations. they do not do the real sense sometimes of where inflation is for the consumer and what disposable income is a factor in consumer spending. >> the majority of the people renting cannot spend elsewhere. they are not going to spend. it is the ones that own who are spending. that is a dichotomy that is not looked at. laura, how do you look at it? >> i agree that any kind of sign that the consumer can't hold us up is worrying. not stay as robust as it has been. that is a risk that we are monitoring. >> is that a lagging indicator or a leading indicator? >> it is yet to be seen.

we have seen some indicators of ifn employment tick down. it is something we are monitoring. business owners are saying that they're hiring plants have declined. that is something that we are -- >> that is a great point. both the services and manufacturing pmi's, employment index of both of those components are the lowest since 2009. that is worrying. alix: i know you are not an equity guy. would you be fading? it seems like you would. both of, when i look at these things, i am old school. i kept my position on a paper and not on the computer. if you look at growth and say this is the long term momentum value, that is where buffett mixes money and he will be there forever.

traitor, you are always er, you're trad always looking for a bargain. i think you do look at value when you want to look at a short-term opportunity. you need to keep her growth portfolio if you think that things are going to stay the course. it is a little of both to be honest. >> what is the parallel? that is where capital flows go. if you look at the space, everyone keeps talking about the dollar has peaked. not yet. i watch it closely and i thought it would make a turn in the fourth quarter. it may be more of a first quarter story. let's move capital flows out of the u.s. and into the u.k. and emerging markets follow. until that happens, it is still

a treasury story. say with respect to treasuries, it is range bound, which is interesting. the fed is expected to cut rates next week. the question is whether or not they will signal further cuts. my big question is, right now, given how low rates are in the fact that they have been going down, you have actually seen slowing momentum yet again in the housing market. you -- how long until the consumer is tapped out? how much power does the federal reserve have to generate that kind of ammunition and that is what i am watching. lisa is a rare moment when and vince agree with each other and say the same thing on set. it is a momentous friday. [laughter] laura, you will be sticking with me. check it out.

gtv , this will be my happy chart of the day. check that out. this is bloomberg. ♪

>> you are watching bloomberg day bag. i am viviana with your bloomberg business flash. the most ignatik and changes in the company's history. that is how google executives described an artificial intelligence tool that will be used. any tweaks to google search will impact the industry that -- industries that rely on it for web traffic. -- that is to reflect plunge of the value of some of its biggest holdings. this includes uber and we work. softbank agreed to bailout wewor k in exchange for 80% of the company. that is your boom blurt -- bloomberg business flash. alix: the indonesian

investigators found lots of problems in the crash of a 737 max 8. at the center of it is an on flight control feature that relied on a single sensor. and a sensor that was not calibrated properly but the plane was still allowed to fly. they said that this indicated the aircraft was released with known possible recurring problems. they went on to blame boeing more as well. we will have more of that over the next few hours. coming up, amazon fails to deliver. we will break down amazon results with michael. this is bloomberg. ♪

♪ alix: this is "bloomberg daybreak." i'm alix steel. happy friday, everybody. s&p futures still over that 3000 level. you have the momentum stocks

underperforming value. you have small caps leading the way. can we sustain that 3000 level without it? food and beverage in europe getting hit quite hard by disappointing numbers from ab inbev. in other classes, a mixed dollar story, but the euro gaining some steam. the ruble, really interesting move higher. rates.tral bank cutting amazon sinking in premarket. the company posting its first year on year decline for earnings since early 2017, with spending for faster delivery taking a toll on the bottom line. joining me on the phone is michael levine come up little research group senior analyst. why the cut in the price target, michael? michael: we are trying to maintain a fairly rigorous

framework with regards to some of the parts. i actually felt like we didn't really cut by that much. in reality, our numbers were quite a bit lower than the street. i feel like around the q4 outlook, i think that probably the biggest variants that caused some dispersion on the treat was what were people thinking about shipping for one day. we've been in the bucket of thinking that was going to be a big a member versus a lot of our peers -- be a bigger number versus a lot of our peers. i think what is probably why the stock is not acting worse this morning is they actually quantified how big an impact one-day shipping will be, so i suspect that actually allayed some concerns in terms of margins really deteriorating. alix: so what you think needs to happen? how much of a material growth

driver will one day shipping need to be? you can always joke, do you youry need your teedo -- your cheetos in one day. what is the growth driver in that respect? michael: i think they are actually seeing pretty good response to it. if there is something i would say i was a little disappointed about in terms of the revenue outlook, and our numbers did come down there, i assumed that this is an investment. this is a management team that we basically want to be betting behind on a long-term basis. i think you look forward in a realized we will you will see major benefits company's --the benefits accrued at the company. but i think the part i am trying italso highlight, ultimately

probably doesn't make a massive long-term change at the company, was around aws, which is probably worth digging in on. i think a lot of investors ascribe a majority of the value in the business. it's now been the third quarter in a row that numbers have come whisperere below the or the bogey. but this is a huge business at this point. we are sort of in unprecedented territory. this is by far the largest cloud business in the world. alix: i want to dig into this for one second. that was going to be my next question. it is a huge revenue driver, a good margin driver. they are lowering costs to get more business. the growth rate for that is slowing. what do you model in terms of the growth rate they need to have to boost revenue? michael: i actually took my yearss down on the out

for aws because if you look at the cadence of dollar growth, of how much they are adding in q3 , the dollarq3 2018 growth is beginning to flatten out. it is such a large business at this point, it is hard to see massive inflection in terms of dollar growth one way or another. in reality, i think we have been to bullish, and i think the street is too bullish. we did take our numbers down by a healthy degree. we've been in the view, and what i think people caught off guard was how muchrint, aws margins declined by. we've been in the minority thinking that those headwinds are going to continue until at least the other end of an increase in hiring combined with an increase in cap police

expenditure -- cap lease expenditure. i tend to think leaning in from an investment in sales is a good thing. lead toly will re-acceleration. i think they are signing more long-term deals and they have been giving disclosure about that, but i don't think anything is structurally wrong with the margins at aws. i think you will see them bounce back, but i think people are going to have to wait. i haven't seen where numbers shook up across the street come about lest your people didn't take those down, which i -- across the street, but last year people didn't take those down, which i was very surprised by. alix: thank you for that perspective. i wanted to get your thoughts on

this represents the whole shift i was talking about represent small caps. what do you think? guest: we are kind of neutral across value and growth come about where we are expressing the differentiation within the u.s. market is our sector calls. we want to get exposure to some of these secular trends like e-commerce growth, cloud computing digital advertising. we have been overweight consumer discretionary and consumer staples, and we also have overweight on communication services. we want to get exposure to some more secular growth stories versus the cyclical, given the environment we are in. alix: pair that with this great investor survey you guys do. you spanned the globe to look at different trends, how people are allocating, what business is they are thinking about. what was your biggest take away interns of how the market is positioned? with: we survey investors

$1 million or more, and also getness owners, to sentiment. i think you take away is they are cautiously optimistic. that is not really surprising, given some of the news we see in the market. 53% of those surveyed felt optimistic about the economy. the. big worry was trade. 73% said that trade uncertainty was way go there ride -- was weighing on their mind. some other concerns we sour around the business owner segment and their expectations for recession and for slowing in hiring. i think we are seeing trade translate into this dampening of business sentiment, which is something we seem sure up in the economic data as well. alix: i was also interested in what cash position investors wound up holding. responsee number one was rotation into cash. this is something that unfortunately, we don't like to see because cash, as much as it

is perceived to be a safe haven, is not where you want to hang out over the long-term as you face uncertainty. we feel that having a diversified portfolio is the best bet. we saw this trend of investors not putting their money where their mouth is, where optimism in some cases actually picked up, but then cash balances also increased. so i thought that was an interesting result. alix: but it also implies that if we get any removal of a headwind or any kind of tailwind, that there could be a meaningful move into the market? or you get the sense that they will stay in cash for a more sustained amount of time? laura: i think as we get relief on these uncertainties, we could see a rotation back into the markets. i do think some of the uncertainties will stay with us for some time. at this point, some of the worst case scenarios have been removed from the table, or at least the risk has been diminished, but trade uncertainty will stay with us for quite some time. alix: i also picked out one key part from every region, the

weakness in hiring trend. europe and latin america, too, are most worried about domestic politics. maybe it is related to trade in europe, but latin america, it is not. laura: i think we do see some regional issues at play. i think trade is the big one. in europe, there are certainly concerns over the economic picture. there's also brexit uncertainty weighing over markets. latin america has their own issues with regional economies. think overarching trade is still the big one. alix: do you think we stay range bound here? are we going to have a breakout, or do we tread water? range bound expect markets for the time being. while some of the biggest uncertainties, the worst case scenarios, have been diminished, they are certainly not behind us

at this point, especially with respect to trade. even if we have a partial deal in mid-november, the issues between the u.s. and china have not been worked out yet, so we can see this overhang continue. earnings,e time, with there really isn't a catalyst in terms of, right now we are just happy to see earnings come in not as bad as expected. but in terms of having a big catalyst upward, same vague with monetary policy. while we are welcoming the cuts and this should put a floor to markets, this should also not catalyze at this point. alix: laura, thanks a lot. really appreciate it. laura came of ubs global wealth of ubsent -- laura kane global wealth management. if yana or todd it is here with first word news -- viviana or todd a is here with first word news. viviana: vice president mike

pence criticizing china's actions against protesters in hong kong. he also accuses beijing of curtailing the rights and liberties of the city's residents. the u.s. justice department opening a criminal investigation on illegal spying on donald trump and his 2016 campaign. it has been largely secret for months. the investigation is widening just as the u.s. house impeachment inquiry is becoming a threat to the trump presidency. over to northern california's wine country, where pg&e had a power line failure moments before a wild fire broke out nearby. that fire blackening 16,000 acres, destroying 49 structures. earlier this week, the bankrupt utility turned off electric power to half a million people in california to prevent powerlines from starting fires. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. -- i'miana or tonto

viviana hurtado. this is bloomberg. alix: coming up, captain america ditched is a car endorser in china. how growing nationalism in the country could affect american brands. that is coming up next. if you have a bloomberg terminal, check out tv . you can watch us online, click on our charts and graphics, interact with us directly. this is bloomberg. ♪

viviana: this is "bloomberg daybreak." coming up next hour, heavy o'mara renzi, opimas -- coming up in the next hour, octavio cofounder ands

managing director. goldman sachs is joining the firm,s from ken fisher's pulling $234 million from fisher investments, and that figure may grow since he made vulgar comments at an investor conference. wppgiant advertising group posting its first quarter of sales growth in more than a year. the london-based firm winning more business in the u.k. and western europe. business isn though still down, it's seen significant improvement in north america. vice president mike pence criticizing nike for its approach to china. he says the athletic apparel company will philly ignores the approved -- apparel company will human rights the abuse of china. never response from nike.

i'm -- no response from nike. i'm viviana hurtado. alix: time for our weekly "business week" feature. first, western companies worry that as chinese products see a pop grow from growing nationalism. and how one lifestyle brand is welcoming a more diverse crowd to the craft beer community. last but not least, the 50 company stocks to watch for 2020. top companies with blockbuster potential and unusual challenges. joining us is joe weber, "bloomberg businessweek" editor. the first story is fascinating. the first company is captain america. joe: when you have captain america in china right now, that is not going to go over so well.

it speaks to a bigger interesting global dynamic. the two countries have been intertwined for so long. you can always use americans to represent those brands in china come about now we are seeing a greater decoupling with the whole rethinking of those relationships. it speaks to where we can go from here. alix: and you already saw this happening it certain companies. they are trying to make lower end machinery so they don't have to rely on imports. but this is a branding thing. so how much money can these companies lose for that? joe: it remains to be determined because we are just at the beginning of what we think this could play out as. ,ut you see homegrown brands like one that is huge and sports apparel, already number three in china. they have grown so tremendously. do they even need the nikes and adidas of the world?

is not just hollywood or auto or anything else. it is across-the-board, why do we need the west? alix: let's get to the beer culture and how it is trying to get out of just being a white culture thing and diversify. joe: that is beer culture with a k. it is an entrepreneur from the bronx who basically fell in love with beer and said this whole craft beer movement is exclusively white. so he has basically created a whole movement among african-american communities. he's launched this beer kulture brand and has said tap beer -- has said craft beer has tapped out. he's trying to bring flavor to the black community where the stereotype, as he said in the article, if you go to the corner shop and get a 40 ounces malt liquor. that doesn't taste good. what if we could cater to a different audience with beer that taste goods?

it is a story about entrepreneurship. somebody sees an opportunity with an audience that was just waiting for a moment, and it looks like he's found it. alix: let's wrap it up with you guys teaming up with bloomberg intelligence to break through how you're looking at the companies to watch. there are a lot of different metrics. one is sales growth. what is the one company to check out next year? joe: 2000 companies that we've whittled down to 50. y or sell, saying bu it is just ones we want to watch. the one that popped higher from a sales growth perspective, the one i love here is a female board conversation. cd project, a videogame manufacturer based in poland. we are looking across the universe of publicly traded stocks. this is one based in poland. we see new products that are really interesting because it is not a chinese based company. this other one, the

third-largest e-commerce site in china, we think they are about to turn the corner on profitability. it is so cutthroat in china that we felt like they have an advantage. alix: let's take a look at female board members. the number one was lululemon. is that apparel or in general? joe: in general. it speaks to how far they've come. 50% diversity on the board. it's kind of an incredible turnaround story, and the stock has really been on a tear. salmar is another that was really interesting. this is a space you wouldn't necessarily associate with having women on board. aquaculture is when we think will have a breakthrough year. facebook has plenty of bad rap. we think it is going to have a great year, but we've also got a really diverse board. alix: really interesting. you have energy on their metoo

-- on there, too. joe: you can sort it by all these different metrics to filter it as you want. alix: joe, thanks a lot. you can read all of these stories in the latest issue of "bloomberg businessweek" on newsstands and digital. speaking of challenges faced by women, in today's women of all street, we want to hear from someone who's had extensive c-suite experience. companiesh has run and a movie studios, and now she -- >> we are already seeing a vc's bringoys club on their first female partner, and it is all because of foam a -- of fomo. they fear they are going to miss the next wave of big, successful comedies. alix: coming up, university of

michigan consumer sentiment data expected out. that is in today's traders take. if you're jumping into your car, tune into bloomberg radio across the u.s. on sirius xm channel 119 and on the bloomberg business app. this is bloomberg. ♪

alix: time now for traders take. joining me is vincent cignarella, voice of the bloomberg audio squawk. i love that this is a chart half of you missed. it's my favorite consumer

sentiment index. they make thought to be in the control room. you bring it in and you have a trade. vincent: is coming out today. this segment is about making money. normally we talk about summing that is happening today. i wanted to talk about something that would capture the mood of the month of november. it is not a surprise when you look at this chart that dollar-yen follows sentiment. risk on, improves, dellien goes higher -- dollar-yen goes higher. today we are expecting to see it tick higher again, around 96. what that suggests is that the move we seen in the last week's will carry forward. as sentiment improves, risk will improve. the dollar-yen trade should get better. we talked about this a few weeks ago. $1.07 should hold. another advantage for the dollar-yen trade. if we see it today, especially

at 10:00 a.m., i think we will see another really nice base for dollar-yen. for the month of november come up in chile trade up to $1.12. alix: does the inflation trade come in, or just the headline sentiment? vincent: overall, i think it is the headline number. inflation really isn't an issue as much as the sentiment. inflation from a sentiment standpoint is more of a forward-looking thing, so better sentiment, potentially higher inflation. alix: interesting. thanks a lot. love the trade for the month of november. coming up on this program, lori heinel, state advisors,bal joins us. this is bloomberg. ♪ us. this is bloomberg. ♪ devices are like doorways

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october 25. i'm alix steel. here's everything you need to know at this hour. >> it would be much harder for us to make a trade deal if the authorities resort to the use of violence against protesters in hong kong. alix: china strikes back. >> the accused vice president pence of lying. they accused him of arrogance. alix: the foreign ministry blasts vice president mike pence for criticizing the chinese government on human rights. they say pence ignores u.s. problems such as racism and wealth disparity. pm johnson: if they genuinely want more time to study this excellent deal, they can have it, but they have to agree to a general election on december 12. alix: eu diplomats have agreed to delay brexit, but they won't say how long until after a vote in parliament monday. british lawmakers are going to decide whether to approve prime minister boris johnson's call for an election in december.

jersey, the five billion-dollar american dream mall will feature 300 stores, waterslides, and a caviar bar, a nice grading -- and ice skating rink, and a nickelodeon theme park. in the markets, it has been about earnings this week. what has been leading has been value in small caps. can that actually continue? the german sentiment index coming in a little bit better. are we finding a bottom? that is now the question in the market. joining me for the hour is romaine bostick, coanchor of bloomberg's "would miss?"s -- "what'd you aside from the mall in jersey,

what are you looking at this morning? very interesting for our european viewers. holy cow. we were on site yesterday until earnings broke, and remember, if you months ago, everybody was ready to write the obituary on intel. they were having difficulty making the transition to data center products, and a lot of people weren't buying their forecast. they were saying they are just behind the curve. yesterday, not only did they knock it out of the park on earnings, but just the forecast they gave and the acceleration you saw. you had the drop in growth on the chip side, the pc chips come up with a more than made up for that on the datacenter side. down 26% at one point this year. they will call themselves out of this hole over the next couple of sessions. alix: they had a really dismal outlook for trade, so they go to

end market. outine: also, don't count some of these big chip companies. intel,seeing this with seeing this with microsoft, which is kicking butt all over the place now. some of these companies have the scale to catch up should they have the mentality and leadership to actually make that shift. intel definitely has it. microsoft has it. keep an eye on these companies. i think they are going to challenge a lot of those second-tier software companies out there nipping at their heels. alix: and really create some turn within the nasdaq and tech sector. we are about 40% of the way through earnings season. on average, companies are beating i nearly 4.5%, but earnings are actually lower year on year. but earnings are actually lower year on year. joining us now is lori heinel, state street global advisors deputy cio. what do you take away from

earnings? yay, we beat? we are growing? lori: the fact that we are beating is good, but we are seeing a lot of divergence. as companies do a little better than expected, they are getting rewarded for that. companies that are missing or just hitting at expectation are getting punished. we think we will see a lot more divergence. romaine: what is the narrative here? there's a lot of jokes over the last couple of days, or be looking for profit or revenue growth? the last couple of quarters, this was all about revenue growth. now people seem to be much more focused on profits. lori: it's a little bit of everything. revenue growth is something we always want, but disappoint meant -- disappointment is important when it is a little cloudy on where the outlook will come from. but there are a lot of paths to prosperity here. there are company seeing better demand from the consumer side, and that is being rewarded. other companies have that cost discipline, and other companies

have idiosyncratic things going on, so i think it is a missed bad -- it is a mixed bag. romaine: they are saying if we do one day shipping, if we are going to compete, we got to spend. in the past, they've gotten a pass for that. now it doesn't seem like investors are willing to do that. lori: i think investors are trying to look at the shorter-term. investments generally have not been happening. we seem a lot of pull from companies on that front. but smart investments where there is actually a payoff attached to that, investors are willing to be a bit patient. the question is whether they will get that from amazon. alix: to that point, there could be an argument that it could've been worse. amazon could have been down 10% or 12%. it was gross in the cloud that is going to hold it up. romaine: they've always managed to find their way back up. that is another company you don't want to count out. alix: you bring up the point i did want to highlight.

if you come inside to bloomberg, this is the momentum etfs, value etf's, small-cap etf's. small caps and value actually increased. is this another fake out or the start of a trend? lori: one of the things it tells you is some of those other sectors have gotten so far extended. certainly, momentum carried the market higher the last couple of years, so the short-term is not surprising. the narrative of the economy bottoming out and potentially having longer legs is also starting to be heard by investors. romaine: that part is interesting to me because earlier this year, the gap between small caps and what large caps are doing was a pretty wide gulf. it has narrowed pretty considerably. when you start to see that, does this say to investors, they have that confidence that the minimum, we are not going to fall off the cliff? lori: first of all, valuations

have gotten so expensive. you look at growth versus value. a lot of those sectors have gotten super expensive, so investors are willing to take more of a chance here. you are also seeing improvement in some of the sectors. take banks as they start to see more positive yield curve, a little better growth prospect. those have been propelling the market higher. alix: that gap has been there for a while, but the differences we have a steeper yield curve. romaine: we have a steeper yield curve, and that is helping. and the sentiment has changed. we had the s&p value segment at a record high. euro seeing smaller companies participate. i am wondering, does that extend outside the u.s.? there has been a narrative that investors should look outside the u.s. because of the valuation issues. you can go to europe and get barclays for a lot cheaper than jp morgan. lori: outside the u.s., it has

been a lot about geopolitical tension. we are starting to see those dissipate. we may have a brexit deal. alix: well, eventually maybe. [laughter] lori: there's still flashpoints, but on balance, there are some tensions fading. but we remain much more overweight to the u.s. because we think the tailwinds are better. romaine: when we look forward to next week, this was the biggest earnings day yesterday of the year. we still have a huge slate of earnings and, not to be pessimistic, a lot of opportunity for disappointment. when you look forward to the rest of the earnings season, do you think we are going to get enough of that guidance going forward from companies like intel to keep this market at least at that 3000 level or above? lori: first of all, investors aren't expecting a lot. we are actually seeing earnings improvement, so that is a good thing. what is more important next week is the fed.

certainly, we will be watching earnings. we will be hearing about it on a company by company basis, but it is more about what the fed does. alix: do you like industrials? lori: we are mixed on that. we are seeing select companies where we are biting -- where we are buying. of statei heinel street global advisors and romaine bostick are both sticking with me. coming up on this program, european bank earnings get into full swing. we will speak to octavio marenzi, opimas founder and ceo, next. this is bloomberg. ♪

alix: barclays investment bank

outperforming its peers in the third quarter. the bank confirming its 2019 price target. ceo jes staley telling bloomberg the outlook will be a challenge. >> given the current interest rate view across europe, u.k., now in the u.s. as well, and if we have economic softness, you need to put some caution against 10% target for 2020. alix: joining us now from paris is octavio marenzi, opimas founder and ceo. still with us, lori heinel of state street. when he took a look at what we've learned from european banks, do we have a broad take away yet? have we found a bottom for them? octavio: if you look at the two banks that have announced so far, ubs and barclays, they seem to be going in diametrically opposite directions. bank did quite badly. barclays did very well. ubs didn't do so well in domestic retail banking, and

barclays did kind of mediocre. these two banks so far aren't really giving us any real direction, but i think what we will see overall is a bit of softness in domestic markets, a ,iny bit of growth there loan volume up, and on the investment banking side in the european market, things do not look so great. we seen some downturn there, a big downturn in ipo activity, trading volumes have been flat a bit. so far, we haven't seen much of a direction, but i think it will be that investment banking and europe will draw things down, and domestic and corporate will be kind of flat and down slightly overall. romaine: are you a little concerned that we didn't hear more with regards to cost-cutting? octavio: well, i think if you look at all the big banks, they are still very much focused on cost-cutting. that is the one leverage point they have. certainly if you look at

barclays, they were quite successful in keeping costs under control, certainly domestically in the u.k. they diversified quite a bit year on year, so the carry on in that direction. i think be very easy cost-cutting, the ability to take 10% or 15% out, is behind us. there's just not that kind of volume left there. so these banks are going to have to incrementally try to squeeze more and more out, and that is going to become increasingly difficult. i think we will see small reductions in cost over all, but they will carry on the and very disciplined in that aspect. after a while, you're trying to squeeze water out of a rock. romaine: another concern is credit quality. we've heard from some other banks showing some data that does appear to be more concerned about whether or not some of the debts they have are going to be made good on. barclays did not really address it in full, but when you look at

the banking sector across europe, did you have any concern that we may be at a pivot point in the credit cycle? octavio: i think we are for two reasons in particular. one is if you look at continental europe, the european central bank is starting to punish banks of excess reserves. they would have a negative rate on excess was there is posted with the european central bank. a few days ago, they lower that even further to get a 0.5%. -0.5%. -- to banks are going to lend out more to people who have otherwise been marginal and they wouldn't have really chosen. that is going to have to reduce credit quality overall. it is also going to have an impact on net interest margin because they will have to make lower interest rates. since they are losing 0.5% on excess wizards every year, they will be more incentivized to do that. are taking on borrowers

they otherwise would not have taken on. on the other hand, you see a looming slow down in the european economy that will lead to increased default rates. alix: fairpoint. lori, do you like the european banks? at what point would you like european banks? lori: we don't like european banks right now on balance. certainly come of the additional quantitative easing puts them under a bind. the problem in europe is not cost of capital. the problem is structural reform and fiscal stimulus. there have been a little bit of vectors in that direction. for the most part, we remain very cautious on europe. romaine: how confident are you that we might get fiscal stimulus, particularly how that at the ecb someone in charge who, to a certain extent, may be more of a politician than draghi? lori: there is certainly opportunity to change the narrative. i think draghi gave a little bit justver by introducing qe

as he was leaving, so there is space to do something else. you have seen some appetite for that even in places like germany to look for fiscal stimulus. some of the geopolitical tensions, trade, for example, which hurts the euro zone worse than other regions are dissipating. there is some light there, but they've missed these opportunities in the past. alix: if we get some kind of fiscal stimulus, from germany or some other country, does it change the profile for banks materially? octavio: definitely. if there is importantly sized fiscal stimulus, definitely. you talk about it from christine lagarde in the ecb on the monetary side. i think they push the envelope there as far as they possibly can. they've pushed the monetary policy envelope farther than anyone else thought they could. the monetary stimulus does not seem to be working terribly well. maybe they will push that even a

bit further. but on the fiscal side, definitely. if there's increased fiscal stimulus, reduction in taxation, that could. have a nice impact i don't since -- that could have a nice impact. i don't since in the european landscape a large appetite for that. it all seems to be going the opposite direction. so i would not hold my breath hoping that will compound. romaine: what about a snap back on monetary policy? we've always been looking for the bottom here in where rates can go. you can't really get much lower than where we are right now. getvio: i suppose you could lower on the long-term end of the yield curve, so they could manipulate that a bit and push prices down even further, beyond 10 years, beyond 15 years. i don't think that will have a positive impact on bank earnings. banks like to have steep, upward sloping yield curves.

they would like to avoid that overall. but it is difficult what they could do more with monetary policy. christine lagarde has always been very dovish on the true policy, so this is very much in the mold of the policy of the ecb so far. i don't expect a dramatic departure in november. i wouldn't expect too much uplift from that side. alix: it is looking pretty grim for european banks. more earnings coming next week as well. who is best positioned, if any of these headwinds go away, even if it is more of a macro trade? octavio: well, i think macro trade, if you're talking about cross-border activities, there's firms like deutsche bank who are particularly well-positioned to pick advantage of that, but they have their host of their own problems at the moment, so i don't think they will be out performers as a result of that.

most european banks will benefit from easing trade tensions. probably alike hsbc, has the largest asian and chinese exposure, so they would probably benefit the most if trade tensions subside. but bear in mind, a lot of large european banks have very international business portfolios. alix: lori, looking ahead to the fed, president trump out in the morning yesterday talking about the fact that the fed needs to lower rates, that the european counterparts continue to be more easy, etc. is there a central bank relative trade to be made? we take a look at the u.s. treasury-bund spread that continues to narrow. what you think? lori: the real mechanism there is the currency. the fact the dollar has been so strong is in part because the fed has been more hawkish compared to other central bank's around the world.

we believe that longer-term, the dollar will weaken eventually, but there still needs to be a catalyst. the fed potential he moving those against -- the fed potential he those against europe, it doesn't look that way in the long-term. alix: octavio marenzi of opimas, think you very much. $5ing up, softbank plans billion write-down in uber and wework, and let's not forget about lift pop -- about lyft. this is bloomberg. ♪

viviana: you're watching "bloomberg daybreak." shares of intel are higher. the chipmaker reported third-quarter results that were better than expected. it gave a fourth-quarter outlook that was seen a strong. still, intel's gross margins are a concern. they are also worried about

competition with advanced micro devices. amazon showing third-quarter profit growth -- verizon showing third-quarter profit growth. it is expanding its 5g service to 13 cities. softbank's vision fun plans to take a right down of at least $5 billion to reflect the plunge in the value of some of its biggest holdings. this includes uber and wework. softbank agreed to bailout wework in exchange for 80% of the company. that is your bloomberg business flash. alix: thanks so much. one of my favorite quotes that manager,from that softbank brought wework to its senses. that comes from chris gaffney. i don't know if i believe that. romaine: it is interesting.

since they had been a public company -- if they had been a public company already when this broke, would that have shifted sentiment in the public market? general consensus was yes, but being private, there is still a little bit of cover here. there's cover for softbank. we talk about the $5 billion write-down. we still haven't seen the differential between what they put into this company and what it is valued at. uber are also presumably down. there's a lot that hasn't been laid bare. not everybody has gotten that message. alix: agreed. i also wonder how much of it was actually softbank having so much capital to put to work that it sort of that into a lot of different kinds of companies, that maybe if we valued wework is a real estate company versus unicorn start up, that is a different kind evaluation. but with $100 billion put to work, you've got to take a

different kind of risk profile. romaine: there's so many great anecdotes from bloomberg reporters about some of these companies that are also sort of questionable. obviously they go big. he's failed big before. he's also succeeded. alix: that's true. that's like your point, don't discount amazon. romaine bostick is sticking with me for the hour. coming up, argentina heading to the polls sunday for any president. the current front-runner is worrying investors, though as much as the current president? it really is debatable. this is bloomberg. ♪

alix: this is "bloomberg daybreak." i am alix steel. happy friday, everybody. level,ding at the 3000

from amazon or good news from intel as well. highlight beverage stocks. in best coming out with pretty bad numbers, particularly in china. gaining a little bit on the dollar, the euro losing earlier gains. you want to find out what is happening with the rubalcava actually up despite the fact that you saw the biggest cut from potential -- the central bank since 2017. the continued theme of emerging markets central banks rate cuts a big part of what is leading returns and the e.m. space. elections will be held in argentina for a new president. carillion of is joining us, the bureau chief. players?he bid for the carolina: it stunned investors. victory, twice what console

consultants that would be for president macri. leaders are concerned that alberto will bring back government spending and take a more interventionist approach to the economy. romaine: so what are you expecting bad? once we-- then? differentt a new or government here, or the expectations on the ground, what you are seeing out there, so much different than what we had under the previous administration under macri? carolina: the reason why people are concerned is because he is a previousngside candidate who people thought was heavy-handed, interventionist, everything from intervening in statistics, bringing up government spending, and maintaining a default. this isoncern is that

what we might be growing into, as well as promoting the decision to continue. alix: thank you very much, bloomberg's carolina milan, joining us from buenos aires. joining us is bill campbell, is still with us on set, lori heinel of state street global advisors. how are the positions heading into the sunday elections? going into the sunday flations, i am currently on argentina. i think there are a lot of unknown spirit we do not know, well, i think the outcome is the foregone conclusion that alberto fernandez and his team will come in, but we do not know what his cabinet will look like, and we do not know, importantly, what the economic steam will look like and what the economic package that they are going to have to present to the imf will look like. my concern is that immediately

following these elections, if there is a first round win by alberto fernandez, he may take some time to announce the putures that he is going to forward and announce his cabinet until he effectively takes control in december. and the issue that we are seeing now is the reserve drain. the bank of a when you look at argentina central banks, they had to implement capital controls in order to slow down output from the country, and we have seen about 17 billion and fx reserves have to be used by the central bank in order to keep the currency from moreciating to, you know, than what we have seen following the primary election. if you look at the blue rate, which is the unofficial rate, you are looking at a further discount from the official rate today of about 31% pure the time window is very limited, and the package, the economics and

structural reforms that alberto seems to be putting forward to the imf are going to be critical, and he needs to do it quickly. romaine: so, bill, how much confidence do you have that fernandez, should be win, is actually going to stand by this light is that he will make good on the debt or find sor some sot of an way to find this out with creditors? think,ell, i unfortunately, it might be a little bit out of his control, and we need to look at the other side of the coin, the other side of the negotiating table, which imf.e when we look at the imf, the recent statement is that they are looking for debt sustainability with a high probability over the medium-term. now, that is a change, because the prior program that they implement it had a debt sustainability with a low probability, and the implication of that means that under shocks that the imf will, you know, test the alberto fernández plan

with, he needs to come up with a substantial fiscal adjustment to be able to withstand, you know, the shots that the imf are going to present to his plan. arebiggest concern is we looking at, and argentina, primary deficit or fiscal deficit excluding interest payments of about 1%. export taxes,the which he is talking about potential wealth taxes, there may be a little bit of growth, which are all, you know, reasonable, but maybe a little bit on the optimistic side of the assumptions. maybe i can get to a 1% primary surplus, but in order to meet the target of the uruguay-style targets that alberto is talking about, i think he is going to need a primary surplus of 2% to 2.5%, and that is going to require expenditure cuts, and what we have seen in his campaign rhetoric is continued movement toward increasing the social safety net and increasing

subsidies, and that will be the sticking point in the negotiations between the imf and alberto. alix: bill, clearly you have done a tremendous amount of work on argentina and the fiscal stimulation. the vice president of this ticket, which is cristina , very unpopular in the business community for instituting capital controls, do you really think it will be alberto in the government? why wouldn't it be cristina? bill: that is a great question, and we here at doubleline are looking at that closely. alberto is focusing on trying to get the largest margin of victory can iorder to solidify h legitimacy on this ticket going torn is he is need to deliver a quick adjustment. if he cannot deliver growth, if real wages, heer runs the risk that you start to

see social unrest pickup, and in that scenario, i can see cristina taking more of a leadership role on this ticket, but initially, i think the ball is in his court. he has got a small window to put together a credible package to put -- to the imf to get a new program in place with them. this new program by the imf would be an anchor for investors to look at the country over the next few years as, you know, an investment opportunity. if he cannot do that, i do not see the growth model. romaine: lori, i want to bring you in here. bill mentions the social unrest we see in argentina, and this reflects we see across latin america in weeks and weeks and months and months good when you look at e.m., in particular that part of the world, is it safe, i guess, to go back and? we have heard a lot of people and they

specifically single out south american countries. lori: these countries have been incredibly volatile, and the political process is just one step in the process, as we have heard. there is going to be policy. there is a lot more there. we would be quite cautious on the region. alix: ubs was taking the opposite view when it came to the equity markets, saying while investors need to monitor developments, we continue to monitor emerging markets and nations, addressing economic and social pressures. you do stick with that, like, when you are looking at emerging markets, how do you factor that into your models? lori: the equity markets generally, we have been reducing our exposures by going more negative on e.m. throughout the year, because again, a lot of the geopolitical trades are in a emerging markets more than they are in the developing markets. with highot companies expectations, and yet they continue to miss, so we were

talking about earlier that the u.s. has been beating, and actually e.m. has been coming down and missing. we think it is still too early for e.m. romaine: let's say we can get that reversal on the dollar, that may or may not ever come. does that make it more attractive? that generally is more profitable than e.m. equities, you have improving credit quality, pretty attractive yields, and as you say, they are not as overvalued as they were going into the taper tantrum, so we actually like em debt. taper, it is all the same. [laughter] alix: yeah. issues ing we have argentina, equity forced out of its leadership, you had a hile,st this week in julci what is most appealing? bill: i have to agree with lori that valuations are still

attractive. on the fx si the potentialde, the potentialide, would be positive. we had disinflation's globally over the past year, and that has allowed central banks to cut across both develop markets and .- developed markets in emerging markets when we are looking across the complex, yes, we have to be concerning, but -- discerning, compared to the taper tantrum, we're seeing improved twin deficits. you get a removal of this headwind on trade, even if it is temporary, to provide a nice boost for the return outlook for the end of the year. alix: all right, guys, thank you

so much. bill campbell of doubleline and lori heinel of state street global. viviana hurtado is here with first word news. viviana: alex, we begin with this word, "lies," which is why china calls mike pence's criticism of human rights, also calling into racism and income disparity. talking aboutdent the protesters in hong kong and also accused beijing of raining and the rights and liberties of the residents. a criminal investigation examining a legal find on president trump or on his 2016 -- illegal spying on president trump or on his 2016 campaign. the investigation is widening just as the u.s. house impeachment inquiry is becoming a threat to the trump presidency. over to northern california's wine country, that is where bankrupt utility pg&e had a

power line failure just moments before a wildfire broke out nearby. blackening 15,000 acres, destroying 49 structures. earlier this week, pg&e turned off electricity power to a half-million people in that state. this to prevent power lines from starting fires. global news 24 hours a day, on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i am viviana hurtado. this is bloomberg. alix? alix: thanks so much, viviana. coming up on this program, mounting problems for boeing. max design is among the issues that led to that crash. and bloomberg users, you can interact with the charts we feature throughout the show on be tv , check it out on g tv . this is bloomberg. ♪

viviana: this is "bloomberg daybreak." i viviana hurtado in the bloomberg enterprise greenroom. coming up later today, mark mobius, the enterprise cofounder. now to your bloomberg business flash, the most significant changes in the company's history, that is how google executives describe the new system, using artificial intelligence tools to better interpret the billions of web searches it gets every day. it will impact the industries that rely on it. goldman sachs is joining the exodus from carrie fisher's fi -- from carrie fisher -- kent and that figure will grow. since he has made vogler comments at a conference,

investors have pulled billions from the fund. the first quarter of sales growth in more than a year, the london-based firm when a more business and the u.k. in europe. wpp saying even though business is still down, it has seen significant improvement in north america. i am viviana hurtado, and that is your bloomberg business flash, alix. alix: thank you so much, viviana. amazon, am looking at posting its first quarterly profit in about two years, yet some of the bulls are still bullish, just maybe not as much soak. i spoke with michael levine, used to be the biggest bowl of the street. he downgraded his target was still has a buy rating. here is what he had to say. michael: the dollar growth is beginning to flatten out. business, it is hard to see massive inflection in terms of dollar growth one way or another. in reality, i think we have been

to bullish, and i think the street is to bullish. alix: i wonder what that means, what does to bullish mean? romaine: i think it means lower your expectation -- alix: in a bullish way. [laughter] romaine: in a bullish waiter they see the long-term story, which is still positive, but at the same time, they have to acknowledge in the short-term, this is looking a little off. alix: 100%. now we are down 6% in premarket. what are you looking at, romaine? isoft.e: eunicun have you ever heard of this? alix: [laughs] no. romaine: their earnings themselves were not the issue. they basically talked about two video games they had, was running a big tom clancy game, basically fared relatively poorly cared shares dropped about 20%, the biggest mover in the stoxx 600 curate a decline appeared they are trying to

compete. they are a much smaller version of ea and activision. they use a lot of voice actors. it a lot more realistic or that was the big thing a few years back. now everybody does it, and they have not kept the pace. and you have activision's new call of duty game, the big mobile version they are putting out. so far, pretty well-received, if you go by twitter and social media. probably a couple of days before we get actual numbers, but this against.hey are up you look at these games, and they are realistic am almost like watching a major feature film. alix: i was going to say, i wonder what the budget is. romaine: you used to be -- ubisoft used to be the forefront. i know you are into unicorns, a unicorn game, the secret of the unicorns. alix: awaken, my love tintin. have you ever read tinin? i love it so much. romaine: i am glad i could

connect you. [laughter] alix: right now, this is the best moment of my day. this has to do with the investigation into the lion air crash. what did they uncover? >> the report is going to be released today, and bloomberg news got a little bit of a preview of this, and it does not look good for boeing. it does not look flattering for boeing. most of the things have been reported or have come out over time, but when you see it all in one place, it is really devastating. they talk about this mcas my control software system that was implicated in both fatal crashes, how they made incorrect assumptions about pilots ability to respond to the system, and the part of those were incorrect, because the pilots of course did not know about this system. they did not know it existed. it was not in their manuals. it was not part of the training on the 737 max 8. this is not good for boeing, especially as the ceo is set to testify.

romaine: i am curious -- how are they going to make it right? on bloombergo yesterday, and incorporate ceo speak, he seems pretty angry about how boeing was handling this relationship and how they were compensating or not compensating, rather, some of the airlines. interviewthought that was very fascinating, and you saw the ceo, gary kelly, talking about the airbus jets are southwest has take the company on being a single model league, that gives them significant cost savings, so having serious conversations about diversifying tells you how seriously bad this for boeing. s&p lowered the credit rating earlier this week, and one of the things they talked about is this risk of long-lasting reputational damage an potentiald market share lost i do not know if this is just negotiating by felt with -- by southwest, and ryanair is

looking to negotiate, are they just looking for better pricing? or maybe this is not strategically responsible to be if youndent on boeing could in fact see a major downing of a major plane. romaine: if itromaine: is a negotiating tactic, wouldn't you have to start putting this is your forecast? these companies are going to start holding them to the walls. alix: gary, notably come in the interview, was quite positive, i was like "your stock is down 10%." brooke: they are really frustrated, and he was not confident boeing's timeline in getting the planes certified applied by the quarter. their expectation of the -- certified to fly by the first quarter. expectation, saying we are completely confident in boeing, nd of itself tends to be telling, because like you said, he is an optimist. alix: romaine, thanks for joining me this hour.

the unicorn game, to be clear, is my daughter. [laughter] romaine: so you save your no judgment here this is a no judgment zone, alix. alix: it is a full judgment zone. women in wall street. the world of finance. citigroup, the first female ceo of the bank, has just promoted jane fraser to president, the second-highest post she has had at citi's sizable operations. in her new job, she will take bankas head of consumer appeared ceo michael corbat says he is still planning to lead, but she has helped shape the company we are today. coming up, the tale of two tech giants. amazon gets a bullish forecast. more on these earnings today. if you're heading out, jumping into your car, tune into bloomberg radio, sirius xm 119 and the bloomberg business that. -- app. this is bloomberg. ♪ mberg. ♪

alix: time for technically

speaking. the voice of bloomberg's equity squad joins us now. you can find it on the bloomberg .you type in squa >> it was brutal, down in the premarket. the support level since its march break out, now amazon is going to open up in the 1600 to 1700 range. key support level is the zumo, 1672, so below that, really nothing to 1600. 1672, 1600, your levels. alix: that could be pretty brutal. let's go to intel, a tale of two texts -- techs. like a texas instrument's less exposure to the mobile unit. >> intel is up, a clear uptrend from the august lows. it is going to try to break out into this gap above 53. if it does that, first

resistance around 55, which is another retracement level, that a top around the gap around 57, so 55 to 57, but it has to get back into the gap. --x: sector, old-school tech michael socko staying with the blue-chip sector, old-school -- alix: microsoft, sticking with the blue chip sector, old-school tech. >> microsoft remains flat, not able to break out after the numbers. 142 remains your resistance. alix: all right, bill, thank you. bloomberg's bill maloney. the rats appear for "bloomberg americas." this is bloomberg. ♪ this is bloomberg. ♪

jonathan: from new york city, for our audience worldwide, i'm jonathan ferro. they count down to the open starts right now. the countdown to the open

starts right now. coming up, the equity markets treading water and amazon is rolling over as a spending cuts into profits. german expectations show a slump ending. and a brexit breakthrough remains elusive. for johnson again pushing for another election. good morning. it is your friday morning price action. we are grinding toward a third straight week of mild gains. equity futures roll over, down two points on the s&p 500. market,he g10 and fx treasury yields coming down by a single basis point, 1.75 of the u.s. 10 year. the big issue, markets shrugging off weaker than expected data. >> i do not think there is any reason to be super fearful. >> the u.s. is in a good spot. >> it is slowing in the u.s. >> manufacturing is weaker globally. >>