jon: welcome to "bloomberg markets." matt: equities continue to rally the s&p 500 .8%, 4575 is the level. near section highs. we are looking at investors buying bonds pushing the 10 year yield down, but to end the third basis points, 39746.

the dollar coming down against the euro and the pound, 1216 on the bloomberg index. we are losing some momentum and the same is true of oil. we had crossed up over $80 a barrel but now down to $79.80. what are you watching? jon: important to watch. at so many earnings stories. notable -- so many earnings stories. t. rowe price better than expected numbers, 7.28%. a very strong revenue number for roku, the stock has popped 25% today. a lot of people watching chip stocks today thanks to intel with bpce recovery playing a

role in quarterly performance. shares of 5.5%. a number of high-profile tech stories this week including meta platforms. it has gained 10% over the last four trading sessions. matt: let's get back to the economic picture. what does today's data say about the u.s. and canadian economies? let's find out whether we are heading for a hard or soft landing. there is always an opinion. haeckel, we had a great data -- michael, we had great data in terms of inflation and personal spending. michael: over all cost of compensation is going down.

the cost of inflation is going down in the united states. we didn't get much better numbers from the pce index, the fed's favorite numbers. what we ended up with is a less than expected, pushing us down to 3% and court falls to 4.2%. employment cost index showed a 1% gain in overall employment costs at a 1% gain in the wage and salary component. overall, things seem to be going in the direction the fed wants. we ended up with spending up .5%. you heard jay powell talk about how that may be related to barbie and oppenheimer and people who might be going to concerts. matt: i'm going to the fish run tonight. michael: i bet you are feeling

good about the economy. matt: absolutely. jon: we would like to ask the statisticians in ottawa whether they can measure the barbie impact in canada. we are seeing the stories about resilient economy, a contraction in the canadian economy based on early numbers for june 2023. i think also if he thinks about the fact that you've got an overall growth picture for the second quarter that may end up being softer than what the bank of canada zone or cast was -- canada's own forecast was, it was a question of where do we go from here? lara: we saw the preliminary data showing a 0.2 decline in gdp in june suggesting we are on track for 1% annualized in the second quarter. it is softer than the bank of

canada was anticipating but a bit of a muddled picture the forest fires in may had a hard to hit on energy production, so is the energy sector climbed by 2.9%. that makes it tricky to see exactly how the economy is really fearing under rate hikes. that is one piece where they might want to think, we want to take a look at consumer spending in the next gdp release when we get the final picture for the second order. also a bit of a bounce back in may from federal striking workers going back. matt: why do you think the u.s. economy looks like better footing than other g-7 economies? i see slower growth out of canada, stagnation in germany. why is the u.s. doing seemingly so much better? kathy: i am not sure why the

u.s. is doing better but we have wondered in canada why they aren't showing more sensitivity to rate hikes. housing and consumer spending was still going despite the massive tightening we have seen in the past year. when we compare canada to the u.s. we may be seeing that canada is showing a bit of sensitivity, at least to the rate hikes we have been expecting them to show sensitivity to for so long. movement finally see consumer slowdown, especially since we had to hikes. -- we had two hikes. jon: i did notice in canada this week we saw signs there were fewer job vacancies, maybe signs the employment picture is starting to cool. can you tell us about the jobs

in new york? michael: we are running just under 10 million and that is significantly higher than pre-pandemic. there is still a lot of jobs as far as the last report that we had. numbers haven't started to come down. we have seen higher slowdown but still strong. if we don't see the job vacancy numbers come down, it will mean a tight labor market is in place. matt: thank you for joining us. coming up, bumps in the road, for's investment in edie's is expensive. we will discuss the results with itay michaeli. this is bloomberg. ♪

jon: time now for our stock of the hour. we have been watching for, shares slumping. investor worries tight to the money-losing electric vehicle business, now projected to lose $4.5 billion this year. as for the overall production numbers, the goal to produce 600,000 ev's now getting pushed out to 2020 for -- 2024. matt: let's bring in citigroup global markets analyst itay michaeli. he joins us to talk about this lay. we should preface this by saying

ford did much better than expected on the top and bottom of my -- bottom line as a whole. they will lose $4.5 billion on the ev line and we thought it was only three. why is that? itay: it was in the ford commercial and fleet but the big news was the setback in the model ev vision pair they widened the loss. . we have seen slowdown in u.s. ev adoption in the second order. with a part of that relates to slow regional dispersion of demand outside the strong coastal regions in the u.s.. some of the ford vehicles they swell in dealer inventory.

it is still early days in the 40 ev. the late iteration isn't due out until next year -- in the ford ev division. the late iteration isn't due out until next year. within the company is trying to be strategic around company acquisition, increasing the f-150 lightning capacity. that relates to their desire to maintain a strong position in the pickup truck profit. matt: a number of others have asked me today and i'm not 100% sure why the production of the ev's is so expensive. the battery, electric motor are far fewer than an ice and they need fewer people to build the truck. is it retooling and investment in new products? itay: some of it is where we are

in the scale, lower volume, higher fixed cost per unit. we have inflation and battery and motion -- and propulsion costs. whenever you have capacity coming in met by slower demand, at least two price cutting and more competition. that the that does happen. it is around 7% in the u.s. and excluding california it is 5%. it is to be expected, not just from four but others. they are in the early days of ramping ev's. jon: i want to ask you about patients within this journey, internally, on wall street and with analysts like yourself. when you're transitioning away from highly profitable vehicles and the short-term taking big losses on an electric vehicle

market where there is uncertainty where the sales picture is going like, what does it look like? itay: we always want companies to hit their prior targets. the stock is reacting to the new information that we think it is a long-term journey. first ford and gm, they are underrepresented in the coastal regions like in california where ev demand is currently strongest peer we have seen and do see lucrative long-term market share opportunities particularly in the coastal regions. we do want to see customer acquisition and companies launch a successful product where we can see those market share themes. there is patients early on for you get to positive. but certainly to what is

happening today you want to see companies be able to hit targets they laid out a couple months ago. matt: white is for -- i always pull up a comp chart and i get a five-year picture and i feel like it is better to cherry pick time periods. ford stock over the past five years is up 65%. general motors is up less than 10%. why is for doing so much better than general motors over the past five years? itay: a lot of potential region -- reasons. some of it probably does have to do with ford being early to launch some of the edie's and now it struggling a little more than they were short while ago. ford has delivered that leadership in electrical

vehicles while gm is still in the early stages of ramping. the stock has benefited relative to gm and now gm is ramping to reflect by them in the second half of the year. we see more upside to gm relative to ford in part because of that and other assets they have as well. those are some of the elements that have caused that disparity over the past 12 months or so. jon: the price cuts from tesla, how significant have those been in disrupting what is going on within ford? itay: is having an impact on the total ev market but every product has to stand on its own. ford had to respond and cut prices. the tesla when we look at the market share, q2 is down versus q1. slowdown in ev demand has affected pretty much everybody

in the industry right now and does have an impact. the model e business, a few nameplates, we don't think the price cuts have really impacted other parts of a ford's visit -- business. the ev space has had an impact in the broader space less so. jon: great to have you with us. appreciate the time. coming up, california in focus. the climate challenge, it is wildfire season but the largest utility said the infrastructure is safer than ever. highlights from the interview with the ceo a pg&e is next. this is bloomberg. ♪

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jon: right now, we are living through the hottest july. climate solutions is the focus today's big take would to contact out on the bloomberg terminal. we talked to the ceo of pg&e as the state hurtles toward the height of wildfire season. >> there is infrastructure technology and deploying tools to make sure every minute we spend doing work we are doing it in a smarter way there we are getting smarter every day and that will lower the unit cost of doing the undergrounding which is the heart of the plan. if enabled we can dispatch back to the grid the power plants. i say put the power where the people are. these can be mobile powergenerating units that optimize using the right technology and we can have a

modernized rid that diminishes the peak and utilizes energy in the middle of the date when we have access because of ott's of solar on the system here and we can lower the unit cost as we did carbonized the economy. that is possible with the right technology underpinning this transformation. jon: that was the ceo of pg&e. we are worried about the fragility of the grids, especially as we get record high temperatures and we all want to plug in cars. how much will they have to invest to bring us to the modern solution? ed: they plan to spend $50 billion over the course of the next few years. to her mind, the risk of an equipment-induced wildfire is now 94% lower than it was in 2017.

that is the history of this company. it emerged from bankruptcy because the fires caused by their equipment. and they were the cause of the dixie fire, the second largest in history. they have acted on using technology to mitigate the risk. when it comes to the grid is self, completely changed -- itself, completely changed. they are putting power lines underground. jon: literally changing safety settings on some of the power grids as well. you talked about ai which is important for every conversation you have had this year, in this case detecting risks. ed: they have used ai since 2021. they run the energy infrastructure from oregon down to bakersfield and they use ai in three ways, predict where

fires will occur, including weather, camera, data, decide which areas have the most likely hood -- likelihood of a tree falling on it. if a wildfire occurs, with a are better at is predicting the cause using ai to look at the area where the wildfire is active and say, where is it going to go next. that is proving to be a success .4 pg&e. jon: bloomberg's ed ludlow. another stock we are watching is reality pharmaceuticals -- reata pharmaceuticals. joining us is reporter michelle davis who worked through the night to give us the news. one of the first things i like to try to figure out when looking at the biotech stocks is

what do they have, are they making and what are they trying to acquire? michelle: they have a drug that got approval to treat a rare degenerative order affecting kids as young as five. they are the first to get approval for a drug like this. biogen has been trying to expand . those drugs are losing revenue and they haven't looking for growth and this is one of the ways they will do that is by finding the drug which analysts say will generate $1.5 billion. jon: you are constantly covering this sector and it does not every day we see this company pull the trigger on a deal. michelle: this is biogen's biggest deal by a landside and it is thanks to the ceo. he is known as a dealmaker.

when they hired him in november, it was well expected deals. even set on the first earnings call he said you shouldn't have hired me if he didn't expect me to do that. this is the perfect deal because it hits all of the buckets, rare disease, neural and will help growth. jon: michelle, thanks very much. i hope you get some sleep this weekend. michelle davis covering this big multibillion-dollar deal. we continue to see the markets march higher into the weekend. s&p 4600 is the next target we are watching for and also a number of other numbers, u.s. 10 year 4%. the bloomberg dollar index coming up from 1200. crude over $80 a barrel. this is bloomberg.

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it's an amazing thing when you show generosity of spirit to someone. and you want people to be saved and to have a better life, then you don't stop. the idea that we have saved five million people's lives, it's overwhelming. it's everything. romaine: goldilocks tells the barest kick rocks. katie: kicking up the closing bell here in the u.s. we have a rally on our hands. we sat down to talk about what's going on in the markets. the s&p is up .8%. big tech, the nasdaq 100 up 1.7% to close out this week.