welcome to "street signs." i'm joumanna bercetche these are your headlines deutsche bank sinks as it scales back investment bank warning it will reduce its work force after another sharp fall in trading revenues barclays beats on the bottom line but litigation charges on both sides of the atlantic sees the bank's capital ratio fall. shell falls after the oil giant reports weaker downstream

and lower refining margins despite a strong rise in first quarter profits. and vok vlkswagen shares dr higher after announcing they will partner with airbus good morning it has been a busy morning as far as earnings are concerned. we'll get into that and look at how european markets are reacting to the huge earnings results we got this morning. it's also ecb day. best day of the month. but looking at the markets, you can see the handover from u.s. equities and asia was quite strong but overall the broad composite index is trading around flat if not slightly firmer, up 0.1%

let's get into individual bourses. the ftse 100 is the laggard, down about 0.1%, about 10 points lower. let's not forget that happening today in the house of commons is a non-binding debate on the customs union. we've been talking about everything else going on in european markets let's not forget there's a ranging debate about uk's position in -- well, if they're going to go ahead and remain in a customs union, if not the customs union post brexit. european markets trading slightly firmer, inching into the green. we have the ecb meeting coming up they're likely to leave rates on hold, not making many adjustments to monetary policy, but people will be listening to what mario draghi has to say about the recent lieu slew of da

switching to sectors, autos up 0.8%. volkswagen results out earlier this morning the stock there is up more than 2% that's helping to give that sector a boost yew tutilities up 0.5%. oil and gas up 0.5%. that was boosted by some of the stronger earnings out of total and shell and the move in spot price higher basic resources down 0.1%. technology is lagging. we have some big tech numbers. yesterday we had facebook results coming out after the close. those are strong numbers again, today we will have amazon and microsoft coming out of the u.s. so keep an eye on that as well let's look at some of the names that have reported this morning. a bit of a mixed bag barclays has reacted well to its numbers, up 0.9% deutsche bank is actually

recovering, it was down 0.3% at the open, now inching back up again. almost back at the flat line disappointed on the top line and bottom line. as far as the market is concerned, perhaps more guidance on the shape of the bank and the future we'll get into that shortly. total as well, and shell is a bit ofa mixed picture. total is up 0.5% shell is down 2% also had roche around the flat line you can see the biggest -- two of the biggest underperson formfor -- underw underperformers are philips lighting and roche holdings. barclays first quarter profit beat expectations with the pre-tax figure at 1.7 billion pounds

the cte 1 ratio fell as legal costs in the united states and the uk hurt capital levels the additional litigation coasts means barclays posted a loss for the first three months of the year ceo jes staley called it a significant quarter saying the numbers show the bank's ability to hit return on tangible equity targets. and it be it deutsche bank' has described the job cuts as painful but regrettably unavoidable. they have outlined plans to slash its bonds and equities trading divisions after net profit fell almost 0% 80% in the first quarter. geoff joins me now to discuss this these numbers look backward looking. it happened at a time when we didn't have the incoming ceo it

looks like investors are willing to put this behind them and listening to what is said in the future this is a classic kitchen sink process we're witnessing from the new management team at deutsche bank. it does raise a few questions about the strategic direction they want to take the organization in. having interviewed on several occasions john cryan over the last two years, it was clear he believed in the investment bank and the opportunity in capital markets and expected at some point that we would see a pick up in activity which would justify his faith on holding on to those business lines. what we have is a pick up in activity if deutsche bank continued with its current structure, that would have begun to show improve emt improvementes.

unfortunately or fortunately the new management team has come in and has taken a red pen and saying we will rewind the clock. we will takedeutsche bank to its beginnings, which is corporate finance, ultimately providing businesses with capital for expansion or for starting their ventures, and we'll refocus on europe. pull in our horns internationally. the irony of the announcement is this comes at a point when we're focused on some of the slowing pmi numbers in europe and asking questions about just how much fresh capital the corporate sector is going to be demanding going forward if it doesn't see the opportunity to expand. so a very bold statement from the new management team. as you point out the market may be willing to give them the benefit of the doubt for the time being, but look how short john cryan's tenureship was in reality. i wonder if the new management team will get two years to

deliver what they obviously see here as a big new vision for deutsche bank, but one that not only cuts risk but also opportunity. >> seems as though john cryan's achilles deal is that he was exposed to the u.s. banking business and willing to give it a shot and the other irony is they're deciding to withdraw a bit from the u.s. bainvestment banking business at a time when investment banking businesses are picking up is this going to be the right focus for deutsche bank? the market is giving them the benefit of the doubt perhaps the market opportunity in europe and in the retail banking sector in europe is not there anymore. >> the questions that you ask are terrific ones. we won't know the answers until this all comes out in the wash

in the fullness of time. it does raise issues as to what the next couple of quarters will look like for the bank i would imagine the phones are ringing off the hook at the financial head hunters around the city this morning. anybody who sat in the markets business is thinking if i'm going any way, i just need to start looking to my future here and i need to make my own arrangements perhaps i can ease back a gear or two on delivers for the bank. they talk about de-layering layers of management which will bring them a boost in terms of reducing costs, but the fact they talked about running down some of these other business lines, i think that means increasingly it will be difficult to believe they can

profit from ongoing market volatility, which we now expect as this yield curve flattens and the ten-year sits above the 3% mark >> equally what we've seen with the likes of other banks, with credit suisse and ubs, that the market rewarded those banks for going back to their core businesses, for focusing on wealth management in the case of ubs, credit suisse shrinking the business, we've seen that in the earnings one thing that steve always talks about is the price to book ratio. as far as deutsche bank are concerned, from a value proposition play, they are trading at a heavy discount relative to their european peers. perhaps from a buying opportunity perspective, if you were willing to give them the benefit of the doubt, now is the right time to do it. the price to book is 0.5, others are 0.91 >> the challenges for any german bank, in the listed space, in the private lending market, is that you are taking on the state

banking system, where they can afford to operate with thinner margins, and largely lower costs. so i think that the challenge for deutsche bank at this point is okay, you want to take us back to a time where the fee income and the recurrent nature of that income stream will be supportive that's where you want to go. that's why credit suisse was rewarded, i think. we have deeper competition from public banks, and do you think anybody else in the european banking system or in the american banking system will lay off your clients now when they see this announcement? this is sharks and blood in the water. >> you asked mr. amati, and he said that was not his style. >> we know that was the answer his pr expected him to give.

they weren't like hey, you know what we need somebody in the corporate finance space, deutsche bank, those guys are worried about their jobs, pick up the phone, offer them 5% more, and tell them to come across the street. bold to be buying deutsche bank this morning, probably on the evaluation, but a lot of questions to be answered >> we'll have more on those figures later today when we hear from james von moltke at 12:30 cet. the ecb are expected to keep the monetary policy decision unchanged later despite recent softness in european data. the governing council was optimistic about the growth momentum in the eurozone when it last met in march allowing it to remove its easing bias it pointed to strong incoming data and increased staff

projections which forecast a faster rise in growth than previously expected. the figures from the euro area since then could be a cause for concern for president mario draghi and fellow policymakers a number of hard data points have missed expectations including inflation and industrial production. pmi and the german ifo survey have also disappointed this coupled with severe weather in recent weeks is leading some analysts to reduce forekas for the fir forecasts for the first quarter gdp due next week. i want to talk about ecb but also the color of mario draghi's tie. you're going for the bold red. >> i'm feeling purple. i'm in the red, but feeling purple you know, he likes the purple tie. there you go evidence and i have a feeling it could be a purple tie again today those who have much better data analysis than me on this are

talking blue, because he has not worn blue in a wlihile and it could be that kind of day. what is the ecb's mandate -- >> inflation >> inflation let's throw growth into the mix. of late, mario draghi has taken great pleasure in seeing the improvement in some data trends we've seen in europe at this point are those data trends weakening if they are, and we still don't have evidence that the ecb managed to generate inflation, do we need to be asking mr. mario draghi a different kind of question about whether this mandate is the right one i would just throw up this other issue as well about the bund yield, you're probably more expert on this than i am, having been steeped in the trading desk -- >> i like the word steeped >> it seems that regardless of what mario draghi is doing with

interest rates right now, the market is drawing its own conclusions. even as maybe some data trends in europe are weakening, the ten-year yield is moving in sympathy with the ten-year yield in the united states so the american yield curve is still calling the chew for european borrowers in essence. >> not just for bonds, but also for the currency as well there's a lot of focus on you're yo in previous meetings the euro had strength, but with the bounce back in the greenback, theeuro has dropped about 2% so the backdrop of today's meeting is more easy when it comes to financial conditions than in the past, not because of anything that the ecb has done, but being led by the u.s. and the strengthening of the u.s.

dollar at the last meeting they did drop that easing bias with respect to the mandates of adding to asset purchases. they dropped that completely, since then the market has not responded. he managed to tweak the language and not spook market investors that's vintage draghi. >> on the program this morning we had the riksbank come out, and their statement is that we think we may have to push out our first movement on interest rates this year because inflation is not behaving in the way that we thought it would be. i wonder whether we will see similar kinds of language in the nuance around inflation from the ecb. we know mario draghi is a master at manipulating market expectations let's hope we have a clean set of statements from him this morning, especially on the questioning and not one of those confused ones.

>> it's always smoke and mirrors with draghi. that makes it so fun >> then we need clarification later from the ecb >> absolutely. we'll bring you more on the ecb decision later today in our decision time program, that's at 13:30 cet. coming up on the show, uber's coo tells cnbc that the company has been reinvented under new leadership more in just a few moments you know what's awesome? gig-speed internet.

you know what's not awesome? when only certain people can get it. let's fix that. let's give this guy gig- really? and these kids, and these guys, him, ah. oh hello. that lady, these houses! yes, yes and yes. and don't forget about them. uh huh, sure. still yes! xfinity delivers gig speed to more homes than anyone. now you can get it, too. welcome to the party.

welcome back uber's coo says the company could have approached some new markets differently. speaking to cnbc, barney harford said mistakes had been made, but that he believes the new ceo, khosrowshahi, has reinvented the company. hadley, uber has come under scrutiny lately what about the coo have to tell you what we heard from the coo from uber, he basically said not only

should the company work much harder in terms of getting in touch with government is, and reaching out, but that safety is a top priority for the company, not just when it comes to data but also what's happening with testing new products, like we've seen with the driverless cars. i asked has the european model done it better when it comes to the safety aspect of this. let's listen in to what he had to say >> we take the privacy of customer data incredibly seriously. we do not sell access to our customers data we are completely focused on using customers data to enhance the reliability and the affordability of the service that we're able to offer both to riders and to driver partners around the world >> so lots of questions of what uber can do next in terms of working better with governments. mentioned what happens with london in the next few days, but also in this region.

the coo was ehere to promote ubr eats, trying to make the business profitable in egypt, saudi arabia but i asked what their rival, kareem, and whether they would try to do something like they did with grab in singapore, because obviously they took my noeri minority stake in that company >> we have no interest in minority stakes. we've been clear the markets we remain in today are core markets for us we're doubling down on our investments. >> in terms of the grab scenario, could the same happen with kareem? >> we are operate in a position

of very clear strength here in the middle east, north african market >> so the minority stake there, the questions about how they'll continue to grow when they have been basically strong-armed by their largest investor, softbank, when it comes to expansion particularly in asia i said what are you doing in the middle east? he said we're still investing, looking for growth, looking to our core growth markets in terms of what happens goes forward this man was brought in to bring financial structure to the company. he said there's still a ways to go >> thanks for that, hadley did you get the impression that at least as far as they're concerned, this is a new chapter for uber, new beginnings, new expansions, still positive about the middle east and asia >> that seemed to be still the message, but in terms of where they're focusing, the united states, europe and something in south america, but trying to tell me in the middle east they were doing so much in saudi arabia, encouraging women to become drivers, or whether it be in egypt with uber eats, they're

looking to expand here as well we'll have to see how it goes. >> thank you for all that. comcast has submitted a 22 billion pound bid for sky formalizing an offer first made in february. sky has withdrawn its support for fox's offer and independent directors from the pay tv group said they will now engage with both comcast and fox comcast has offered 12 pound 50 pence per share, fox offered 10 pounds 75 pence per share. let's look at those shares this morning to see how they responded to the news. both fox and comcast are trading up on the day. sky is trading slightly softer much higher than that 12.50 pound bid that has been put through by comcast fox is also benefiting from the

fact that sky shares rallied, and they have that 39% already interesting stake in the company. so whatever happens, at least that 39% stake is appreciating in line with appreciation of the sky share price. to talk to us more about this, i'm happy to say paolo pescatore joins us on the line good morning to you. >> good morning. >> so the ft front page says a three-way bidding war is about to start over sky. do you read this as well is this the formal beginning of a bidding war? do you expect to hear back from fox disney in the coming weeks >> for sure. it's quite clear that a bidding war is going to start, and this is great news for sky stockholders >> we're up to 12.50, and perhaps a counter bid coming from fox or disney

before we get into that, have you done work on where you see fair value for sky at this time, not taking into consideration the potential synergies as in the case of comcast. >> it's not something that we look at. >> okay. fair enough. going back to comcast, do you think that the -- they have a higher chance of succeeding here due to less of the regulatory backlash we're due to hear from the cma about the potential outcome of the fox/sky tie up that should come out in a couple weeks. it doesn't look like comcast is facing the same issues would you say it puts them in better position in terms of takeover chances here? >> for sure. comcast's bid is extremely credible as you rightly say, from a regulatory perspective, they will not be under the same stringent controls we've seen so

far from 21st century fox. equally as welcome cast has agreed to most of the remedies that fox has already proposed as part of its offer. it said it would establish a separate board for sky news and guarantee a decade of spending at equal levels to last year from that perspective, if a regulatory side, comcast's bid is quite sound >> do you see any opportunity -- any probability of disney themselves coming up with a counter bid? effectively making a bid through disney as an entity rather than going through fox? >> yeah. i think that's perfectly sensible as well it's clear right now that the ball is firmly with 21st century fox and ultimately with disney i think fundamentally it boils down to how strategically important sky is in both cases for either company as part of their grander aspirations to

complete with the online giant under. i will how much is d do you see any scenario where comcast and disney own sky jointly? >> that cannot be ruled out. comcast originally said when it put its case forward a couple months ago, it would be prepared to co-own sky in partnership >> i have to leave it there. thank you very much forever sharing your views on this topic this morning that's paolo pescatore a bromance battle. after emanuel's cozy trip to the white house, it looks like the french president may have a fight on his hands for president trump's affection. find out more after this break - i love my grandma. - anncr: as you grow older, your brain naturally begins to change which may cause trouble with recall.

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welcome to "street signs." i'm joumanna bercetche these are your headlines

deutsche bank scales back it investment bank warning it will reduce its work force after another sharp fall in trading revenues barclays beats on the bottom line but litigation charges on both sides of the atlantic sees the bank's capital ratio fall. shell falls after the oil giant misses cash flow forecasts despite posting the best profit rise in three years. facebook earnings blow past expectations as the social network increases users and the stock rises 7% after hours despite recent troubles over how it uses data we were just talking about facebook and how it posted strong results after hours in u.s. equity trading. speaking of which, let us look at u.s. equity futures and see how the mood is. to be honest, it doesn't look that promising

dow is seen opening up a bit weaker, just a couple points s&p seen opening up around flat. already taking those facebook results in stride. yesterday we did have the stronger boeing results that helped give u.s. equities a bit of a boost towards the close it looks as though today the mood is not as optimistic going into trading but everything may change in the next couple of hours also to watch in u.s. markets later, look out for amazon, microsoft and intel earnings as well another big day for earnings as far as techs are concerned let's switch to european markets. here we had a big earnings day in europe. ftse 100, xetra dax are under performing down about a half percentage point. we do have the ecb coming up in a bit. we'll see how those markets will

react to some commentary coming from mr. draghi in a couple hours time ftse mib having a good day, up 0.5% more than 100 points let's switch to foreign exchange the theme has been one of dollar strength you can see a muted price action today. we're looking at euro/dollar getting into the ecb meeting already through the 1.22 mark. trading at 1.2175. definitely a lot of scrutiny on euro/dollar today. three air france pilots unions are calling for strike action in may. the industrial action would be the latest to hit the french carrier. the airline has battled unions over pay demands

and the french prime minister says air france could face a period of turbulence if it loses the conflict shares in norwegian air are trading sharply higher after the airline said serious players were showing interest in the company. this after iag bought a 4.6% stake in the company earlier this month speaking to cnbc after the budget carrier reported a larger than expected first quarter loss, the ceo declined to name the companies that made an approach lufthansa has declined to comment on whether it is one of the parties interested in norwegian. this as the german carrier reported first quarter profit growth far below forecasts as costs from expending the euro in france weighed lufthansa is growing the budget carrier to fill a space left by

air berlin lufthansa also lowered its capacity growth outlook for the year and volkswagen has reported a drop in first quarter operating profit the german carmaker says group ebit came in at 4.2 billion euros, down 3.6% accounting changes, currency pressures and technology costs weigh the on the company shares in volkswagen are up after it backed its full-year guidance one of the big movers today, philips lighting posted worse than expected first quarter core earnings citing declining sales in margins especially in the united states. net income was also lower compared to the same period last year in february phillips warned that first quarter profits would be soft you can see that stock is down more than 10% in today's trading. we spoke to the ceo about the

company's performance. >> we had said that the first quarter would be soft. and that's mainly due to one of our businesses, which is the home business. and in the united states the three other businesses are philips lighting, and they are continuing the profitabilities, specifically in the professional business by 310 basis points there is one important action for us into '18, the reduction of our indirect costs. we have been striking a 13% improvement on costs versus the same quarter last year last but not least, after a strong cash flow in q4, like for like, we have delivered cash flow in q1 which is higher than for the same period last year. so, as you can see, structurally we are moving in the right direction. we know what we need to do to fix the home business. we remain confident in the

outlook we have provided for the full-year. switching to politics, french president emanuel macron admitted he probably failed to persuade president trump to stay in the iran nuclear deal saying he thinks the u.s. president will withdraw from the agreement in the coming weeks. he added that france is not planning to abandon the deal without having done something more substantial andrea mitchell has more >> reporter: a french connection on capitol hill after the charm offensive with the man he calls share donald the state dinner and all those public displays of affection, today in congress emanuel macron with pointed pushback against president trump calling for him to get back in the paris climate agreement. >> we're killing our planet. let us face it, there is no planet b. >> reporter: to save the iran nuclear deal, president trump calls insane.

>> we cannot say we should get rid of it like that. >> reporter: macron is proposing a side deal to address president trump's complaints extend the ban on iran's nuclear program beyond 2025, when it is set to expire. ban iran's ballistic missiles, contain iran's aggression in syria and elsewhere in the region, an am wish shows plan with the president threatening to tear up the nuclear deal on may 12th. >> nobody knows what i'm going to do on the 12th, although mr. president, you have a pretty good idea. but we'll see. but we'll see also if i do what some people expect, whether or not it will be possible to do a new deal with solid foundations. >> that was andrea mitchell on the bromance after a warm welcome to president macron, donald trump traded twitter love with kanye west head to cnbc.com to find out

more. and we discussed plenty of things today from earnings season to upcoming ecb get involved in the conversation e-mail the show. the address is streetsignseurope@cnbc.com we are also on twitte twitter, @streetsignscnbc. you can also tweet me directly coming up, facebook proves its resilience as it beats quarterly estimates. we'll break down the figures when we get back

let's check in on energy markets. we had some earnings out of total and shell. the spot prices are trading a bit stronger and overall the picture for brent and for wti has been a lot more positive in the last couple of weeks or so there you can point to many things, mainly the geopolitical production and a cut out of venezuela. let's get into some of the earnings that came out this

morning starting with total. which posted a better than expected rise in first quarter net profit as output hit a record level the french oil firm now expects to exceed production targets for this year. the oil major says production ramp ups and new acquisitions boosted production total also said it would continue to be disciplined on its cost base. an else where shell has opened lower after posting weaker cash flow and refining margins in the first quarter however the oil major reported its highest operating profit in three years beating expectations it says higher oil prices boosted net profits. net income, based on a current cost of supplies also came in ahead of forecasts chief executive ben van burden says earnings were bolstered by improved profitability on

upstream businesses. we have our guest with us. the stock this morning is down 2%, but it looks like they beat on top line, bottom line as well so what do you think is making investors nervous about shell? >> i think the problem with the numbers this morning is the cash flow generation was disappointing. earnings were strong, but it didn't pull through into cash generation now, there were some reconciling items in there some tax settlements and margin calls associated with the gas trading business that hurt the cash generation. i think the market has not reconciled those items yet >> overall, do you have a buy rating on shell, so what do you think is driving that, apart from the big bounce in oil >> we see shell as a business now completely restructured following the bg acquisition we see shell having the strongest cash generation of the integrated companies on a move forward basis. strong growth in that cash

generation and production growth that will be competitive as well >> i think one other element that has disappointed investors is that they said free cash flow is consistent with a plan to buy back $25 billion worth of shares, but they have to the committed. why do you think they have not committed? >> i think they want to get their balance sheet back in order. i think that will happen probably in the back half of the year and we will see share repurchase begin this year the company is targeting 25 billion in overall repurchases by 2020. that's about 10% of market cap >> that should be a boone for the stock in the future. i want to broaden this discussion out one thing that struck out clearly in the commodities market is the demand for oil has been strong year to date strong year-on-year growth do you think this is sustainable? >> it's been very robust we do believe it's sustainable looking at some data out of

china, there's some concerns about deleveraging on the chinese economy, we see the consumer driving chinese growth. u.s. demand has been strong. i think what we're seeing, we're seeing synchronized global growth for the first time in ten years, that's pushing oil demand >> what do you think the risks to that are? i came back from the imf meetings in washington trade war and this concept of protectionism did come up a lot. is that influencing your outlook for oil and the energy markets >> it has us cautious. trade wars are never a good thing for oil or the economy in general. i think also the price of oil. the price has come up rapidly to a level that could elicit price elasticity i think 2018 looks strong, but looking into 2019, price also have an effect >> you have the supply side of things as well there's talk about the u.s.

shale production, especially with oil trading here, you would expect a ramp up in production the latest numbers had u.s. production overtaking that of saudi and russia with elements on the supply side and demand side, where do you see the price of oil ending up >> the price is exceeding our forecast now we have a price forecast of 63 this year. it's probably under advisement at this point. even though u.s. supply is growing at a rapid pace, we're not seeing much growth anywhere else in the world. you referenced venezuela earlier. because of the delines in venezuela, opec output will be flat so we're actually looking at demand potentially exceeding supply growth this year. that is putting a good fundamental underpinning for the oil price. >> do you expect the opec cuts to get extended beyond the agreement? there's a lot of talk about

whether or not russia will play ball >> i really do expect that we'll see an extension the primary issue now is that saudi arabia, uae are the only ones with spare capacity so it depends on what they decide on policy, and they're being hawkish right now. if there's a saudi aramco ipo, the higher prices will be beneficial for them. jason, we have to leave it there. shares in samsung electronics are higher after the firm reported a record quarterly profit first quarter operating profit came in at 14$14.4 billion, a jm of 58% from a year ago the big driver behind the figure was the korean company's chip business, while the mobile business also jumped however samsung has warned of signs of weakness in the global

smartphone market saying it anticipates slower earnings growth in that division. and facebook shares jumped in extended trade following first quarter results that saw the social media giant beat quarterly profit forecasts the site's crucial mobile and business also grew as it pusheded a vidpushed ed ad video content investors had been worried previously concerns would drive users against the site daily active users in the u.s. and canada reversed declines coming in at 185 million total revenue of 11.$11.97 billn also came in ahead of expectations i'm happy to say to discuss with us is the investment director from gam along arjun kharpal these are strong numbers coming out of facebook despite all expectations people thought that at least

some of this, they would exhibit some impact from the cambridge analytica scandal. if anything, they have actually grown the amount of users for the first three months of the year for you, do you think we can just classify this incident, put it behind us, and focus on their core business and that going forward the outlook is rosy? >> i think in a structural sense we can put the incident behind us i would also point out that cambridge analytica came quite late in the quarter. if it were to have an impact, it would impact q2 more than q1 but the key here is facebook has a huge network.ndividual item, e analytica in this case, is unlikely to impact the power of that network to an extent. i wasn't expecting any dent in the numbers. they came in better than i thought, but i wasn't expecting that to be an issue.

>> what we see is they gained 2$2.2 billion, monthly users, 15 daily users. those are huge numbers, but also advertising revenue has jumped it tells you even advertisers have not been bothered by this incident >> i think the point for advertisers, there's nowhere else to go the revenue at facebook increased from $8 billion first quarter last year to $12 billio first quarter this year. that $4 billion increase is the same as the combined annual revenue of twitter and snap put together it is the giant in the space >> mark, what do you see as the risk to this business? are there any in the sense of regulation has been spoken about. we have the yenl data general protection regulation coming up. is that a significant regulatory hurdle for facebook?

>> i think it will have some significance but both facebook and google have been proactive. in many cases people have already opted in to facebook and goggle this morning i was prompted to opt in and i did it. that's something they will naturally do they won't read the new user agreement. they will just opt in because they need to be a part of the network. just in the same way the advertisers can't go anywhere else, the users can't go anywhere else either >> that's the risk with the regulators when i get an opt-in, i don't read the agreement, i just opt in the users are captive as well. is gdpr going to change things >> i think it does in terms of bringing additional comfort for users that their data is being handled in the right way it pushed facebook and google and other internet companies to make significant changes facebook made it clear that

expense levels will run much higher this year, they're hiring in total 20,000 people with the responsibility of looking at the data and privacy and fake news issues so it is driving the companies to do things but the growth is so strong that they can afford to make those investments. they can have the best of both worlds >> something that tech investors are more conscious of is the spending alphabet says we look to spend more, that was taken negatively by the market. you look at amazon or netflix, investors in those companies are happy for them to carry on spending at these massive amounts. is spending an issue for facebook we have seen capex increasing over the last few quarters >> i think spending is a reflection of the way in which we're seeing this very strong shift in technology. the companies are spending ahead of a much faster growth path

the key spending area for all these companies -- it's across every single one of these companies. the key spending area is in the rollout of cloud, of infrastructure so that plays into the hands of other infrastructure companies and gives them great opportunities >> we have amazon earnings later today. what's your view there on the stock? >> i think for this earnings season in general it's about psychology rather than numbers i didn't expect facebook numbers to have an issue, but it's how the market reacts to them. as with google and microsoft is tonight. so i think it will be about the psychology it's how people are positioned going into them. >> all right mark, we have to leave it there. thank you very much for joining us arjun, thanks for joining the show before we head out, one quick look at u.s. futures and you can see that we've tipped into the green, but it's not a super stellar day.

dow seen opening up about 5 points higher. we do have big earnings coming up including the likes of microsoft and amazon let's look at european yields before the big ecb coming up in a few hours time you can see that rates are trading stronger on the day. ten-year bund trading at 62 basis points spanish and italian yields putting in a good showing. that's it for today's show i'm joumanna bercetche "worldwide exchange" is coming up next. we'll be with you for decision time in just a few hours

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it is 5:00 a.m here are your top five at 5:00 one of the biggest banks in the world prer pairiparing for signt jobs cuts. facebook moving higher after beating the street. ford slashing several sedans from its lineup. the company trying to rein in costs. the head of tesla's autopilot unit leaving the company for intel. and a high stakes sitdown as the leader of north korea and south korea formalize plans to meet it's a busy thursday, april 26 "worldwide exchange"