[theme music] . good morning welcome to "street signs." i'm julianna tatelbaum and i'm willem marx. >> beijing and washington agree they must cancel some tariffs before an agreement can be termed >> telling us he's more caution about the first half of 2020 >> we do accept in the first

couple of quarters and believe the short cycle of business are flattening out and do expect their recovery >> a tale of two banks shares in unicredit and commerce bank sinks despite confirmation of prerelease numbers and gaining altitude cost cuts helped lufthansa and they believe they will return to profitability by 2021. potentially big news china and u.s. agreed to remove existing tariffs in phases if both sides agree to lift their

tariffs at the same time presidents trump and xi were supposed to meet in chile before that was canceled. it is agreed they are trying to meet in december >> reaching a phase one deal that they would have met before host country chile canceled the event due to unrest. that deadline might not be feasible as the two continue negotiating the terms. if the date gets pushed out, that could get pushed out to europe president trump is expected to attend the nato leader submit in

december he has suggested switzerland as the neutral location leaders have reported switzerland and sweden are under discussion the firm deadline for a deal signing is now viewed as december 15. let's taicke a look at the yuan the onshore and offshore yuan both down and surely showing deescalation let's take a look now at the major indices. we are seeing gains of the dax at 0.7%. the export is heavy.

highly showing how things progress everything is green here the outperformer here. the ftse mib is up unicredit is quite a performer this morning the key message here is green across the board it is an earnings day for germany in particular today, we have a number of results coming through. you heard from seimans in the headlines. the cyclical chinese sectors with auto, travel and leisure, and then defense utilities, food and bev and real estate i mentioned seimens there.

they reported a 20% jump in operating profit thanks to an increase in larger orders. the company expects geopolitical and economic risk will cause a decline in the next 12 months. we'll go live to frankfurt for more details how is siemens doing and what are they saying about their outlook? >> actually siemens is doing quite well compared to competitors like abb and general electric general electric had a loss in the quarter. siemens is outperforming them. even if we call that gloomy, if

you look at what we are really saying, they do think revenues should increase and that is what they say between 2% and 3% given the economic head winds, this is still, one could say, a slightly optimistic out look also the market is believing them he is someone at the top of the company who has a track record actually meeting expectations or beating expectations like they have done in the last quarter. the fourth quarter was better than expected. that is also probably one of the reasons the shares were doing so well today all in all, what it is promising is that even those who are very sensitive to economic swings like the dig call division is

doing better than one had expected of course their short business is what they are calling their delivers to the car and industrial sectors, there, they are seeing focus going forward next year but what they wehe wan in our interview is that he thinks the second half of next year will be seeing a revival and improvement. sos it only a short stint of weakness of course the trade war is an issue for them he was commenting on the effect this might have on their business in our interview. take a listen here >> those economic outlooks

we do not exactly believe that trade wars are producing winners and obviously what we see is some what a pro token and prove to that. we are a very international business we are more than 20 million in revenues and net export out of the united states. second biggest and largest country is china with almoour b and our value sometimes compared with the made in germany theme we are not that worried about the geopolitical matters >> essentially next year, we'll

see the completion of the restructuring of siemens will look like is a fleet, the energy business and also being listed they are sticking to their plan to list the energy business until the end of their fiscal year 2020, which is clearly the end of september so next year, we'll see one big more listing from siemens coming to the market. they are increasing their dividends and giving more money out to their share holders all in all, the monies are better than expected but not like a complete disaster or extremely negative with that, i'm sending it back to you >> let's take with the german corporates

commerzbank expects more to come in lower despite a 35% jump in third quarter net profit they blamed that on trade conflicts. the bank is in the middle of an overhaul as it lays off more than 4,000 staff and sells off its polish division. and deutsche bank plans to cut to 60% even if t-mobile doesn't merge with sprint. it says it will keep pay outs to a minimum as it invests record amounts to the 5g network. the german flag carrier expects the budget airline euro wings to return to profit. managing director of research from citi joins us live from

paris. we've seen quite a positive reaction what has investors excited here? >> you mentioned a bunch of interesting things here. i agree cost did come in better than expected. it is really expectations. they were fairly low after a number of profit warnings. i think that's is causing a rally in the shares. it hasn't gone any worse more than this is the right numbers >> suggesting that market decision has more to do with the knee jerk reaction do you think given the more positive numbers, this is a turning point for the share price. >> i think you made a point with regard to euro wings >> not just in the long haul

because but the short call business out of germany over the summer months that has improved pricing and ultimate driven part of the beat today in the q 3 numbers it is a couple of things the cost side, the sentiment and the fact that things haven't gotten any worse and the short haul business has been a touch better >> let's talk about the other things how about long haul, how about premium and cargo. >> if you look at the long haul business and short haul, they have continued to struggle there is significant dislocation between demand and supply. the company on their confidence call blaming brexit as one of the many reasons cargo remains

weak there is a sense there are a number of one offs driving that cost in the q 3 numbers. i would say a mixed quarter overall and it is a case of sentiment having been into the quarter not as bad as people thought. >> if i was a share holder, i might be happy but if i was a passenger, i might not be so happy because of the strikes what impact do they have on the bottom line and on the brand in germany? >> companies have been doing a very good job of mitigating their risks. we've seen ryanair shifting. if you take the entity and we are referring to cabin crew strikes in particular. you can actually see $25 million to $30 million of costs if the

business shut down they are doing a good job of shifting things and making sure the most profitable portion of the network still flies. >> we have been talking on the show recently about this phenomenon of flight shaming i'm curious about your discussions with investors and companies and leaders. how material of a risk is this out look for the european airline industry >> i think this is one of the big teams investors are talking about. we spoke on your show about this last week and have written a piece, that the global industry has caught fire in the minds of investors. we have seen sri pick up in the

last year. they are very much focused on the sight of people flying less and trying to offset their carbon footprint only 1% of global passengers offset their carbon when they get on a plane it is a theme. it started in sweden we know all the press going on with greta corporates will pick up on this and want to become more carbon neutral. so big theme for the airline sector >> thank you to our guests >> if you have any views on flight shaming get in touch with us at street signs cnbc. >> coming up we'll take to

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welcome back to "street signs. let's continue with some of the corporates this morning. focusing on the ebitda beat. posting a profit and issued a down beat forecast for demand in u.s. and europe but will increase its base dividend to share holders in an aggressive manner shares are trading about 7% higher at this point >> skanska is posting a profit the swedish construction group posted a quarter profit. the indicator point to potentially slower growth. >> unicredit has reported to a line as italy's largest bank benefitted from gains in trading and announced the sale and

slashed holdings in italian government bonds >> uber shares hit an all-time low as the post ipo lockup period expired shares had already dropped 10% this week on the back of the giant's third quarter results. even though it recorded a net third quarter loss >> i'm the right guy for the company now. in two years since i took over the company, think about where we are now versus some of the messes we had. we did take the company public at the right time. our bookings are up 70, 75% since the time i took over now when the markets are demanding this path and growth,

i think we are going to deliver it >> delivery hero has made strides in being the largest platform outside of china. reporting 117% jump in third quarter revenue with the highest level since listing. the cofounder now join us around the desk a lot of concern floating around profitability around food delivery you guys continue to move from strength to strength i have been going through your numbers. winning market above any competitor but at what cost? >> building our restaurant coverage, speed and delivery and we also saw that we start

driving in our second half this year in our food segment europe is at break even. asia is a big investment market. >> when do you stop vesting and start profiting? >> for us, it is all about driving good profit per order and drive that per scale in this one that we see, having said that, we are over a billion people in this stage and continue to grow our business. >> a lot of share holders are looking at firms and saying where is this path of

profitability. what gives people confidence that over 50% of our business, we are profitable. we are driving one of the biggest profit pools i think people have a lot of success where they have been driving. we see they'll have strong profitability and strong profit per order. there for, we want to be able to invest and take the long term

investments with size and profitability and i think our rates are still very, very early. >> uber plans to exit markets where it is not number one or two. is this the only way to be profitable is to be number one or two is that just the way this industry is going to work? >> i think it is a lot of scale. we believe in that >> i want to ask you about dark store. you are looking to expand from one to five markets in terms of dark stores what is the out

look >> the return of building these is being able to deliver something our customers want that is groceries very fast. from there, work towards profitability in this segment. with those dark stores, they are warehouses we can do logistics right now, we can deliver groceries in 12 minutes in the turkish market people love it >> the ceo of delivery hero. separately, transfer wise chairman says it is shifting towards profit and sustainability saying the company is focused on long term growth, reliable for customers and investors.

>> for us, it is very important from the beginning to build a business that is sustainable they don't have to go fundraising every year who knows how the markets will be do you think our investors are focusing more on the profitability. i do think it is the time of proofibility and i do think investors do think about the given model. i have no problem vesting with future brother and profitability down the road but you have to make sure you are operating with a sound model that can become profitable >> is this something you are

discussing with your investors >> our investors are pretty excited. we can see that in the second refinancing. they are encouraging us to stay profitable but to have a model that works is very important >> i have to ask you if you have any updates to go public >> we know we will go public but there is no time line. still a few years away >> when we come back, we'll speak about the potential crack mseupen tech fir in ro more after the break we call it the mother standard of care.

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ceo tells cnbc he is more cautious about the first half of 2020 >> we do expect some weakness in the first couple of quarters we believe the short cycle of business are flattening out and then expect a recovery >> a tale of two banks higher trading income boosts profit >> the looming snap election casts a shadow over the bank of england. prime minister boris johnson campaign launch is mired in controversy. >> al right, europe markets about an hour and a half into

trade are moving into positive territories. the dax is up 0.8% the leader among different regions. we are seeing quite a strong bid. a lot of that strength coming on the back of the chinese commerce ministry's comments around the state of u.s./china trade. providing a nice support for stocks we got more german corporate earnings coming through. we heard from siemens there. this has been a positive earning. shifting gears looking at the 4 x market. no policy decision expected. it will be interested to hear what he has to say as he nearly finishes his tenure. trading 0.1% higher.

the euro also trading higher versus the dollar. clearly the dollar on a bit of the back foot. what does this all mean for wall street the gains will continue across the pond the s&p 500, the dow jones all indicating a higher open we also saw a strong reaction in the yuan the onshore and offshore both fell >> the state of california has revealed it is investigating facebook over privacy practices and accused the giant of stone walling and refusing to hand over information to assist in the investigation including

e-mails from mark zuckerberg but shares hardly moved. the company says it is cooperating, quote, extensively. at the new york times conference, microsoft founder bill gates said people would be using windows mobil if the anti-trust lawsuit hadn't taken place. >> no doubt the anti-trust lawsuit was bad for microsoft. if we had been more focused on he creating that mobil devices so instead of using android, you would be using microsoft mobil >> we go live to the web summit in lisbon and somebody who has a really important role in tech. >> we are here talking about tech regulation.

alongside some of the big tech companies here at tech summit. i'm pleased to join with you in your role of justice in gender affairs and equality is twitter's decision to ban political ads a good choice? >> this is twitter's decision. i am watching what all the big flat forms are doing we are in frequent contact with them we wanted to have reasonable rules before the european elections. this was one of the topics and its development. for the eu, the question is whether we will set the rules for political campaigning. i think this is the future and we will introduce new rules for

more campaigning so the people know who is behind the campaigning, who pays it and what are the interests that is what the task is to come with such rules through the law and for twitter and others, it is the obligation to obey those rules. that is something like the editorial policy of each of those platforms. that is what we are speaking about now. >> facebook has decided to take another approach should it be the company's decision to make those choices or be up to the awmakers >> it is still a private space they occupy. that they occupy too much space and have too much power and it is not balanced well for us, the task of the day is

the rules which will will protect the out of limits of decision making of the voters we don't want like cambridge analytica with dirty money we want the political fight to be open, transparent, clear so that the people can choose it should be also on the people to understand what is lying and what is not. lying in politics should disqualify the politicians in real life, it doesn't work so much like that there are more factors than only the decisions of the platforms, what to do >> are you prepared to insure

t institute enforcement of companies if it doesn't look like they are enforcing? >> once we come with the rules, of course we will enforce. but that's a big question now. i am personally very reluctant to come with the rules that will somehow define what is the truth, who will be the arbiter of truth how do we sanction lying. it is so difficult for me to speak about it i don't want to create some swell. if we as politicians are careful. i'm a liberal democrat, if we are careful of coming with some rules, how can we enable the digital industry to set the rules? this is another question when i am complaining that they

have too much power. there will be a big discussion in the commission. we will invite academics and society. we need to do this right to come with the rules which will not introduce censorship but which will address the most varying risks which might be in it >> is there a flip side to these arguments that companies are just too big and to enforce these rules, they have to be broken up. >> i don't like this big or small. i dealt a lot with the protection rules the so-called gdpr it is not about who is big and who is small the small company can do the harm to the privacy of people. we see the biggest are now

facing the string enter rules in the eu we go after them and we are watching what they are doing scrutinizing their behavior and the respect of clients this is just a matter of proper enforcement. we are quite good at it. >> we are about one year into gdp now, we haven't seen any big fines. do you think that is coming down the line and is it what people expected with tough privacy >> they will produce the sanctions or come with big signs. there are already big cases in the mature stage of investigation. i cannot tell you anything and i don't know where that is

in the cases but the individuals for sure will come with the sanctions in case they see that there is a big breach that is causing harm maybe to millions of people. >> i have to ask you about brexit when it comes to the agenda, do you feel that uncertainty around brexit is affecting your reports whether on the tech front or more broadly >> brexit seems to be a continuing saga. once the british people express their will, we should do it in a well managed, organized, civilized way to get out of the divorce period and work together with the brits on the future strong partnership and digital area has this feature that it is removing borders

i think this is one of the sectors or spheres where we will have strong operation. it is inevitable they will not disappear in the atlantic ocean they'll still be there, very close neighbors. if we work through the sensitive phase of divorce, we will be able to build up something new for the people >> commissioner, thank you for chatting with us we'll bring you a few more highlights on digital. go to cnbc.com to check that out. back to you. >> thank you really interesting congressional democrats have announced impeachment hearings will be open to the public next week with testimony from there state department officials including the ousted leader.

hillary clinton weighed in >> there has to be something really wrong with the president using the power of the office to intimidate, extort, bribe the president of another country to do his bidding by manufacturing scandalous material about apparently the opponent he was most worried about >> coming up on the show, decision day for the boe meeting as election campaigning gets under way we are live with joumanna outside the bank

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>> boris johnson's election campaign got off to a rocky start. the event was overshadowed by a minister resignation and another who was forced to apologize that the victims of the tour fire

should have used common sense and ignored instructions to stay in the burning building. >> if i come back with the working majority in parliament, i will get it working for you. in day one, we will start working getting our deal through and get brexit done in january >> the labor party tom watson resigned he insists his decision to step down is personal and not political. at a campaign event, corbyn outlined his plans >> all of our leaders will say with labor, you are getting an incredible deal. we are not allowing the no deal

to happen. you have a labor offer and at the end of the day, you get the final say. it is grown up politics. >> britain's snap election and continued uncertainty may well cast a slight shadow over today's bank of england meeting. they are discussing keeping rates the same in september, he set a rate cut was plausible if brexit continued to be, quote, a slow puncture for the uk economy. you man joumanna joins us there. >> certainly some members of the gc are turning slightly more dovish, most specifically you talk about michael sanders

they do continue to talk about the possibility of a rate cut even before brexit gets resolved i have an expert with me the economy joining us outside the bank of england. an important day as ever when it comes to dissent ers, do you think they could go in that direction today? >> if we take the comments at face value, it is possible that they might dissent today given that basically they suggested in the scenario, there is no solution for brexit. there might be the case for a rate cut that said given elections ash the corner, they would probably hold and they will probably stick to the wait and see

stance >> sticking to the data, the deterioration does stick interest rates or market interest rates are higher than where they were. are you anticipating a down grade to the forecast. >> yes i feel that overall tone of the report or meeting today would be more dovish. as you said. data have deteriorated over the last three months. developments and other practice suggests the out look and growth would bedown graded today. >> what about the limited language of course none of the uncertainty we have more

uncertainty, do you think it is time for that language >> continual and gradual tightening is down grading in previous settings. it is natural to have a down grade or mitigation. the bank may just stick to the existing framework and putting more emphasis on the short term uncertainty and the fact that they'll be on hold in the for seeable future rather than on the full guidance. >> my colleague was talking about the dovish turn. we've seen it everywhere the ecb, rba, the fed said it recently turned more neutral as far as global central banking

is concerned, that this easing is coming to an end? this midcycle adjustment >> for sure, central banks turned more dovish this year the fed cut rates three times. it is true that the fed is discussing that they are in the polls. this kind of neutral stance might now perk owe late to other central banks globally but they are facing a special situation. the expectations have been more elevated we are facing election uncertainty because of brexit. the bank of england would probably be more tactical because of this and to some

extend, it might still be more divergent compared to the central bank >> we are trading around 1.28, 1.29 a good 10 points higher than the beginning of october people have taken comfort from the fact that boris johnson was able to get to a brexit deal at this point, how much uncertainty about brexit is priced into the pound? >> it is hard to say the pound is still in the range of the last three years, we need to take that into account. uncertainty is still there even if there would be a deal, it would throw a deal. at the end of that period, it would come as early as next year there are four that i think the founder would remain like over

the last three years uncertainty will remain. the pound will move in, let's say, more defined directions once we have clarity on the final terms on the relationship between the uk and european union or the rest of the world >> it is not just about the future relationship with brexit. certainly something we'll have to keep an eye on. thank you. the hermes senior economist here back to you guys now >> make sure you join us today later on for our special program. that is decision time at 12:55 cet. >> let me recap where things stand on the u.s./china trade front, which is front and center the china commerce ministry said

they agreed to remove existing tariffs in phases given both sides agree to lift at the same time saying cancellation is a key condition for a trade deal to happen the u.s. has set december 15 the date to implement new measures on chinese exports you can see the onshore trading there. in terms of european equities, we are also seeing support come through, i would say largely on the back where we look at the major indices now. the dax is leading gains a lot of that is coming from

cyclical sectors te telecoms are leading the way what does it mean for wall street we are looking for a stronger start to trade the dow looking at a stronger start. also looking at stronger days. this comes on the back of a fairly muted session yesterday closing just around the flat line >> that's it for "street signs." make sure you stick around as we bring you the eu's aumutn economic forecast next with every attempt to free itself, it only becomes more entangled. unaware that an exhilarating escape is just within reach.

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>> it is 5:00 a.m. now trade talk whiplash. stocks could hit new records again. stock futures, they are soaring. despite a hat trick of big tech trouble. a top exec at google under investigation and how leaders dealt with claims of sexual harassment and questionable relationships. two former twitter employees blamed for