a. welcome to street signs. these are your headlines banks rally across europe. u.s. futures falling to big gains for the dow after u.s. markets open for the holiday weekend. china's shanghai composite with the largest jump since 2015 driving stocks to a five year high commerce bank shares are up after the german lenders ceo and

chairman re-signed cnbc sources say an internal replacement has been considered. warren buffet's berkshire hathaway makes a $10 billion bet on dominion in the first major deal since the on set of the outbreak >> markets in europe have been open for one hour. now markets friday here in europe are a little bit soggy. without the u.s. direction but futures state side this morning marching higher. you can see the groan een on the board here todayment that's just over 1.5%.

we saw about 1.75% on the overall bempnchmark but very sml gains for some of the markets. look at that in the stock market and then geography and this morning the ftse is one of the better performers. just over 2.1% and so this has been real versus gains a lot for the french market and german stocks in particular so it's slightly outpacing the other markets. you're saying almost 1.9 on the french market. sprain has been strong from the outset 2.6% higher. this has been one market that gained a lot of attention since the start of july. a little bit less and it's been the smi. look at those developments also health care is very much a

huge component so it's very rare to see the banking sector race this far in europe 4% not attacked to monetary policy news and not attached to anything else out there and that is the gains that you've got elsewhere in the markets and it's usually in lock step with other huge gains on the markets but it is leading the charge again highly unusual to see that here in europe so 4% higher for that sector autos playing catch up you have seen a little bit of interest in the sector in recent days and that 3% is now sticking this morning and insurance stocks soared 2.5% travel leisure another set to where investors have been cautious and waiting back in a decent size one today, 1.8% along with a hard hit media

where stocks are advertising and recovering some territory. that's being picked up again this morning other sectors where investors have been going there. but underperforming, you're seeing the bank. also health care right at the bottom of the charts a gain of less than 1% >> the china markets have been fascinating. escalating tensions with china over the national security law and the trade. and just intraday. and hong kong following the markets u.s. futures underlying what we're seeing.

clearly there's cross winds here for a lot of investors what do you make of the gains we're seeing on the board. >> well, yes it's a strong rally at least when you look at the numbers on the picture. i don't have the numbers yet yet it seems that the investors are focussing on reopening economy so it also seems a bit like it's climbing the wall. >> we'll get to your call because you're currently slightly underweight equities. you're positive. do you fear you may miss out on

this rally are you concerned that you're just not going to be on the market a little bit but i'm also having a slight dejau view and we see that the market in a way wants to go up and things can change. and for now it's very strong and we miss a bit of the market. >> is this time different. first round we saw that the mass closure of economies because we have a genuine health crisis and concerns around reaching capacity very, very quickly with a spike in covid cases but now we have gotten up to speed with the use of mask wearing sanitizers, social distancing. could it be different this time as we battle through the second wave and surely, does that have an impact then on the economy?

>> well, i'm still of the opinion, that we're still in the first wave not even in the second wave but it is slightly different however, if you look for example in europe for denmark and sweden, there were much less restrictions or lock downs than in denmark and in the end the economic damage in sweden is worse than it is in enmark we should also not forget that even though they are completely down, people are not stupid. if there's a virus around you and it's spreading then you automatically say i stay close to home. so i think that it's tooearly

and we get more monetary stimulus. >> that's true stimulus is an extremely important driver but i do have to say there is a difference between easing programs as we head to the last ten years because now a lot of the quantitative easing is just to absorb all of the debt that is coming from governments that are -- where levels are rising very fast

i also agree with you is that when markets go in the complete risk off mode, most of the time that happens when something unexpected is happening and what you're now seeing, even though cases are rising it's not new. so from that perspective, i don't expect much new or stress. i see more others. >> i want to switch tension. >> anyway, particularly with disruption and this one even more so given that we have lock downs in the second quarter and we have the opening story. and what exactly are you hoping to glean in terms of information from the report cards that would make you more positive or negative on the story ahead.

it will all be about guidance. if i look at data, expectations from the f and p earnings drop off 43%. a revenue drop of around 12% for the stoxx 600, it's 54% earnings drop and 90% revenue drop. and it will still be very unclear. and earnings will be bet and investors do want to know what companies are guiding for. i think companies have to bring more to the table and say what they expect for the rest of the year. >> what jumped out to me around this time is starting to get more clarity and maybe better numbers but the reality is that we don't know what the implications are of the coronavirus. is it fair to say that we might

see another round of cost cutting because they'll start to roll off unless they get extended and it looks more uncertain. they have not been in the hardest hit sectors. might be the ones to cost cut. it's something that we should look out for. >> already get the cost cutting. of course as a company that are severely hit, the play makers, we already saw that. but i think that we are talking about like also looking at the economy and the market and the impact of second round effects, it takes longer to go back to normal it will be bigger. and it will get tighter financial conditions that kind of stuff and then it's negative and the longer it takes then the effects of that are negative

so i think that most companies when they make their budgets for 2021, then the real cost cutting will start i think that will come later online sales went through the roof and there was pressure on margins because of the online sales they had higher costs. and then quite interesting and i'm wondering if we will see that with other companies as well. >> that ramp up phase in the online businesses as well as they try to cater toward e-commerce thank you for joining us our chief investment strategy. we'll take you back to the european banking sector where we see the strong gain this morning. it's an individual story around change of the helm

the gains now accelerating for french stocks. 4% roughly the gains there. they're in spain as they won the stronger ones from the outset. this is about clearly what they're concerned about because of natural security law in hong kong and those concerns just being put to one side of the stage and across italy, it's out in front 4.3% so just an incredible day on boarding for european banking stocks. i want to get to why they're clearly in the financial services spaces. the company's core business in europe and the u.s. failed to turn profit since at least 2016. they show that the company's core activities have become lossmaking they were upset by proposed

profits. however that money has been found to have likely never existed. wirecards filed for insolvency last month the fed's latest stress test reportedly show a number of sharp loan losses. and hardest hit by the pandemic. it would fair worse. and the commercial real estate and lending conditions and they're expected to burn through capital faster than any other financial group examined in the latest analysis. rejected a 4.9 billion euro takeover saying the bid undervalues the lender and would penalize it's shareholders shares would be diluted to less

than 10% of a combined group if it's looking to raise pay outs in the coming year despite forecast until 2022. so pay up to shareholder and see if there's any takers. well, on the radar this morning, it's announced that it's ceo will step down next year after ten years in charge of the british bank it comes as the lender as the new chairman the current ceo said he would time his departure to smooth transition the bank has not announced a successor to him. >> the commerce bank ceo zephyred his resignation on friday he says the german lender finds itself ensnared over restructuring plans. they are being considered to

take over as chief executive and let's get out. a huge change is taking place over at commerce bank and it wasn't long enough that commerce bank lost it's old ceo and decided that if he just stuck around a little bit longer he could have had his eye on the prize. >> that would have been a potential job for him. that's for sure. if you look at the current management he was also part of that management he would also not be the best fit given the strategy that was the say when the company wanted more profitability and more aggressive cost cutting and

they're also not happy with the low profitability targets and what's looking on a return with more than 4% by 2023 so they have their own cost of capital. and then we have other investors that follow suit and also the ecb was arguing that this bank needs to improve profitability and push cost cutting even further. and then the unions are against that plan in a surprise prove. a surprise move late friday announced that he would plan on stepping down until the end of the year that most likely as soon as

possible so we were waiting for a new strategy like stone where they can cut cost further but most likely they should now be derailed because first there needs to be a new ceo and a new strategy this wednesday, the supervisory board has a meeting. and according to my sources, two names that we're mentioning are potential but they're only very young to their jobs so it could be him in question that's very long serving he's the leading manager at the bank but also outside it might be considered and that will of course take longer to find someo someone. so bottom line is it could also

mean more m&a because clearly nothing needs to be duone, especially if you look at the share price, compared to others like deutsche bank they're down tremendously where other banks had quite a good run this year. back to you. >> thank you very much i'm glad that you mentioned the consolidation angle as we see a big move in the share prices this morning more in a minute

bars, restaurants and hairdressers open their doors for the first time in over three months matt hancock praised the largely responsible crowds but more action will be taken should new outbreaks emerge. >> the overall plan has always been through the lifting of the lock down to try to lift the natural measures and also be absolutely crystal clear that we'll tackle local flair ups when we see them and we have seen that in a number of places and we have taken targeted action and targeted measures and we're fully prepared to take the action like that we took in leicester. >> reintroduced restrictions on saturday let's get out for more clearly coming up to catalonia

and barcelona is now in lock down again. >> you're right. spain ended it's state of emergency on june 21st after very slow after one of the toughest we have seen in europe and spain when the virus made 29,000 deaths in the country so now there's been smaller clusters that have been identified it's tougher and people are not allowed to come in and out in that region unless there's a very important work related reason they can move within the region and let the situation deteriorate.

and then on sunday on that side of the country and this time linked to specific bars. and it's a bit unnerving and looking for me to just reopen bars and it's about 70,000 people there's already some to postpone that election given situations and that's something to keep an eye on it's a bit of negative news there from spain they just reopened their boarders and they want to attract tourists again and 20% of the country's gdp and they identify these clusters and they put measures in place

and lock down in necessary in those regions to contain some of the clusters there but to give you an example you had the running of the bulls festival in pa pamplona and they had to cancel it and put checkpoints around the city to make sure that they don't descend on the city so it just shows you a city relying a lot on this festival for the summer and so that's news from spain. >> thank you very much i want to push on to what is happening as the louvre is reopening today. visitors have to wear face masks and observe social distancing and following a guided path in front of the museum.

and can't step up close to the glass anymore and take a selfie because there will be but fears linger over whether it can survive. that's right after the break

welcome to street signs if you're just joining us these are your headlines banks lead a broad rally across europe while u.s. futures point at the gains to the dow where u.s. markets reopen after the holiday weekend. china shanghai composite with the largest one day jump since

the july 2015 numbers. as investors focus on easing those over record rise in global cases. commerce bank shares german lender ceo and chairman re-si re-signed following a dispute. they say a replacement is being considered. >> warren buffet berkshire hathaway makes a $10 million bet on dominion energy buying up the gas and storage assets in the billionaire investors first major deal since the on set of the outbreak strongly out of the starting gates this morning on european markets. and in particular you're seeing a flash up on the ftse one of the underperformers in the core markets in recent weeks and months leading the charge today, 2.1% on the ftse 100. outpacing the dax.

similar size gains at the french market and italian stocks also in the region as well. many markets eyeing that wall street trade later on today or post the 4th of july long again and futures stateside so it's giving us much higher markets in trade today but european banks today they're also one of the best performing parts of this market which is fascinating to see. typically not one at the top of the boards the u.s. futures, they're counting down to the start of the session. green for s&p 500. do jones futures more than 400 points to the upside and the nasdaq closed at a record on the friday session is also going to be chasing some as it starts out the trading day today. let's push out to the oil majors this is how they are fairing in the early part of the session.

berkshire hathaway is planning to buy natural gas assets in a deal with dominion energy. this will be his first major purchase since the beginning of the pandemic the deal is expected to help move from gas transmission and business into clean energy and help increase their own energy footprint. they'll now earn 18% of all gas transmissions in the united states dominion energy also announced it will cancel it's planned atlantic coast pipeline. the $8 billion construction project faced multiple delays and increased cost as well as pressure from environmental groups u.s. energy secretary blamed the cancellation on activists and claimed the development would

have created thousands of jobs in the region. because in the billionaire capital is not what you see in the same sentence but it lost a lot. is this going to be right for him to get back on top >> it's fascinating. there's so many parts of the story. let me just start on that last comment about the legal side of cutting the pipeline is it about legality or the fact that infrastructure spend in the u.s. on assets has ground to a hall and has gone backwards over the last year or so. way before covid-19. people were terrified about putting more investment into oil and more investment into natural gas that basically wasn't paying dividends as well

gas is fascinating it's natural gas they're quite phenomenal this is natural gas pricing in the states that we have up there as well and quite frankly the prices are just along at the bottom the low that i have seen on natural gas spot prices in terms of btu, british thermal unit are basically $1.49 in the middle of june as well i tell you in the early part of this century, we're talking about ten times that ten times that so natural gas, not only oil but natural gas. the price is diminished so aggressively that people think what is the point of investing in this. so that's the point about the dominion pipeline as well. but warren buffet, it's now 18% of the transmission. it's saying i think there's going to be a turn in economic activity there's going to be a turn on natural gas and also you put in

the line about cleaner transmissions. well, that may well be a bonus as well but this is about buying natural gas assets at the moment. >> if i can put a couple of stories together, what we're seeing from some of the oil majors, bp and shell cutting back on the valuations and assets and before this crisis we were asking questions at what point would they take a valuation of the legacy assets that are not going to be the same in the future and they were reluctant to do so but you've seen a little bit of a kitchen sinking moment which means a lot of them are slightly more motivated toward the clean energy transmission. do you think maybe buffet is right about that >> the investors as well you're actually doing this transition, we don't really necessarily want to invest i think what is fascinating is the speed with which it's moving as well.

it's clean gas and in reference to the story of last week, when you say legacy assets, i say big stake he put on by buying the enormous pg deal he thought gas would be part of the future not just the transition and this debate rages and rages and warren buffet, by the way, the gas asset natural gas asset and then that's still the others. we do still think gas is going to be a major part of the equation and then you have alternatives that are clear how you transition from a to b and then to c is going to be torturous as well.

however they were not enough for a total ban. the companies are already using the chinese tech companies equipment and may continue to do so boris johnson is reportedly expected to begin phasing out britain's use of huawei this year following a report by britain's spy agency pointing to the risk posed by the chinese con glom ra conglomerant that's according to the daily telegraph. >> the u.s. government is creating plans to phase huawei out of the 5-g networks according to the sunday times and the sunday telegraph

newspapers if that was true, that would mark a major u-turn in the british government start toward the chinese giant. this year they can play a limited role in britain's 5-g roll out what has changed in may, new sanctions against huawei were aiming to cut it off from key chip supplies that prompted an arm of the british intelligence agency to carry out an emergency review

it's already in some of the u.k. carrier networks already it can be trusted as it stands the u.s. has been running a big campaign against the company but the u.k. is in a very critical market from huawei and it could end a very standing relationship with the u.k. and be a big dent for business >> now travel to 59 countries without quarantining. they highlight the uncertainty around the sector. >> here's a quick look this morning. you can see one of the sectors picking up a little bit of traction today gains not on the boards. intercontinental, one of the better performers. 2.3% on the bottom you can see 2, 2.5%. the one gaining the most, up 3.1% and the airlines this

morning are also getting some traction one of the rare spots on this board, up modestly in the green. so a little bit of a mixed gain on the percentage gains. let's bring in melinda stevens who is the editor and chief, melinda, thank you for joining us today we're keen to look at the outlook for the sector because maybe the airline analysts compare this to september 11th in terms of their demand and concerns for many tourists traveling right now but as the crisis evolves, clearly this has had a much longer lasting impact than what 9/11 had what do you make of the crisis and how many of the operators from the airlines to hotels are going to fair during this crisis. >> i think it's been incredibly intense. certainly at the beginning of the crisis, there was hope that there would be a hockey stick at least by now in terms of revival

and of course it's gone on much longer than expected and as you pointed out, we have been certain of those countries that have recently reopened for example. from a british traveller point of view >> clearly all of this has changed. business travel is falling off a cliff and new experiences, surely they want to go somewhere they have bp before to minimize any chance of risk >> do you know what i think people want? and i can see it in traffic in the u.s. and u.k. right now is people's desire to travel and

connect and aget those experiences or from experiencing different cultures that doesn't go away. but the fact is that what you are also pushing or what you're delivering is an aesthetic view of a world that is something other and and that desire is in people to look at beautiful photography and not your own backyard. >> how do you think various

parts of the travel industry will be because clearly the crisis has been across jurisdictions and right down to the lower end of the market. where do you see tim pact at this stage falling is it just right across the board or is it in more concentrated parts some people say things and allow them to continue on and have safety going forward and now these people that don't have anything will be with all of these first hurdles. i think from a responsibility point of view my feeling from the beginning has very much been about the community of people that you're attached to as a traveller. so we're not just talking about

the high end of the arket. so from the beginning my focus is on how we spend our tourist dollars and going forward we decided to join up with our sister publications in india and china and spain, the middle east and et cetera and continue to focus basically through this initiative under one sky on the people who are directly affected by travel in all areas of the market so that we're seeing the amazing people and the amazing places it's not just hotels and restaurants, et cetera but also

sustainability and we need to continue to shine a light on other businesses going forward. >> right from the start a lot of businesses were told to look back over their costs that demand is going to be less than what it was before they need to spend less on marketing and advertising and we know that many, many businesses across the board say the collapse in advertising at the start of this crisis what are you witnessing now? you see more travel taking place? it's still down but just how bad is the advertising side of the industry >> the advertising side is really intense.

and that's currently the british publications here at this point. however there's still people who look at traveller as a trusted and authoritative platform and that trusted part of it and that authoritative part of it has become even more crucial, particularly in this time, fake news and uncertaintyand. they have been under fire about criticism and inclusion. what does that mean at the individual level from your publication behind the scenes?

>> we have taken a long hard look and we'll continue to examine and doing our best to improve. travel by definition is about voices and we always talk about the magazine being a place to acquire voices from different walks of life so while we have always highlighted people from tons of different industries and across different diversity there is still much to do and that's our commitment the first thing that we're doing is opening up our pitching guidelin guidelines. >> thank you, very much appreciate your time traveller, u.k. and u.s.

coming up on this show, coronavirus cases continue to grow globally with the u.s. leading the way. more on that when we return. save hundreds on your wireless bill

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now crossing the wires, this after the resignation of the chairman and ceo as activists have been demanding job cuts the management team moving with the unions last week so the news this morning of the resignations has been deemed to be credit negative reporting to moody's. they warned about these resignations as they say it raises questions around the strategic plan and increases uncertainties around the future financial profile. take another look. clearly it has not been a kind assumption in regards to commerce bank. well, global stocks are expected to see growth stagnate this

year the negative impact according to city which is recommending investors focus on more defensive portfolios instead of chasing markets higher goldman sachs lowered it's u.s. economic outlook to the third quarter and the full year. the investment bank still expects a rebound in september but now sees growth of 25% in q-3 compared to the original estimate of 33%. it now expects a 4.6% contraction saying a resurgence in cases over recent weeks would cause it to store. goldman upgraded expectations to 2021 saying prospects for a vaccine have improved recently the u.s. reported another record increase in coronavirus cases. more than 40,000 infections were confirmed on thursday. let's get out to nbc's alic alice barr for the latest. there's a lack of clarity as to

what's happening on the jobs front. it doesn't tell us about the impact of closures on the testing side the lack of clarity on the extent of the covid cases. >> that's right karen. you just mentioned the holiday weekend here there's new concerns this morning that some partying, large gatherings that went on over the course of this weekend could contribute to a record setting increase in cases that we are seeing. if you looked across the country, in some states, beaches were packed with people out there wanting to celebrate and other states it was the opposite beaches were shutdown. large gatherings were banned and that's where you get the mixed response to what has been some mixed messaging here in this country. over the weekend, president trump, made again the unfounded claim that it is an increase in testing that had been driving an increase in cases and as you point out, that would not be the case over the weekend when

testing was down and cases were still up we have seen the 27th day in a row, the 7-day average of cases is increasing in this country. president trump making that claim and again this is something that medical experts have frequently disputed that it's not just the overall number of cases 99% of cases are harmless. he didn't want to get into detail about what was right or wrong they both showed their largest number of cases over the weekend and now the mayor of houston, he is saying that 1 in

4 people is testing positive and just a month ago it's 1 in 10. that againpoints out it's the rate of positive cases that is going up but yes, there are folks in the administration saying we can continue to reopen just putting it on personal responsibility. medical experts say it's time for more of a national strategy. back to you. >> thank you i was just saying that in houston it will be overwhelmed in two weeks as the coronavirus cases are not really concerning. we are closely tracking european action this morning. banks have clearly been out in front. a very strong trade of more than 4% a lot of this coming from wall street where futures have been building that is all for today's show worldwide exchange coming your way next

surging coronavirus cases over the holiday weekend as states struggle to get the upper hand on the outbreaks and the oracle of omaha makes a very big deal as berkshire hathaway buys dominion energies in a multibillion dollar deal it is monday, july 6th and you are watching worldwide exchange right here on cnbc