the namesake he never got to meet. that's all for this edition of "dateline." i'm craig melvin. thank you for watching. [theme music] welcome to "street signs." i'm joumanna bercetche with julianna tatelbaum the ftse plays catch up and data shows china factories continues to run production. it's a new record amid bullish german jobs and manufacturing data and factory activity across the eurozone hits multidecades highs.

and diaimler will pay for th patent and royalties between the two companies. opec producers are set to talk about easing supply curbs an let head of today's meeting. >> good morning. welcome to the show. it has been a busy morning as far as the final pmi numbers we just got the final manufacturing numbers for the eurozone as a whole. it has come in at 63.1 versus 62.8 higher than the estimate also boosted by higher estimates for higher for germany that came in a few minutes ago

the final numbers at 64.4 versus the flash reading of 64. france at 59.4 versus 59.2 italy is 62.3 versus 63.7. they have come in higher for the final print than what we got on the flash. it tells you the manufacturing sector is continuing to hold up and the eurozone is somethingw are watching closely with a lot of links to china and the demand to come from china partially, also, due to some of the intermediate goods pricing that is showing up at a final price level as well. that is the picture and the read across the euro which is positive you see the euro trading firmer over the dollar to the tune of

$122.40. joumanna. and germany flash number was beaten with pmi 64.4 over 64.0 annetta joins us now it wasn't just the pmi that came in better than expected. we got german labor data which shows the labor market has held up well. relative to other parts of the world. >> exactly the labor market is doing better than expected. we are hearing from the labor office that they are seeing a first sign that a substantial recover isy is kicking in. the unemployment rate stood at

5.9% 0.1% better than expected. one important measure is the amount of people who are still on short-term working schemes which is a subsidized scheme here in germany. people can stay and work despite low demand for jobs. this number also declined to 2.26 million people. down from more than 3 million back in march. this side of the economy seems to be doing well especially because we are now moving really in big steps toward the reopening of the service sector here also in germany. let me talk a little bit about the pmi manufacturing. final data is not as great as it looks like on the face of the number because many companies, more than 75% of the companies are complaining that there are

serious shortages in product and also the time they are waiting for the products increased substantially. there's the market institute which sees a loss of momentum in may and the receipt of inputs reached a new record high in terms of delays. this side of the economy is still going very strong, but there are serious threats from supply chain problems for the german manufacturing space with that, back to you. >> and that is something we discussed with chris williamson and saying the good number of german companies are facing shortages with the goods and deh ded delays on the transition that is not is not all we're log

at a lot of green on the map behind me positive start to the day. we had a positive handover from the asian market session u.s. markets were closed yesterday for the bank holiday some so were uk markets today, it has slightly a different mood stoxx 600 is up 0.9% we talked about the manufacturing numbers coming in. we are watching the eurozone cpi numbers that come out at 10:00 a.m. there is a lot of focus on the u.s. equal that is coming up and europe is watching to see how much the headline print will move up. expectation of 1.8% points. let's break it down for you. ftse up 1% breaking through 7,000 now

70 points higher in the session. good gains in home builders and resources with the mining stocks which have a good performance today after the vacation index in china which estimates private firms came in higher the strongest number since 2019. we moved on. the european board is doing quite well we did not have time to go into the cac. in terms of sectors, every sector trading in the green. we have the relative defense basket under performing. telco around the flat line up at the top, look at what we have here. oil and gas up 1.6% points a big day for oil. we have brent breaking through $70. all eyes on the opec plus meeting and how much production they decide to release back to

the market about 600,000 has already been slated in. we will see if they stick to that number. auto up 2.3% points. the sector we are watching closely because of the chipmakers and basic resources is up 3% po points good start for cyclicals for the first day of june. you see yields are coming under pressure 10-year is up to 62. we had the numbers come in which were the highest since 2008 which would have spurred a larger selloff in fixed income it remains supported and hovering at 1.6% level interesting to see if it breaks higher in the coming weeks

we have payroll in the u.s. coming on friday about 1.5 basis points higher for the stronger pmi data. that is the focus and ecb next week also coming under selling pressure let's get out to our senior portfolio manager here joining us let's talk about the bund here we saw quite a selloff in may. it seems it has stalled the last couple days. some analysts think we could get to zero for the german bund. what is the catalyst for the german bund continuing to move higher at this point >> i think there are two catalysts. one is the strong numbers on the

inflation side and the other would be an ecb which would be perceived as not fully committed to the inflation target given it is showing 1.4% for 2023 it would be trsurprising if they scaled back support any time soon >> when it comes to the ecb all eyes on the upcoming meeting next week, is it your view that they will start to slow down the pace of purchases? >> the goal is to maintain favorable financing conditions without specifically finding what they mean by that if you look at the staff projections, they are showing inflation for the next three years. you could make the argument that financial conditions are too tight in the area and that means maintaining the current level of

support. not scaling down the purchase. i'm surprised that the debate is only about doing lessor maintaining the current stimulus and nothing about doing more >> constantine, we have the ecb angle and ecb supporting the fixed income markets, but on the virus front, europe lagging the u.s. and uk for the start of the year when it comes to vaccinations now you it looks like europe is making a pretty good effort catching up. case numbers are coming down vaccinations are ramping up. do you think european fixed income reflects the up side with europe catching up to the u.s. >> i think so. if you look at the yield development in europe and u.s. in q1, you saw it was overrun by the u.s. it has some spillover.

what you see now as you alluded to, europe is catching up on the economic development and pandemic front that is why the yield is driven from europe and not so much by the u.s. >> on the european economic outlook, do you think that european fixed income markets are pricing in the european recovery fund or is there an up side moving up and implementing plans for the snunds. >> i think the recovery fund which has been agreed one year ago and rectified by all member states and kicking off later this month and next month is fully priced in. there could be hiccups in the implementation the money is released against reforms. it will be monitoring which countries are doing in return for the money they are getting

there could be hiccups along the lines in the next couple years all in all, it is priced currently. i would not expect any large movements on that debt in one direction or the other. >> i want to turn to political premium pricing. the german federal elections coming on later this year. greens are ahead in the poll french elections happening next year to what extent is the political risk priced into the respective markets? >> it's probably a little bit early to think about these risks. they will come in early for the next couple months and in regards to the german elections, there is a chance the greens will be in the government in one form or the other and it will depend if it comes in first or at the end or junior coalition partner. any strong mandate from the greens in the government could lead to lose fiscal stance and

across europe with pressure on the yields and some efforts on the integration front with the european project with tightening potential. that remains to be seen. there are still a couple of months left down the line. the french elections are remaining to be seen and there is a potential for bobbles in the market. it doesn't look good for macron. >> thank you very much for joining us senior portfolio manager at pimco. pushing on, we also got data out of china overnight china's factory activity risen to the highest level since december it focuses on smaller private firms. index inched up to 52 in may analysts had expected to figure

the number to remain unchanged the read goes against the official pmi which showed a slowdown as prices of raw materials spiked. in japan, manufacturing output growth slowed with the bank pmi falling to 53 in may from the 53.6 in april factory activity had remained above 50 points for four months straight japanese firms boosted by strong global demand, but coronavirus worries at home may prove a concern for the domestic recovery. also coming up on "street signs. the president of ev motorss tell us that the chinese electric vehicle market is set to take f. weill have more of that after the break. do you have a life insurance policy you no longer need? now you can sell your policy, even a term policy, for an immediate cash payment. call coventry direct to learn more. we thought we had planned carefully for our

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welcome back to the show we want to take you to some live pictures from the oecb council meeting. this is the second day of the meeting.

oecd released the major findings of the report. this is the luxemburg prime minister the australian prime minister will take over the role today. we will hear from mr. cormann as well later on. his term starts today and lasts five years we are watching the comments out of the luxembourg prime minister bettel the changeover means we will have an australian at the helm of the oecd. let's shift focus to the estimates from the world global

forum. the world lost 255 million jobs. speaking to cnbc, the manager warned it is a balance with the aid programs withdrawn >> there is a concern that the support measures are pulled back and some companies waiting for the schemes to end and will she s they shed the large number of jobs i think what it requires is some stepping back and thinking through what part of the support measures can actually now shift to a medium-term focus are we investing in the right jobs of tomorrow is there enough ongoing support for rescheduling programs that is what policymakers need to start looking at here >> almost a year after it was

drafted, the eu will launch 750 billion euro recovery plan this month. under the plan titled next generation eu, it will reduce borrowing costs for weaker economies. this comes after the australian and polish governments were last to approve the debt mechanism on thursday. and the g-7 is nearing a global minimum tax rate. according to a draft communication, g7 finance ministers will agree on a global minimum tax by july. the biden administration said it could support a 15% minimum rate the uk has so far refused to give its full backing. back to corporates dividend payments will resume

again this year at faurecia. speaking to cnbc, the ceo said his firm remains optimistic. >> the demand is strong. the oems are low historically. we have to face some headwinds like the electric component shortage and inflation this is okay we have to go through that for the electronic components, i believe. we will not get out of the difficulties before the beginning of next year >> daimler and nokia ended the dispute with the german carmaker paying directly for the use of technology

the long running legal battle included a complaint by the european commission over royalties over navigation systems and self-driving cars. elon musk responds to a kept part skeptic on twitter tesla increased the model prices in may the ficfth in recent months tesla experienced the most harmful supply chain challenges ever during the pandemic. and xpeng has increased the predictions for may. come ppetition is rising and th is one part of the conversation. switching from audio to video as an outlet. let's talk about the interview that you conducted

the electric vehicle industry is heating up in china. where does xpeng fit in the overall picture given the competition? >> one thing you have seen over the past few years is government subsidies for the electric vehicle market helped start ups come to market to challenge the traditional automakers pivoting to electric vehicles tesla, it is important to note, that the deliveries is smaller it is growing quickly in comparison the numbers for may delivery is up over 400% year on year. there is a strong growth there xpeng is trying to compete on the tesla level. a lot of people vying for the slice of pie one trend in china is the tech companies like baidu and shami

have starrted to produce electri vehicles as well rising competition here at this point and that is certainly one of the big topics in the beyond the valley podcast that has been pub published. i caught up with the vice president to talk about the chinese market for ev as well as broader competitive landscape. here is the snipit >> a few we started this endeavor, we were faced with a different universe. especially now while we recognize that the ev opportunities are so vast and also what it takes to succeed is on the technology side i think we started to attract the technology companies it is exciting it validated our original

thesis the differential of the technologies the making of the battery is intense and it has networks and other capabilities i think it is very exciting to see people share that vision that we had a few years ago. secondly, making a car is also quite different from making a cell phone or smartphone it is a much longer product in a cycle to achieve as it takes years of development and manufacturing as well as sales and services set up. i think if all of these technology companies are a few years behind us. >> that was a snip-it of the conversation we talk about the challenges of the ev infrastructure and

batteries. we have not got time to talk about the hair viewers have to go out and watch "beyond the valley" on facebook or youtube pages if you get around to watching it, i would love in our feedback drop me a line on twitter. back to you sdp. >> i love the set up thank you you for bringing us that interview turning to italy atlantia shareholders backed the share of the autotrade backed by the cdp worth 9 billion euro it is at the heart of the bidding war. this was approved by 887% of shareholders this is all over a dispute by a bridge collapse. the stock today is positive.

up 2.5% points since 2018, it has been on a slippery road down 30 points. coming up on "street signs." opec plus will meet later today with the group to stick to ease supply curbs we'll being right back

. welcome back to "street signs. i'm julianna tatelbaum with joumanna bercetche these are your headlines mining pushed the stoxx 600 higher private sector data shows china's factories continue to ramp up production. and europe's recovery has factory activity expanding at a record pace in may. daimler agrees to pay nokia for use of the patent over the long running battle of royalties between the companies. oil prices gain with brent breaking $70 a barrel as demand

picks up ahead of the opec plus meeting where producers are set to talk about gradually easing supply curbs >> we have more data crossing the wires for you. we were looking at the eurozone manufacturing numbers for may. we have the uk numbers now the final may manufacturing for the uk at 65.6 that was lighter than the flashes estimate of 66.1 drawing a contrast to what we saw in europe where the final numbers were actually generally better than the flash suggested. germany in particular seeing some greater strength than predicted. very strong out of the uk strong in the 60s. 50 is the line between contract and expansion. uk north of that as the economy

reopens. joumanna let's look at europe markets. it is june 1st the first trading day of the month. all of the indices have a positive start to june ftse 100 and the pmi numbers below flash. still strong up 1% for the ftse 100. big gains in the miners with a good session also good date for home builders as well as nationwide the numbers show that for the month of may, house prices were up 11%. that's the ftse and cac at the record high. 180 points higher on the day 1.2% points higher we had strong macro data inflation coming in higher coming in at 2.4% in may versus 2.3% is what the market pencilled in the fastest rate of inflation

since 2018 we are seeing good reaction in the german index cac and france is up and doing well up 40 points stronger session for the french index. in italy, up 1.2%. one company we are watching is atlantia today we have a relation in the stake in the shareholders selling off that to a consortium led by the state lender some resolution there. switching to the foreign exchange the pound is scaling back versus the u.s. dollar. trading at 142.20. it could be a reaction to the slightly weaker than the expected pmi it is coming from a high base.

the dollar and yen is close to 110. that is the theme the last couple months. the euro as well 1.2215 this is continuing to go from strength to strength the faster rollout with vaccinations is something the ecb is watching closely as we get to the meeting next week u.s. futures coming back from the bank holiday. we are looking at levels relative to the close on friday. it was a positive session in the end on friday. mildly so. you can see today for the first trading day of the month that all of the 53 are opening in positive territory s&p up 14. down 150 points. nasdaq, which was the laggard in may, is now opening in positive territory. keep an eye on terms of data friday is a big day in the u.s

payrolls was a bit of a downer for the market and a huge miss by 750,000 let's see what this friday brings for u.s. jobs data. maintaining the pace of the easing of oil supply curbs citing hoping for the demand the group is set to decide on policy later today to discuss oil and broader commodity markets, we are joined by jeffery curry at goldman sachs. jeffery, thank you for joining us let's kick off with oil. opec is in focus today brent broken back through $70 a barrel after a volatile month. what are you looking out for today and what is baked into the oil price at this stage? >> i think the event itself is going to be a non-event.

we expect them to basically reconfirm the plan they laid out on april 1st on a month over month basis in july, they are likely to increase production by 800,000 barrels per day. that's the headline production increase the bigger issue is how they deal with iran it is too early to give specific numbers around iran. the reason for that is that you need to see what the u.s. lays out in terms of offer on returning the oil supply you need a verification timeline and quotes we don't have that the best you can hope for is how they deal with iran is an indication they are willing to offset any increases in iran that could be the positive upside surprise coming from the

meeting. >> you came out bullish last month now telling your clients to buy the dip take this as an opportunity to get better access to the next leg higher in oil. where do you see oil going by the end of the year and what exactly gives you that confidence >> it is mainly demand recovery. india has been the area of concern right now. it looks like we're now seeing a recovery although from very low levels. the key issues is what is going in the u.s. and what is going in europe as we go into the summer travel season. that's where you expect to see that sequential increase in demand when you look at overall demand levels, the core of the decrease is coming out of covid is in jet fuel demand. if we can see at least european domestic travel recovering are

the lifting of international travel ban and combine that with the summer season in the u.s., that's what we think will drive that big leg up in demand between now and mid-july >> jeff, just another question on the supply side clearly from what you say from the demand perspective when it comes to supply, you pencilled in a slow recovery as far as u.s. shale producers. obviously things are picking up in the u.s. if you look at the recent macro data. why is that the case >> the reason is that counts and fid and every measure you can look at across the commodity space, not just the oil story, show no indication of aggressive investment i find surprising. if we went back six months ago and i knew oil was going to be at 70 -- by the way, we were bullish seven months ago say there has been almost no

supply response in terms of cap x and rig counts, i would have told you no possible way the key here, i think, is most of the companies are focused on roe very near term you prfind prices going up and returns are going up i think the shareholders do not want to see those returns through increased investment particularly how ybad it went five or ten years ago. that is one factor that is driving it you throw in the esg overlay on top of that. you had announcements from shell, exxon and chevron which indicate is very difficult to see large-scale cap x. you look at fid in the oil industry right now you in 2021, it is the lowest on record we expect to get back to

pre-covid levels later this year that's really supporting that bullish outlook on energy and commodity. >> you mentioned the green transition that is something that goldman has been big on. we're in the middle of the global super cycle in commodities especially with raw materials for transition into copper you point out traditionally the swing factor for many of the metals would be chinese demand that is no longer the case you don't see china to be the marginal factor any more why is that so >> absolutely. the key point here is the bullish thesis both tactically and longer term is predicated on

scarce difficult in the develdev developed market led recovery. when we look at china more specifically, it has now or it lost its position as the marginal consumer of commodities, which is the west, and you can think about china being the incumbent consumer it is that base load consumer out there. the reasons for that, the u.s. and europe backing the marginal consumer, near term is the huge fiscal expansion in the u.s. right now. the margins are so strong in the u.s. right now that they can pass through commodity price increases dollar for dollar. they keep pushing ahead. in contrast, the chinese margins are razor thin there is a structure point going on that i think is deeper. when we think about somebody once said that the reason why

china was consuming so many commodities in the 2000s, cheap labor and cheap coal and blind eye to the damage to the environment. when we think about the current environment, they can't do that anymore. they are focused on preserving the environment. they don't have access to cheap coal the cheap labor. the last point here. when we think about the world when it was made in china, you centralized commodity demand in china. we are not doing made in china anymore. it is made at home when you do made at home, you end up with a global demand picture for commodities. >> jeff, before we let you go, i want to ask about the price of gold we're up $200 since the beginning of april $ $1,900 is where we are right now. when you can buy digital gold,

what appetite are you seeing from the clients to go down the traditional gold route >> the digital currencies are not substitutes to gold. if anything, they are a substitute to copper the reason i argue that is they are pro-risk you look at the relation with bitcoin and copper or measure of risk appetite and bitcoin. we gott ten years of trading history on bitcoin think about why. it is demand through payment systems. it is core late is core lat tive business sector.

that's what bitcoin hedges that is what copper hedges gold hedges bad inflation. supply is curtailed. people were focused on the shortage on chips and comm commodities and other raw materials. you want to use gold as that hedge. what that is seeing is you see the converge of gold and real rates. >> jeffery, really interesting to get your perspective there. thank you for joining us jeffery currie at goldman sachs. still ahead on "street signs. u.s. equity looking to start week on strong footing we'll have more next

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welcome back to "street signs. u.s. start up sofi will become a public company later today via a spac the move values sofi at $8.65 billion. we will speak to the ceo anthony

noto at 1700 cet let's bring in the ceo of morgan free capital market. great to have you on the show. we had a guest yesterday on the show saying there were 400 spacs looking for targets. they all need to transact by 2022 looking for a company to acquire. it feels like the next 12 to 18 months will pose a big test for this product >> yeah, i think the great news is exactly as you described. we are finally reversing this two decade long trend of de-equity and taken back 500 of those over the past year very excited to see access to the incredible growth companies.

these innovative companies creating industries of the future rather than staying private and being the playground of the wealthy. they are now being democratized by the spac market. >> there is a lighter touch to the spacs coming to market versus the traditional ipo how much of a threat after scrutiny from the regulators will pose the outlook? >> great question. i don't think there will be much change the regulatory process exactly the same there are a couple of minor differences in terms of forward looking statements at the end of the day, what we want is the innovative high-growth companies to be public it is advantageous to be public

and broader ownership and use the equity as currency and acquisitions i think people get past the issue of volatility when companies are new and the best days are ahead, it is tough to value future cash streams. i use space travel and exploration as an example. how many space tourists do we have today zero how many in the future probably a lot it won't be me personally, but a lot. >> mark, when it comes to sparks, one major concern is and i argue a concern that is holding true for cryptocurrency as well is whether retail investors need more production i'm curious what you would say to those critic ws who say retil i retail investors are too exposed and don't understand the risk we

t when they invest in? >> that falls in fud fear, uncertainty and doubt. you have the idea that retail investors are not smart because they're not rich is silly. this idea that we have to protect them from themselves and keep these great investments away from them is just crazy if you think about history history tells us that regulation should help companies advance. it should help them with access to capital not preclude them from capital markets. i believe this idea that protecting investors from themselves is really protecting the wealthy by creating a walled garden as opposed to a fence to keep other people out. >> i suppose when it comes to

spacs, part of the risk is the role that hedge funds play and the role they play in seeding the spacs and redeem the holdings in these early on the question here is whether we do need to see a restructuring in the way that spacs are handled to her point here. it sounds like you don't think that isnecessary as a way to protect investors on the retail side >> quite wrong spacs are different from the combined eentity the spac is a low-risk asset you own a portfolio of treasuries in a trust while the deal is being searched for 400 in the market searching for a deal once they find a deal and do a merger, the company actually de-spacs it is a post-merger combined entity that company is just like any other growth company

not a different asset class. it is an equity. again, this idea that hedge funds are doing something -- yes, hedge funds do spac arbitra dprks e. they hold during the deal period they sell and make a 10% or 11% return they are not speculating on whether the deal is good or bad going forward. that is the idea for any investor virgin is not a spac it is a company. draft kings is not a spac. it is a company. it used to be a spac or went public through a spac merger hedge funds are not investing by and large any differently than anybody else the other myth is people are cashing out in the spac world is absolutely not true.

the sponsor puts up millions of dollars in venture capital, risk capital. that money has to be rolled into the deal they don't get to sell look at the traditional ipo. the traditional ipo, there is massive insider selling. all-time records for insider selling. i say insiders know more about companies than you and i insiders don't sell at bottoms the traditional ipo process, i would think, has more risk of that unloading on to retail. if you look at the price of traditional ipo with the big one-day pop, it goes to the clients of the underwriter, the data is more damming in that respect. >> to her point, referring to the investment option. quick question for you we have seen a pull back in the price of spac and alongside the pull back in cryptocurrency.

what extent are both of those a reflection of frorth mentality i the market right now >> the question about price is irrelevant the daily price of the asset where the best days are ahead, not behind, is irrelevant as i you borrow a line from john. the value of cryptocurrency and the low price for bitcoin every year in the 13 years other than one, has been higher the value continues to improve the price is volatile because people cannot contribute on a day-to-day basis. >> mark, thank you you for joining us on "street signs. "worldwide exchange" is coming up next.

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it is 5:00 a.m. on cnbc. here is your top five at 5:00. black eye for big tech the sector comes off the first losing month in six. my guest says don't count on faang for much longer. another hack attack. a developing story as the world's biggest meat supplier is the biggest victim of cyber criminals. banning the booze. airlines back tracking on resuming in-flight alcohol sales amid reports of rowdy travelers. oil on alert ahead of th