that's all for this edition of "dateline." i'm andrea canning. thank you for watching. [music playing] good morning and welcome to street signs. these are your headlines. a almost 8% rise in quarterly sales as higher prices offset volume. pricing growth will remain elevated even with peak inflation. sales help lower the

inventory and improve the four year forecast. meanwhile the bayer shares slump for the 2nd time this year. aging pledges to revive the suffering economy saying it will adjust economic policies to tackle unemployment. sending equities in china surging. attention on wall street turns to microsoft and alphabet with the two tech giants reporting quarterly figures. good morning again, yesterday's adjusted pmi numbers coming out of germany, just now we are getting the

german e phone numbers. let me break them down for you, there are clear signs that business morale in germany has fallen yet again. the german july equal numbers come in at 87 .3 just below expectations of 88 point one. versus the expectation trends of 88, in terms of other parts of the current convictions index coming in at 91.3 for the month of july. the consensus forecast for 93 so current conditions weaker than expectations. as for what they would call the expectations index, this is the company's expectations looking ahead has come in line with the forecast. 83.5 is what we got we got 83 point for but overall i think

it is significant that we have seen quite a big drop yet again in the business climate index. this is following a decrease from the previous month. it will be the third consecutive decline for these trends so this does tell you for a while the equal sentiment indicators are moving in the right direction and now we have slipped to moving in the worse direction because of business sentiment worsening. this is echoing the data we had out of the pmi the manufacturing numbers, indicating a big manufacturing slump in the manufacturing part of things and also services as well beginning to show somewhat of a decline. this is not just about manufacturing anymore but also services numbers in germany beginning to disappoint. as i entioned, one glimmer of hope coming out of this is the equal expectations number was in line with what the markets

have been penciling in. let me get out to the president to get more context on what is going on here. a bit of a surprising decline in the business climate index falling 287.3 and this is falling from june, what is going on here? >> -- fall, it looks like germany's economy is finding it difficult to get out of this recession we have been in in the last quarter of 22 in the first quarter of 23. the hope was the economy would recover in the summer with the easing of supply bottlenecks but now it looks like general conditions are worsening. that is certainly the case with the monetary policy having a effect on demand. we see restrictions moving from

the supply side to the demand side now. that is having a strong impact, especially on manufacturing companies. >> we looked at pmi's yesterday, the demand picture has also started to worsen as well. how would you characterize the demand picture internally versus external sources? >> i think it s declining in both areas, internally interest rates are having a fax, maybe there is also a effect due to the fact that a lot of people purchased goods during the pandemic like furniture or bicycles and little money was spent on services and now there is few demand for industrial goods coming from private households. certainly externally we have a declining demand that is related to the global tightening of monetary policy

which is having a impact on demand and investment demand and did german economy is exposed toward investment goods. >> i was going to ask about the impact monetary policy seems to be having but you answered my question. let me ask about energy costs, they are sitting lower than they were a year ago. why has that not provided more of a tail wind to investment sentiment? >> it is probably because the uncertainty looking forward is still very high. it is far from clear how gas supplies will look in the coming winter. so there is a lot of caution. if we look at the energy intensive chemical industry in germany, there was a decline in production last year and it is not recovering. companies are not getting back to the production levels before the energy price jump.

suggesting many companies suspect trouble ahead. the issues with gas supplies remain. electricity prices are high in germany. >> is it true from a utilization perspective that a lot of german companies started to bring down production because of the energy crisis we saw last year and they are no longer operating at full capacity because of the concerns you highlighted? >> correct, if we look at the service industry, we see they are operating below capacity. they are making plans to ship production abroad. what we now see is that the situation worsens in the metal industry and machinery. this is also an important sector. not quite as energy intensive

as the chemical industry but the situation is also declining and i guess energy prices are also a aspect having a impact here. >> one thing i noticed as the numbers broke was that the expectations number came in line with what people were anticipating sitting at 83.8. we are not seeing a notable decline from the expectations side of things. what is providing support here? >> maybe this is just a return to normal. for a couple of months, especially in the last month. we have seen pessimistic expectations. as well as a okay current situation, what is being seen now as the current situation is following the expectations and the expectations have only worsened a little. i would say it is more of a return to normal. expectations moving closer together. i would not call it a support.

>> taking the two data points together, the july pmi's we had come out yesterday. the data coming in today. is it your expectation that the german economy may enter into a recession? >> i think the likelihood has increased strongly the we will see a shrinking gdp number for the second quarter which will be coming in a few days. we are close to zero. it is hard to say but the likelihood has certainly increased. >> it makes sense, thank you for joining me on the show today. also coming up on street signs, union leaders doubled as a broadly negative day for

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welcome back to street signs, it is a busy week. point to the numbers the last 24 hours, the pmi numbers are disappointing to the downside, the german numbers are also disappointing, showing the european recovery is beginning to stutter. that is as we head into the heart of earnings season. 30% of the snp reporting this week. the focus on the recession is seen on the report cards. today the focus will be on the tech giants, microsoft and alphabet to report numbers after the close. of course later on in the week we round up things with central bank meetings starting with the fed wednesday and think of japan on friday. in terms of markets today, you can see green is evenly split. up about 9 basis points or so.

also we are not just focused on macro data but also the earnings that have come through. let's switch to european markets . you can see there is a lot more red on the board then green at a indexed level but only marginally. very much in focus yesterday after the inconclusive election results. they are reporting later this week. germany is down 4 basis points. the data has disappointed to the downside. i see that as a bright spot in the index up 4% today. we will talk about what is going on there shortly. down 4 as well. right in the middle, lagging the index. this is in response to the results coming out. as well as the acquisition of a cyber

security firm. we are seeing a bit of green there, up about 10 basis points and write at the top we have another name that reported today. we will talk about that in a few minutes with my next guest. there is knock on effects for some of the positive press action we had in asia overnight on reports that there may be more targeted stimulus coming out of china. in terms of sectors this is a breakdown in leadership today. up 3.2%. luxury also sing a bit of a recovery up 1 .3%. one of the names we are watching today posted decent results. also a passive percent. we have healthcare lagging two thirds and the measure continuing from yesterday's decline. they set the tone with a cautious outlook. we are seeing the knock on today. in terms of u.s. futures, this

is what the recession looks like for wall street and it is a mix the bag. opening 5 point hires marginally so and the dow jones slipping 8 point weaker. a lot of focus will be on the tech names with microsoft and alphabet reporting after the close. let's bring you right back to europe, they are trading at the top of 5400, set for the biggest one-day jump since may 2022. the firm raised guidance for the year on the back of better than-expected underlying sales in the second quarter which came in at 7 .9%. this after the firm hiked prices by more than 9% in the 1st half and sales volumes only fell .2%. it is a excellent signoff for the former ceo according to a note with all eyes now on what the replacement will do next.

the government scrutiny of food prices and upcoming departures from the board room table. he kept his cards close to his chest saying he will share a more complete set of observations when it posts 3rd quarter results. a lot to unpack your. great to have you with us charlie. let's talk through what stuck out to me. the sales growth numbers. i think it is significant that sales numbers beat the forecast but at the same time price increases were quite high. up more than 9%. the volume dipped a little bit down .2%. this toes you the bulk of the sales are on the back of higher prices. >> -- probably the most encouraging point -- volumes --

nothing -- volumes are declining -- given the -- put through -- a lot more down trading -- declining more than they are -- volumes are holding -- despite -- pricing -- probably the reason why -- this morning. >> can you put this into context in terms of the political narrative going around about price gouging? again, the fact that this consumer goods company was able to pass through price increases more than 9%, the first half margin is still sitting at 17%, is this a example of the company that has taken advantage of higher cost increases to pass

them on to consumers and benefit from them? >> i do not think -- look at the margins -- reasonably -- pandemic -- company that was -- around 300 -- pandemic -- that would suggest -- price gouging -- increases -- which is why the margins have come down -- companies -- too far -- c consumers -- more -- brands -- fine ine -- price increases -- conscious -- too much -- price

increases -- relatively modest given the level of inflation they have seen which has been extraordinary. >> one other thing that struck out to me, the percentage of business winning market share is now sitting at 41%, the second lowest number ever disclosed. even though the sales numbers are beating expectations, it is not happening across all of the portfolio. >> absolutely not -- account for -- seem to be doing better -- portfolio -- pockets of weakness -- down around 10% -- indonesia -- you know -- also --

disappointed with that -- priority -- >> are we likely to see a downsizing of businesses and focus on he core businesses gaining market share at the expense of other businesses underperforming? >> i think so -- come down by 29% -- that would suggest -- biggest brands -- tackling that -- something the new ceo will look at --

>> i have a question about the strategy of the company going forward. again the incoming ceo has said he will not give a lot more detail about the overall strategy until the next quarter. he is very new to the role. his predecessor came under a lot of fire because he was a flag bearer for a lot of the sustainability initiatives much to the chagrin of shareholders sitting on the union leaderboard. to what extent do you think new management will take the criticism is on board and, if at all, look to veer the strategy away from being sustainability focused? >> -- decided -- likely -- change to the strategy -- changes in how the strategy is executed -- relatively modest.

on the call this morning -- views on sustainability -- proponent of sustainability -- delivered in a way to get consumers to pay more for those brands that are labeled as sustainable -- around that -- execution -- walk away from -- sustainability -- not at all. >> thank you so much for joining me today. interesting to hear our perspectives on what has been happening with consumer goods companies. another company we are watching today, bayer downgraded the for that year forecast announcing a 2 1/2 billion euro write-down -- weed killers. the german chemical giant cut the outlook for 2023 between

11.3 and 11.8. the reaction -- pretty positive. adidas will see smaller than expected losses as demand for easy trainers remains unexpectedly strong with orders coming in for the 4 union paris of unsold shoes. expect me what is going on here. i thought they were sitting on a number that was around 1 ,.2 billion and now they seem to be selling the stock. >> i think the real decision around this is they had to write down at least 500 million initially and that will probably grow a little bit as well. previously writing 440 million of these brand shoes as well.

the key reason here, they thought to themselves it will probably be difficult to actually sell these because of the recent anti-somatic marks he made. actually it seems demand and the younger teenage category has actually grown and those of the ones that decided to get into the ale of these 4 million pairs of the trainers. 500 million euros gained in this regard. adidas did say they plan to use the proceeds to give to charities across the u.s. and china. saying 8 ,.5 million will go to the tragedy but also saying they have two pay for the costs for the cancellation of the partnership. >> it seems it is the only thing we're talking about the last couple of months.

then again the future prospects seems good for the company and it seems like they are benefiting from a retro revival. customers are coming back and looking for the signature shoe from the 80s and 90s. >> that is how adidas originals comes in. that is another brand, it has been in place for quite some time but that has grown significantly which has put together the old logo back in place on the adidas as well. doing that with a collaboration of a older style over and above the brand collaborations they had with the likes of beyonci■ and kanye. those have not worked out for them. >> the three stripe shoes. did you have those in high school? >> i did. look at how much more in fashion they are now? i friend said fashion does not

change really it comes back as something different later on. this is a clear sign of that. even nike is trying to establish growth with something they had in the past. overall 50% of the stock has been liquidated. they have those losses and well in place, with shares going up 37% the prospects are good. >> brilliant, thank you for the latest. also coming up on street signs, beijing pledges to step up economy support. mi uave the latest from china congp next.

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welcome back to street signs. these are your headlines. shares jump as the consumer goods giant jose 8% rise in quarterly sales as higher prices offset issues and volumes. the company says prices will remain elevated. germany shares rise as strong sales of the shoe line

helps right off. beijing pledges to revive the stuttering economy, pledging to adjust economic policies. sending shares surging. attention on wall street turns to microsoft and alphabet leading to the tech giant reporting quarterly figures after the bell. european markets are beginning to turn around here, a lot more green than a half hour ago with the exception of the index in spain still

adjusting to the results of the election over the weekend. we are now seeing the conservative party trying to cobble together a coalition, we will see how the talks go for the time being we are seeing a pullback in the index. digesting the new macro data we had over the last 24 hours. today this morning out of germany we had the phone numbers showing a downward tilt and sentiment on current expectations and future expectations as well. it is now leaning more positive on the back of adidas. tech in france also of 10 data points or so shrugging off reports in the macro side of things. in the uk also of 15 basis points and we are seeing a resurgence in some of the basic resources mining names, a discussion for the likes of --

helping to boost and of course as we spoke about the union leader right at the top. let's talk about what is happening in china. it is getting a boost to any sector in europe that has any sort of connection to beijing. the country pledged to boost -- calling the post pandemic economy torturous. they want to focus on expanding domestic demand according to local media. on the back of that, we see a major recession out of some of these key chinese indices. this is up to that .1% from yesterday. the composite as well. a major recovery, 766 points. let me break it down for you. this characterizes the extent

of the ove we had after those comments. the banks in hong kong up more than for that .6 in mainland properties, a big focus for investors the last year or so up 14%. let me give you context here, until today this index was down 40%. we are still down 25% for the year for the mainland property index. a huge report today but still negative on the year. to give you more color, sam filed this report. >> reporter: chinese stocks rallied, investors liked what they heard. chinese leaders met to discuss economic priorities. the market has been waiting to hear what tone they set for the 2nd half. shares surged despite no major policy announcements and rumors of a cautious tone as they

warned about nude challenges and difficulties. the market seemed to be encouraged and they did not say anything about the property sector. he stands they have been taking as part of the leveraging campaign. this suggests a supportive division which helped real estate stocks today with expectations that help is on the way. policymakers also reiterated the need for language strengthening macro policy. they also implied a even bias. on policy they say the leadership will stick to the proactive stance for now. they are giving full play to the role of monetary policy tools applying big back

stimulus. there was also a emphasis on jobs as a top priority as policymakers look to stabilize the labor market amid record highs in unemployment. nbc business news. the uk economic activity slowed sharply in july. for the month they had a seven month low while the services output also fell. the latest figures come amid a backdrop of higher mortgage rates and strong job growth. a 15 year high of 5% last month. we caught up with the ceo of one of india's largest conglomerates with businesses in the uk and globally and asked about investment climate politics and more.

>> reporter: -- losing of access of the 27 member trade block. now the uk is looking to the east wild forging new trade alliances -- the likes of joining -- the expectation is they will all be looking at more -- relationships in the asia-pacific region -- chairman of the group -- particularly about how lucrative could a free trade agreement look like between india and the uk and this is what he told me. >> there is to be a lot to be done and technologies. in health. in education. especially in the fence. very interested.

i would only advise to both of the governments to finalize and finish up this fda issue. >> it has taken more than a year and it has not happened. >> i know, our commerce minister was here last week, i think 26 24 issues, the majority has been resolved. but still some are pending. do you know why? bureaucracy is the biggest problem. this bureaucracy, even in indi , will not help. we would have much more investors in india. even here, if they have a

policy of increasing investors to come in and not delay. we would request one to start with electric vehicles here. we were promised concessions, subsidies, we did not get anything. >> the chancellor at the g 20 told me in february that the potential between bilateral trades between the two countries , right now it s berlin, but that is too little and the two countries can easily double it. close to 100 billion. what are the kind of numbers you see? >> i know him personally. what he has said, i totally agree with. at that level, everybody wants

the fda to be signed quicker between india and the uk. some steps have to be taken by both leaders to finalize it. maybe when the prime minister visits india they will resolve it. i am just thinking. i am not involved. >> -- also the election results -- political climate in the uk -- given that the election results pretty much were in sync with the polls -- going down the road -- looking -- next general election.

this is when he told the -- policies playing out for businesses in the region. >> nowadays nobody wants negativity. they all want to see everybody successful. i am a strong believer that we should be settlers. we need to watch for at least six months more to come to a conclusion, if any part can continue. also we will have to see if the labour party is changing their policies. >> do you expect that to happen? >> why not? when tony came in he did a good job.

so it all depends on the leaders. the personal experience and what is happening. it is too early to see. -- democrats are very smart. we will have to watch and see. after six months i will tell you who will be victorious. we will bet at that point. >> you are positive about the uk future. >> yes. more than that, india. we are investing quite a lot. if we join hands together it

will help quite a lot. >> we need a bet. >> it is something you will have to follow up with. we will have to come back in six months time. thank you very much. elsewhere in commodity space we are watching wheat futures closely. calling on months of games as the ukraine war intensifies. prices have soared after russia pulled out of the un brokered deal allowing ukrainian exports across the black sea. the account for 30% of globally traded wheat. ukraine's president has asked the un to lift the exports, a man on exports to hungarian --

set to expire in november. the ukrainian leader described the restrictions as unacceptable. >> there is a very important agreement with the european commission, which is -- european side -- temporary restrictions will cease to be in effect. any extension of the restrictions is unacceptable and non-european. europe has the capacity to act more rationally. we are working actively with everyone to find a solution that is in line with the spirit of our europe. coming up tech is in focus as earnings season rounds out, we will break down what to expect after this break. hi. i'm shannon storms bador.

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welcome back, today sees the first key test of big tech

names this earnings season with microsoft's and off of it earnings to after 12. they hope the companies can capitalize on generative ai. alphabet revenue is rising four and half percent on the year which will be the highest growth level in three quarters despite continued concerns over application spending. aps is at 12%. cloud revenue is a key focus for investors with the microsoft report with expecting to go to 13% the lowest rate since 2017. earning shares and revenues are expected to go over 55 billion over all. the head of intelligence joins me now. a lot to focus on this earnings

season. i first want to ask about special intelligence, to what extent do you think these big mega tech companies can ride that wave? to what extent can they all be winners? >> i think in this earning land for tech ai is the number one question and people will be focusing on cloud but the forward guidance will be based on ai. it is a little bit -- ai has been around for a long time but i see it as a formula one race and we are at the starting point. nobody has monetized it to a great extent. the monetization will start now. we have all of big tech investing billions. they are at the starting line, they all have good ai engines and the winner will be the one with the best driver. >> let's start with microsoft then. you and i were talking off air about -- generative ai and it

was microsoft's announcement that they purchased open ai. nvidia released their results and added to the fuel. this week microsoft announced they

. .

it is 5:00 a.m. and here is your five at a5. the latest policy meeting and a rate hike expected tomorrow. a morgan standing mea culpa as mike wilson issues a rare apology on his bearish outlook for stocks and speaking of stocks, the short squeeze trade appears to be back and with a vengeance and bumping up against historic highs plus, six days until unionized u.p.s. workers can hit the picket lines then later in the show