stop, you goofy dog. that's all for this edition of "dateline." i'm craig melvin. thank you for watching. [theme music] good morning and welcome to 'street signs'. these are your headlines after announcing a domestic bank of credit suisse and its first earning since the takeover. the ceo told me integration is the right move

>> it was not viable any longer. european markets look to end the month on the from foot on what has otherwise been a downbeat august. wall street is set to break a five-month win streak, rates are high enough. chinese factory activity shrinks. the u.s. expands its chip export controls restricting access to some middle eastern countries. nvidia downplays the decision

welcome to 'street signs'. the big earnings of the day. ubs is a plans to fully integrate credit suisse domestic bank into its own business. announcement comes as ubs hosted its first set of results since the emergency takeover of its collapsed rival. ubs hosted a knows profit of $29 billion. that was short of expectations. the shares are reacting very well to today's update. we have been covering these results on morning. it seems like the biggest strategic question coming into today was the fate of the swiss bank. tell us about the strategic decision and round that what we heard in terms of results today. >> reporter: thank you. let me take a step back for a talk about the swiss bank. it wasn't focus going into today.

let's rewind and remember the reason the earning results came out today is because ubs needed more time due to the complexity of combining their own earnings with the results of credit suisse. it was a mammoth task for them to undertake. today is the first opportunity for investors, for the street to get an understanding of what ubs found under the hood once i got access to credit suisse balance tree -- sheet. 29 billion number, the difference between what ubs paid to acquire credit suisse and the value of the assets, was $29 billion. a huge number. it will go down in history. let's remember that. in terms of other major announcements, they have announced more strategic decisions. one is with respect

to the swiss bank. there was lots of questions going into the day. whether they would decide to spin it off and go down the path of an ipo. in the end, ubs decided to retain the swiss bank. that may have some political ramifications because it does actually entail headcount reduction in we found out about an hour ago ubs said because of that integration, 1000 jobs will be lost in another 2000 jobs in switzerland will be lost. a big question is, how much more personal reduction is to come? they instituted a cost-saving target of $10 billion. a lot of that will come from a reduction in headcount. let's listen to what was said today. >> our cost ambitions -- we are counting on natural attrition. we are counting on retirement.

and unfortunately, we will have to take some drastic action. we do that in the most responsible way, in order to mitigate the problem for people affected. >> reporter: the headcount reduction has already started. how far away through the process are we? >> if you look in terms of, we don't really like to talk about forward-looking on headcount. we have a target of cost and we will address that. every quarter you will see progress on how headcount plays in achieving our targets. last quarter, you will see from the reports today, we had already 8000 headcount reduction at credit suisse since the beginning of the year. >> reporter: there is not a headline number you are targeting? let's see about the decision to

retain the swiss bank and there has been political chatter about your decision to spin of , but in the end you decided to retain it. >> everybody has an opinion. on what we had to deal. we had to focus on what was visible. we took it in the right way. we went through a deep analysis of what will be feasible and sustainable both from a client expectation, employee future, social standpoint of you, and at the end of the day we had to look at feasibility, risk of implementation of sustainability both from the risk point of view and at the end of the process it was crystal clear the best options for the clients and employees, for switzerland is to have a stronger bank that is able to serve its clients any more confidence of way.>> reporter: the credit suisse banking will

remain domestically? >> we expect the integration to go through in 2024 or early part of 2025, until the nothing will change to the way we approach clients, to the way clients are served and therefore we continue to exist abroad, i don't think we will phase out the vast majority of the cases come the credit suisse brand and integrate into ubs. but we can use the brand in some circumstances. >> reporter: you will see that i did try to get a number with respect to how much headcount reduction, how much more headcount reduction are we to see. he did not want to give me a number but essentially we are looking at $10 billion in cost savings some analysts have gone to calculations and they came up with 35,000. this is from the analyst community. about outlays and jobs have already been lost in the second

quarter. today announced another 3000. this will be a big issue for the market going forward >> for the market and employees at ubs i know that was a question coming into the results. great you pushed him on that. when you preview the results yesterday you raise the point that, what in sight did you get? >> reporter: that is the number one question. you are looking at a huge bank within switzerland. about one third of swiss customers have accounts with this new combined entity. how it is operating will be key to this was economy and globally it could have implications.

the first question i asked, how has business gone since the deal was put together and since was completed at the beginning of june?>> one of the most interesting challenge for us to really manage both, and integration focus but at the same time staying close to clients and beginning through the uncertainties we see. it is very clear that we are making very good progress in our integration plan but i also plan to see the clients are seeing loyal, they understand our stores and the rationale of the combination and they are entrusting us with good inflows in the second quarter and third quarter. >> reporter: one of the numbers that struck out was $29 billion worth of negative goodwill. that plays into, this was actually the deal of the century for ubs. >> when people look into those

numbers, they will understand that the negative goodwill, is necessary to sustain the assets. the financial resources to go through a deep restructuring that is necessary at credit suisse. our analysis has proven that the business model was not viable in the longer. credit suisse had excellent people, clients, product, but the business model was not sustainable in the longer. and needs to be restructured. >> reporter: a lot of questions and concerns about what would happen. we saw a massive wave of outflows. what are you seeing now? >> we see good momentum in inflows both on the ubs front and see as front. particularly after we close the transaction in june.

credit suisse in june met new money in its wealth management platform. we see net inflows in the swiss bank operation, so clients are coming back. credit suisse lost around $200 billion during its difficult times in 2022 and 2023. we are seeing some of this coming back and our goal is to try to get back as much as possible. it is not easy but it is our ambition. >> reporter: do you think you can? our customers loyal? >> it is good to see how loyal the clients have been to credit suisse. it is something that ubs went through our own issues and is one thing that is really will warding for the people were putting so much effort in staying close to clients to see that clients are bringing back

the trust. >> reporter: let's talk about the integration and how it's going. you announced yesterday that you will close down the global markets division. whatever decisions have you taken with respect to investment banking and wealth management? >> we will now focus the investment bank of credit suisse that fits into our strategy. in terms of 13% of the risk assets we use in the investment bank. what we are shutting down is the entire infrastructure, the it infrastructure that is there to sustain. we are migrating people and positions on the ubs platform. this is important because it is one way for us to achieve our financial target as we take down costs by shutting down infrastructure, merging entities in this we will do between now

and 2026 >> reporter: just to pick up on one element that minneapolis of also pointed out today, the net new money number was reassuring for the international community and for many people look at this because throughout the second quarter, ubs itself saw close to $16 billion. for the first month, credit suisse got inflows of $1 billion. the goal in the hope for ubs going forward is they can continue to attract that money again. overall, a positive reaction in the market. up 6% and positive reinforcement from the analyst community. to bring in an extra voice, the partner from rayfield joins me. first of all, what do you make

of this? >> it is a normal reaction. you have investors, the general public in the politics which are different voices. we knew that today would be a day where this is once in a blue moon, historic number. the best number ever on banking. we know where that comes from. combined with drama. that has been highlighted to a different extent. the good news is, stabilization came in the market seems to the risk what was out there and was potentially which still had some hidden dead bodies in the cupboard. this seems not to be the case. that seems to be under control and i think investors reacted positively. >> a couple weeks ago ubs said they will not lean on the government anymore. that gave the initial boost but

they said they will not go down that road. some people say it gave them cover to keep the swiss bank because it removes political interference >> it gave them the freeway to do what they want. it can be in the public channels at that is the case. that is something. the good news is they have the capacity to do so >> reporter: as a function of integration, jobs will be lost. what is going to be the public reaction to the announcement >> it is difficult to combine the blowout results like that and to announce results at the same time. it is inevitable. they call it rightsizing instead of downsizing. there is diplomacy going on. will be different ways to get

to that integration. the general public, in the end, they want to have a solid time. one third of switzerland combined. the de-risking, going from risk culture to another one is clearly something that is when to be beneficial to the public. >> reporter: to the general public believe they are the right man? >> they have brought the stabilization. one should never underestimate the task you have ahead of them and they play on different levels in order to make sure that all the holes are stuffed and this is clearly going forward in the way they wish it to go forward, and they

need to compatible eyes it all and that will take time. the systems, the people and into the new set up will take time >> reporter: they announced that huge number in cost savings. new money has come in. that is a positive sign. >> at this stage i think, a lot of institutional clients want to diversify. that may reduce a little bit. i think again it is a sign of trust of the new bank and the way forward. i think this can only be cheered.

if you play that out on a global level, -->> let's talk about the potential job cuts. how is he is it going to be for these individuals to find job placement and other domestic institutions? >> it may be more tricky than internationally because internationally you have more choice. they are ready to support in finding new jobs. that will not be an easy thing to do. that is a human drama. at the moment, because of its political contagion, that is something that should not be underestimated. they are aware of it but they are looking for value creation >> reporter: we got the big

announcement but a lot of work is still to come >> for sure. >> reporter: thank you for joining me. the take away from the market is , there is plenty of work. the integration on credit suisse, further strategic decisions, with the name of achieving the $10 billion in cost savings they set out today. >> excellent analysis. thank you for all the college this morning turning to markets, you see the ubs found lift the swiss market. doing pretty well this morning. we are seeing some underperforming in the uk. in terms of month to date

performance, let's put this into context. it has been a downbeat monthly trade in europe and the losses are widespread. some of the most interesting points have come this week. the fresh inflation data we have had out of european countries, germany and spain and france, inflation running hotter than expected. and it is a harder job for the september meeting and the market is expecting them to raise rates once again. today we will get the european cpi number for august. this is the breakdown. you have financial services in front. real estate also doing well. on

the downside you have food and beverage selling off and household goods. in terms of other corporate, accused by dozens of the world's largest asset managers of lying to cover up corruption. escalating a far-reaching action in london's high court. this is according to the financial times which says nearly 200 funds holding stakes of almost 400 billion pounds are suing them. they declined to comment to cnbc. the shows are reacting in the stock is down nearly 5%. a bottom line beat in the fourth quarter. enabled the company to raise prices. they said they see softer's sales in the u.s. as well as in china where they expect economic conditions to hit consumption. that is a focal point for investors. coming up on 'street

signs', energy prices feel hot pressures in france and we breakdown those fresh numbers after the break. ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term

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welcome back to 'street signs'. french inflation is hotter than expected. accelerating 5.7%. compared to forecast of 5.4% rise. this comes after a series of stickier than expected inflation across europe. charlotte is here with more on these numbers. yesterday we discussed the spanish numbers. then we have the german come through and it seems to tell a similar story that inflation is alive and well in europe >> 5.7% the number for august above expectation. looking at details, a slow down

of prices in manufacturing goods and services and in food prices. it has been such a hot topic of conversation. it was almost 14% in june. they met with retailers yesterday to talk about products that would have a cap of prices. it has been such a big hot topic of conversation. it is a visible thing with food prices being twice that of the overall inflation. we saw slower household consumption.

the expect inflation numbers. they are looking at this overall picture in france. we watching this number that is heating up. we saw this in europe >> the market is reacting. markets are pressing in a 55% of the 25 point basis height at the meeting. coming up on 'street signs' we dig deeper into a difficult month for asian equities as week economic data keeps coming. after this break wake up, achievers. you're making the most of every hour of your life. except the hours that you're sleeping. so why do we leave so much untapped potential on the table? this is a next level bed, for a next level you.

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a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com. welcome to 'street signs'. these are your headlines ubs shares surged to a 15 year high after announcing it will absorb the domestic bank of failed former rival credit

suisse. and its first earning interview since the takeover. the ceo tells me the integration is right. >> it was not viable any longer. credits reese had excellent people and clients and products. and needs to be restructured.>> european markets ended the week on a from. wall street is set to break a five-month win streak in the fed says rates are high enough chinese factory activity shrinks. that comes in better- than-expected. despite lingering fears over the health of the company's property sector. u.s. expenses chip export controls restricting access to some middle eastern countries. nvidia downplays the decision saying he will not have immediate impact on its results.

let's get a check on markets. the final day of trade for the month of august. we are in the green across the board. the swiss market is up. we will get some in sight into the overall inflation picture. markets expecting or suggesting 55% chance of a hike at the september meeting. u.s. futures. you have green across the board as well as the dell in front. that index looking to enjoy 130 points higher. a change of pace from the

recent trades we've seen where the tech heavy nasdaq has been the upper former. the nasdaq gained about 0.5% and it appears that we are in a bad news, is good news regime when it comes to markets and the reaction to macro data. the fed is more likely to hold steady atlanta fed president says monetary policy is tight enough to bring inflation back down. in a speech in cape town, he said the fed should be patient to avoid inflicting unnecessary economic pain. >> based on current dynamics in the macroeconomy, i feel policy is appropriately restrictive. i think we should be cautious in patient and that the restrictive policy continue to influence the economy less we risk tightening too much and

inflicting unnecessary pain. that does not mean that i am for easing policy anytime soon. inflation in the united states is too high. >> we looked at the european equity market over august. we have losses across the board. nasdaq is under performed as an index overall. s&p down 1.6% in dow jones down. here is a look at some of the big movers in august. you can see this been a positive month for alphabet, amazon and nvidia. the downside of steep losses for meadow down 7% in apple taking a hit down about 4.5% and tesla down 4% in the month

of august. variable picture protect. focus on bond market. the treasury curve has marched higher and we have seen a rise in yields. we have come off the highs we have seen but we are still elevated to where we were in the beginning of the month of august. asian markets have been the source of the worst pain on a monthly basis but here are the actions overnight. chinese markets sinking after manufacturing activity contracted for a fifth straight month. the manufacturing pmi reading came in above expectations at 49.7% but below the all

important mark after negative data this month. it has been a brutal month of selling for asian equities. the first monthly decline since may. the index has been hit by weak sentiment on the economic front around china. and problems in the real estate sector. let's take a look at country garden. this dock, the company said it was remorseful after it posted his worst loss on record. it soared as much as 8% after revenue grew 40%. china's largest property group, with creditors set to vote on payments

here is a look at the month to date moves across property stocks in china. massive selling across the board. this is the year to date chart. we are down 67% year today it currently stands at the dollar up to percent month to date versus the one. you can see the progression. hong kong dollar has been on the move. posted is worse month since 1985. let's bring in harry. an economist from moody's analytics.

what a month for investors if you are involved in the china market. it feels like the epicenter of the pain is the property market in the property sector. how back in the situation get in chinese properties? >> it is challenge number one. there is a host of weakness but at the top of that list is the property market. we've seen massive falls across every measure of the real estate market for new sales, commencement's and the all important actual investment. it does not look like it will be slowing. chinese officials are hesitant to step in to try to correct the market for fear of inflating it even further and kicking the problems on the road. we have shifted our outlook for real estate investment.

and 12 months before we see the property markets hit a floor >> there is so much speculation as to what she's thinking could do next in terms of policy support. when it comes to the property sector, it is a balancing act because they don't want to spur a reinvigoration of the property market and they don't want to cause a bubble. what is the best course of action >> the targeting of households which is trying to incentivize more demand coming back into market. that is tricky. household source goes scared of getting back into the market. if you look at the survey data, in the first time in a long time, households are expecting prices to fall rather than make gains. it is probably not the household sector that will be reinvigorating the property

market. the other thing we can do is look for things like trying to provide extra support for finishing unfinished buildings around the country. not only does that at a little bit of actual activity, but encourages and adds more certainty back to the sector >> looking beyond the property sector, earlier in the summer, the headline youth in employment rate got a ton of attention hitting a record level over 20% youth unemployment. the officials in china decided to stop publishing the data. to what extent is the consumer in china reluctant to spend because of uncertainty because of anxiety 50 -- around the jobs market? >> in a sluggish jobs recovery for china we expected more to come through. but because the domestic economy has been that way and the property market is pulling down overall activity,

businesses increase their workforces and that has been flowing through to households. youth unemployment is a massive concern in china. unfortunately, we don't have the data now to track how that is going but we did see an uptick in unemployment overall in the most recent data. youth unemployment will become worse before it gets better. that means the challenge is harder for officials to step in. it hurts consumers >> it is hard not to feel pessimistic. am i missing anything? is there any reason to feel confident or optimistic about the outlook for china on a 12 month view >> there is a positive story

coming out of china, household is it. they are not spending at the moment but some of the forward indicators suggest that maybe they came to dip their toe into the spending water a little bit. household savings may come down a little bit toward the second half of this year. that can invigorate a little more activity, back into the private sector. overall, weaknesses permeating china's economy. it is lowered the outlook down to 4.9%. the bottom, the official growth target of around 5%. to put that in context, when

officials announced 5% growth target earlier this year, we thought it was very much unachievable target and we thought it was a slamdunk that officials would under promise at the start of the year and over deliver toward the end of 2023. increasingly it looked like officials could or china could miss the official target and that really does show the weakness at the moment >> it is surprising that the chinese president and the party would be willing to miss the target they set given the targets are so important to the political front within china. is there no big robust stimulus package coming? should we just put that idea to bed? >> we have seen how quickly policy can change. in china, let's think back to december last year. it can happen. no officials of really trying to hold off's to misspending we saw.

the global financial crisis in 2015 and a market crash. we think it will be more targeted and that may help trying to find a floor for real estate market but i would not suspect we would see anything much greater than that tore the back end of this year. >> when we ask you about a comment we got the earlier this week. and talking about the relationship, american companies see china as an investable at this point. what are your people telling you about the appetite of american companies? you look at the tech companies and a lot of them are so heavily invested in china both from a supply-chain perspective but also a consumer market >> it is incredibly difficult to dig couple or do risk from china. we have seen investment full of a little bit the reflex the

weakness in china's economy and the hesitation of putting money in and the second thing is the global the risking type trends, that has gone to other countries in the region. india has seen an uptick in western countries. with u.s. demand, taiwan and seeing an uptick. realistically, even we are seeing trade out of china, a lot of it originates in china. if you look at the manufacturing that is shifted to vietnam, a lot of that is from china. it is a tricky scenario to work through for businesses. >> thank you for the in sight. shares declined amid allegations that partners

bought stock. in a report published by the nonprofit journalism group alleges millions of dollars invested in the funds. he categorically denies the allegations and say they are based on closed cases from a decade ago u.s. has increased restrictions on chip exports beyond china blocking the sales of nvidia chips in the middle east according to a regulatory filing. it comes after the financial times reported saudi arabia and the uae were buying thousands of chips >> reporter: america's chip export blacklist is being expanded beyond china. according to the u.s. chipmaker nvidia which revealed this week that sales of its highly sophisticated machine learning chips will be subject to licensing requirements and middle east regions. it is understood the chipmaker

was also given the same directive. it is not exactly clear which middle eastern countries are impacted. but the move comes after it was reported that saudi arabia and the uae were actively buying thousands of the american-made chips to power their own domestic a.i. ambitions. most u.s. export controls are implemented on national security grounds but no so specific reason was given for the latest. it is understood that growing fears with the issue in countries with close ties to china could attempt to export the chips beyond the borders or use them for intelligence gathering or advanced warfare applications. both nvidia said they would have a limited impact on the businesses but the move is another sign of rising tensions and competition in the global chip sector as countries battle to gain a leading edge in artificial intelligence.

microsoft will unbundle teams from his office software suite in a bid to allay european european antitrust concerns. cell force black messaging app filed a complaint three years ago. elon musk has announced a function for video and audio calls will come to x. he has long touted the potential the platform could be the everything app and compared it to china's we chat are you can do is get out. you can follow us on x, formally known as twitter. and she is checking. coming up we will look at the wider european banking sector amid reluctance of lenders to pass on higher savings rates. ah, these bills are crazy. she has no idea she's sitting on a

goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

welcome back. european banks have been quick to raise mortgage rates. wonders have been slow to pass on the benefits when it comes

to savings. there is an analysis on this topic looking at european banks. we talk about how a higher interest rate environment is positive for the banks, but the flipside of that equation is it can be negative for consumers. >> i realize we spoke to people in the feeling is that banks could be offering more. these are figures collected by a dutch bank in the average deposit. this number gives an idea of how much of those wage hike increases that the ecb announced as passing through to the deposit. this is in the eurozone in june and the number was 47%. an essence a passing through two deposits.

look at the national breakdown. 73% is the highest. other countries are not enjoying this. similar in portugal. croatia, 12%. if you have your money in savings, you are getting a lot less than savings in france. if your lender you say you faced negative years of rates.

i want to bear in mind that one comment we got from the guest was the premise of this reporting is highlighting the banks are evil entities. that is not the case. this is just the data. have put forward a plan, exactly to say to lenders they need to do more and to pass the higher rates two deposits. it is not just across europe, it is what some of the regulators are saying in the banks could be doing more when it comes to passing the higher rates on >> what is the story to the reputation of banks? consumers are probably frustrated with the rates.

>> we need to keep in mind and some of these nations, the banking system has had a transformation. people don't look at banks in a good light. i will share this with you, banks think about profits not about people. we need to keep in mind this is important and it is important for the banks to think about how actions might impact the way the public sees their work >> this is an issue, not just in europe but in the u.s.>> this is an issue, not just in europe but in the u.s. thank you for the breakdown. excellent reporting. more about the situation, i

encourage you to check out her article. before we hand you over, let's take a look at european equity markets. we are holding onto early games. month to date it has been difficult for european equitie . we are lower across the board. u.s. futures. wall street. we had a positive session yesterday and it looks as though the gains will continue. all eyes turning to tomorrow's payroll report. that is it for 'street signs'.

ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

it is 5:00 a.m. here at cnbc global headquarters and here is your five@5. we begin with futures fighting for gains as investors look to close out what's been the worst month for stocks this year helping the bulls, new comments from atlanta fed president, raphael bostic we'll tell you why he says inflation may already be very close. and speaking of the fed, investors are bracing for another key piece of economic data what is known as the central bank's preferred gauge of inflation. we have the milken chief economist, bill lee here wit