this is the entire financial sector it's on the neckline, it's bad amex not the case. amex looks like it's, in fact, going to break out and go higher this is the place to be if you need to be in a financial stock. >> mike, how are you trading amex. >> american express is a company, one of the reasons it might be outperforming they had a period of bad performance, miss steps, lost jetblue, costco affiliation. let's not forget when we think about payment processing, it's not necessarily all going to be about credit cards in the future especially if we look at places like chain the thing that does work fundamentally is earnings. that's what's coming up on the 18th this is trading 13 times earnings so the company is relatively cheap my inclinations because option premiums are elevated when they are going into earnings call spread risk reversal to make a modestly bullish bet here. specifically i was looking at july '94, '99, 104 call spread risk reversal. selling to collect $0.60 for those. $2 on the july 99 calls, selling 104 for 40 cents net net that entire structure cost

and what we know is financials have been the dream and a real misfortune for anyone who has been -- amex may be a place to do better. what we have here, something that happened that only happened five times in the history of the s&p 500 sector five months in a row here is this month, barely started. disregard that basically, we are talking about one, two, three, four, five. how infrequent has that happened what is the outcome going forward? five months down and there is the arrow. there is the number. let's look at the data this circumstance has happened five of the times and the history of the data going back to 1989 and what happened there after. financials one week later, down, two weeks later, down, three weeks later down the odds, not always down but it is an average. but the odds of it being down are high it's about the area of the market, i think at this point it is clear what to do, maybe something like this, if you have to be in financials, what we know of course, is that you have had a good response to this trend line repeatedly and we are here again. another way to draw the li

amex says itwill be conducting a review with an external party in order to determine whether all of its being met. equipment maker caterpillar says it's up its full year forecast after reporting record second—quarter profits. it's an important one for us to watch because caterpillar's results can shed light on how us trade tariffs are affecting american companies. earlier this month, the company, which makes construction and earth—moving equipment, increased its prices to offset rising material costs. growth in china's manufacturing sector cooled for the second month in a row injuly. chinese officials say the official purchasing managers' index fell more than 51.2% in july. that's down from 51.5% injune. economic data from china is being closely watched because of the trade tensions between china and the us. so let's look at financial markets 110w. so let's look at financial markets now. the bank ofjapan is saying is going to keep rates very low at the moment and monetary policy flexible. isaid moment and monetary policy flexible. i said the bank of england tomorrow at the beginning of

the higher the conversion rate, the bigger amex's margins on that particular transaction, that divisionve raised fees on foreign exchange transactions without their customers knowing. the story is based on conversations with current and former employees, who spoke to the journal on the condition of anonymity. amex said it would be conducting a review with an external party in order to determine whether all their standards are being met. the company says it believes their transactions were completed and reported in a fair and transparent manner at the rates the customers authorized, this business accounted for less than half of 1 percentage point of amex's overal revenue, still shares are down nearly 3% today, guys >> thank you, lesscy otaboming up, details out anher company warning of the impact of tariffs on its bottom line no more lugging your clubs through the airport or risk having your clubs lost or damaged by the airlines. sending your own clubs ahead with shipsticks.com makes it fast & easy to get to your golf destination. with just a few clicks or a phone call we'll pick up and

amex, we'll hear from netflix and bank of america. of all the names, gary, which ones do you watch the closest? >> netflix of course. who is not going to be watching netflix? it is disclosure i own netflix. i love netflix. i think the interesting thing about netflix they have 100 million subscribers. they have pricing power. they could tomorrow increase everyone's subscription by a dollar and no one would notice. the other thing, they're trying to cut down on password sharing, multiple streaming. everyone in my family uses my wife and our netflix account. if they can cut down on that, continue to add content. everyone says overpriced. maybe i'm talking about my book, i see the stock is higher. cheryl: jigging up as far as sharing with accounts. they will clamp down. >> thank you, cheryl. cheryl: watching netflix, the stock and of course the shows. gerri: sharing our passwords. why not? coming up russian president putin expect to press president trump to stop financial sanctions on russia. how will president trump respond? right now u.

. >> the scene that you all missed that you really couldn't hear was the day that the amex antitrust came down, and the court marshal didn't realize that justice breyer was going to do an oral dissent, and she banged the gavel and started to say the court is adjourned until tomorrow. and justice breyer was, you know, adjusting his microphone, so the chief had to sort of stand up and wave everybody to sit back down, and everybody was laughing. and justice breyer started out with a big grin saying, well, you know, i realize it's only an antitrust case, but some of us think it's important. [laughter] and justice thomas, who'd just delivered the majority opinion who sits next to him, had this enormous smile on his face and was, you know, laughing at justice breyer's little joke. but really making a show of good cheer all around on the bench. and then breyer delivers an opinion basically saying that thomas, you know, had swallowed the snake oil that these amex lawyers were selling. >> [inaudible] antitrust law professor. but the reaction in the press room when we realized that justice bre

. >> welcome back to half team report an updated statement from amex today in response to the "wall street journal" article which alleges that the company's fx unit increased fees on their small and medium sized business customers without their knowledge. the updated statement says that that group -- their transactions were completed and reported in a fair and transparent manner. this is akorccording to a spokesperson they say they take these allegations very seriously, and they'll be conducting a review with an external party in order to determine whether their standards are being met. now, as you can see, there are am exshares down 3%. back to you. >> appreciate it the traders are answering your questions now. first up, marcia in connecticut asks what do i do with nxpi? >> well, look, i'm disappointed. the merger with qualcomm didn't go through here's the look. the damage is done the stock is up about 12% from two years ago before the deal was announced. in that time the compound annual growth rate in revenue and earnings has been solidly in double digits. you're getting a great company

the "wall street journal" says this went on for more than a decade amex denying the claims. hi, bill >> hey, courtney i'm bill you never know who you are going to see on "power lunch" these days with the nasdaq's big tumble today, are we seeing this great rotation out of big tech bob pasani has been sounding that at the new york stock exchange, and it's happening again today. bob. years on that. maybe it's finally starting to change let me show you the sectors today. what are leadership groups today? well, energy, retail, and financial. those are traditionally value sectors. what is the laggard today? tech, that is traditionally a growth sector. just take a look that pattern is continuing, and there's the fang stock we talk about this last week down various degrees, but google only down 2% these are notable declines that we've seen recently here if you take a look at whether or not fang is fading, well, i'm not sure they're completely fading, but we are notably down for the 52-week high as you heard earlier, facebook is down 22.7%. netflix, 19. they only hit their highs a sh

amex, phillip morris, and ebay among them. bloomberg. ♪ shery: from new york, i am shery ahn. bloombergcome to markets, balance of power. president trump taking aim at eu over the google fine. the storm still swirls over president trump over his remarks regarding vladimir putin. the white house efforts to contain the fallout. we have a stellar lineup of lawmakers who react to all these issues. ♪ kevin: the commerce department began open hearings is money to consider whether auto impor

yes, it looks like revenue should be up at least 9% according to forward guidance we're getting for amex as well. talking about global merchants and network services representing a good healthy growth of 14%. so, yeah, surprising that the stock is lower in after-hours despite the beat that we're seeing across the bottom and top line. i will dig more into these results. see if there is any growth concerns i can maybe filter through for you as we await ebay results. back to you. david: expectations are so high right now for good numbers, even though they were a beat, perhaps expectations were even higher than what that could do it. thank you, susan will come back as soon as she finds out more what is happening with that stock. >>> meantime google fined $5 billion for the european union or allegedly violating antitrust regulations. kristina partsinevelos is in the newsroom with details. >> you showed moments ago the stock was barely even tapped, cost of doing business, seeing trading $1200 u.s. at the moment. why did google get fined by the eu? the eu regulations are pretty much saying that

i, on the other hand, amex treatmently hopeful that we'll be able to implement this bold vision, but it will take change in departments and departments that only vaguely touch housing, public works, other departments that sometimes deal with putting permits on the back burner. it will mean this body will have to change the way it thinks about housing. it means we'll have to move at a pace that will cause anxiety among many of you. and that's okay, because it will end the overwhelming housing insecurity. we need to move forward at a pace that i think none of you have yet considered yourselves prepared for and i'm very excited for the increase in pace that we're going to see and the bold vision that we can see and some of the neighborhoods that we have asked less of in the past. we can ask more of our outlying neighborhoods. they can do more to approve housing and you can do it faster. single-family-home-only zoning should quickly become a thing of the past. it was designed to be exclusionary. you have the ability to take the first steps to end it. thank you. >> president hillis: thank

the currently second worst performer on the dow along with visa which is feeling the heat from the amex news. need to look at caterpillar. trading higher after reporting stellar earnings and raising its forecast outlook and this was the stock that was supposed to be totally hammered in the wake of the chinese trade tensions. right now caterpillar is flat and trading volume 10.6 million shares but this is helping to ease investor fears about the impact of the global trade war on the industrial giant. however, the ceo said on the, while the quote, we urge government leaders to take action to remove uncertainty with regards to trade. we will see if government leaders read president trump and president she's caterpillar's advice. let's get to that national gases. president trump is part of his discussion in front of the press with the prime minister of italy really got into discussing what is going on with the natural gas and we knew last week that part of the breakthrough that came with the european union would agree upon more natural gas here in the us and that would be liquefied natural

what is interesting, the important perspective in the amex decline, the stock was trading at a recordsome high expectations going into earnings. the shares are only up about 5% or so this year. that is enough to push it to a record. we look for numbers on loan growth as well. anythingee if it has on revenue trends in particular. we will keep looking through the statement to see if we have anything on the loan front to bring to you. scarlet: let's move on to ibm. the company reporting results for the second quarter. you can see the stock is trading lower by .6%. revenue beat analyst estimates. ibm also reaffirmed its outlook for the 2018 session as well. in terms of the forecast, it is looking for at least $13.80. and cash flow of about $12 billion. ibm coming in with the beat, but it reaffirms its 2018 forecast, does not raise it. change has been down on the stock. let's see how this shakes up as we continue to go through these reports. for more on today's market action, but spring in the global head of equity derivatives strategy at the berkeley. when you look at earnings s, morgan s

the b-1, the b-2, amex missiles, no procurement money as well as, as i said, including the be five in the ohio class submarine. every single program was cut. and then i went and looked at 1980 one, ronald reagan's first press conference. the first question was from an ap reporter who said do you believe in keeping the salt to treaty? which as you know, had been withdrawn by president carter from the senate after the soviets invaded afghanistan and we were under no legal obligation to abide by it because the senate had never agreed to it. the president said basically, how can you call that arms control? as we all know, it allowed a build up to about 13,000 nuclear warheads under this treaty, and i was sitting in the back of the room against the wall where they put young people who are guest, and i was doing some publicly deployments -- public diplomacy for them. you could hear the gasps among the press corps when he said that. the second question was from the head of the upi, and the question was, do you believe in a peaceful coexistence? the president said no. again, the audible gasp

the point i would argue is that the markets are kind of miss reading the growth amex right now. medium term. the point i would argue is that when you look at the change in data expectations and revisions coming the market is very bullish right now. i would not make the case here this kind of divergence play is here to stay. alix: you're going to be sticking with us. coming up, johnson & johnson shares lower in premarket after reporting second-quarter earnings this morning. now they are up by about 7/10 of 1%. talk with ceo joseph wolk. ♪ is "bloomberg daybreak." united health's effort to diversify is paying off. , providingup 22% consulting, clinical, and drug services. amazon sales rose in the opening hours of its prime day sales event, despite technical glitches. shoppers spent 54% more in the first hours. amazon's 36 hour shop is expected to generate $34 billion in spending. boeing keep racking up sales of the farnborough airshow outside london. an unidentified customer has signed a memo of understanding to buy 100 jets. no word on the value of the deal. earlier boeing announ

to mention, that anti-trust argument you started to hear around facebook, amazon, or google, that amexision by the supreme court a couple of weeks ago was important in terms of how it came down in two-sided markets. >> there's also no indication that that's what they're looking into >> no, not at all. but i just bring it up as another risk that has, at this point, abated a bit as a result of that decision >> s&p tech sector accounting for 102% of year-to-date gains for the s&p 500. crazy. >> all right we've got an opening bell about 5 1/2 minutes away don't go anywhere. 'rba rhtft ts.wee ckig aerhi alerts -- wouldn't you like one from the market when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. but prevagen helps your brain with an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. the name to remember. ♪ ♪ each day, brings new possibilities. that's why you

huge drop an american express less money coming in there and they are down just over 2%, $100 even on amex a week forecast you pay the price. that is what ebay did and they are down nearly 9%, $3 down, $34 a share. profit at travelers falling short hit by those big losses from the hailstorms in several parts of the country and that is a dow stop, dragging the doubt down 2% lower. philip morris, again, not a rosy forecast and that is what they came out with an it was not positive for the future but down nearly 5%. we are all smoking less. jeff bezos blue origin rocket company which is the milestone wants to send people into space in a test but yesterday shot a capsule higher into space ever done before. it went up 190,000 feet, 74 miles and the poster and the capsule landed straight safely. they have not said when they will sell tickets or how much the street lights will cost but that's the intend to do. richest people in america are living in just five states forget this, california is not one of them. is yours? we will tell you which they are in a moment. speaking of california, i will sh

but amex had to set aside more money to cover potentially bad loans, which may be a sign that customersstruggling to pay bills. >>> ebay had second quarter revenue that missed expectations and the third quarter forecast is underwhelming analysts. the company is blaming fewer games at sporting events and ticket sales at its stub hub unit the stock is off by 6.5% >>> the biggest names on wall street gathered in new york yesterday for the eighth annual delivering alpha conference. leslie picker was there. she joins us with some other big headlines of the morning >> the biggest headline among all the panels was trade trade was a recurring theme. larry kudlow heads the white house economic counsel, he said he believes world trade is broken kudlow says he does not believe the chinese president, xi jinping, has any intention of following through on their previous discussions >> insofar as we know, president xi at the moment does not wish to make a deal now, i'd love to be wrong on that we are waiting for him the ball is in his court and the tit-for-tat business which is nobody's favorite path,