the heels of that company's plan to spin off the health care business and unload its stake in baker hughesf you look at these companies going forward, health care will be well capitalized, baker is well capitalized and these actions, taken together, will drop our leverage at the core ge company below 2.5 times. so they'll have the fire power and investment power they need to keep growing that business. at the end of the day that was really the objective. >> interesting discussion with flannery everything under the sun, including the makeup of the portfolio. got to trade issues and whether or not they're evaluating portfolio shifts in production because of these threats not yet. interesting discussion. >> absolutely. also thought it was interesting when david faber said are you done is this it is this sort of the last of the big news and he said yes. i thought that was very telling from an investor standpoint. we have gotten so much news from them over the last couple of months also the decision to have aviation and power together. technology sharing, ceramics, materials. deeply global infr

the baker hughes divestment makes sense.using on power which is what analysts have been looking for. karen, thank you very much. shannon will be sticking with us. says the natural gas boom is all about china and the u.s.. could the trade war change all that? we will talk to the nuclear threat initiative ceo and former energy secretary. the markets still calm, now on the downside. this is bloomberg. ♪ two, down, back up! our phones are more than just phones. they're pocket-sized personal trainers. last minute gift finders. [phone voice] destination ahead. and discoverers of new places. it's the internet in your hand. that's why xfinity mobile can be included with xfinity internet which could save you $400 or more a year. it's a new kind of network designed to save you money. click, call, or visit a store today. alix: this is bloomberg daybreak. i'm alix steel. a think it is going to be little bit calm her in the markets but the s&p starts to roll over just a touch. we are now off 10 points in the premarket. also want to look

it is one that has performed okay and the ceo at one point had run it and the baker hughes thing, i thinktors were probably hoping for something like this it was an unwieldy structure and ill timeding a agre entry in gas as well. so we'll see if it can rebound >> and this is of course a part of ceo john flannery's year long strategic review we're seeing the stock pop around 1.6% on the news. >> and i would expect to pop i think the idea that there was value trapped inside of ge was pretty uncontroversial, but it was not clear what the time table was for trying to realize that i don't think health care is really a turnaround story. it is much more about is a spin over better than a potential sale or can you just hang on to it because it is a decent earner you will have the aerospace business, the power business which has been an issue for a while because they did also -- they have sold pieces of the industrial unit away just this week we heard they sold a big commercial engine business >> we'll see if it unlocks shareholder value. let's stick are ge -- >> and it is happening on an interest

wall street journal" reporting ge will spin off its health care business and sell its stake in baker hughes coming as the stock will not be a member of the dow jones industrial average for the first time ever in a hundred years that begins today. ge replaced by walgreens. uber fighting for its life in london. a monster valuation for instagram. is facebook now worth more than

baker hughes is a big company.l with ge, but there should be other interested parties. there has been a lot of consolidation in that sector. byreasingly, it is dominated a number of others. it is possible somebody could snatch up baker hughes. guy: is ge selling at the right time? are we seeing pricing power returning to the services sector, as it was, as we were a couple years back? james: we seem to be entering a phase in the industry where the services do better. cutsprices drop, everybody costs and the service sector is squeezed. prices are going up and the services will start taking a bigger share of the pie. they can charge more to the international companies. though ge is not necessarily doing this voluntarily, it is better to be doing it now rather than two years ago. guy: we will leave it there. james to james haran -- herron. -- overseas work in washington. he will be here to give us a great perspective on what is happening with the oil market right now. att conversation coming up 7:30 a.m. in new york th

reuters is saying general electric will spread the ownership they have an baker hughes.company. ge planning to cut its dividend following the health care unit spinoff. all part of ge which has been struggling this one year strategic. john flannery putting into place. shares of ge are high in the premarket, but cut in half we should say so far in 2018. >> after 122 years, what a story that company is. coming up in the trade were tensions, defense secretary james mattis has arrived in china and rising tensions over not just the growing economic influence, but military influence as well. tech stocks were hammered yesterday. we've been telling you about worries of trade restrictions that the nasdaq down over 2% with the selloff overdone. let's take a look at your u.s. stock index futures right now could the toppling could the dow plaintiff and 16, now negative. the s&p 500 down almost two in the nasdaq down to. you are watching the "fbn:am." ♪ ♪ ♪ build and run apps anywhere you like, while keeping your competitors at bay. the ibm cloud. the cloud for smarter business. chery

that's the process that will take 12 to 18 months, going the exit baker hughes over the next two to threers remember, ge merged its oil and gas unit last year, similar deal under way at transportation right now as well. the results, a quote simpler stronger ge. one that is focused on aviation, power, renewable energy which flannery's bet willing unlock value for areas like health care but help shore up the balance sheet. investors have been looking that the for months this is the reason the day ended up 8% but i caution it will take time many details are still unknown, particularly around ge capital also the future of the dividend, ge says they will maintain it at the current level for now. but ealth care is stand alone, those payouts are going to be reassessed according to the company. back over to you. >> all right, thank you morgan brennan at the noysyse. we thought the perfect time to play t pri"the price is right. when the traders are done, traders will vote on whether or not they think the price is right. let's get to it. who is the next contestant. >> tim seymour, upper west side o

they will sell 20% and redistribute the rest to shareholders it plans to exit its baker hughes stake over the next two to three years end of a more recent era for ge. sort of a sad story. and that news just crossings tape this second >> officially as opposed to before that is helping move the stock as you see but today also marks the end of an era because today is the day the company will officially be booted from the dow. this is after more than a century of trading on the index. the stock down nearly 27% on the year and it is being replaplaced by walgreen's the change officially is this morning before the market opens. >> a lot going on. >> and they used to own us, general electric so a lot of additional feelings beyond the, wow, it was in the dow for so long. just when you think the company is invincible, it never ever -- >> and you want to see them survive. if they can continue the asset sales and keep their head above, everyone looks at coming out of the dow saying this is going to be the death knell, but historically the stock turns and moves up >> and do you think that this is

thendiaus iomltr ipa cny health business and shedding i ownership in the oil company baker hughes. the ceo says the move a year-long strategic review that he hopes will get the one-timeether out of its rough patch. investors seem to agree at better than 7%, its best one-day gain in quite awhile. hrngan brennan has more on ge, thegit. >> reporter: it's simpler, stronger ge. that's the vision unveiled by general electric ceo and chairman john flannery today. >> we laid outka a p of $60 billion of potentiallur sources. 25 goes to the deleveraging. thats lea immense amount of surpl surplus, if you will, to deal with leverage and risk going ourward or --know, so i looked carefully at the balance sheet. it's clear we know how to get to the endoint and how we're going to do it and we have think so, you know, i when we spend some time with people, they'll see that. >> reporter: the plan,shab eli viation power and renewable energy. that means spinning off ge's health care business as a standalone compan a process expected to take up to a year and a half to complete it also means exiting the

and also saying it's going to fully separate ge, baker hughes over the next two to three years in which it has a two ds stake in that company. so earlier today, on squawk on the street, john flannery, who has been at the helm just shy of a year, saying that this process and this announcement which investors have been looking for for months now, is very personal to him >> i share in every sense the pain, if you will. you know, my life savings is in the stock. so i have the same sort of connection to the issue. the second thing i would say is we have gone through a tough patch. we faced into the issues we're dealing with the issues. we have a plan, we know where we are. we're realistic about that we know where we want to go with the portfolio, with the balance sheet, with how we run the company, and we know exactly how to get there, and stay tuned for the ride here. >> now, david faber also asked john flannery if this is it, if there are any more surprises that could be coming out of ge, something that we have seen in terms of news announcements in recent months that has helped push the s

there's a plan, as well, to exit the 62% of baker hughes, a ge company that ge currently owns that willlso take place over the next two and a half to three years, the company said, and, perhaps, as importantly, they are doing things to the balance sheet to instill more confidence overall in their investor base i asked mr. flannery about that balance sheet and how much of today's actions are designed to put it in a better place >> well, i focus a ton of time on the operations of the company. that's ultimately our mission to make the operations of the company better, more cash, better return, better capital allocation, less cost, less bureaucra bureaucracy, all that stuff. that's key i spend an equal amount of time looking at the balance sheet i grew up in financial services, respect for what it means to be encumbered by a weak balance sheet. when they process what they see today, there's going to be a dramatic change in the leverage capability of the company, reduction in our lev raerage don to a much, much lower level. >> two and a half times by 2020, you feel confident you can achieve

giant said it is spinning off health care business and unloading ownership in oil services company baker hughes. that's not all that ge is saying good-bye to. today is officially the day the stock is kicked out of the dow. what happens? the stock is up more than 8%, it has been replaced by walgreens boots aligns which has been a drag on the dow. >>> lennar, one of the leaders on the s&p after the company solidly beat estimates for earnings and revenue on the second quarter helped by strong housing demand. not a lot of houses on the market. that's helping new home demand, other stocks following in lennar's footsteps, lennar, toll brothers, kb, pulte, dr horton moving higher in today's session. >>> harley-davidson and the president going toe-to-toe after the iconic american motorcycle brand said it will shift some production overseas after the european union raised motorcycle tariffs by some 25%. president trump, well, not too pleased with that decision, blasting the company earlier on twitter saying no, harley-davidson should ever be built in another country, ever, and says they're using tariffs

wall street journal" reporting ge will spin off its health care business and sell its stake in baker hughes coming as the stock will not be a member of the dow jones industrial average for the first time ever in a hundred years that begins today. ge replaced by walgreens. uber fighting for its life in london. a monster valuation for instagram. is facebook now worth more than morgan stanley and ups combined among others? fox business that were dagen mcdowell were dagen mcdowell and republican presidential candidate "forbes" and "wall street journal" editorial board member, mary jo still. great to see this morning. >> are to be with you. maria: thanks for joining us. america's soul, and always great to have you. dagen, what was your thought when he saw the market tumbling the way it was. we note the administration would do trying to protect the crown jewels. >> they are not liking it. myurprise when he saw technology stocks get hard-hit yesterday. my surprise was this was well telegraphed out of the white house. we sat on the second you read a statement put out in late may. he was on may 29th

that should be a 15% margin business and baker hughes should probably be a $40 stock. i just don't see a lot of downside in any of the scenarios we look at now. >> justin, how should we be thinking about ge capital? we got comments on it from flannery on set a short while ago, the fact that they're looking to streamline that next year but certainly that has been, to this point, very much an overhang on the stock and on the story in terms of how to think about value and liabilities. >> sure. ge capital remains a concern for investors. you know, we think with the $3 billion capital contribution, ge capital is better capitalized to reach the credit metrics that the rating agencies want sooner having capital cushion should ge find an attractive option to reduce or eliminate its long-term care liabilities there are a couple of things that remain to be clarified on ge capital but i think we are reaching the end of that uncertainty process and, as we reach the end of that uncertainty process, the concern about a negative poll there will evaporate. >> david faber is back on se

announced yesterday its plans to spin off its health care and sell off a stake in oil company baker hugheslectric's stock oh feshally dropped from the dow jones industrial average yesterday, however, investors rose as they announced their restructuring announcement. as for broader market, stocks finished slightly higher tuesday, a day after the heavy selloffs. the dow rose 30 points. the s&p 500 added almost 6 points. the nasdaq gained 29 points. >> uber gets a green light in london again. a uk court granted a 15-month plan to the ride-hailing service yesterday. it was revoked last fall. it agreed to stricter oversight from local authorities. >>> 1040 tax forms are getting smaller but no left complicated. a postcard size format will soon replace the current two-page version. the new form does not have room for multiple popular deductions that will be submitted on accompanying work sheaths. >>> and barbie has a career as a robotics engineer. a new version of the iconic doll launched yesterday and comes with protective goggles, a laptop. it's to high light a field where women are traditional

it shifted away from baing, ld off nbc universal and bought oil services giant baker hughes just as oil sank. with john flannery in charge its once coveteden divhas been cut in half. no wonder the company barely shrugged when its impending removal from the dow was announced. ge's statement says we're focused on t executing again plan we've laid out to improve ge's perfmance. it doe nothing to change those commitments or our focus in creatingro er, simpler ge. icons like gm and aoa have left the dow and survived. now investors wonder if ge can find a way to bring itself back life. >> while now that general electric has been removed from the dow, let's talk about whether that iajorex is still as representative of the u.s. economy as i oncewas. we're joined by david blitzer andhaman of the s&p dow jones indisease. it's great to see you today. >> goodafternoon. >> can you tell me what's behind the change? why walgreens? >> well, our change is based on what we feel the index needs and how we wil t make index even better and more representative of the u.s. markets and the u.s. econy, so t cha

they will sell their 65% stake in baker hughes. vonnie: what impact if any on the dividends?ividends have always been rather secret for ge. they say they will maintain the dividends through their health been off and after that it will be -- health spinoff, and after that it will be adjusted. vonnie: emma chandra with our stock of the hour. ge is up 8% in today's trading. mark: take a peek at where u.s. markets are trading, where europe closed the tuesday section -- session. in europe, we saw the biggest selloff in march. ftse up on the day. a quick peek at the currency board, today has been another day dominated by trade and the assessment of the trade position and the situation between the u.s. and china. sterling is down against the dollar. we had comments from an outgoing member and it seems the incoming member is on the dovish side. the dollar.ainst ♪ what's a gig of data? well, it's a whole day's rth of love songs. 300 minutes of baby videos. or, it's a million chat messages. a gig goes a long way. that's why xfinity mobile lets you pay for data one gig at a time. and wi

the ceo racing to selling a company -- majority stake in baker hughes. breakup.xpecting what else can be divested? >> this is very significant. this is as much as we are going to see for the time being. these are meaningful moves. this is a radical effort to rethink what ge is as a company, what its capital allocation strategy should be. you are seeing in the market that investors are pleased with this. they are pleased with the progress ge has made so far. people were expecting a big announcement. they definitely got one today. vonnie: what is ge's scalability now? it divests these smaller parts of its business -- it will no longer be the -- >> the ge of old is gone. instead, we are moving on. there will be the power unit and the renewable energy business. the question is what does that look like for investors? what is the value proposition there? i would argue that ge will be very diverse in the structure. you have the crown jewel aviation business. margins are under pressure. the power struggles are well-known. the profile for that is not going to be very attr

also in the news, oil services halliburton and baker hughes have been awarded 7 billion in services contractsrwegian oil and gas producer equidor. the contract is for a few years. we'll watch them. >>> virgin money has agreed to be bought by cybg for $2.26 billion. it will create the biggest bank, a guy you may have heard of, richard branson, owns 35% of virgin money >>> now to your money. you know the macro setup in the state. unemployment is just 3.8%. earnings growth up more than 20%. gdp could come in at more than 4% oh, yeah, small cap and tech stocks domestically, all they do is keep making new highs things, in other words, are good joining us now, founder and lead market strategist at north man trader sven, thank you for joining us warren buffet selling part of usb. the drywall manufacturer in the united states. buffet loves to buy low and he loves to sell high when you see warren selling, does it make you think maybe now's the time >> well, look, when we looked at the recent rally that we've seen, like a month ago we talked about s&p maybe reaching and filling the gap at 127.50. the q

recount baker hughes comes out. it will be interesting to see what the latest is there.will speak to the kk oh founder. ulie: bloomberg technology is up next. joe: have a great evening. this is bloomberg. ♪ i'm emily chang in san francisco this is bloomberg technology. the u.s. has reached a deal that will allow zte after paying a record fine to management changes. trade talks between the u.s. and china. plus amazon is attempting another home device breakthrough. board.t alexa is on

healthcare units sold off, ownership of baker hughs shed ding that ownership. yesterday it was the industrial part of it, the industrial engines unit for that also sold off so that's what general electric has been up to stocks at 13.74 gaining 7.7%. quick peak at tesla which gained elon musk talking about the new electric pickup, which will park itself automatically and has a lot of features up 2.7% back to you. adam: nicole thank you. oil surging closing up more than 3% to a new one-month high after the u.s. state department demands all countries cut all of their oil imports from iran by november where they risk sanctions, phil flynn, what are traders saying about this can the u.s. really pull that off? >> they can and i'll tell you what we're already hearing from major oil companies that they are backing away from iran in a big way. they're taking the sweat from the state department very seriously and we're going to see of course the biggest challenge and the biggest sanctions we've probably ever seen on iranian oil sanctions and it's not only the oil compani

those moves in oil weighing on a number of energy names including baker hughes and newfield explorationback downtown to you ambiguiguys >> coming up, we're all over the new tariffs announced by the white house. china already promising retaliation. we'll see if the selloff continues through the afternoon. industrials are one of the ha hardest hit groups on the china trade story. and try to figure out what the difference is between a squirmish and a trade war and whether the president is trying to use this as a negotiating strategy or will he follow through even further >> or why fst a surprise for those who have seen this coming. worst day for the dow of the month. when we come back a lot more on the selloff as the dow is down 234. later on, it's an interview that you don't want to miss evan spooeg the with us on monday dot ay.n'gawa see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian.

baker hughes new field range resources are some of your laggards >>> welcome, everybody i'm tyler mathisene's what else is happening right now. global airlines is slashing their forecast for industry profits in 2018. why? that spike in fuel costs they also warn that higher interest rates in geopolitical tensions could add to operating risks. >>> the supreme court has ruled in favor of the colorado baker who refused to make a wedding cake for a gay couple on religious reasons. the vote was 7-2 >>> and according to zillow, u.s. home values rose 8.7% in april ands that the fastest year over year climb since 2006 san jose led the gains with a 26.2% rise meantime, let's sends it down to sara eisen at 3 world trade. hi, sara >> hi again, tyler thank you. that is right. i'm at 3 world astrtrade center new york city, a massive 2.5-million square foot complex opening next week. just ahead, we will talk to the tenant, ceo of ad giant group m, why they've made the move downtown and the state of advertising, digital versus traditional, lot to get to that and much more straight ahead from downtown new

121 from a year ago it is the third straight week of increases that we have seen according to baker hughescombine this with a surprise inventory builds here in the united states and product at 10.8 million barrels a day along with opec adding barrels back on line and crude prices are in the red today. actually only slighter lower on the week, guys >> jackie deangelis thank you. >>> now to meg tirrell who has a market flash for news dialogue semiconductor, that company said to be in deal talks with apple supplier sin apartmentics according to bloomberg citing source sin an tech surged on the news we will bring you more on that when we get it another piece of news to draw your attention to. eu anti-trust reg will iters apparently set to clear without conditions comcast's bid for sky. according to reuter's citing sources. a couple market flashes for you there real quick. >>> the dow is taking an afternoon turnaround it's now on track for its best week in three months where are traders slugging off all the trade tariff fears and all the events next week yet to come. >>> plus, what could add $1

8%, tracking for the best day in three years as it makes move to spinoff the health care unit, baker hughesemoved today from the dow jones industrial average after more than a century, replaced by walgreens. rich ross is here, so, rich, on the chart, it was ugly, but see signs of a bottoming formation with a big move? >> sarah u up 8% on the day, but down 80% over 18 years that's no way to go through college. so to your point, when you look at that chart, bringing that up, a bottom is a process. it's not a a price you've moved sideways the last four months here, setting up a potential double bottom at the tail end of this historic-type collapse, but you can't get back above the 50 day at the 14 level let alone the 150 day at 15 and change i trade it, don't trust it longer term, you can see the magnitude of the structural decline. manage expectations here could be a trade in this stock, but let's not get ahead of ourselves. >> a trade higher, you're saying >> well, look, the trade for now, if you come on the show and tell people to sell g at this point, you're not doing your job, so is there

didn't -- when you bought a company in 2015 it turned out to already be overvalued when you bought baker hughesit was already over valued. all these were clear to a couple of analysts but not clear to management i'm giving management a gift there by saying it wasn't clear to them. >>> oracle says 4x will be head wind now versus 3% tail wind stocks down 5% that will take you back to june of last year. >> oracle this is a tortured conference call. larry ellison said you don't understand give us a break down of cloud numbers. mark nothing to hide nothing to hide. it's hard to figure out how cloud is going we loved it when they said cloud is going this and this i understand this is a rebellion over the way the company is choosing to tell the story and mark hurd calling it a nothing burger is not resonating with the people who think it's a something burger. >> right or they would gladly pay you a year for a burger today. >> yes. >> david, you're still in boston for awhile this morning, disney shares were out pacing comcast now it's the other way around. >> i haven't been able to see them pass by, ca

today the health care business as well shutting its ownership in the oil services company baker hughes restructuring that t forget, general electric is out of the dow jones industrial average. for this year the stock is down 21%. moving onto an to move their production abroad because of the tariffs. today is to the downside in president trump has some tough talk saying that this is not what the country needs. you can see the stock is lower today. oil moves higher about $70 at more than $2. they says we are looking and focusing as the u.s. is pushing its allies to halt imports of iranian oil by november. a big jump in oil of 3%. neil: i'm noticing a big jump in oil related stocks. they are all smartly moving up here. a big cnk of that behind vidal 72 points. meanwhile trying to figure out what china will do right now. this is interesting in their own neck of the woods they are cutting import tariffs on a lot of the good that comes from asia. trying to stimulate as a base 150 billion u.s. dollars over the last couple of weeks. are they bracing for a storm and preparing what is depending

in the all services area, halliburton and baker hughes have been awarded a $7 billion services contract from norwegian oil and gas producer equinor the contract is for four years but could be extended for up to a decade so rupert stadleer individual, what did it say about him, andrew >> taken into custody. >> oh, okay. >> germany. >> what happened to rupert stadler. >> let's get to watch ton. >> that's a tuffy. >> trade and immigration coming out of the headlines out of washington kayla tausche joins us. >> reporter: good morning, becky. the immigration debate is intensifying the trump administration holding on to its zero tolerance policy as lawmakers compromise on a bill to satisfy mr. trump. mr. trump wants tighter security tweeting the democrats and republicans should, quote, get together and work something out. meanwhi meanwhile, today at the white house two gop senators who hold the pursestrings will meet with the president. that could determine whether a shutdown could again loom in september, this time over those issues meanwhile, the first lady issuing a rare public statement o

they're near four-year highs that's going to benefit ge's stake in baker hughes.ntinue that to be a source of outperformance rather than disappointment as it had been since 2015 clearly we think that the company that just visited them on friday has the resources in place to self liquidate and fund all the liabilities at ge capital. >> those are the regulatory and shareholder and bond holder lawsuit issues you're talking about? >> wmc bondholders, they reserved 400 million liquidating in line. 7$700 million for the wind down of the 40 billion, 45 billio vendor financing portfolios. so you'll end up with $5 billion of extra cash at ge capital, and the leasing business the healthcare and oil and gas business are better than expected power this year and probably next year is less than expected. but these wash out to still allow the company to be in line with their guidance. and free cash flow will be better than the 6 billion or 7 billion they guided to this year versus the 5 billion to 6 billion last year. and i think the company is well positioned to see its underfu