to own a stock in blackrock. not that the trend can't chang but you can capture some of the flows you're not going to get. >> we like the blackrock and baba >> i think baba has huge discounts and part of that is justifiable to what google and the others are selling here because you have a company that exists at the will of the chinese government but nonetheless, the discount is too great and for a country that really wants to open their markets to a greater extent, they're going to let baba keep going. in terms of dan lobe, he's one of the best other. he's navigated every market. he started as a credit guy and just to show that he's able to find value on that asset size, which is absolutely incredible so i've got to take a look at blackrock. i get what you're saying completely. >> but blackrock -- >> they are feeling pressured in their core business. >> i don't like that name because -- and i respect blackrock and we do business with blackrock but your primary competitor is schwab who will give asset allocation a

that plays right into blackrock.of success, so which has been seeing a lot of success, so much which has been seeing a lot of success, so much so which has been seeing a lot of success, so much so that blackrock is trying to get more interest for actively managed portfolios by actual people. rising interest rates is also going to be a boost to blackrock. and shares in blackrock itself are down a bit this morning, i gather. people thought good results but perhaps not as good as hoped? yes. then there is still a bit of concern, given the fact that their etfs are just doing so well, but not as well when you compare it to when it's managed by an actual person. so that is giving some investors a bit of pause. we should remind people why we care so much about blackrock. it's really massive, just controlling from thes of dollars of —— trillions of dollars of money and people refer to it as dollars of money and people refer to itasa dollars of money and people refer to it as a shadow bank. there's even been discussions about

i'm delighted to welcome ursla marcioni from blackrock. good morning >> good morning. >> let's talk about some of the biggest issues here as well. i continue to hear commentator after commentator telling me how great european equities are, how they have a real kind of earnings and growth tailwind, how politics calmed down i have a head wind, that's the strength of the euro that gentleman there, bob parker, he reckons it will get to1.20 will that make some of these exporters underperform or not? >> if you look at most recent exchange traded product flows, i think you get a bit of a pulse of the market and how investors are trying to answer the question that you're posing, which is very well founded what i would say is that couple of points. one, we're coming from a situation where in 2016 europe has been severely sold so if you look at exchange traded product flowsas an element, we've seen 34 billion going out of the markets 28 have come back this year. i think you can totally see that we are moving into a different phase of this growth and

blackrock's aom is still growing, more slowly and if there's one thing i look at blackrock's mix, two-thirdsassive, and it's not as if they are out of this game. >> they are not that different. >> they are almost both riding the same trends, and if we all believe that it's not so much active or passive, versus high cost versus low cost. >> i would mention it before. >> yeah. >> look at what they actually learned on a year on a $5.7 trillion asset piece. >> 21 basis points .21% of all the assets. >> need scale to keep the lights hon. speaking of rivalries, i love the one between walmart and amazon and we briefly mentioned amazon's plug power deal last week and they are following in the steps of amazon which did the same exact deal six months ago. in fact, they both got warrants from the deal that could leave them joint investors in this forklift customer. >> sort of reads as these companies are making sure that this supplier stays in business and is there for them when they need them and also to play the future of this particular type of fuel now. >> it's a sophisticated forklift company now.

earnings, blackrock is already out. disappointing numbers there and now netflix is out tonight. >> interesting about blackrock and the whole technology conversation because blackrock came out four or five months ago talking about how they were replacing pms with watsons, right, because they were looking forward to the passive investing and lower costs, blah, blah, blah, so i guess it makes some sense that they are losing a high end and they are seeing a growth in the low end because that's kind of what they laid out a couple of months ago that. being said, look, it's another quiet day. low, low volumes no action in the market which actually surprises me a little bit because after friday's move higher into this record territory i just figured the market would digest and back off a tiny little bit, but quite honestly it's really done nothing all day except holding here tight on edge not only this afternoon but the earnings as we move about in the rest of the week. >> i'm looking, meanwhile, mark, at some of the picks that

the blackrock etf's go with self indexing rather than paying an external index provider, that means blackrockf the control over the process the beginning to the end. they come up with the methodology, they do all the rebalancing. there is a cost saving there, not having to pay an index provider for their intellectual capital. that means when you look at how the etf's compare with the other indexes in the market, they are cheaper with some of their peers. out more frequently with self index products, rather this up being a one-time foray. julie: as you know, the single greatest factor driving volume in the etf world is -- are the new funds gaining traction as a result of the lower fee structure? >> with these particular funds, we don't have a gauge of that yet. they have about $10 million in assets each, it is hard to say how they're are doing. but in terms of the space as a whole, we have about $500 a smallin assets, section of the market that is access managed etf. that in't really seen the flows yet and even in the terms of the etf's being launched at the moment, a split between market cap

blackrock and the secretary of labor. this is bloomberg. ♪ than 90e're less minutes away from the june jobs report, which will recover from the disappointing numbers in may. hitting recorde highs with turnover. joining us is michael mckee. he is in washington. projectionsbout the and the recovery from eight. michael: we are seeing a slowdown in hiring, not as dramatic as we saw in may. what happened was seasonal adjustment. apparently, did not capture the people who were going to be taking the summer jobs, the high school and college students. a lot of that will be added back in today. we move up to 178,000. there is no change in the unemployment rate. it could go higher if we attract more people into the labor force. that will be the unemployment rate going up for good reason. everyone is going to be looking at the wage numbers. we expect .3% growth. that is still a disappointment. in december, we were at 2.9%. we are looking for wages to go higher. again, it's likely to go down if we have some strong hiring. more people

isabelle mateos y lago of blackrock stays with us. with lloyd like fine, that is at 1:30 p.m. in london. coming up on "bloomberg surveillance," the u.s. job numbers on friday. we talk about central-bank risk aversion and some of the positive things that can help with the fed, the boj, and ecb. this is bloomberg. ♪ ♪ what should i watch? show me sports. it's so fluffy! look at that fluffy unicorn! he's so fluffy i'm gonna die! your voice is awesome. the x1 voice remote. xfinity. the future of awesome. ♪ francine: this is "bloomberg surveillance" with david and francine from london and new york. here is taylor riggs. taylor: retired marine corps general john kelly takes over as white house chief of staff today. president trump tapped him on friday to replace reince priebus. he will have the backing out president's daughter ivanka and her husband. calling china and russia the biggest economic enablers of north korea after the kim jong-un regime launched the second icbm in a matter of weeks. rex tillerson says the u.s. wants a peaceful re

despite unnerving headlines, our next guest says to keep calm and buy on terry is a strategist from blackrock. good to see you. what do now make, some of the risks maybe being ignored. >> it's important, even as investor, we're always trying to make regular examinations of our views and be confident going into them, so there are some significa significant head winds potentially, talking about that later this year, but also, i would say the ip interpreter traditiinterpretation of low volatility, in our estimation, we had our mid year meeting, we don't believe these are head winds that are going to be moving investors away. we think it's an opportunity to be investing in risk asset >> but you still favor assets outside the u.s. over u.s. based stocks, right? >> we're rtrying to find value you. to a certain extent and remaining overwalgt. >> what are you seeing in terms of flow? where do people come to, where do they want to have their money? >> it's a great question you guys talk about this come place enpsy. one of the things we're seeing and this whole argument we talked about three years ago

to with us to discuss risk and the prospect of andrew, an is colin, marilyn watson from blackrock.ague lisa abramowicz picking up on the fact that there's a growing trend in credit at the lower quality names are boosting offerings and extending duration as well. how are you thinking about that theme at the moment? marilyn: i think looking at european growth and fundamentals, we actually have a relatively positive the despite the fact that yields are pretty low and there are a lot of yield investors out there. we see a lot of issues extending duration and not being a for the next duration, what we prefer to stack toown the subordinated financial debt, for example. it offers better value in terms of valuation in terms of yield other than necessarily looking at the extend the duration. jonathan: andrew? andrew: the chart you put up his interesting. if you look at that duration of the day, the quality has to to rated even since june 2014, the post crisis low and credit spreads. the composition of the market has changed. it's bigger from 40 to 49%. the quality of the index is much worse

jonathan: colin will be staying us along with andrew and marilyn watson from blackrock will be stayingith us as well. coming up next, it's the auction block. greece returning to the bond market and at&t delivering the biggest investment grade credit deal of the year so far. from new york, this is "bloomberg real yield." ♪ ♪ jonathan: i'm jonathan ferro. from new york, this is "bloomberg real yield." i want to head now to the auction block where we saw a few landmark deals throughout the week. we start here in the united with the treasuries $26 billion 2-year note sale that for a yield of 1.395%, the highest since 2008. the auction had a bit to cover ratio north of 3%, the strongest since november 2015. on the corporate side, saw the biggest investment grade deal of the year so far and the third biggest deal in history. at&t sold $22.5 billion of bonds in a multipart offering, said to have drawn almost three times as many orders as they were securities for sale. to wrap it up in europe, hungary investors welcoming guess what? new greek paper. greek stocks $3.5 billion of bonds in the fi

. >>> lower fees hurt results at blackrock. that's where we begin tonight's market focus in an effort to attract more customers, the world's largest asset manager cut product fees in the latest quarter. resulting in earnings that trailed estimates. investors funneled a record amount of cash into blackrock's exchange traded funds business. low price business, by the way. but it wasn't enough to lift revenue above expectations. shares fell 3% to 424.63. >>> fedex warned the cyber attack that recently impacted one of its units would cut into full-year results. the delivery giant said its tnt express division still experiencing severe disruptions from the attack and doesn't know when the issues would be resolved. causing lost revenue and higher costs. fedex shares off more than 1.5%, at 215.48. >>> consumer products company church & dwight is buying privately held oral health care company waterpik for about $1 billion. church & dwight also reaffirmed its profit outlook for 2017. shares were up 1% at 53.33. >>> some retailers close

. >>> plus, in the blitz today, trades on blackrock and a big call coming up in the oil space. >>> plus, netflix reporting after the close. our desk will take their positions on the stock we do have media and tech analysts rich greenfield with us as well. the five things and the five questions he has for that company. he'll tell us first. next for your heart... your joints... or your digestion... so why wouldn't you take something for the most important part of you... your brain. with an ingredient originally found in jellyfish, prevagen is now the number one selling brain health supplement in drug stores nationwide. prevagen. the name to remember. steve, other than making me move stuff, i'm here at the td ameritrade trader offices. what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place and lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim. see options data like never bef

blackrock cited lower performances and a drop in activity. their c.e.o. said the u.s.nomy is growing more slowly than expected. he also reiterated the concern for the market and asked whether president trump president trump can pass key reforms. bank of new york mel oon has a new c.e.o. -- melon has a new c.e.o. he replaces has hol will remain chairman through december. worked for jpmorgan chase's equity fund and also former c.e.o. of visa. and that's your latest bloomberg business flash. coming up, it's classic subprime loans, rapid defaults, sometimes fraud. we'll speak about the u.s. auto industry. ♪ ♪ vonnie: live from bloomberg world headquarters in new york, this is "bloomberg markets." a quick check on u.s. stocks in the see the major averages not doing too much, but they are all in the green. the nasdaq has paired its games. not all groups are in the green today. there are some areas in the market where investors are little mixed. let's go to abigail doolittle to tell us more. abigail: with the major averages trading in very small moves, investors may be on hol

the imf, the economics professor at george mason university, and the head of chinese equities at blackrock. >> i think the respondents hit a really, really good topic, which is the geopolitical or geoeconomic tension. i absolutely agree that things like productivity and debt burdens are a threat, but these are not things that were built up overnight. they were built up over a number of years, and to some extent we may even see -- let's say artificial intelligence, technology offset over the medium-term. i do believe that is the biggest issue to consider, the geoeconomic issues. that really brings us back to the unpredictable nature of some of these driving forces. for example, what's happening in north korea, what's happening in the middle east. a lot of unexpected things have arisen, and even with that aside, we still have all of trump's agenda in terms of protectionism and trade wars globally, which fortunately, so far, haven't really panned out to the extent he has talked about during the election. stephen: your views on the poll results? >> i think it is a mixture of feelings. short-te

larry fink is blackrock.had toudgment, telecom be examined and say what is really going on here? how can a company in cincinnati by a company in hawaii? they don't do anything. how does that impact corporate governance when you have organizations you heard yesterday like iss and class lewis monitoring and providing a cover for these guys to make their political decision? does this mean we go down greater and greater momentum when the bull market breaks? the passive focus, does it mean we will go down bigger and deeper? of 2010, thenamics market went down 300 points to 400 points, couldn't care less. when procter & gamble dropped 30 to 40 i paid attention. you have no stress test on his products in a challenging environment. .o uptick rule no capital from a world that used provide capital for a buffer. that didn't happen in 1987 either. what outperforms? does: the answer is what your client want? over the last 20 to 40 years i have been in business we try to generate an absolute return of 10% real with compoun

let's talk more about the moves with marilyn watson from blackrock. good morning to you. how long does this selloff in the bond markets in the u.s. and here in europe last? as you know, we've seen low volatility in the markets for a long time. it's going remain low for quite a considerable amount of time to come given the actions by the central banks. we would expect this to continue further. they've been triggered by various things such as the data in the u.s. yesterday. we had strong data coming out of the eurozone as well comments from central bankers including mario draghi, mark carney also fueled a little bit more movement. i think what we're seeing are still movements within the year to date ranges we have not seen anything that has come outside of the ranges that we've seen so far >> how do you reconcile this with the fact that inflation numbers are still low. and the price component of the ism manufacturing index, that was quite low as well. that really doesn't go together with the bond selloff, does it >> i think it's something the central bankers in particular h

at blackrock.ng desk, the bloomberg terminal, you can look back at a gorgeous chart that only jonathan ferro would love. jonathan: i love anything guy johnson did. ♪ ♪ jonathan: from new york city, for our viewers worldwide, i don't know whose idea this was, but here we are, jonathan ferro alongside time king. was this all you? is francine coming back? tom: the rumor has it she is coming back. it is a british thing. jonathan: the u.k. has a knowledge for the first time on paper -- acknowledged for the first time on paper that it will have to pay obligations to the eu. joining us now is tim ross in london. i guess this shows how far we have come, which is not far, that the u.k. has just admitted there might be a bill to pay. >> for the first time in writing, we have got this statement saying there will need to be a financial settlement. it is not say the u.k. is going to have to pay a lot of money or what that will be for or how much. jonathan: the u.k. and the eu will need a fair settlement of obli

at blackrock, we think a lot about the future for retail and disruptors like amazon.m and they continue to inflict themselves -- brands, can they continue to inflate themselves? how do you maintain that customer relationship when you have the scale of change we see? >> we have a fairly light retail footprint. we'll have about 400 stores. we have prime locations. oursocations in china starting at $600 per square foot. at $600 pering square foot. we focus some much on our people, personal development, the most amazing people. our productsll of in rfid. we have incredible channels. we have really relevant assortments and can provide the entire assortment through digital. i think we have really unique experiences people value. you see that through loyalty around the world. francine: thank you so much. we will talk more about these disruptors and maybe if we have talking time earnings. that was lululemon. we will be back. we will be talking about trade globally. this is bloomberg. this is what you do. you can look at some of the cool about we were talking with rupert and l

wei li, blackrock ishares emea head investment strategy. higherare going to trade into the opening.eye on. the marks & spencer story. they are selling more at full price. and pearson, as well. 22% stake in penguin random house. keep an eye on that. reiterating the 2017. the european open is up next. we will talk about u.k. politics. plenty of that coming up. as is bloomberg. ♪ as ♪ guy: welcome to bloomberg markets, the european open. s equities about to open here in europe. the first trade of the day. matt miller is back in berlin. what are we watching this morning? is britain heading for cross party cooperation? ideas for the opposition in a speech later today. the view from professor john curtis. the president's oldest son was told

that's blackrock. how about this?le the largest company to face a proxy fight. he wants a seat on the board and what does it tell you about procter & gamble, keith? >> it makes me very suspicious. because activist investors tend to be out for one person, the activist investor, they're not for america, contrary to what people think. if he's not aligned with my interests, i'm concerned. stuart: he owns $3 billion worth of procter & gamble stock and figures he can make it a more profitable company, more expansive with him on the board. it doesn't look like the market agrees with that, virtually unchanged on p&g, but i've never seen a company that size taken on by an activist investor. it's a new era, keith? >> it is. look where we are as a market. more money is chasing quality stocks, so the stocks are getting bigger. this is the first out of the gate in the big boys' league. stuart: dare we call this a positive economic indicator? google searches on buying a first home are up. is that an economic indicator. ashley: 11%

this monday the world's largest money manager blackrock leases its second—quarter profits, at the endhad by $.4 trillion worth of assets under management. netflix is piling up any nominations, investors in the streaming service hope its strong content will lead to more than just critical accolades when it reported quarterly profits this monday. it shows like 13 reasons why and stranger things, wall street expects netflix to report substantial growth in the number of viewers signing up for its servers. the company is projected to have added 600 and the 1000 subscribers in the us during the quarter. thank you. joining us now is david buik from panmure gordon. good morning. ladies, what a joy. let's talk about what's happening on the markets. trading in the narrow band but lots going on. there is a lot of business going on, it's interesting, a feeling which michelle referred to, that the quarter earnings in the united states will be quite good. we had three large banks on friday all beating expectation, whose one junior members club that people didn't like, the fact trading reve nu es di

russ of blackrock. when i think of a value trade, i think of energy.re doing in terms of debt. where do you stand? >> i think you have to pick your spots. it is a value trade, one of the few left in the u.s. having said that, we are finding a lot of the best value outside of the u.s.. some of the largest companies overseas are not only cheap, but are better sources of yield in the market. it is hard to find cheap dividend plays like five or 10 years ago. you say energy, are you talking equities or bonds. there is quite a lot of disagreement. -- neutral for the bearish, do you agree? russ: we have taken down some of our high-yield exposure. i do think energy is still vulnerable on oil, the do -- the break point is lower. in 2016 with oil on the 40's. i think you have to have a three handle given how much more resilient -- have become. >> that is a big deal. oil prices would have to go down into the 30's. when we got down to the mid to low 40's, you didn't see any .ffect the breakeven as lower than it was. ofwhat you think in terms energy, how discipline

shares in the asset manager blackrock dropping about three percent after it revealed disappointing revenue for the past three months. earnings about two point nine billion dollars as it cut fees to attract more business. china's economy has kept its momentum a steady growing a slightly more than expected six point nine percent in the second quarter. analysts of long cast doubt on the reliability of beijing's statistics. officials said they were looking at june brief balance the economy and maintain a steady pace of expansion. clear rush reports. good news for china's economy. the country six point nine percent growth beat expectations. thanks in part to an uptick in exports and consumption and a strong property market. hi housing prices have prompted property investmen. which grew eight point five percent in the first tough compared with the same period last year. exports also grew eight point five percent in the first half of twenty seventeen. and retail sales rose eleven percent in the first half of the year. positive data puts the chinese economy back on track to reverse six consecutive

a weather warning from blackrock , questioning the u.s.g that dark clouds are building. and netflix on a roll after smashing forecast in a record setting quarter. subscribers top those at home. the second hour of daybreak asia coming to you from the u.s. and asia had orders. on 8 a.m. just after 8 p.m. here in new york. and sherry, of course, we're watching how the markets are opening right now. market delivered by earnings season. netflix, this huge subscriber growth not just in the u.s. but also overseas. for netflix and gearing up for goldman sachs, ibm, bank of america, so many more. we also have data points to look at property prices out of china, not to mention the minutes. excluding japan. remember, japan was on holiday yesterday. the markets get going. -- so i wonder >> this is now at a three-year low. with the function to show you how. weaker there at the end. slight gains in sydney and soul just fluctuating at the open here, this having slight gains on monday. take a look at the aussie dollar down about .2%. ahead of the rba minu

we will talk with sergio, at blackrock. and, drains in the perfect storm. suddenly turns into a hot market. we are about 30 minutes into the trading day in the united states. week in july, julie hyman is here to tell us more. julie: not much movement on the overall average as he s&p is 1%, the biggest move of the three major averages. more movement on the sector numbers it analyst estimates but the shares are trading lower. some of the growth came from selling more premium level snacks and higher margins. they expanded a bit. still seeing stagnant beverage growth particularly in north america. ont may be putting pressure the shares in terms of trading here. downgrading stocks saying a recent pullback in home buyer traffic is inconsistent with the rise in valuation we have seen for the homebuilder stocks. lower,he stocks trading they are among those specifically downgraded by barclays as well. valuations andof in this particular instance, i am looking at going back about a year here. if you go back further, you will see that on a historical basis, they were

director atmanaging blackrock. they oversee $30 billion in assets. we are pleased to have him.et me start with the theme of the day. this about pushing through the republican ideas. relief --ence of tax there is a problem with that. brian: everybody is thinking about washington. where we going to get to? when you step back and look at the equity markets, it comes back to certainty in the market. this is one of the things we can talk about today. what do we have in our portfolios to make sure there is risk dampening and volatility dampening? washington is part of that. funds, things were you can be market neutral and agnostic to the direction of the markets. that is important. they look at washington and what happening there. vonnie: they are more exposed to alternatives. >> you see this massive rise. it's a bad move? brian: was really happening is a re-examination and looking back. how does active and passive the together? how do our portfolios mix? they are looking at reevaluating hedge funds and how those components work together and use the tools have been blessed with. it h

new images captured by a moving what is being melted in the waters near fukushima your blackrock andances at the bottom of the reactor -- it will take time to confirm that. the images were captured by a designed tot withstand the reaction. powered by 2700 journalists and analysts in 120 countries. this is bloomberg. haidi: thank you so much for that. let's get you a quick update on the markets as the trading week gets underway in asia and new zealand where trading is underway. 0.2%.w is down the kiwi, the u.s. 72.49. the dollar holding onto losses, futures in australia just a couple of minutes ago, pointing points. the aussie dollar 59.11 after comments from the deputy governor, taking the wind out of the aussie's rally. close to $.89 last week. we are looking more broadly at the yen. at's bring that up, sitting 129at the moment, sterling .97. gilts, ahead of the fed -- yield, a lot of scrutiny. the number coming through towards the end of this week. a reminder how the stocks closed last week largely unchanged with the s&p 500 slightly in the negative. we are watching trading in asia

blackrock etf. the emerging debt is causing jitters among investors.d the ishares jpmorgan local bond. it has doubled in size this year. it has mopped up about $3 billion of inflows. the risk is that the trade on happen -- asnd to the trade unwinds, but does tend to happen. they have been criticized for creating global-like conditions in less liquid markets. mass outflowss to inside and see changes. you could see it potentially toxic situation. 6656 . vonnie: that was pretty serious. abigail, what do you have? >> i have to go big with the bank trade. i'm going up against mark barton and his fierce chart. this is the bank trade over the last year. we had that tech pullback. some would call this a head and shoulders pattern. that is when those who bought well here, trying to sell those who bought less well. netflix having a stronger-than-expected quarter. alphabet reports today after the bell. this is a broadening situation. it may suggest that alphabet, amazon, or facebook could drop back down. isthe r issi -- if the rsi over but, we could have some

blackrock had supported only two bank out of 98 diversity proposals from 2012 through 2016. place for the bulls. with some now guidance for the second half is norman chan. quite something. the hang seng two-year highs, the kospi at all-time highs. >> taiwan multiyear highs. you're not going to get 20% in the second half. you're saying we will get half that. >> second-half return will be positive, but not as strong as the first half. the first half was the perfect situation for equities, including hong kong, china, taiwan, korea. to facend half, we have the challenges. qe is tightening in the u.s., europe, and probably u.k. to a certain extent in china as well, gradual monetary tightening in china for the last six months. that has started to push the violations andrn less loose monetary policy. rishaad: of course we have cpi today out of the u.s., key for janet yellen. what do you make of her testimony? >> the testimony is very very favorable. she keeps saying that she is still very confident about the u.s. economy, and also she has not changed much since the june fomc meetin

blackrock ceo larry fink says the us economy is growing more slowly than expected, and the trump administration'so act is a threat. he told bloomberg that there are dark clouds building. black rock issued second-quarter earnings. revenue missed expectations for the fourth consecutive quarter. the united arab emirates says there is little likelihood of a speedy resolution to the qatar crisis because the saudi led alliance wants a deal that would endure. uae foreign minister says they need a clear signal that qatar will meet him on the position on extremism. a brazilian judge has denied a request for companies and individuals related to the disaster to pay financial guarantees. marco, bhp,y some and vale do not have the funds while the case is being tried. 19 people were killed when the dam collapsed in november 2015. indian lawmakers have been voting for a new president. an election is widely expected to be won by a little-known member of a political group. kovind is a longtime associate of a hindi group accused of spurning religious hatred. global news 24 hours a day, powered by more than 2700 jo

we are still with terry simpson of blackrock. people say buy europe. when you put the u.s. together, how do you talk about it? terry: is important for the global economy is shifting. we want to position our portfolio that. there is opportunity in europe and international markets, but it very fundamental case to be made about europe. that fundamental case is the earnings growth in the united states held up after the recession and has quite recovered. we did not have that in europe. we are on the verge potentially if we have higher inflation coming up, that's a better pricing power. i think that's the fundamental story people are not looking at. jonathan: how you fold in the composition of the individual indices? is weighted toward tech at 23%. that's the biggest waiting. it is like banks versus tech. is that more of the bet instead of europe versus the united states? terry: yes. the composition indices are little different. if you're buying broad europe you're making specific bets on sectors, particularly financials. this is where active portfolio management comes in. , we w

vanguard group created the first index for retail investors and have seen winners, as has blackrock.es that specialize in active management, they are slimming down. others are emerging or even closing passive investments. here is the background. active investing often means putting money into mutual funds as managers make case-by-case decisions. passive investments track investments which are groups that are alike in some ways. funds chargee higher fees, their actual performance will generally be worse than the index counterpart. here are the arguments. a study by the s&p dow jones some actived managers failed to beat sales. in their defense, active managers say the period since the 2008 financial crisis has been abnormal, with many stocks moving in lockstep. they say this is likely to decline as the economy moves into an environment that will stocks andre off of bonds. you can read all of our quick takes at and i quick -- at niquick at the bloomberg. nejra: procter & gamble are facing a proxy fight from investor nelson peltz. is bloombergw deals reporter scott deveau. what is trian

blackrock giving us a first look at their third quarter investment institute outlook joining us fromak down the highlights richard turnill is blackrock's global chief investment strategist. richard, thank you for joining us i said you'd give us the highlights i'll hand you the floor for a second to give us the highlights >> thank you first of all, great to be here thank you for inviting me. we see three, i think, important themes driving markets over the next few months. the first is we believe sustained economic expansion one of which will continue to benefit many of the stocks which have been withered in the first half of this year. we think this is a time where investors should be rethinking returns. we see this environment of growth and low interest rates underpinning valuations in many equity markets and finally we think this is a time to rethink risk many investors have been nervous about investing, we've seen risk levels fall. many investors underexposed to risk but our analysis suggests low volatility could be sustained. overall we think it is a good time to invest in stocks,

. >>> as we were speaking, blackrock is out with numbers. asset manager earned 5.24 a share for the second quarter, below the consensus estimate of $5.40. revenue was below forecast the ceo larry fink says significant cash remains on the sidelines, but that investors have begun to put more cash to work so far replacing people with machines hasn't helped black rock we'll see. >> not a big replacement >> starts like that, slowly it happens. elam musk says all of us are going to be replaced by artificial intelligence. >> bill gates shares some of his concerns >>> coming up when we return, the political effect on the markets. joined by roger altman and then senator more os oh will be here. and dean of the columbia business school. and served as adviser to george w. bush. stay tuned commercial real estate company cbre out with annual tech trends report, showing where the biggest tech job candidates are found, where companies are moving to hire them. according to the report, tech job creation grew faster than the prior two years. tech companies re

martin small, he runs ishares, which of course is owned by blackrock.years ago, and yet the business has grown exponentially. blaunched in july of 2002. but in a. >> some have argued the business has gotten too big, but your point is, and this is part of the industry, it's a very small part of the industry, in fact bond etfs is less than 1% of the entire bond market, and stock etfs less than 8% of the stock market value. >> yeah, the capital markets are huge we've got $170 trillion of stocks and bonds all over the world. there's also a whole array of index exposures everywhere it trades $186 billion a day on exchange the ten-year treasury future trades $146 billion a day. those index exposures are key to how capital markets work, and enhanced price discovery. >> how much bigger, though where can we go from here? less than 1% of the market where will we be >> i think we can double, or maybe more fixed income moves from the byzantine over-the-counter market on exchange. >> more electronics bond trading? , what hall in equities in may of 1975 that connecte

alibaba, blackrock, these are big, blue chip well-run businesses not the broken ones that they used tot. >> that's a good point and there's alibaba, 77 incompetent year >>> next, verizon shares higher today after citi said comcast should buy it. that was citing synergies and less fiber builds. would it be a savvy move though, michael? >> it would be a big undertaking, obviously, and i don't know if those virtue us of the couple of problems that get solved are worth a merger of a similar sized company was about $180 billion in market value we also know that there is some kind of exploration of wireless solution for charter and comcast. do you have to buy verizon to get there or can one of the smaller players do that for you? >> do you think verizon, is it going to be the acquiree or the acquirer >> and verizon wants a way out whatever form that might take. because it recognizes that it doesn't kind of have all of the answers and all of the assets in house. >> down 17 -- >> and of course less bold than at&t in going after content. >> that's a point, comcast up 14%. and finally today, we

selling blackrock and dti. it does feel very different now to us.ings is this massive fee compression. it's really putting a lot of pressure on us. julia: did you predict that, too? did you predicted to early? >> i think we did. julia: 17% net flows. -- it feels been different this time. you're seeing a lot of high wealth individuals. you are seeing an aging population that is starting to think through investment and retirement. and there is regulatory changes. china from an exchange perspective is really helping mature the market. julia: is there an acknowledgment that they are not the only things out there? >> for sure. that is true. we need a longer-term here to develop projectslonger-term. looking ahead and trying to figure out who the winners might be, is the only way to win to have scale? important. it is also increasingly, asset management says it needs to generate returns for clients. scarlet: the bigger company is doing better than the small ones. >> they deliver on those investment strategies. it is the classic sort of stuck in the middle.

aggressive schedule being laid out by baron, a very optimistic view on europe being laid out by blackrockpe is the critical thing and earnings are the key issue. gilts are opening down through the futures, labor day futures, down by 11 to. you are -- 11 pips. trading there at 1.22. that is the gilts. guy: let us go to the mov screen. a lecture looks, strong number -- electrolux, strong. market seems to be finding favor with it. stock is up by 5.6% this morning. let me change this to him that points and then i will show you the fact that reckitt is trading up by 1.4% this morning. oil stocks are dead. shell and the p as well. on the downside, sound out story this morning is volvo, down b. this is the trucks business. we are going to be talking to laterss of the business on in surveillance. looking forward to that conversation. the other thing to mention as well is we continue to have weakness in ericsson at this point. it is now down another .7%. that is moved to the macros and find out exactly what is happening where we work our way towards his ecb decision tomorrow. the ecb is said to be

they are utterly and complete cost of test to the point where blackrock has a chart that shows that costt criteria people look at when picking a fund even ahead of exposure. julie: what do we know if whether the strategy will work for fidelity? everyone seems to be lowering fees and vanguard attracts most of the money. what will differentiate the etf's from one another? vanguard has something going for it which is the 30 year head start. they have been lowering fees since the 70's. they are known as the low fee provider. it takes a long time to override that. that said, it does work. they have seen flows. it in thety is doing index mutual fund space. it is working because they've taken in $84 billion in the past two years in index funds. that is the biggest growth area infidelity. accountnds basically for 10% of the index visual fun market and they basically attempt to battle vanguard on their own turf. -- people are willing to come in. scarlet: the fee wars continue. thank you so much, eric. we have more ahead on breaking president trump has decided to remove anthony scaramucci has deci

a double miss chips away at blackrock shares we are breaking down the second quarter earnings futuresg, dow jones industrial average and sandt new all time highs in europe begins a in he think demanded and france slightly lower in germany to report, and the chinese markets in shanghai composite down about one and a half% the growth reported for chinese economy closed because of a holiday in japan. >> nascar into new hampshire fox business network. >> it is going to hold off larson -- wins 2017. >> nascar stare harvick finish p5 going to talk about a race coming up on fox business network, this week. of them that is right fox business, in nascar top story this half hour, the white house has a highly orchestrated strategy for overhauling the tax code this is according to reporting from axios, the administration will start pitching its tax reform plan in mid august, this comes after j.p. morgan showcase chairman ceo jiame dimon blamed gridlock in washington for holding american businesses back. >> this administration made breakthroughs infrastructure we have become one of the most bureau

what next for treasuries and beyond from blackrock. >> looking forward to it.ntinues. this is bloomberg. ♪ rishaad: i am rishaad salamat. on g 20 up with strong words trade and climate change. ivanka trump stepping into the spot light, critics asking why she was allowed to sit in for her father. raised eyebrows there. also this hour, the latest inflation numbers from china, early indications of more stability in the economy. this is "bloomberg markets: asia." ♪

have: coming up, we coverage of policy decisions with blackrock's chief strategist.at's wednesday. from new york, this is bloomberg. ♪ so new touch screens... and biometrics. in 574 branches. all done by... yesterday. ♪ ♪ banks aren't just undergoing a face lift. they're undergoing a transformation. a data fueled, security driven shift in applications and customer experience. which is why comcast business delivers consistent network performance and speed across all your locations. hello, mr. deets. every branch running like headquarters. that's how you outmaneuver. thank you. that's beautiful. thank you. i could never have said it that well. believe me. thank you. much appreciated. thank you for that. thank you very much. julia: what you are watching here is president trump visiting service people from the uss arizona. we are waiting for him to make comments on press secretary sean spicer stepping down, and sarah taken overnders has that role. we were expecting him to make statements and what he has said about anthony scaramucci is he is a terrific guy and the purpos