dan loeb sets his sights on nestle details of his plan to shake up the firm straight ahead.p nearly 5%. back with that and me aorin couple of minutes. >>> good morning markets now. investors gear up for a new week on wall street trading day ahead. >>> nestle, maker of kit kat bar and other brands is targeted by new activist investor. details coming up. >>> facebook going all hollywood. we'll explain what we mean june 26, 2017. you're watching "worldwide exchange" on cnbc. ♪ >>> good morning warm welcome to "worldwide exchange" on cnbc. i am wilfred frost. >> i am courtney reagan in for sarah. >> good morning from both of us. let's get straight to the global market picture futures are pointing higher at this hour. we had a flat week essentially for the dow and s & p, positive week for the nasdaq up 1.8% last week health care was the best performing sector, energy the worst. this morning higher. san francisco fed president john williams said the fed needs to keep raising rates to keep the economy on even keel, speaking overnight in sydney. warned that if the fed waits too long

dan loeb benevolent on nestle? u.s.a. he's striking that taupe at the moment. ht now is we think it's incredible, work with him to engender some of these changes. we want to get the ratio up. we want them divest some stuff. in ally their stake l'oreal about, a 23% stake, worth somewhere around $23 billion. he's saying you should bring that cash back in, return it to m&a, grow s, or do the business in a sort of nonincremental way, which ey've been critical to doing in the past. francine: did you get a sense he'll go into other food europe?s in or is it just nestle? >> nestle is not only the iggest food company in europe, the biggest in the world. i think this is a pretty strong place for him to start in terms of trying to move into that into the kind of packaged goods space. a ton of stuff that nestle can do. i think he's going to push for the to do moves around world in terms of getting out noncall. 's perhaps whether he uses this more, it will be interesting to see. thus far, the guy who's done kind of food beverages has been nelson. so tell be interesting to s

but how does dan loeb fit into a longer-term strategy.think he complements it or do you think he feeds against it? eric: there is certainly a view in some parts of the market that is you or buying in kind of orplements -- his view the othercomplements view. he has a big agenda he wants to pursue and having an activist does not undermine that agenda, perhaps. i expect a lot of people thinking quite carefully. eric pfanner joining us out of geneva. talking of valuations, of london,and speaking in janet yellen it knowledge to valuations in equity markets has risen noticeably in recent weeks. >> as it valuations are somewhat in traditional metrics like price-earnings ratios, but i would not try to comment on appropriate valuations in those ratios. it would depend on long-term interest rates. and uncertainty about that. guy: janet yellen in a very big chair. the chair in the chair. with us now, william hobbs. good morning. are asset values getting a little toppy? the bond market that sticks out in terms of valuation and equities have a good re

it sounds like dan loeb got som very good recommendations. that's the path to get this done >> i was also curious, just given that it is a swiss company, you know, what these -- what the laws look like over there. are they very shareholder friendly, especially relative to the u.s. and they actually did change recently, to make it so that, you know, investors could replace the entire board, in one proxy contest. if it gets to that point, which, of course, it appears based on your reporting and based on the investor letter which praises the new ceo, that they're getting a aloget getting along right now. it will be interesting to see what happens with this one >> and he's certainly done awfully well leslie, thanks >> thank you >> let's get a check on the markets now. stocks are mixed bond yields, man, they just continue to drop there is the ten-year note yield, 212 volatility index is under 10 tony, what -- you threw in the towel on your sort of more neutral negative point of view, whatever you want to characterize it. >> i'm glad you bring that

low -- danfrom dan loeb. and there is the amazon deal and the disruption that has had.end of being victim to pray? amazon are anow disruptor. is shootthe reaction first and ask questions later. we saw a massive impact from the european companies. our holds -- amazon and whole foods does not change the dynamic short to medium term for these companies. if you think about the whole foods customer is different to walmart. this does not necessarily lead to a price hold. manus: thank you for being with us. fund manager at aviva. thank you for being with us. the european market open is next area -- next. we are seven hours away from the meeting. if you want to know who has the fo for markets, that is mr. mario draghi as the high hits the levels that highest level since november against the pound. ♪ guy: wednesday morning, good morning. markets, this is the european open. cash is opening an half hour. i am guy johnson. matt miller returns to berlin tomorrow. let's talk about what we are talking about. i read somewhere virus spreads across the globe. doing enough to protect inve

the market likes the fact that dan loeb went in for shares of $3.5 billion.e chamber of commerce this morning, and the director general, they are putting forward their view on went the first rate hike will go through in the united kingdom. they say it will be in the first quarter of 2018. the market is live in august for a rate hike, but this is 3.96. we have a call here from blu-ray that u.k. will scrap austerity. withgoing to hit 2% average of about 1.08% in the past 12 months and we spent four months below 1%. we have not seen that since 1989, so they would say we will hit a 2% metal. is 1.72%berg consensus for the first quarter of next year. 18 months time, we are looking at 2%. we need to reprice guilt risk. literature you what is happening in terms of individual stocks stories in europe. manus mentioned what is happening with nestle. we have an opening price on l'oreal, opening at a 2.53% price. some paulo is the lead gainer, the markets likes the underwriting detailed from the time government. we are looking at the rest of the italian taking section lo

billion share buyback and says it will focus on capital spending, just days after third point's dan loeb pressured the firm to shake up its structure. >>> maersk shuts down a number of systems after hackers strike in another large-scale cyberattack targeting the shipping giant and several other corporations and government institutions across europe and the world. >>> good morning it's wednesday, i'm glad to be back in the seat hope you enjoy the show today. we have a jam packed show for you. let's kick things off with a look at the heat map the stoxx 600 is down by 0.8%. a lot of weakness extending yesterday's losses the stoxx 600 at this point is at the lowest level in two months we saw tech stocks underperforming in the u.s. and a similar thing is happening in europe this is also on the back of the renewed cyberattack. we'll spend more time talking about that during the show oil and gas also underperforming given that prices have dropped given the surprise increase in api crude inventories. what you're seeing is that we're seeing a lot of red across the board. xetra dax off by 0.8%. ft

dan loeb, a high-profile hedge fund or in the u.s., generating trading and speculation on monday.etty: you will see the impact monday morning. we have also the impact of a fresh round of economic words. -- reports. su: let's get to that, because the statement phase is more than the first. -- second phase is more than the first. capital the minimum requirements. this was in place after the financial crisis to make sure the banks had enough capital reserves to endure shock. this had more strategic requirements to see if the banks have enough money to fund buybacks and dividends. in terms of other things, looking at major reports of economic data with durable goods orders, economists. they do say the income will have a continuing trend which is positive to the economy. we have another round of monsanto and nike earnings, and many say they are selling tech shares to restore decade-long trend. it will be a big oak is on growth stocks versus tech stocks, cyclical rotation continuing, or whether tech stocks rebound. not only looking at corporate news and breaking news, but also washingto

dan loeb is making his biggest that ever.e fund has taken a $3.5 billion stake in nestle and demanding changes. according to an investor letter, urged nestlehas hedge fund has 5 billion to sell a stake in l'oreal and increase leverage for share buyback. nestle shares fell to its lowest in at least a decade. lloyd's of london is illuminating 10% of its u.k. staff to cut costs and streamline operations. the specialist insurance market has struggled with the low interest rate environment and pricing pressures. planlanned -- lloyds introduces a bond severance program. that is your latest bloomberg business flash. anna: still to come on the program, the trial of martin shkreli is underway. here is a former pharma executive, famous for hiking the price of a drug by more than 5000%. he will tell you how his bragging to the fbi may seal his fate to the prosecution in a securities fraud case. this is bloomberg. ♪ anna: welcome back, everybody. this is "bloomberg markets." i'm anna edwards. vonnie: i am vonnie quinn. martin shkreli is

we have seen this come and dan loeb was there.ange of companies coming into play and unilateral was -- unilever was targeted. on a constant journey. thank you. you have the emergency rules and a liquidation of lenders. it is great to see this morning. we talking about the euro package. with the size of this expected, was it bigger than what the market had anticipated? this is fundamental to facilitate the process with the popularity and there are 12 the dish euros as part of a state guarantee with the potential this was pretty clear yesterday. who couldmany people this is because withspecial fund set aside 20 billion euros and created in order to help some. >> thank you very much. that was the main headlines on the italian banks story. is with the black rock investment industry and she is still with us all stop two biggest stories have been setting the table. .et's do italy what do you make of the handling of the banks. show me the alternative. decided towards resolving that we are in terrible shape and we are loansng this mountai

but dan loeb's firm says there's more value to be made.nt stake, nestle spokesperson said we always keep an open dialogue with shareholders and remain committed to executing strategy and creating long term shareholder value. beyond that, we have no specific comment. third point pushing the company to improve margins and double leverage to do more buy backs, additionally third point wants them to consider selling underperforming brands the firm alauded the plan that it would look at brands. nestle should sell 25% stake in l'oreal, worth more than $25 billion. >> it is interesting to see stake of this size, see an activist pushing things. leads you to think it will be successful >> well, it is unclear at this point in time. they have a lot of fire power behind them, nestle does because performance and stock price has been not too bad often times a way activist investors get there to be changes, they get other shareholders on board. it is unclear at this time whether other shareholders are unhappy with what nestle has been doing so far. they

necessarily finishes higher on the day, oil helped things along bouncing off the lows. >> dan loeb has a sweet tooth as do you and i nicole. thank you. david: health care is number one on capitol hill now. we're he waiting for the congressional budget office for review of health care. modest revision, hoping to unify their party, behind the obamacare replacement plan. adam shapiro is live in d.c. with very latest. some votes hinge on cbo report, no? >> absolutely, david. one thing we need to keep in mind is that the original cbo score on the house side, they found that 23 million people were going to lose insurance. we want to see if that figure changes in this cbo score. we want to find out, not only that, but whether it is deficit neutral. if it adds any money to the u.s. annual deficit. it will not be able to get you through the senate. here is what i had, interview with orrin hatch, the senator chairman of the senate finance committee earlier today, and i asked him specifically will this senate bill pass? here is what he told me. >> i don't know. to be honest with you, there are fi

we will talk with the hedge fund and talk with this, dan loeb investing in nestle.a rock and a hard place, rio tinto with a dilemma. this is bloomberg. ♪ betty: we noted takata filed for bankruptcy. they also filed for bankruptcy protection with the tokyo district court. that is why they expected to be filing in the u.s. and that the home market in tokyo. we are waiting for the shares to begin trading. then they are suspended as of now by the tokyo stock exchange. yvonne: we got a little bit of a glimpse from the filing about a half hour ago out of the u.s. $10 billion in liabilities. that is not what we were expecting. it could be as much as $9 billion. this for takata. quite a lot for takata. who will cover that cost, offerslly as we hear the from key safety systems later this week? problem as well , after expressing room and did -- glencore has arrived last minute, and even better offer. paul allen joining us with more. rio tinto could take the bigger offer, but they could risk alienating an important customer. paul: yes. bid has been recommended to shareholders.

nestlÉ targeted by the activist dan loeb.n has the latest in new york. >> monday in wall street is usually all about deals. this is a deal maker, a highaker, dan loeb profile activist from third point. very interested in nestlÉ. the company has confirmed a $3.5 billion stake. we can look at a chart on how nestlÉ has done. there has been a lot of pressure on food companies to rein in , a new ceo looking to sell off some candy units. in the u.s., there has been a large step back from consumption of sugar-based candies. interested in?kingwhat is loeb they own 40 million shares and some options in this was company. tends to that the fund encourage management bursar change with a greater sense of urgency. it appears they would like nestlÉ to sell off its stake in % in the makeup company and review his portfolio. third point, which has traditionally been interested in u.s. and japanese companies, is starting to take a closer look at europe. they said in their investor letter that as economic conditions have improved in europe and f

why did dan loeb make this big acquisition?uisition, is in his own words, because he thinks this is a rare opportunity of having a huge ompany, which is still a really con glom late in terms of brands, where there's get big y to divestitures, raise ton of money by doing sales, and eturn the money to shareholders. he also think -- i think he's knocking on the door. 's have a new c.e.o. who shown a willingness to be a bit more progressive and change the direction of the company. loeb's plan is i come in, i work alongside this guy really improve this monster-sized company. david: as you point out, they headed in this direction. what does he have to add? he has is he at has very specific thoughts in terms of things that he can ivest. he mentions in this letter l'oreal's stake, which the worth about $25 billion. talks about them lifting their debt ratio, it's much lower than some of their peers, and more broadly making divestitures. at we don't know yet is what loeb is going to ask for. who the is guy advising him on this particular

dan loeb went after nestle 48 hours ago.e they're in a bit of a slowdown in that which also was maybe taken a little bit of pressure off companies for themselves to do deals >> you know you've heard me say before that in the u.s. i think activism has been played out there's so many assets chasing so few opportunities and in the u.s. we don't have a lot of conglomerates anymore and the play of doing buybacks is kind of played out. so there aren't a lot of opportunities in the u.s people have run out of ideas classic example being green light coming up with this idea for two classes of common which really made no sense >> at gm ams >> so then you talk about in europe, european companies are more like u.s. companies five to ten years ago so there's a lot more opportunity it's been there before i advised sony when dan loeb went after it. >> what would you be telling nestle right now >> i think, in nestle he's basically come with a very soft touch, supporting management, which is very large company. i think nestle may be somethin

what is, you know, what is the company going to listen to when it comes to dan loeb's suggestions? this is where he has come with a menu of requests. strategy, butone multiple things the company can do. the l'oreal stake will be interesting if they even have a discussion about that. it is huge. it is worth something lightweight $5 billion. if you were a shareholder in nestlÉ, why should you be forced to go into l'oreal. you should be able to choose. some of the other stuff he has asked for a slightly more incremental. an investment in encore europe.utside of it's not inconceivable they could do some of that. i think the other thing that is not in the letter, but may well is obviously working guy who wasis formally the ceo of sara lee and is done a lot of deals in europe. started -- so i think it's possible that loeb says we should put this guy forward. he's a very smart guy. he will have this company. benie: consumers seem to where it is at these days. all of the action, small acquisitions, investing at the consumer company level. so, who might he put on the board or what might hap

nestle made his first concession to dan loeb, announcing a $21 billion share buyback plan to boost stock them to increase leverage, even more for stock repurchases. ♪ that is the latest bloomberg business flash. axt b,otc -- botc, transatlantic battle of the brits with emma chandra, will oil out stocks? ♪ vonnie: donald trump has been meeting with state and local energy leaders, comments on health care, he said health care will be so good and less expensive, and says the republican plan is a repeal and replace plan and the trump health care plan will be special, if we can get it done. he said we will at least get very close. charts, battle of the what these mean for investors, access on the bloomberg by running the future on the bottom of your screen. starting off is emma chandra. >> this week in the u.s., the white house energy meeting, the president busy and one of the things he will focus on is u.s. energy dominance. making a big speech tomorrow where he will talk about how the u.s. is becoming on the brink of an exporter in oil and natural gas and talk about american innovation and e

. >>> activist investor dan loeb has taken a $3.5 billion stake in nestle to add pressure on the foodts nestle to boost profits and sell the 23% steak in l'oreal. lobe's investment in nestle, represents 1.25% of the company. >>> food delivery service, grubhub may be the next target for amazon. a morgan stanley analyst says amazon's restaurant business is set to grow 54% over next five years, boosted by the recent offer to buy whole foods. amazon's growth will impact grub hub future possibilities, leaving grubhub a possible acquisition target for amazon. wait and see. >>> president trump growing increasingly frustrated with the russian investigation and questioning why the obama white house did nothing about russia meddling in the election when they first heard about it? >> well i just her today for the first time that obama knew about russia a long time before the election and he did nothing about it, but nobody wants to talk about that. in other words, if he had the information, why didn't he do something about it? >> buck sexton, erin elmore are back with me. erin, why didn't he? >>

i mean, the fact that within a few days of dan loeb putting his letter out, nestle has decided to buytock and probably do a lot of other stuff. it seems to me there's more upside across the pond at the moment than there is here at home. >> we'll have more of the mega buyback. stay right there the republican leaders are headed to the white house after the senate delayed a vote on the health care bill eamon javers is there with much more eamon? >> we're expecting pictures of the republican senators here after the collapse of the effort this week to get that health care bill passed up in the senate we're told that reporters will be going into the meeting momentarily and pictures for you as soon as we can get them and meanwhile the white house today in the norm of sarah huckabee sanders offering a fairly muted response to the decision by the senate majority leader, mitch mcconnell, to press pause on this bill and simply abandon the effort to get it done before the july 4th recess. here's what she said a little while ago in the briefing room >> we're continuing to be optimistic the preside

the m&a activity is the best in any sector >> judge, when you see just a 1%, because that's all dan loeb is -- >> 1.25% >> it's a $300 billion company a $280 billion company it's basically 1% of the overall company. and yet, they respond this fast to it, sirott? does that tell you there's a little more heat >> i made this point yesterday those old rules, if you will, seem to be out the window in terms of what sort of influence an activist investor can have, even the their percentage stake is small it's not like nelson peltz had a massive percentage position in ge >> right >> look what's already happened -- >> or carl icahn >> those rules don't apply anymore. and this is evidenced more so of that new, that new road of activism if you are a credible activist with a credible plan, you can exert some sort of change, fairly quickly, at least it seems in this -- >> yes >> and it looks like in this case, they are aligned management is aligned -- there's nothing come out, third point saying -- >> it's also new we don't truly know. >> management has been articulating their need to change strategy

looks like dan loeb has a sweet footing biggest bet on clooekt company hedge fund got a third point,he underperforming stock key line there, this alec baldwin president trump's impersonator honored in tribute by spike tv, robert deniro julianne moore former president bill clinton. . he is going to george washington university two years, came back home to new york, then classic path, from politics into soap operas, and, now that we know the other way around -- >> yeah okay a rare look from that event, robert de niro juliÁn we should say sought spoken critics of the president i am sure clinton jumped in on all the fun. dagen: oh, boy. good time had by none. cheryl, coming up, again i don't go to gallonos i do my mom and daddy every day final thoughts from all-star panel coming up. ... >> republicans need to figure out that once they buy into it. >> i sound like a broken record, but the health care message, tell us what's in it, don't tell us what's wrong with obamacare and republicans get it together. >> how about helping jobs getting rid of the medical devices tax and destroyed the jo

the modalities are changing, that's why you're seeing people like dan loeb buy $3.5 billion worth of look at grocery penetration online, grocery plus drug, it was 1.5% of the total. so 800 -- 8 billion out of almost a trillion dollars of grocery. online has barely touched the grocery business. the food chain is changing completely. stuart: peter morici, i do want your take on the news out of europe, and that is google fined $2.7 billion because of anti-competitive practices. you say what? >> the europeans love to fine successful american companies, especially where they can't match them. they have an administrative process over there that's very difficult to appeal, it's not particularly fair. i mean, this is really the administrative state gone amok in the worst possible way. this is a good reason why brexit is a good idea. stuart: last word from peter kiernan. >> i think it's administrative friction. i agree, it has no impact on google long term. zip, zero, none. stuart: europeans start to innovate themselves -- >> they don't like when we -- [inaudible] they'll figure out disruptio