david tweed there for us live at the adidas h.q. still with us for his views on today's market is the head of global clients at deutsche asset and wealth management. before we get into the nuts and bolts of what the clients are telling you. tell me what you make of this. this is bill gross. he is quite an opinionated guy. >> in terms of investment markets, we have a new neutral and the new neutral basically refers to the neutral policy rate going forward. that magical number, whenever it is, whatever janet yell and mr. carney and others decide it should be in order to maintain 2% inflation and 2% to 3% real growth. the real neutral is that magical number that will drive markets going forward. >> and in the best -- it was difficult to hear. he was talking about inflation and that is what is going to drive markets. for you and your clients, what is driving markets? where are the allegation going to? where is the thinking? >> it is interesting. bill gross' interview last night. it is talking about interest rates and remaining low for l

let's stop to david tweed. he is live at the headquarters in berlin. we will start with the earnings. a lotis all about about of other factors. >> it is all about this massive strategy review that siemens has been looking at vinson new ceo came in last august -- looking at since the new ceo came in last august. i will see if i can run through the main items of this reorganization. gone are the four main sectors that siemens had under the previous ceo. by, they will be replaced nine separate divisions. those divisions will focus on what siemens is saying will be the growth areas. digitization, authorization. -- automation, electrification. to be runing completely separately. which is already leading to speculation that this division will eventually be spun off from siemens altogether. we have seen it before. the semi conductor business spun off. that is the speculation with regards to that. the nine other units will focus on these areas. these arewant to do, the fastest-growing areas they have identified. you want to fill the gaps in their portfolio, wh

.y >> david tweed is in berlin with numbers from adidas today. >> ubs reported profits that surpassed estimates. profit rose 6.7% from a year earlier. our markets editor manus cranny is over there in zÜrich. run us through the numbers. what is the number going to be focusing on? >> i think they are going to focus more on three keywords. return on equity? target.king to the we are on the way to the promised land. reducing --d assets moving the target on risk weighted assets in the businesses they don't want to be in down to 40 billion. management brought in new

european editor david tweed has the details. we knew there was a probe going on on the subject of the number previously was a lot smaller. plaxico were looking at something like $3.5 billion for me also spoke to people familiar with these investigations and they have not even come out with the final figure. it could be bigger. we are expecting the actual ruling to come down probably next month. morellion is certainly than bnp had to set aside. they only set aside $1.5 billion . this is certainly a lot more money than it was expecting. the reason is because the u.s. attorney in new york is taking a very dim view of the sanction violators and the attorney dealing with the case said in the past that the fines have not

david tweed is in berlin. >> i am going to tell you as dori. you will understand a bit about how french government and industry works. are four main operators in france. you have orange, which is the biggest. you have got deleted. you have got a lot of competition -- you have got iliad. you have a lot of competition in france. companies go thinking of cutting maintain probability. they have send a letter to the industry commissioner. they sent a letter saying they are worried they might lose their jobs. he said, i think we need to have three operators in france. in order to have three one needs to disappear. that is why we have this speculation a are going to get together. be problems if that happens. orange is the biggest operator in france. if it merges they will have half of the mobile users in france, and that could cause antitrust issues. probably takeill on the authorities on this. before you start rejoicing, there are going to be certain legal implications. >> talk to me about virgin mobile as well. they are in exclusive talks there. >>

david tweed is that one of the country's most iconic companies, adidas. tell us why adidas is a good reflection of the german economy? adidas isng about that it is a huge exporter and the german economy is really an export-driven company. it is a huge innovator and that is one of the strengths of the german economy. like the german economy, and we did see great numbers in the first quarter, zero point and percent -- 0.8% largely driven because of local construction, but like the german economy there are question marks over what is going to happen in the second quarter and third quarter. a lot of people are worried about what is going to happen in russia, particularly with the situation in ukraine. we were talking about the potential slowdown in the russian economy. adidas is already seeing it. we saw for the first quarter, they had some problems because the ruble has declined against the euro. another question, what is going on in china? this is a question a lot of german companies are looking at. china is not just a manufacturing land these days. it is a

david tweed reporting on airbus from berlin.aviation and go a little bit further down the aviation supply chain. easyjet has just released its first-quarter earnings. joining us to take a look is easyjet's ceo. good to have you on the program. thank you for joining us. i am sure you are pleased that losses have narrowed in the first half compared to the same time last year. can you tell us where it is performing strongly? heust spoke to peter and described the u.k. market as excellent. i wondered what your geographic experience was. lex we have had very solid progress to have a 13% reduction in our loss year on year with easter moving. move froma very big the first half to the second half. that is about 25 pounds of revenue. to decrease our loss in that period is good progress. the reason for that, we are catching more business passengers. we have hit the 12 million upestone, passenger numbers 4% on the half-year. and our yield is stronger. our revenue proceeds have gone up. it is one of the most popular things we have ever done

we are joined by david tweed.ou have had a chance to look over these french numbers and go into them in more detail. what is your take away? is, you haveay another disappointment coming out of france. this is a big economy in europe which continues to disappoint. looking at the detail here, manufacturing and services both contracted. both under that important 50 the which indicates difference between expansion and contraction. economists also saying that new businesses decreased for the second month running. the rate of contraction was the fastest rate since february and , purchasings managers are saying it is lackluster demand conditions. also, i think this is interesting, delays in decision-making. those could be related. they could be related to concerns about the slowdown taking place in china. concerns about what the affects are going to be of the ukraine crisis. on the employment front, more bad news. france's rabbit sector employment fell for the seventh successive month in may. also in services and manufac

outlook for credit suisse in comparison is much more gloomy. >> thank you for joining us today. >> david tweedus to tackle acid numbers. -- asset numbers. ♪ >> welcome back. >> it is 7:23 a.m. estimates, the world's biggest sporting goods maker. david has the details. >> this is a company that has been under pressure for some time. share prices down 17% and now they have had earnings come in and they have missed on expectations on a couple of levels. ,ooking very quickly, sales $3.53 billion under the estimated 2.61. net profit under the 219 estimate. they have maintained profit forecasts. they expect to see some improvement later this year. they are having a lot of difficulties. --s is the third big it's biggest market, russia. they talked about the strength of the euro. they are worried about the strength of the euro against the ruble and the u.s. dollar. they have had difficulties with their big competition which is coming from nike. so much so that one of their biggest shareholders, this is union investment. findut a note saying they it incomprehensible that isrbert heiner had h management

david tweed is in berlin with the details.hey are going to spend 1.7 5 billion euros on their stake, which represents, when you look at what they're paying per share, represents a five percent discount to deutsche bank's closing share price on friday. it has taken quite a battering the sheer. -- this year. it has been under a lot of pressure because speculation that deutsche bank would have to proceed with a big capital issue. there is going to be 6.3 billion in a rights issue that takes the total to 8 billion euros. the entire market capitalization of deutsche bank on friday's close was around about 31 billion euros. you can deny -- an idea of how massive this is. , he signals a failure always said they could recapitalize deutsche bank through retained earnings. they had a collapse in profits. thing, it will bring deutsche bank up to become one of the best capitalized banks in europe. it will be around about 11.8%. the co-ceo of deutsche bank commenting just now and saying the company -- the bank is on the right strategic pat

david tweed -- including sudan and iran. has the details. >> this is a fine that does not seem to stop growing. this $5 billion might not even be the final number. number not get the final until all of the penalties are handed down. it should happen next month. the thing about it is, it was only last month that we were reporting that the fine would be about $3.5 billion. that is considerably more than bnp thought it was going to be. they put aside only $1.1 billion. the reason the attorney has decided to go hard on this is because there's a perception fines for sanction violators have not been tough enough when you consider what they are doing. are supporting terrorism. that is why the finest of severe. whether it is severe enough does not seem to be reflected in the share price. it is only down around 2%. about $2 billion in terms of market capitalization. that is only the difference estimate andweek's the latest report of $5 billion. emergeit suisse seems to unscathed. -- thatre allegations was a settlement over tax evasio

david tweed is in berlin with the story. deutsche bank co-ceo has been speaking on a call to analysts. what are the highlights? >> there had been some speculation that they are going to raise 8 billion euros, which is more than a lot of people in the markets had been expecting. they were expecting between six and 7 billion euros. the speculation was they did this because they could see further fines coming from ongoing litigation. there is a pipeline and having the money there will be important because it will provide a bit more of a buffer. right now, they are not expecting to see any huge increase. that could always change. the share prices down about one percent at the moment. there might be some speculation that they can -- investors can start looking through to improving profitability. >> how likely is this to affect deutsche bank's profit goals? 12%he return on equity was for 2015. that is been postponed until 2016. citigroup has put out a note, they say -- they are looking and saying that maybe people will start to lo

david tweed is in berlin ahead of the release. david, everybody is looking at this measure.e know there are a little bit of tremors about europe. what is going to hit this number? what is the top of the agenda? >> i think the key thing here, thes, is to see whether impact of russia and ukraine, whether there are slowdowns in china, whether the slow growth is undermining german business confidence. if it's beginning to do that, we could see german businesses to delaying investment decisions, delaying decisions to hire, maybe even shedding staff, and that is what we look for in those figures. we expect to see a little weakness in the figures. but remember they are coming from a very elevated position. the german economy has been doing ok. and about an hour, we will get the final gdp numbers. that will be interesting because we will get the breakdown and see how strong consumer spending is. that is what i will be looking at. there was something interesting that came out of the pmi numbers yesterday. we saw a slight slowdown in the expansion of manufacturing in pmi, still well a

david tweed has the story. the small town in the a new east germany, york-based startup is making waves. >> my name is andy katz-mayfield. wem the cofounder of harry sell our own products through our website. there are companies that have been part of the industry for a long time. they charge prices that are disconnected from the cost of manufacturing. was $100tal cost million. we searchedd and all over the world to find the best manufacturer. it turns out the best manufacturer in the world is in germany. we are able, particularly owning a factory, deliver a product efficiently to our customers. we get it directly to them. by doing that, we deliver it at an exceptional value. mean,t down here and, i you walk through the factory and immediately have an appreciation for how hard it is to actually manufacture a razor blade. the workers are here -- how skilled the workers are here. they are truly craftsman. people and the know-how that enables them to get steel into razor blades. >> a great package there. mark bart

david tweed is that siemens headquarters. david, let us kick it up with you.iemens has announced a strategy review and you spoke with the chief executive, joe kaiser, an hour ago. what was the key take away? >> this is a huge strategy or view their undertaking. he has been working on it since august when he became the ceo. it is going to be a whole liar -- layer of bureaucracy coming out. it will be a bit for the purchase -- there is the purchase of the rolls-royce turbine business. there is a lot going on, but there is the potential alstrom bid. he did not want to talk into detail in about it but he did tell me what it would not be because it won't involve any three-way asset swap that has general electric in it. >> we do what we need to do. they do what they need to do. combining some sort of thing altogether would think that more complex. get complexity out of the way with organizations. where would make it more complex? put paid tonly speculation that has been a french press that there may be a three-way asset swap that could involve general electric. it l

one of them is david tweed.ow thislk to us about fits into siemens strategy. >> a context of all of this is that the new chief executive wants to lift margins at siemens because siemens has been lagging , general electric has been lagging, abb. they want to get rid of the companies which are not performing so well, get rid of those units that are not performing so well, bring onboard units that are performing better. the growth that story about siemens wanting to buy the wind turbine from rolls-royce last week. good margins there. now, we're hearing the story that might be decided for good by tomorrow, the siemens wants to sell its airport infrastructure, basically baggage handling business very his business or 900 million last year, its margins in the single digits. siemens wants to move it on. >> is amazing when you do sit and wait for your bags to arrive. now we're waiting, getting the same thing in germany from merkel, yeah? he wants to see mrs. merkel putting her full political weight behind the bid it siem

david tweed is standing by with one of germany's most famous companies. take a look at some of the companies diving the german economy. modern campuses in germany. what is it like? >> the building i'm standing in was only opened about three years ago. that designt incentives in here. we go in various parts of the campus. it is quite an extraordinary campus. we wereof the building, not allowed to take our cameras because what they have got is so top-secret in terms of their latest designs coming up. that is something to watch out for later on. and takell go outside a look at the history and the sporting facilities that are here. this is quite extraordinary company. it is quite old. average age of the people working here is a roundabout 30 years old. pretty extraordinary. energy thatnse of you get when you're wandering around the campus. of the other children very thing is the range of people here are coming from all around the world who are working here in the campus. i will try to say the word [indiscernible] urinating normally call it [indiscernible] --

david tweed joins us now. share still seem to be under pressure. about what is going on here. >> they are down about 3%. they opened up pretty much unchanged. some people in the market are beginning to get worried about telefonica's currency exposure. it is true that they are under pressure in their home market, in their traditional business. vodafone very active in spain. when you look at what happened to the argentinian peso, down about 18%, they are likely to see a replication of that declinesalso from the in latin american currencies. this has been issued for telefonica. telefonica where it can't do much about currencies but it can do something about trying to shift its business in europe and its domestic market. >> partly it has been trying to do that by some acquisitions. it agreed to a deal that makes it the most powerful tv operator in spain. >> indeed it does. digital plus, this came out around 9:00 last night. what it means is they will be able to take a 56% stake in digital plus and increase their take to 78%. it gives it the lions share

david tweed with the latest on adidas and nike. we enter the dragon capsule.usk battles for a contract to build america's next space shuttle. we will look inside the spacex factory. ♪ >> good morning. thanwelcome back. we have it all covered. in today's new energy, let's look at space exploration. aon musk has been leading push for renewables and is in a heated race to win a contract with nasa to build the next shuttle. we got a look inside his spacex capsule, called the dragon. >> spacex is the new kid on the block. born in 2002. do you ever question if you are crazy? >> yes. it is important to question your sanity. when you stop questioning your sanity, you're probably insane. --the end of nasa's saddle shuttle program left america one way to get to the international space station. russia. quick citizen embarrassing that the united states has to bum rides from the russians. nasa is now the client. with private enterprise assuming the majority of the physical and financial risk. elon musk has sunk $100 million of his own fortune into spacex. dragon is a capsu

breaking news now before we go to david tweed.ers index market estimate in contraction. the composite index at 49.2. h

that is why the eu-japan talks are of the utmost importance. >> david tweed.is here with the big macro themes of the day. , 48.1.hsbc it is a contraction. more signs of the slow down. when you look at the provinces and the municipalities in china, 30 out of 31 west their growth targets in the first quarter. the targets were lower than the target set in 2013, not a good sign. it is damaging growth. >> richard fisher, said president dallas, when he speaks, we listen. >> -- said president dallas -- fed president dallas, when we speak -- when he speaks, we listen. he push those conversations out. hawk is notggest talking about a rate rise. the partisan page -- the participation rate was lower. >> we will take a look at how markets are hedging the risks. stay with us. ♪ >> welcome back. let's take a look at the markets. marshal joins us from cyprus. hello, marshall, always good to see you. have talked long and hard about the fed today, what they will do next and how quickly in light of friday's job report. what was your take on the jobs report? from janet yellen's

david tweed joins us with more. what is the update behind the numbers? >> i want to start with greece. i am going to read a couple of lines from the fitch upgrade. they are still below investment grade, but moving in the right direction. "remarkable progress on the fiscal front. the most challenging adjustment for greece is behind it," says fitch. there are problems still, but they have managed to have a primary surplus and start interest payments in 2013. there is a funding shortfall also say theyy will fill the gap. just hold that thought. spain, standard & poor's, i will read you something from the upgrade. it is because of the improving economic growth and competitiveness as a result of spain's structural reform efforts in 2010, including the 2000 well they were market reforms -- 2012 labor market reforms. i want to put that in context and asked what would have happened to these countries if they had gone out of the euro and currencies had to have dropped, as many people prescribed. they would have seen an increase in exports, but would they have don

david tweed joins us. can you make sense of this?this it gives us a glimpse into the byzantine relationship between , unions, and companies in france. theme set the theme with wireless operation world in france. the biggest operator is orange, 27% owned by the government. the second-biggest operator is sfr. then you have bouygues telecom. then you have a discount called ilia. you have a lot of competition. so much so that some of the unions are concerned that gues might like bouy thet cutting costs and unions wrote a letter to the governor saying they would like to see a merger of orange and bouygues telecom. the industry minister, who has been compared to genre keycorp baptisteto jean colbert. and orange are in talkes. , they wouldtogether have half the market in france and that could cause problems with european competition authorities. >> see you later, david tweed. back in a couple minutes. ♪ back to "the pulse," live from bloomberg's european headquarters in london. i am mark barton. >> i and caroline hyde. ukrainian forces have

we will cross over to david tweed in berlin and have a quick chat about sap.e have had some of the top lines on this. this is preparedness for a new world at sap, isn't it? >> one of the reasons why you see the share price is down 10%, pretty much unchanged at the moment, because people are waiting to see after bill mcdermott takes over. the american takes over as the ceo. what we have had confirmed from the company is there will be thousands of job cuts. we do not know how many thousands of job cuts, but that is significant because it is the first time since 2009 that we see sap shedding jobs all across business units. it is a sign of what is happening within the company and that is a shift to the cloud-based services. they will be selling more of their product online. they have also got this new head who hasct development just been thrust into the position. he had something quite interesting to say yesterday. they want the software to become more like lego so the customers can choose whatever they need rather than having some great -- a-- some great big mark

david tweed is based in berlin, too. she also met with the imf. what was the focus?cus was to be on germany's economy. in the end, it was ukraine, ukraine, ukraine. made it very clear that she wants to see a diplomatic solution. the difficulty is that you need to have some people sit down and talk to you. they have had no success getting the pro russian separatists to talk. that is exactly what she said last night. >> everybody is called to make a contribution to this. areelieve that roundtables a good opportunity to do this work. more representatives at the table the better. it is clear that only those are welcome who already and credible to achieve their goals not through violence. >> clearly the situation is already having consequences. we have revised downward the 0.2% thisor russia to year and 1% next year. and that is provided that the situation is resolved. if it was not, the degree of uncertainty that is generated by the current circumstances would clearly deteriorate the situation. >> there was christine lagarde speaking at the same news conference last nigh

we have done it to david tweed as well. we have after for david tweed. and for me as well. probablye looking about 10 years younger when i first joined bloomberg, before, and after as well. i'm sure, elliott, you look much better with pink lipstick and a blush than you do just normal. frankiott, you look like inferred or in the rocky horror picture show. >> thank you very much. grants. >> were those my colors? gotkine, our middle east editor. >> would you use this apple or not? >> i would. but i would also say this segment confirms my belief that british man take every chance they can to dress up like women. >> right. coming up, cyber spying concerns. how chinese banks -- are ibm banks ditching their servers? ♪ welcome back to "the pulse." i am olivia sterns. >> time in london is 10:30. president obama is expected to announce regulations that would cut carbon emissions from the of 600 coal-fired power plants. the rule to be the cornerstone of obama's climate change initiative. >> australia could lose thousands of jobs and billions of dollars after the au

i will leave that for david tweed to talk about a little later on. blicis.just mentioned pu the business deal is off. he always knew there was a bit too much ego going on there. i am not being ironic in that statement is euro dollar is trading at 1.3828. let's see where that goes too. mark, back to you. markets at multiyear highs, can't break above them and sustain the advance, why not? >> there is always the issue of seasonality. i'm sick and tired the same old thing. i have done my analysis. i want to debunk this a little bit. what i found was, the majority has not been, may a bad month. may normally is ok. it may actually be somewhat better than ok. what people are really looking at is the june to the end of september. , which, it is true, is popular for stocks. however, from an asset allocations point, bonds have artie done very well this year. normally, june to september. is when bonds too well. i think there's been a lot of preemption of the fed, of the ecb and of course inflation as you pointed out, housing driving lower. etf ofinvested in an

david tweed is watching airbus. caroline hyde is watching easyjet. d, why the earnings drop that airbus? >> we saw some aircraft deliveries being deferred, particularly by the asian airliners. the number that we come in with, third quarter deliveries, 141 planes a year144 earlier in the first quarter. consensus earnings came in about 10% better than consensus expectations from analysts. the share price is up five percent. for the year, it has done about seven percent. still, it is moving in the right direction. the reason why we got better than consensus earnings is because of better margins, particularly in airbus commercial, the division that makes the marshall aircraft. two thirds of their revenue now are. the good news now is the a380. they look as if they are making much better progress in their cost control of the a380 and they are on track to make that aircraft break even by 2015. so that is good news along with another bit of good news, that -body, they are on track to deliver that to guitar by the end of the year. by the end of the year. this

david tweed in front of siemens headquarters. let's turn to alstom now.to speed with what they had to say today. the message was pretty clear. havenergy unit does not the critical mass to compete with ge or german rival siemens and other companies coming up in the emerging markets. alstom did not close the door to siemens' bid. he said it is ready to open the data room for siemens to come forward with an offer. he said he was not anti-german or anti-siemens. the company employs 9000 in germany and 18,000 in france. it is already a french and german group. beenrench government has vocal against the ge bid. they want guarantees to pretense -- protect french jobs. >> it is not only about the money. the money question is for shareholders, not the state. the state does not have a preference. it is here to look at the different offers made to alst om shareholders and how our strategic interests are preserved and how they can be improved. we are playing a role just like any other state would. french government wants three things. to protect french jobs. they wan

david tweed has the story. put this in context. put this into the siemens strategy for us. >> we have heard that this business is up for sale to a group led by wilbur ross. about whatw more exactly will happen after the supervisory board meeting, which will take place tomorrow. on wednesday, we have the strategy review which we have been waiting for since he took over the chief executive job at siemens last august. -- firstants to do is of all, we are expecting to see a big reorganization in the company. it will probably take out a whole level of management, which might lead to some job losses. more in the white-collar areas, administration, then in the other areas. at the same time, we are hearing about how siemens has some parts of the business up for sale. this is a great example of the sort of business that it wants to get rid of. though the airports made about 900 billion euros -- million euros last year, the market ash the margins were single made digits. -- mid-digits. gins have been lagging behind their two main rivals. the

has the news.m david tweed is thinning by in berlin. -- standing by in berlin.p. today a little bit of a roof are -- a-- a rip reeve == reprieve. >> what is behind this? points good 90 basis higher. can you read a lot into it? no big consensus. >> we will see how the day plays out. let look at some of the indian market. coalitions if the will have more than 300 seats. you are looking at stocks making a record high. the rupee also moving along briskly. let's have a look at the rupee. moody's has a

that is david tweed in berlin. >> chinese manufacturing gauge rose to a five-month high in may. the preliminary reading climbed to 49.7 which beat economist estimates. the report fuels optimism that china's economy is stabilizing. >> a slowing of the slowdown. let's get to another story. u.k. media company daily mail unveiling its first-half results today as well as the hotly anticipated ipo of property website zoopla. here with more is caroline hyde. how do the numbers look? >> pretty good. sales up 2%. rough it up 15%. cost efficiency is boosting the bottom line. daily mail, you tend to think mail online but this is a wide-ranging company. hunting, hunting, job business hunting, this is a company that has quite a raft of assets. it is cutting down on those assets. it is selling job site to axel springer in germany. anticipated hotly -- we are obsessed with it -- zoopla ipo. >> no financial beat goes on zoopla? >> exactly. they are just saying, they will sell shares. it is going to be at least 25% of the outstanding shares held by private investors, most by daily mail. they hol

david tweed has been following the story. profit dropped, but it beat expectations.hat is behind this? why are shares doing so well? >> well, it is a story about profitability margins. you are right, the shares are doing well. they are up about five percent. for the year, they are down seven percent, but on the right track. the earnings came in around 10% ahead of consensus estimates. it is because of margins largely at the commercial unit, the unit that makes all of the planes. two-thirds oft airbus units. they have managed to get costs under control for the a380. this is an aircraft that has been weighing on earnings for years. they have added improvements and they have said that they think they will be able to reach break even for the a380 by 2015. that has gone down for the well as well -- pretty well as well. consensus earnings increasing on the back of this. other good news as well. one of them is the fact that the , the firstbody a350 one is going to be -- is confirmed. they expect to deliver that to of thisrways by the end year. as for the reorganization of t

david tweed joining us live from berlin. >> maybe you are the reason for the record highs. it is called the most unloved bull market in history. you mention these levels to people and they say, one is the correction? -- when is the correction? what is going to turn this around? i don't know. >> healthy market, a healthy turnaround in the u.k. outlook,he advertising that picture that itv is painting. sales up about two percent. the second quarter is for the glut of growth will come from. they expect advertising sales to rise 12%. there is concern, what about the second half? >> if you have a look at itv stock, maybe that is what the market is telling us. there is a bit of concern after the world