this is not all based on the ecb.he tech counters stateside have played an impact on the market picture, especially nvidia, which has moved significantly higher. yesterday, 5%, surpassing $5 trillion. behind microsoft. on this side of the atlantic, we have asml, the number two spot taken by asml when it comes to european companies. again, the a.i., the chip semiconductor space is very important. that is why you are seeing gains with the daix dax higher. the stoxx 600 in record territory as we have seen recently. let's get to the impact and not far from the 2.5 month high that it touched on tuesday at 108.76 is where we are right now. we have the fed and the bank of japan putting out their rate decisions next week, but it will all be about what the future holds in terms of rate cuts in europe. this is likely to move because of that. here are the european yield stories. yields tumbling this week in line with what is anticipated out of the ecb which is the cut then in interest rates. the ten-year bund at 2.52. slightly h

>> i think the ecb is committed to 2%. with rates at 4%ing we're very restrictive, so even after one or two rate cuts, we're in restricted rate territory. i think it still has credibility, but indeed data dependency in this very uncertain area of labor markets means the ecb cannot precommit? >> so central banks have maintained credibility on the back of the sfiepike of interes rates? >> most did not expect this massive spike of inflation we've seen over the last two years. now it's to regain credibility and that requires a cautious monetary stance. i think for the ecb, they have credibility. >> caution along the road. thank you so much. i appreciate it. the chief european economist at ubs to unpack that telegraph by the ecb. >>> lit's go to the equities. bayer had a 2.25 $2.25 billion . their roundup weed killer callsed people to get cancer, arguing the trial was marked by errors. they intend to appeal, seeking to have the initial damages reinstated. >>> now, spanish bank bbva has reportedly asked the ecb to organize its t

some clarity coming through on potential next sex for the ecb -- next steps for the ecb. a u.s.h tech tycoon mike lynch not guilty of criminal charges that he pulled off silicon valley's biggest ever fraud 13 years ago's. he was accused of duping hewlett-packard into buying his software startup. his victory in court came after he lost a civil trial in london and 2022 over allegations he and autonomy's former finance chief used accounting tricks to inflate the company's revenue ahead of its sale into 11. he has been given a pass and the court in san francisco deciding he is not guilty of those charges. data from property shows tenants in the u.k. got a smaller spike from spiraling rents in april with competition for properties slipping from the fiercest levels in years. annual inflation from new let's is 2.6%, down from 10% a year ago, some of this due to the cost of the mortgages going lower, enticing more people into buying properties. coming up, saudi aramco set to raise at least $11.2 billion in its share sale. we break down the numbers and what it could mean for the saudi go

that came through yesterday from the ecb.ntil we see signs of cooling, you will have the driver for services prices. how different are the two central banks now? >> i think after this cut and i think once the fed and i would argue is september, i think they are, you know, not sympatico, but it will be slightly lower for longer. >> what does it mean for the markets? we still had appetite, but the markets are looking for monetary policy ideas from here. >> it is. it absolutely is. i know from the u.s. perspective, there is also kind of the anticipation for what happens in the election. i would argue what with people aren't focusing on, it doesn't party who wins in america. biden or trump, you have a lame-duck president. they don't have another term to leverage to get things do you think down. the makeup of the composition of the senate will likely flip republican. the house so close and it is hard to get anything done though matter which president wins. t what does that mean? you will not have a lot of fiscal change or you will

jonathan: early days at the ecb. to close friends. lisa: it was in part after some criticism by unsourced messages from the ecb governing council. tier point, full circle. jonathan: it is not the decision or the news conference but the story that comes out later in the afternoon after the decision people unhappy with the performance. we get more of the same little bit later. equity futures just about positive on s&p 500. we will catch up with keith lerner. reacting to the ecb rate decision and veronica clark looking ahead to payrolls. all-time highs. the s&p 500 hitting its record. whether it is ample fodder and a near-term environment is expected. the weight of the evidence suggests that the uptrend remains intact. with us for more. keith, i wonder what you make of that record high and why you believe there is more in store for 2024. >> it feels great to be with you. we actually upgraded equities on that pullback. also on duration. i will say, new highs is a characteristic of a boom market. historically, we put out

that is why the ecb is right.y have tools and they could provide liquidity, but they will not use them unless you get something more systemic risk and we are far from that situation. >> frederik, i heard of a risk trust there and i see twice as painful with the program with the unfunded tax cuts. is that something you agree with on this risk? >> unfunded tax cuts is what you need to look for. if you get this kind of threat to the fiscal situation, the market can freak out. it is a mixed bag. i can make a more positive case based on the fact that the euro has improved a lot and grown up to something more structurally stable. we have the balance hsheet in te background if something goes wrong. we have the banking institution. it is the banking union which has not been completed in full. it is much more stable and safe. on top of that, you don't have the banking system in europe, and in france, in particular, that is exposed to the bond market. there are big differences which is hedged against the risk. within the ra

we are getting in the wake of the announcement of the ecb of the rate cut.ltimately, what our businesses are saying regarding monetary policy, are they betting or hoping for further cuts throughout the year? >> yeah. there is an expectation there. we've got business confidence. it did have a setback. that was the political uncertainty that pulled that back. underneath that, there is a nice base of survey respondents that say they do expect the consumer picture to brighten as we go through the year on the back of the cost prices and rate of inflation as the well as that pullback in interest rates. if you look at these data on their own they are consistent with the ecb cutting later in the area. we hv year. we have that with us in september and december. it is too early in the next month or so to see any real change. this data that we've got today is certainly adding to that belief that the monetary policy at the moment is restrictive and taking its toll on activity, but having the desired effect in that service sector. >> let's see what will happen when it co

i would like to talk about the ecb.e have that meeting later today, 25 basis point cut seemingly nailed on, but what is your view on the timing and the signaling that has happened ahead of it? are you confident inflation has been sufficiently slated in europe? kaia: i think lagarde is patting herself on the back that she is moving ahead of the fed. not something we have seen from the ecb in a long, long time. the euro zone struggles with the same problems as most other large economies with fairly sticky inflation. it is an services, now it is moving into goods, inflation, but also wage growth. the main problem is the different dynamics of the different member countries, and this is something that mark alluded to earlier, as well. and the euro zone is it like the u.s. countries are still independent. they can even vote to exit european union and vote the euro zone, as we have seen with the u.k. and the eu, and that is a political risk, and a good indicator of these european parliament elections. my country, estonia, has

it's not just the ecb. i personally think a lot of the central banks want to avoid a doj kind of environment where they get too far ahead of the fed. where it seems like the fed is not going to cut or it's questionable if they will cut in the fourth quarter, with sticky inflation they might hold off a little bit. jonathan: martin, great to see you, buddy. breaking on the week ahead, going into the federal reserve. equity futures, positive by 0.1%. on your stories elsewhere, we have dani burger. dani: mexico elected its first female president in its history. claudia shein bomb was the winner --sheinbaum is seen as the continuity candidate who saw the rise of the super peso. it's weaker versus the dollar by as much as 2.2% and the wider victory led analysts to worry about the lack of checks on state control over the economy. the fed faces significant risk of losing independence to political interference of donald trump is elected again. that's according to the latest survey. 14% say they expect fud -- trump t

will the ecb provide us with guidance about the future of the rate path?ll eyes are on the key meeting at lunchtime european time, and the message from christine lagarde. >> silvia, thank you. a lot of excitement as well. thank you very much. >>> the ecb decision is the driver for the day ahead. let's bring in the vice chair now. >> good to see you. >> good to have you here. let's talk about nvidia. nvidia continues to power the market. it is the biggest momentum stock ever. how are you advising clients to invest in the a.i. trade? >> we're bullish on a.i. we have been so for quite some time. i think the best advice i can get right now is it appears that valuations are beginning to get extended. when you look at the s&p in general, you have five companies that are responsible for almost 30% of the index itself. that overconcentration or narrow leadership in the s&p is also beginning to trickle into client accounts and investor accounts where they see an overconcentration in companies like nvidia. we're just cautioning investors and saying look at the macro

outside the ecb headquarters in frapg further. we will have full coverage of that ecb policy decision at 1:15 p.m. u.k. team. we will also bring you of course president christine lagarde's news conference half an hour after the decision. now to the politics of the eurozone. the nether lands is the first country to kick off four diverse voting in the european parliament elections later today. more than 370 million people across 27e.u. nations are eligible to vote. what is the timeline then for voting among e.u. nations? >> it really kicks off in 21 minutes in the nether lands with the first vote being cast in the european election in the nether lanes. they are going to elect the 21mep's that they get. what happens next? ireland tomorrow. saturday the big first nation, italy. sunday most of the action with germany, spain and many of the other european countries and manned you get a picture of what it looks like. what happens next? where do these parties actually seth? what broader group will they participate in? the amp fd got boote

the ecb will cut rates. this is getting hotter than expected.t may step a bit more cautiously going forward. probably what we will see if there is a hawkish rate cut for the ecb that will not commit to the rate cut yet. i don't think we will see a back-to-back cut. if you look at the ecb, wages are strong and gdp is on the move again. what will happen is you get the rate cut and it will sound hawkish and we will get one more. >> is the work done? >> not nearly. we are still not near any major economy. >> you are getting a cut. you are getting a cut coming from the ecb. we had restrictive territory. we're good. now we've done the job. we've fought inflation sufficiently. now we can cut. >> it is not that clear for central bank. we will telegraph this as a cut. i don't think they will go into the rate cutting cycle yet. it will be a slow process glchlt markets are expected to go higher across europe? >> i think so. on our desk, we are buoyant now. we increased in january and february and now week 're looki >> thomas, great having you on set. thoma

>> i agree with the characterization of the hawkish cut of the ecb.ou need to give guidance as to when and why you cut rates further. if you don't, you will dis disappoint markets. you do tend to see synchronicity with banks here. if they tend to happen together, this cycle hasn't been and synchronous as other ones. the market is expecting benign inflation. we will see if not this morning, the next couple months to force their hand and bring them to the table with the interest rate cuts. >> great point. i want to turn back to the u.s. you are having doubts about the u.s. achieving a soft landing. the things yo you are looking a unemployment. we are expecting it to increase in jobs. what are you seeing when it comes to the jobs market? >> sure. the payrolls have been strong in the last year or two years. we have seen this gradual decline in job creation which is natural the latest you get in a cycle. the leading indicators for the unemployment rate tends to be too late for the fed to step in and help the market or help the economy with interest rate cu

if both programs are pro-demand and the ecb doesn't need more demand right now.he ecb needs cooling of the economy to stay on the ruich pah of the equity markets. >> let's look at the implications of the french elections and what you see in the bond market and the pressure on french banks, too. breaking dowbreak it down for u with the collision of the far left and far right would mean. >>what has been happening in the uk with the liz truss budget. if you come forward with the program, which isn't funded, then markets well take the upper hand and push stress higher. at the moment, france is part the eurozone which means you won't have the currency um impa from the uk economy. the euro is not falling in spite of what is happening in france. down the line, both programs -- it seems that the left program comes with more of this unfunded nature which would bring more. both come with higher inflation. either you have higher inflation leading to increased rates or you have increased rates which is a struggle for the ecb. >> to be clear, it could be a liz truss event in

maybe start with the ecb?s of the morning so far. >> well, i think so, and although i'm not an ecb watcher i did send over the notes there wouldn't be a starsignal what t after the cut. same true of the fed later in the year. that the markets are used to. they're used to central banks cutting when the economy runs into difficulties, and actually easing policy.lation comes downa fixed interest rate, real interest rates, interest rates adjusted for inflation rise. and that would represent a tightening of the policy. these central banks don't want their policy to get tighter. so this is a cut in rates to prevent policy from becoming tighter, and now the question is, and i've been saying this for two years. once qe in the u.s. came to an end, markets and rate policy came to an end markets are in search of what the longer-run real interest rate is. i think it's a lot higher in the u.s., for example, than the 0.6% that's in the fed's forecast numbers. i think probably much closer to 2, where the market is. so this i

we have the ecb decision and they go with a cut.t is commentary and guidance, is that what investors are scrutinizing. the headline is ecb inflation looks more like the fed. does it? mark: a little bit, sticky inflation is global, so we knew services was sticky. volatile goods kill them out of the disinflationary cycle fueled by rising commodity prices so the ecb is more worried about sticky inflation even though growth is not strong. that is why a lot of people think the ecb will emphasize a dovish narrative and price in rate cuts. i am slightly worried that the ecb might take a note and emphasize data dependence, they are open-minded and that would be disappointing to those looking for rate cuts. tom: really interesting. markets live executive editor mark with the analysis. you can get a round up to get your day going in daybreak. subscribers can go to d.a. why bigo to get the details on those stories including a story around blackrock, citadel and others. we are looking at expectations around fed pricing and details around intel

it's the first rate cut by the ecb since 2019.re, it's now late to the rate cutting gathering, which including europe, switzerland, and canada, as well. ecb president explaining the put by saying that underlying inflation has eased. inflation is forecast to decline over time towards the 2% target. and the real rates are more restrictive with the decline in inflation. importantly, she described the cut not as an easing but a removal of excess restriction. she suggested the ecb remains restr restrictive, so there could be further cuts to come, because the rates are still restrictive and far from neutral. she said they are data dependant. jpmorgan writing in the page of the cuts that in september, it is much more likely as there will be new staff projections to take stock of the outlook. rates in the u.s. and europe are little changed today, and the outlook for fed rate cuts pretty much the same. but the ec b's reasoning for cuts that real or inflation adjusted rates have become more restrictive applies to the u.s., as well. it remai

the ecb expected to do the same tomorrow. will the fed end up quickly following suit after the jobs report or will high inflation keep powell on the sidelines? >>> another day, another new ai chip, from a qualcomm backed startup. semis are dominating and one stock picker says there's still room to run. >>> plus, we'll talk to the ceos of travel and leisure and sweet green about the changes they're seeing as america continues to work from anywhere. but dom chu has what's in store with the markets. >> we are working from here. let's talk about the markets, decently in the green. at session highs o just about for the broader s&p 500 which is up 42 points. roughly three quarters of 1%. just about flat on the session for the dow. and the nasdaq composite, the tech heavier trade with chips and everything else, but about 1.5%, that's 255 points for the nasdaq composite, up to 17,113. so that big bounceback is happening within that tech trade. there's also another bounce anning within crypto currencies. bitcoin prices are back above

what about the ecb? does the call sound crazy that the ecb won't cut interest rates at this year?ree or four. how big is the diversions between the ecb end the fed? what divergence? we are talking about a very similar paradigm. at this point, a lot of people are betting on a global rate cutting cycle. can we say that is going to be a rate cutting cycle or just small tweaks on a really bumpy road that we cannot define yet. jonathan: the dot plot, does it show one or two rate cuts and then we can talk about how much daylight there is between with the federal reserve is projecting and what we hear from the ecb. israeli prime minister bennett emma netanyahu accepting an invitation to address the u.s. and senate july 24 according to speaker johnson's office. some democrats, including burning sa -- bernie sanders and nancy pelosi say that they will boycott the address which is shocking considering israel is a big ally of the u.s. lisa: this will be an interesting division between republicans and democrats because republicans plan to embrace wholeheartedly benjamin netanyahu. we heard mi

today it's the turn of the ecb — the european central bank to make its move. 4% main interest rate. that would mark the first cut for the eurozone since 2019. joining me now is azad zangana, senior european economist from schroders. i'm good morning. do you believe that will happen today from the ecb, that they will cut rates?— from the ecb, that they will cut rates? absolutely, this is -robabl cut rates? absolutely, this is probably slightly _ cut rates? absolutely, this is probably slightly overdue. i cut rates? absolutely, this is i probably slightly overdue. they could have started cutting interest rates from about april onwards. but they have had to wait to get more confirmation that the data was going in the right direction and that they could start their interest rate cutting cycle. i could start their interest rate cutting cycle-— cutting cycle. i know, of course. _ cutting cycle. i know, of course, each _ cutting cycle. i know, of course, each economy l cutting cycle. i know, of| course, each economy is different, especially for the euro zone, such a

yeah, so much so the ecb has been able to start cutting already. it won't be an aggressive cycle. it will be gradual. >> it's such a change in the tone. thank you so much for your time. >>> coming up on the show, we'll be talking to marco tronchetti of pirelily. that exclusive cnbc interview is coming up next. has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com. what is cirkul? cirkul is what you hope for when life tosses lemons your way. cirkul is your frosted treat with a sweet kick of confidence. cirkul is the effortless energy that gets you in the zone. cirkul, available at walmart and drinkcirkul.com. switch to shopify and sell smarter at every stage of your business. take full control of your brand with your own custom store. scale faster with tools that let you manage

why did the ecb cut?ased over time from double digit downs to mid 2s right now. inflation is forecast to further decline over the next couple years and rates are more restrictive because of that decline in inflation. importantly christine lagarde described the cut not as an easing but removal of excess restrictions, so there could be further cuts to come but july sounded unlikely. the u.s. started hiking before the ecb in this cycle and actually went higher. now it's lagging in cuts. what's interesting is, fed officials in the past mentioned the same criteria for cutting that christine lagarde relied on today. here's the reasoning. as inflation has fallen the real funds rate has risen becoming more restrictive. that gives the central bank scope to cut, but remain restrictive and keep fighting inflation. what i don't know is, did powell today listen to what christine lagarde was saying across the popped? >> steve, really quick, i have to get you on jobs tomorrow. today the jpm desk that argues anything 150

time, the ecb will be speaking. we will see what he has to say about how thinking is evolving around the ecb's next steps. at 1:15 p.m. u.k. time, another ecb official will be speaking. and another at 6:15 p.m. u.k. time on the more hawkish side of the spectrum. that should give more clarity in terms of the thinking evolving among the ecb. 3 p.m. u.k. time, also going to get the conference. a survey coming through from the u.s. suggesting they may soften. we have seen retail sales coming softer. this is bloomberg. ♪ why the u.k. prime minister is invoking his conservative red assessor -- conservative predecessor. the latest on the u.k. election is next. we will talk to the ceo of rasmussen global on why the french elections have some eu leaders worried about the fence. that's later this hour. this is bloomberg. ♪ tom: welcome back to bloomberg daybreak: europe. let's turn to the u.k. general election. the prime minister, rishi sunak, and opposition labor leader keir starmer have traded warnings about each other's pl

ecb thursday, will they cut? voices think they won't, even though german unemployment jumped in the latest reading. david faber, back to you. >> hey, rick, you mentioned the yield reaction here. we were starting to price in a greater likelihood of a september rate cut by the fed before these numbers. i would assume this might solidify that view? >> yes. it definitely should solidify that view. however, it's going to be very fascinating to see what ecb does thursday. many believe these are coordinated moves, so maybe they'll tip their hand a bit for how we will start to behave if the ecb moves to lower rates first. >> rick, thank you. rick santelli. >>> let's get back over to sara as well. this is typically the time in the show when sara has charts about the macro economy, although i know today you have excerpts from your interview with the imf director. >> commentary. >> right. yeah. i would say that the jolts report, the job openings number, is indicative of what we were talking about. increasing normalization.

we are up as we don't anticipate rate cuts for the ecb pushing out to maybe september. a look at the world of crypto. we will focus on bitcoin later in the show. we are up 3/10 of a percent. 71,000, near record highs. that's what key investors have been saying. ed: let's talk about nvidia. gensanity, of the -- this is a clear call back. the stock is down a percentage point. we touched $3 trillion in market cap. we are going to get into this about valuations, comparisons against other peers on the s&p 500. waiting is important. i put that up as a precursor to my next chart with med the best performer on the nasdaq 100 from a points perspective. this is what we care about now. let's bring up the chart and look at nvidia's market cap relative to apple. it's so close right now. nvidia just a touch below 3 trillion. it was brief and it was short-lived. nvidia is only the third company to reach $3 trillion of market cap and the first-ever semiconductor name or chipmaker to do so. let's talk about which metric we decide if this is fair if it's a good idea or not. caroline: lon

the first time the ecb has cut rates.the fed cuts or not, the question is not now, will they cut, what's the pathway to more cuts? and i think commodities will sniff that out. they cut, but they pointed out that inflation is higher. they painted themselves into the corner. and i think you have a case where commodities aren't going to show more signs of inflation. i don't think it's going to help. and i think the demand side is good enough to keep commodity prices higher. i stay long copper, i certainly stay long gold. >> i agree with that. you know, people think, commodities, first thing they think of is crude oil. there have been other things going on, and recently, some of the soft commodities and the industrial metals, copper, have sold off. the reason why i'm still encouraged, you'll see, free fort mcmoran made a 2 1/2-year high, but it really didn't pull back on the back of the copper selloff, which leads me to believe there's more run in this. i don't want to say soupuper cy, but the ecb just opened a door, and i th

he says he expects a quiet summer on ecb rates.he question mark for the ecb is how many more rate cuts will they push forward? there was a slight blip in the inflation print. they said it would definitely be a hike, or a cut i should say, in june. kazimir says we can expect one more rate cut this year. that would, obviously, be data dependent, as they always said. one thing is for sure. whe what the ecb telegraphed as the first cut in june and may not stand too firm when the next rate cut could wocome. peter kazimir expects one more rate cut this year, he thinks. >>> overall, it has been an interesting picture with the board. now you are seeing a little bit of red across the board. steady as she were because we have the pce data to look out for and a little bit of news coming out as well. h&m in the news with it saying its target for the full year may be tougher to hit. disappointing quarterly numbers. weather conditions not appealing as much. perhaps a fruitful summer may help with regards to earnings. perhaps you are seeing it. c

broadly speaking at this stage, one of the open questions for traders is what will happen when the ecbeets on thursday of course, the expectations are the central bank will cut rates by 25 basis points the key question is whow many markets can they expect for the rest of the year let me take you to the different sectors as well so we understand what happens or what is happening, really, with the corporate stories. we have at the bottom oil and gas down 2% at this stage. one of the key questions is what happens in terms of oil surprises. we are seeing them trading at a four-month low that is also having an impact on some of the oil stocks in terms of basic resources, it is also down by 1.7% another part of the market we are monitoring this morning is actually what's happening in autos. one of the more points here is actually if the european union imposed sanctions on chinese evs and this morning we got to hear from the chinese trade minister putting pressure on spain to dial back the rhetoric we are getting from brussels. let's see what outcome we get. when it comes to the best performa

. >> do you think we're at a point where we're likely to see the ecb actually triggering tpi?you think that the risk will be high enough that the ecb might have to intervene or are we too far from that? >> i think we're too far from that right now. i was fully expecting the markets to test that. that hasn't come to fruition. anytime there is a line in the sand, that is pushed. i would be really surprised if it happens vis-a-vis france. i don't see that as a problem at this point in time. it will be found watch at these levels. >> industry very interesting. i would like your thoughts on the u.s. we talked about the fiscal issues with france with investors. what about u.s. debt? are we lacking paying enough attention to this bond really? >> so debt is el the sevated everywhere. this is a global phenomena. at some point, you have to rein in deficits, whether it is in the u.s. or elsewhere. the challenge that the u.s. market has is that politically, there is no will to do so. if you look at polling, deficit worries doesn't even show up as a top ten issue. until it is an issue in v

we still have 4% in terms of rates and the ecb.get rates hovering between two and 3%, these banks could still be printing money. the primary driver for risk asset valuations remain rate volatility. is it rates volatility or nvidia and ai? >> probably a bit of both. on the overall market, not just equities but also for credit and risk premium, its interest rate volatility. when we look at the level of yields for the level of rates, that's not really that crucial to me. when we look at real gdp in the u.s., we are tracking 3% in q2. we are talking 5.5 or 6% nominal gdp growth which is fantastic. i think it's more crucial -- if you square that growth and save we have 4.5 percent treasury yield, who cares? that's really good growth but what matters is if we get from 4.25-4.50 quickly? that will push valuations again. we've seen that in april where we are having longer dated rates volatility which was picking up strongly. all of a sudden, credit spreads sold off and equities sold off and you had this reverse goldilocks. you can't hide a

interestingly, the riksbank of sweden cut before the ecb in may. they are prospective to hold.nflation data appears to be in line with their views. there is a sense from economists we have spoken to their will be a cautious approach coming through. they are expected to hold at 3.75%. but any commentary around that expected hold will be interesting. that coming through 8:30 a.m. u.k. time. kenyan president william ruto vows to -- bows to public pressure, scrapping his controversial public tax plan after protests led to more than 20 deaths. this is bloomberg. ♪ tom: welcome back to "bloomberg daybreak europe." kenya's president says he will not sign a controversial bill proposing steve tax rises that sparked deadly protests this week in nairobi. william ruto bowed to public pressure after the deaths of at least 23 people. let's bring in ondiro oganga who had been following this from the outset. joining me from kigali. what led to the president dropping this controversial bill? >> it is the sheer determination of kenyans breed over and over we have heard them say reject the financ

at the same time it will be about if the ecb can signal the cuts thereafter.he key thing here is last week's inflation data showed it is still not a clear trajectory on inflation which could put the ecb in line with many of his peers say they are going to remain data dependent which is not something the market will want to hear. quest mary, thank you very much indeed with the context there. after the airlines base. supply chain issues that have held up the delivery of new aircraft around the world could stretch into 2026. >> in the past we used to have to deal with if you must, maybe two months. i think this has not been factored in. airline ambitions in terms of growth have been tampered with as a result of the uncertainty of supply. quest kai johnson joins us now from divide. you got that line out of him in terms of timeframe. 2026 potentially. airlines clearly still struggling in terms of supply chains. what is your take? what are you hearing in terms of what it could mean in terms of the industries longer-term profitability? >> you were just talking to mar

we get closer and closer to that ecb rate decision or rate cut. negative on that euro-dollar by 0.1%. abby roland of john hancock and we will speak to columbia thread needle as india's modi clings to power. they expect another slow down in u.s. jobs. bond yields declined for four straight days coming into wednesday following another downside surprise and economic data. abby roland writes this -- emily joins us now for more. how close are we to that point? >> it's been a couple of days but there's been some pretty notable cross asset trends. you look at small-cap equities and they were down yesterday over 1% even with the decline in yields. over the past month, we've seen the 10 year treasury yields decline. small caps have not kept up with their large cap counterparts. the narrative is small-cap should be the biggest beneficiary of rates coming down because they of higher interest rates. as the cost of capital comes down, that will be a positive for those small-cap stocks that tend to be less profitable and we are not seeing that play out. cyclica

if you believe the ecb, maybe conditions are tight. >> the ecb is moving more from the perspective ofhey have the economy that needs a boost. >> inflation is not quite as bad as ours. >> it has come down. it is not in their target zone either. >>> netflix shareholders voting for approval of the fresh executive pay plan. a year after the last proposal was rejected. the non-binding vote in favor of the ceos receiving a target pay of $40 million each. the previous compensation package would have allowed executives to choose how they allocate pay with cash and stock options. that was rejected last year with the strike by the writers s gui. this calls for a base the salary and the target bonus of $6 million. the remainder would come in the form of restricted stock awards and netflix shares below $650. >> weird. >> what? >>> gamestop is supposed to report next week and it just rep reported. >> really? >> adjusted loss of 12 cents. that's a $32 million loss. $32.3 million. first quarter sales -- is this a fat finger or a fake i don't know? the first quarter sales of $$88 million. let's look

the ecb is expected to cut rates for the first time in eight years. ahead of the 10 for 1 stock split on friday. owners of stock will receive nine additional shares after friday's close. let's siee how the markets are happine shaping up ahead of the market open today. joining me now is erin gibbs from main street asset management. erin, good morning. >> good morning. >> how do you see today shaping up? what is your "wex" word of the day? >> my word of the day is rate-boost. i know we like to talk about equities and higher interest rates hurt equities, but we want to think about how it f fundamentally benefits corporations. they are earning more interest off the cash investments. most have a net cap position and that ultimately helps their health and they are able to put that money into more investment and be more profitable. while it certainly changes the risk profile for equities, it is a big economic boost and that gives us going forward really a nice tailwind going into this next year. >> rate-boost is your word of the day. we are talking about the

she did -- >> but that's because the ecb is not the fed.this and wait and' what the fed does next. i'm not sure -- >> so your argument is that the fed is sitting on top of is the jockey of a thoroughbred racehorse and the ecb is sitting on top of a nag? >> not at all! but i think if you look, if the fed does it next, it's concerted central bank intervention around the globe. you have the bank of canada, the ecb, the fed piling on, and i think that changes the whole dynamic when you have friction between what the ecb is doing and the fed, that creates a little bit of a different scenario in terms of how the markets will interpret it. >> flopping. >> that'sinteresting. dynamic global bank thinking. i like that. >> i might go back -- >> steve's right. i was saying something else at 6:00. anyway, steve, thank you for kb giving us a whole lot to talk about. for more on what to expect, we'll ask someone who has had to make decisions like this. dennis lockhart is the former atlanta fed president who's a professor with the sam nunn school of intern

second, the impact of the central banks whether the ecb or the fed. how much are we see today in the equity markets is the rise in bond yields following the jobs report in the u.s. and how much of it is anticipation about a change in policy if there is a big right wing shift? >> well, we are never really able to separate out those variables and that is the honest answer. with the ecb cutting well before the fed and their fates are now a bit more intertwined than we are used to, we will get more clarity, of course, about how much this has to do with france, as we start to get new polling data heading into these legislative elections. remember, that macron will stay in power as president. legislative elections are held in two rounds and that what makes this different from the uk elections, for example. here in london, the political, you know, elites have been clutching pearls and say why has macron do this. it is a big move and a risky gamble and we are having elections july 4th and july 7th. >> both of them are in a position of weakness. >> yes. >> gen

last week after the ecb we saw 1.09. back down to 1.07 now.omething that was important. france was just downgraded and there's a problem with the debt load that will get a lot worse if you have a government that wants to borrow it does not want to raise money. it is idiosyncratic on one hand but that is the increasing story. there is a market response to spending profligacy. we are seeing it around the world. this is the reason people are wondering about the political risk. jonathan: you think liz will make a visit to the french bond market? lisa: liz has been trying to reprise your reputation. jonathan: the ghost of liz truss's government. lisa: that was a moment when of fiscal change could have that much of a significant to spur central-bank response. was that the width of something that was not the first? jonathan: could we see more of it. i know you're not seeing stress on that pension fund related stuff that took place in the u.k., but the bond market pushing back against a policy of government might suggest. lisa: especially at a time we

the ecb nearing a rate cut. will yields here at home continue to drop? that's next. >>> plus, branching off. dollar tree dropping as the company looks to sell off its struggling family dollar business. how that move could impact the stock, when "fast money" returns. >>> this is "fast money" with melissa lee, right here on cnbc. this is our future, ma. godaddy airo. creates a logo, website, even social posts... in minutes! -how? -a.i. (impressed) ay i like it! who wants to come see the future?! get your business online in minutes with godaddy airo her uncle's unhappy. get your business online in minutes i'm sensing an underlying issue. it's t-mobile. it started when we tried to get him under a new plan. but they they unexpectedly unraveled their “price lock” guarantee. which has made him, a bit... unruly. you called yourself the “un-carrier”. you sing about “price lock” on those commercials. “the price lock, the price lock...” so, if you could change the price, change the name! it's not a lock, i know a lock. so how can we undo the damage? we could all un

we are following situations just on the economic stance, particularly on monetary policy and the ecb.eaking this morning saying the ecb should not rush into another cut and should sit out the summer, so possibly another cut in interest rates later on after the summer. saeimir says september is a pivotal month as new data will be published by then and saying also that inflation not yet broken. price pressures can resurface. questions had been asked whether the fight against inflation had pretty much been completed. central bank governor saying not the case. inflation not broken and price pressures can, indeed, resurface. disinflation will be bumpy but confident the ecb is moving towards target and the word from the governor there. we listen to watching that. >>> coming up, nfp beat expectations. what does it mean for the fed and future? a lot of data. coming up this week we will discuss more afterhere. t bak what is cirkul? cirkul is the fuel you need to take flight. cirkul is your frosted treat with a sweet kick of confidence. cirkul is the energy that gets you to the next level. cirk

i think the ecb got burned here with their move.ey would go in june and then in the run-up to the meeting you have data going the wrong way and they would have been better off postponing a bit if they'd had their druthers so now they'll have to manage that going forward. the mofc shouldn't be prufing on the day -- >> the data is so -- it's kind of up and down and it's not like the disinflation is completely reversed even in the united states and even in europe and not sure she got burned. she's managing. >> you're moving in a more dovish direction where you're upgrading your inflation forecast and your inflation outlook and that's the juxtaposition that you don't want and my experience on the fomc was that the committee gets in trouble on those kinds of moments because what is the market supposed to think? you can do things and what's america supposed to think -- >> that's like saying what the markets are going to think which is as a whole which is where the ecb has been and it's not clear. you have to be data dependent ask do you w

what you could see with the fed in the coming months here is what the ecb did.y cut rates by 25 basis points. no one expects them to go at the next meeting. but the ecb is saying we think rates are restrictive right now. we need to back that off. i can see the fed doing that with a 25 basis rate cut in september, wait for a while, see how things are going and progress from there. >> and it was interesting when they did the rate hikes. they could get that immediate feedback and watch the markets. it was having an immediate impact on inflation. this is different. so i imagine they would just be watching what, the stock market to say we got a quarter point, but we have already levitated. so what would they be watching to see if a quarter point is working? >> i think we would be clearly watching the employment indicators. we get initial jobless claims every week. clearly you don't want to put too much weight on one week, but looking at the employment indicators, looking at the data in terms of inflation, as well. but right now, they would overweight the inflation da

maria: more the ecb sees 2025 inflation at 2.2%.inflation the getting elevated. back to your common man cp irk, when are we going to see a break in inflation? we've been watching this market react to elevated inflation now for four straight months. >> yeah. listen, i think -- and goes back to president trump. i hope he wins. if there is a narrative out there now that because the democrats can't beat inflation, because they can't run away from the inflation that that they created, they're just saying now that it'll be worse under president trump. and think that's non-- i think that's nonsense because the main reason we have a lot of inflation is because there's no coordination between fiscal and monetary policy. maria: right. >> we're running budget deficits at 7 of gdp. donald trump, in me opinion, will start to starve the deep state which has an insatiable appetite for taxpayer money -- [laughter] maria: yeah. >> so in my opinion, there's not going to be a lot that's going to stop inflation between now and the election. if there's

the ecb and canada _ risk—taking side of things.s, this mantra of keeping them higherfor on rate cuts, this mantra of keeping them higher for longer may be waning, do you think, and that may be playing on the mind of the fed. pare and that may be playing on the mind of the fed.— mind of the fed. are not necessarily. _ mind of the fed. are not necessarily. if— mind of the fed. are not necessarily. if anything l mind of the fed. are not. necessarily. if anything they were probably more dependent on what the fed is doing then the fed is trying to take from other central banks. if anything, they needed to proceed given that they were navigating their economy, their economies were navigating different terms which is why they forgot to get ahead in terms of rate cuts but i don't think that will have a play or a stake in what the fed will consider. let's also not forget inflationary pressures in the us are higher than in these other two economies. naturally that pushes back the expectations on when we can get to see a rate cut from the fed

we have the ecb's first cut because of rapid wage growth.use we had a rise in the national minimum wage. but economists expect the first cut in august. the only one fully priced is november but will be interesting to see the new pricing. tom: thank you very much indeed on the politics and economic data. we will break that live. leaders are eager to resolve tough spots, we are live with the latest. this is bloomberg. ♪ >> welcome back to bloomberg. after ursula won the most seats she will look to clinch a second term. conversations continue. joining us is all of. what are we looking at, how is this shaping up? ali: it is hers to lose, what is happening is what blocks they will fall into. winning both vote, they have been ejected because of comments who said not every member of the ss was a criminal. they were cleaning up their party to be back in the groups. monday leaders will speak about who gets the top job. he was floating maybe will get mario in. who is in a position is giorgia meloni. tom: the gamble over the weekend, we have more clari

as well. >> the ecb is going to do it this month. >> they are. further surprise, that could certainly slow their progression and grow that timeline between the expected reduction this week and the next rate reduction by the end of the year. >> i just think watching the fed might be what slows the eb down. >> that too. remember, this global policy divergence is likely a reflection of differing economic conditions. we've seen much slower growth oversees as opposed to the u.s. and that disinflationary trend has been much more robust overseas than it has been. i do think when we look at these different central banks around the world, there's justification for easing abroad that we're not seeing here at home. >> so you are fine with one cut. you're happy, you think stocks are going up, good environment. you don't need five or six. you've weaned yourself off -- not you in particular but as a wall street guy, it's not all about cuts for you. >> yeah, because we actually think the one cut is a scenario that reflects a strong fundamental growth environmen

the ecb is close to cutting, how might that influence the other banks?ht they not wait for the fed and do what is needed? priyanka: yes, it seems like almost a done deal that the ecb cuts, but it is open to speculation how fast they will cut. you might get an odd rate cut, thailand and south korea, but asian central banks are more cognizant as they contemplate easing. they had their eyes on the fed and they will ease after the fed and the scope of cuts will be determined by the fed. haslinda: i want to take you to where i am in india. a landslide victory for modi. how are you assessing? stocks are elevated. 19 times price to earnings. wooded victory change for shape investor sentiment? priyanka: markets do not reflect fundamentals. outflows over the last few weeks or so and the expectation that the government might come back with a strong majority, could see short-term inflows come back. policy continuity has been the buzz for india but even in infrastructure spending where the government has a strong focus, investors may have to rein in expectations to

because the ecb paved the way and if we hear powell talk about that.ould stay excited about the ability to do two more cuts especially if the fed feels confident and we'll see more disinflation. you read all the notes, carl. i haven't read one today that says, necessarily, we won't continue to see progress on the disinflationary side. maybe bumpy not a straight line but not sticky flare-ups. >> i would say most of the commentary is summer looks friendly. there has been passing mentions of base effects not being as positive as you move into the back half of the back half of the year. which is one of the challenges we talked about in a december cut. >> the inflation rate went down so much last year. so the moves, the comps are going to be tougher. it's fed day so nick wells on our data team puts together the then and now, so before fed started to raise rates to where we were now on things like mortgage rates. it's interesting to look, this is how it feeds through, how it affects everybody. mortgage rates, big jump since back in march 2022, when they star

we have been hearing in an inclusive interview with the ecb member all the rent about his views, not original. the dollar at 107. the u.s. tenure, 426, just one basis point so far. brent $85 a barrel. up .4%. proper down .4%. the pricing on copper has come up about 5%. let's check in on the asian markets now. overall standing by in singapore. it is a mixed bag. those expectations of stimulus, the concerns about the economy, that's all helping bonds still. you so that tenure yield is low level more than two decades earlier today. let's let the board. as i see it is really about the inflation picture. nursing data come out from australia today. the cpi print hotter for a third straight month raising concerns that rates are not restrictive enough. hawkish calls are coming in. they are not pushing out that forecast to the second quarter of next year. a hike in august potentially. the aussie and hitting the highest level since 2010. they are also seeing the buying of the aussie, the selling of the exacerbating the levels of dollar yen. raising the risk of intervention. let's flip the boar

>> i think the ecb talked themselves into that cuts. it was not data-dependent. after the cut, if you look at markets, there is a policy divergence. the number of cuts in the u.s., u.k. and europe, 35 bps in the end. one thing that is supporting the rest of the world is that we have seen growth data higher after a terrible 2023. in the u.s., things were great in 2023 but they are slowing down now. there is no rush to cut rates because things are getting better. paul: i appreciate your patience talking about the central banks because we have had a lot of central bank action. i want to get your views on markets. china is closed today. but animal spirits and consumer sentiment are linked to the property segment. the announcements about propping it up -- is that enough for you and the question is around implementation? >> policy is in the right direction. there is a lot of unfinished projects in china. some say it is around 3.6 million square meters. spending 1/5 of that over a long time is a step in the right direction but it seems quite small. the next thing is it