jon ferro is here. on a more serious note, elliott gotkine., two days of testimony. yellenery clear message -- it is very clear janet yellen is a dovish and unlikely to change. >> it would take a significant amount for her to change her view on the economy. when you see the euro dollar and mario draghi talking about exchange rate, just tuesday to europe for a moment, in a sense, they need the dollar to rally for the euro to go lower. they need jannette yellen -- janet yellen to turn a little more hawkish. a lot of presidents cite pressure that she is calling noise. today it is about her listening to the noise more carefully. since you came -- since she came into the job, she has been dovish and stayed dovish. yellen has a tough job to do exiting and how they do that and the language they use. >> how they communicated. to elliott.on what is the latest between israel and hamas and the egyptian brokered cease-fire? has accepted it. hamas is considering it. seconds,st couple of the air raid sirens have been sounding. a rocket was fired in the nort

jon ferro? right now, 70% on the month. the open down 41 point 5%.three point 6 billion euros at the bank. you see the reaction. there's the bad news. the bank sector on the stoxx 600 down 1.8%. element canervisory have seen ayou move of three basis points of over three years. >> arnab das was saying we're going to see these events, but they're not systemic anywhere. >> i think what is interesting, as we go into the stress test and the aqr results, of course you're going to see more failures. you are starting to see the failures come to life. >> there is criticism about the moneyus pots of allocated. private way of raising the capital. >> the troika still in portugal. ♪ >> good morning. welcome back, you are watching "the pulse." live from bloomberg's european headquarters in london. top headlines -- euro area inflation slowed in july to the weakest in almost five years. just 0.4%. concernring investor that the euro zone economy is too feeble to drive growth. an internal dehydration, this is the effect. banco espirito santo shares are plunging by nea

jon ferro joins us. >> 19 minutes in. losses.c 40 by zero .4%.own it is not all geopolitics. -- the ftse is down by 0.4%. will beof tesco stepping down. what is it worth for the market's cap? it is up by 400 million pounds. the market was given "tired." the stocks are moving higher. that it is by a profit warning from tesco. it has to do with the man at the top leaving. morrison is down by over 2%. problem, whatving does it mean for competitors. ? morrison is trading lower. this move here, something to do with ukraine house prices. a decline for house prices. does it take pressure off of the bank of england? i will say it is a stretch. we are going into a busy week. gdp will come on a friday. did anybody putting their hand out for a rate hike? governor carney speaks the same day. he might have something to say. >> he certainly will. the point. >> ok, ok. jon ferro joining us with the latest on the market. u.k. -- ukraine's prime minister has been speaking making it very, very clear where he thinks of the weapons that shot down fl

i am jon ferro in london. on our markets for you now. 30 minutes into the trading day, this is how things are shaping up. you see equities a little bit higher. we have got some big important things. the big one for me is janet yellen. when does she give any kind of suggestion that, possibly, rates might rise? maness, will she ever? maybe not. >> it will come one day. when the complexion of that voting chamber changes. let's talk about three individual names. abbvie and shire look as though they are going to settle a deal. shire would get 25% of a new company. 53 pounds, 20 pounds. lindt, the world's largest producer of chocolate has gone after russell clover. we are going to see a deal go through there. we don't know what price but it is helping the market. tesco up over 2%. time to buy. a target price of 325 pence over the next 12 months. store on saturday, looking mighty fine. >> i am going to bring you some of the top headlines from london. ecb president mario draghi addressed the european parliament today

jon ferro is here with us. was just european banks that got big fines? that is one of my big takeaways from this. bnp paribas and commerzbank, we know about the transactions with sanctioned countries. over avoiding taxes. this is a legacy issue. it goes back to 2008. are taking its very seriously and it does not matter where your bank is domiciled. they are going to go after you hard. what is interesting about this is that we heard so much about the way credit suisse, how investigators worked through this investigation. we heard so much about bnp paribas and the big takeaways houseat if they did not the investigators, the way they investigators saw fit, the fine got bigger and bigger. they offered $4 billion to settle this investigation. whatfine is almost double they are said to have offered. these fines are getting bigger and bigger and bigger the same way they did at credit suisse and bnp paribas. >> is that because the regulators have realized -- the whale story. jpmorgan got a fine. whatever. >> make it bigger. make it bigger. >> it has got to hurt.

. >> that was the ecb's ewald nowotny speaking to us in an exclusive interview with jon ferro. come back, was the world cup worth it or not for brazil? stay with us. ♪ >> welcome back. this weekend is the world cup final. germany facing argentina. brazil still reeling from that 7-1 loss to germany. going to take a while i think. was the world cup worth it for the host nation? let's ask anthony, director of the brazil institute at king's college london. the morning to you. marks out of 10? >> i would give it maybe a seven. people were full of gloom and doom before the tournament started. there were no major problems in terms of organization. if you look at polling, brazilians became more positive about the world cup after it started. polling before the semifinal match against germany of course. people might have mixed feelings still. there is still some disquiet about spending overruns. some of the infrastructure that didn't get finished. but i think it exceeded expectations. >> that seems to be what happens around a lot of tournaments. sochi, the olympics. the loss itself, thou

jon ferro walks us through the central bank story. it continues on bloomberg television throughout the morning. we bring you the rate decision 12:00 p.m., london time. let's get back to andy. executive director. it was hard. credit took a big hit. we underestimate what is happening in the eurozone? >> look at the data coming out of france in the core tds bank having problems. this is something as central banks and markets may not be looking so favorably at. >> it is interesting. you take the u.s. and it has written off 10% of the assets the banking assets. this is the way. it was lending again. the u.k. is a long way down that route. markets and what could come out of left field. let's not forget when greece started running into a few problems. the whole thing fell apart. i think people forget how interlinked they are. the question is what is our exposure. do you want to hold the paper if people are not going to pay you for it? when it starts, it is hard to stop. they have a blind or over time and say that they will do whatever it tak

jon ferro back with the top three stocks on the move. equity markets are just trying to regain. see paris up 0.3%. london down. volatility was up yesterday. draghi speak later this evening. the federal reserve has the minutes. london, the biggest one-day drop in four months. the dax was the biggest one-day drop in 44 trading sessions. as it stands, london is the only equity market on the downside. stay with us. up next, we are going to talk more about that german victory over the host nation brazil. follow me on twitter. i usually start at around 4:00 in the morning if i have had a very strong cup of coffee. ♪ >> welcome back to "on the move ." i am manus cranny in london. equity markets open for 30 minutes now. regaine is trying to their composure's as we wait for mario draghi to speak tonight in london. u.k. stalks off by 0.25%. insurance stocks are having trouble here. the premiums that we pay to drive our cars our down. think you can really compete with mario draghi, can you? the dax down by over 3% right now. down the most since may of last year. it is not pretty. they have

i am jon ferro live from london. the is a stock that is on move. not a stock, and index.he russian equity market down by 2%. 20% lower at one point, then over 20% higher. called the stock crash called the rebound. he is calling for the micex to the 10% lower from here. not all about russia and the ukraine but it is about geopolitical risk. israel has launched a ground offensive in the gaza strip. soldiers moved in after 10 days of airstrikes failed to stop militants firing rockets at cease-fire effort collapsed. elliott gotkine is live in tel aviv. what is the latest on this? invasion --nd ground offensive i should say began at around 10:00 p.m. local time last night. thousands of shoulders -- soldiers backed by tanks and heavy artillery moving in. this grainy video posted by the defense forces showing these tanks and soldiers moving in. we understand that so far one israeli soldier has been killed. intouthorities are looking the possibility that he might have been killed by so-called friendly fire. there have been about three injuries, about 20 hamas militants reportedly

in an exclusive interview, nowotny has told jon ferro that he needs -- he sees no need to further ecbion. he did not rule out quantitative easing. is economicaspect development. what we see in europe is that we do have a recovery, but it is not a very strong recovery. >> ukraine has said separatists etsk, with their strikes killing 50 people. pro-russianthe insurrection that has rocked the country since march. we are going to get potentially more eu sanctions. israel has called up reserve soldiers according to an official in the country. world leaders are trying to persuade israel not to invade the gaza strip. the palestinian leader has called on hamas to stop the rocket attacks. more details on what is happening in the region with elliott gotkine. he joins us now from tel aviv. reservists in addition to the ones previously called up read what does the number now stand at? total ofk it is a 33,000 reservists. the state capital approved 40,000. so 33,000 in total. that is alongside three infantry brigades that have been deployed, preparing for a possible ground invasion. will we get on

plenty more coming up with jon ferro's exclusive interview and may come back. ♪ . .tny he tells bloomberg the central bank does not need to take additional stimulus steps now. >> if we see that our mandate demands it. areersonal feeling is we not there at the moment. i do not see an immediate need. >> stocks sell off. slide amidst concerns over a company linked to portugal's second-largest lender. israel says profit the estimates. morecust costs and won orders. welcome to the second hour of "countdown." let's go to our top stories. bloomberg sat down yesterday with the ecb central-bank governor edwald nowotny. we estimate if the euro is too strong and whether the ecb could do more. >> i think the markets understood the message. and at least for the appreciation of the euro has stopped. in that sense, this program has proved to be successful. new policy, we have of directly influence -- no policy of directly influencing the exchange rate. there is no perspective of intervening like the swiss central-bank. on the other hand, i think that a number of economic arguments

i am jon ferro in london, just almonds away from the start of european trading.hanged through the morning. china's growth accelerated. today in the u.k., what will unemployment deliver? that comes out at 9:30 u.k. time. ryan chilcote, caroline hyde, what are you watching? >> one thing i am watching is ibm and apple. they are partnering up. they are going to make business apps for the iphone and apple together -- the iphone and the ipad i should say. investors love the news. we will look at that in more depth. >> i am looking at marissa mayer. she is still struggling to turn around sales at yahoo!. investors are looking on the bright side with cash coming in from ali baba. initial share sale, the biggest hit in the u.s. on record. sharesere in europe, could be on the downside. sales don't meet analyst seemings and deliveries to suffer for 2014. >> thank you very much. tech, the sector in focus this morning. even the fed has something to say. janet yellen comes up later this evening. make sure you watch that. markets just opening across much of europe. manus cranny

let's catch up with jon ferro. you don't know which way -- which is exciting you more?rench status does not upset me. industrial production down 1.7% on the month. you're looking for manufacturing production to stay flat. draghi last night, when he delivered his speech in london, was very political. yes, we have done all these measures. but forget about budget flexibility. you need to drive through some reforms. this fresh data illustrates his point. these guys have got to change their economic trajectory because these numbers are terrible. it doesn't matter what the ecb does. unless this french economy changes fundamentally, there is nothing the ecb can do. there has been >> structure of -- there has been charter reform. matteo renzi looking for budget cuts ability. he is also looking for structural reform. >> yes. is, if thek structural reforms are not frontloaded and they get the flexibility first, they do not follow through. it is a big risk for the likes of france because they have been talking about her forms for five years. the only thing we see from the french r

jon ferro with the check. has launched its largest offensive in the gaza strip in two years.aerial 150 targets, killing 23 post any and. spokesman says hamas has to pay for rocket attacks. the new york times reports the deal figure could be $7 billion for citigroup. of the world cup after the semi final last night -- brazil is out of the world cup after the semi final last night. it is the biggest loss ever in the knockout round. the opponents will be subsided -- decided when argentina takes on the netherlands later today. >> palestinian rockets reached the skies above tel aviv. israeli troops are positioned for a possible ground invasion. elliottyou from -- joins us from tel aviv. what is the latest? sirens sounding here half an hour or 45 minutes ago. two missiles fired from gaza were intercepted by the missile-defense system, iron dome. no missiles actually hitting here just yet. but missiles rocking fire from gaza. out air strikes in the gaza strip. more than 400 targets hit since the beginning. more than 20 health and killed. -- palestinians killed. the cabinet approved

. >> thank you very much, jon ferro with the latest market reaction.will take a short break here. let's look at those pictures from kuala lumpur. malaysia's transport minister is giving an update from the malaysian point of view. the government is to investigate. he welcomed any international help. he said there was a need to preserve the crash site. we will be back with more after a short break. ♪ ." welcome back to "the pulse let's get back to malaysia's transport minister. he's giving a news conference on the jet shot down in eastern ukraine. we will not be -- [inaudible] my question goes to the root. many airlines were told not to try that route because of safety concerns. i mentioned -- airlines were going to other destinations. route for aken this long time. many, many years. the route was safe. [inaudible] >> can you confirm if there was a mayday issued from the cockpit of the plane? was it shot down from the cockpit first? >> i don't have any information on this. we did not receive any distress signals. >> [inaudible] >> hold on, hold on. >> a

let's find out what is going on with jon ferro. equitiesstart out with first.ed on a high note. equities higher off the bat of some good earnings. ubs beat, bp beat. bp, 34% increase in profit. not much higher if you look at the stock today. on the other side, they have rosneft.stake in b.p. themselves say if new sanctions are imposed on russia, his could have an adverse material impact on the relationship with rosneft and the investment itself. what are the sanctions that are going to drive that? will we get them today? that is the big unknown and that is the other opposing force. equities lower across the eurozone. the dax down by .25%. b alsoex, the ftse mi trading lower. yields in germany, record lows on the german 10-year bund. lower than it was in the crisis era. here is the key point. lows in italy and spain as well. near record lows in those two countries. about $70 billion of redemptions this week and a cpi number that is going to come this thursday. it is risk off, yes, but this is not the european crisis because you see money going into italy and spa

jon ferro. >> or geopolitical risk, stocks go up higher. higher on the dax.ters and the brussels. how do the u.k. go to the party? .t remains to be seen a compromise. the big earnings story came from arm holdings. the stock is up by 3%. of the royalties side of the business. you see a slowdown. on the licensing side, you see it move higher, much higher. a strong flow the royalties side. i spoke to the ceo this morning and he seemed confident about it picking up in the second half of the year. watch out with what is going on with russia and the ukraine. it has been a minimum. you see the dollar moving higher to a one-month high. it could be geopolitics. cpi will come out later. inflation is one to watch. >> the fed will scratch their heads. credit suisse, a conversation with the swiss bank's ceo. the fine has the bottom line. that is coming up. we'll see you in a moment. ♪ . >> good morning, everybody. welcome back. you're watching "the pulse." we're arrive in bloomberg's european headquarters. i'm guy johnson and these are are the top headlines. saudi arabia

. >> all right, jon ferro joining us with a perspective from london. ank you, jon . >> for now, it looks like everyone just viewed yesterday as a short-term buying opportunity. >> exactly. it is a blip until further notice. >> i watch the highlight. "bloomberg businessweek" is now available online and on newsstands. it is a pretty salacious story. the fall of the sleaze king. you can pick that up. >> we will have it on the coffee table at home. >> this is "bloomberg surveillance." on bloomberg television, streaming on your tablet, your smartphone, and bloomberg.com. ♪ >> good morning, everyone. dow futures up 39, the bigs closing at 12.59. it is "bloomberg surveillance." i am tom keene. scarlet fu and with me with our morning must route, -- morning must-read, and here is adam johnson. >> "the wealthy deriving an important part of their income interest on bonds, and low rate policies have reduced its income. monetary policy is not in their interest. it is bound up in class and ideological conflict." total return price move up. do they get a wealth of vyt

jon, they give very much. jonathan ferro in front for. up next, novartis, the profits disappointed.ll see what is weighing on the world's largest drugmaker. when we are back in just a minute. ♪ >> this is "on the move." up at the" is coming top of the hour. first up, a fragrance maker posted profits lifted by the emerging markets. the chief financial officers will give us more details. star's chief executive talks travel and the impact of the euro. novartis turned in disappointing results. appropriate -- it reported profit and sales the shade below estimates. we are joined. analysts.140 sam, what happened then with novartis? disappointed but not buy anymore just margin -- an inner misfortune. >> it is quite difficult for to look at the orderly numbers, especially for a company such as novartis which has a cross in swiss franks. and a whole host of other currencies that are affected. you know currencies have been volatile in the past quarter. that was not the only reason. analysts overestimated how much diovan worse going to sell in the second quarter. not by much. generic. gone some