00:00>> GOOD MORNING FROM LONDON. WE ARE AN HOUR AWAY FROM THE OPENING TRADE. HERE’S WHAT YOU NEED TO KNOW. BIG BANKS REPORT BEATS AND BUYBACKS WITH SOCGEN AND STANDARD CHARTERED RETURNING MORE CASH TO SHAREHOLDERS. BBVA ALSO TOP ESTIMATES. THE EUROPEAN EARNINGS KEEP ON COMING. WE BREAK THE LATEST NUMBERS FROM SHALE AND ELSIK. WE HEAR FROM THEIR CEOS. PLUS, BIG MOVES. NASDAQ FUTURES GAIN ON BUMPER RESULTS FROM META AND MICROSOFT. U.S. COPPER COLLAPSES AS PRESIDENT TRUMP EXAMS REFINED PRODUCTS FROM TARIFFS, SENDING PRICES TO THEIR BIGGEST EVER INTRADAY DROP. KRITI: IT’S A TALE OF TWO RALLIES ON BOTH SIDES OF THE ATLANTIC. UNDERPERFORMANCE WHEN IT COMES TO NASDAQ FUTURES. EURO STOXX 50 FUTURES HIGHER BY 3/10 OF 1%. FTSE 100 VIRTUALLY FLAT AT THE MOMENT. REALLY KEEP AN EYE ON HOW QUICKLY WE GO TO THE DOWNSIDE ON THE MOVE. CONSOLIDATION TO THE UPSIDE AT THE MOMENT. DOLLAR REBOUND SHOWING UP IN THE EUROPEAN CURRENCIES. THE COUNTDOWN TO THE OPENING TRADE STARTS RIGHT NOW. GUY: THURSDAY MORNING. THERE’S A LOT GOING ON OUT THERE. I’VE GOT A LIST OF THINGS WE MIGHT NOT EVEN GET TO IN DETAIL BECAUSE WE HAVE SOMEWHERE — SO MANY EARNINGS WE NEED TO FOCUS ON THIS MORNING. TAKE A LOOK AT THE CHART ON YOUR TERMINAL. THE FED FACTORING INTO OUR THINKING AS WELL. BOJ. THE YEN IS STRONGER THIS MORNING. YOU’VE GOT ALL OF THESE TREAD DEADLINES AND SHOCKS COMING THROUGH AS WELL. CORE PMI’S OUT OF CHINA. YOU’VE GOT CHINA SUMMONING HUAWEI ABOUT ISSUES JOINING SECURITY AND H20 CHIPS. THERE’S A LOT GOING ON. HOW — HAVEN’T EVEN MENTIONED EARNINGS YET. BIG TECH EARNINGS WITH THE DOLLAR THEME LAST NIGHT. WE WATCH FOR EARNINGS OUT OF EUROPE AND THERE ARE MANY TO CHOOSE FROM. ANNA: SUDDENLY, NVIDIA. LOTS TO WATCH IN TECH. LET’S GO TO ANGLO AMERICAN. THEY SAY THE WORK TO SEPARATION IS WELL UNDERWAY. THE CONTEXT IS A RESTRUCTURING STORY. SELLING THEIR COAL UNIT ALTHOUGH THAT HAS BEEN DELAYED BECAUSE OF A FIRE AT ONE OF THEIR OPERATIONS. ADJUSTED ETS OF $.22. ONE PART FOR THE BUSINESS WE WILL FOCUS IN ON AS WELL AS COAL , THE COPPER STORY. GUY, YOU WERE JUST REFERENCING THIS. EXCLUDING REFINED TOPPER FROM HIS TARIFFS ON IMPORTED COPPER, CRASHING THE COPPER PRICE IN THE U.S.. WE WILL BE WANTING TO GET A PERSPECTIVE ON THE COPPER BUSINESS AT ANGLO AMERICAN. ONE HEADLINE SAYS THAT PART OF THE BUSINESS META ESTIMATES FOR THE FIRST HALF OF THE YEAR. WE WILL SEE WHAT THIS KIND OF VOLATILITY WILL BE DOING TO THE BUSINESS AS WE MOVE FORWARD. SHALL WE GO TO SHELL? GUY: LET’S TALK ABOUT WHAT’S COMING OUT RIGHT NOW. THE Q2 ADJUSTED EPS LINE LOOKS LIKE IT BEAT ESTIMATES SIGNIFICANTLY. $.72 VERSUS AN ESTIMATE OF $.60. THAT NUMBER IS AHEAD OF ESTIMATES AS WELL. THE KEY TO DIVIDEND TO SHARE LOOKS A LITTLE LIGHT. PAY ATTENTION TO THAT. IT ANNOUNCED A SHARE BUYBACK PROGRAM. THE ADJUSTED PROFIT LINE IS WELL ABOVE ESTIMATES. I WANT TO SEE THE TRADING LINE. I NEED TO DIG INTO THE DETAILS A LITTLE BIT MORE TO FIGURE OUT WHAT’S HAPPENING WITH TRADING OVER AT SHELL. WE CONTINUE TO WATCH OBVIOUSLY THE VOLATILITY IN THE COMMODITY SPACE. AIR FRANCE LOOKS OK. KRITI: BETTER THAN OK. THEY ARE FLYING HIGH. THIS IS IMPORTANT BECAUSE THEY ARE TALKING ABOUT MACRO UNCERTAINTY. IT’S A CONFLUX ENVIRONMENT. YET THEY ARE ABLE TO MAKE UP FOR IT FOR TWO MAJOR REASONS. MASSIVE INVESTMENT IN FIRST CLASS AND THE IDEA THAT THE OIL COSTS HAVE COME DOWN LOWER. THEY ARE STILL TALKING ABOUT KEEPING THEIR GUIDANCE, MAINTAINING IT FOR THE YEAR. THEY ARE EXPECTING CAPACITY BY 45%. ALL IN ALL, GOOD NUMBERS COMING OUT OF AIR FRANCE. ANNA: LET’S RECAP THE EARNINGS STORIES WE’VE HAD THIS MORNING. EASY TO CHARACTERIZE. MAYBE IT’S AN OVER SUPPLICATION. BANKS HAVE DONE WELL. AUTOS, A LITTLE LESS OVERWHELMING. CERTAINLY POSITIVES AROUND THE BANKING SECTOR. SOCGEN GUIDING HIGHER ON RETURN ON EQUITY AND BUYBACK. AT BBVA, GUIDING RETURN ON EQUITY HIGHER. NUMBERS COMING IN BETTER THAN EXPECTED. CREDIT AGRICOLE BETTER THAN EXPECTED. THEY GOT A BOOST FROM D CONSOLIDATING ONE PART OF THEIR U.S. BUSINESS. ING, BETTER THAN EXPECTED GOING HIGHER. YOU GET THE PICTURE OF WHAT’S GOING WITH THE BANKING SECTOR. NICE NARRATIVE DEVELOPING THERE. ON AUTOS, THINGS A LITTLE LACKLUSTER ALTHOUGH NOT HOLY. BMW CAME IN BETTER THAN EXPECTED. THEY ARE ACTUALLY GUIDING FOR THE FULL YEAR, SOMETHING HIGHER THAN THE MARKET HAD IN THEIR SITES. THAT’S INTERESTING ON THE PLUS SIDE. THEY HAVE BEEN WEIGHED DOWN ON SALES BY WHAT’S GOING ON IN CHINA. AND THEN RENAULT, NET LOSS WORSE THAN EXPECTED. NOTHING TOO EXCITING WITHIN THE OUTER SPACE IT WOULD SEEM. KRITI: LOTS TO DIGEST. I’M IMPRESSED THAT YOU RATTLED THOSE EARNINGS OFTEN 30 SECONDS. IT WAS INCREDIBLE. LET’S TALK ABOUT THE MACRO. THE LAST 24 HOURS ON TWO MAJOR FRONTS. THE TECH EARNINGS COMING OUT OF THE STATES AS WELL AS THE FOMC YESTERDAY AS WELL. NO SURPRISE. WE DID HAVE NO CHANGE IN INTEREST RATES. STILL TALKING ABOUT UNCERTAINTY. THAT SEEMS TO BE THE MAGIC WORD OF THE CENTURY IN THE YEAR AS WELL. TECH EARNINGS WERE REALLY INTERESTING. YESTERDAY WAS THE DAY OF THE M’S. TODAY IS THE DAY OF THE 80’S. APPLE, AMAZON. DOES MICROSOFT SET A TONE FOR THEM? GUY: SPEND SPEND SPEND IS THE NARRATIVE. KEEP IT GOING. KEEP THE TRAIN ON THE TRACK ON THAT FRONT. REVENUE STARTING TO PICK UP A BIT. THE STORY AROUND TECH IS AMAZING. IT ECLIPSED WHAT WE SAW YESTERDAY. ALPHABET AND APPLE COMING UP LATER ON. GREAT GUESTS LINED UP. RIGHT NOW, WE NEED TO TALK ABOUT THE BUSINESS HERE IN THE HEART OF LONDON. EARNINGS DROPPING ONTO THE SCREEN THIS MORNING. PRETAX PROFIT BEATING. STILL SEES REVENUE FULLY AT 6.5 TO 7.5. DIVIDEND LOOKS HIGHER THAN ANTICIPATED. THE CEO OF THIS BUSINESS IS DAVID SWIMMER AND HE JOINS US NOW. NICE TO SEE YOU. IF YOU LOOK THROUGH ALL THE BANK RESULTS, ONE OF THE THINGS THAT STANDS OUT IS THE TRADING BUSINESS. THEY ARE LOOKING LIKE THEY ARE BENEFITING RIGHT NOW FROM THAT. DOES THAT FEED THROUGH INTO WHAT YOU ARE SEEING? IS THAT REFLECTED IN THE NUMBERS THIS MORNING? >> IT IS. VERY STRONG FIRST HALF. TOPLINE GROWTH OF 8.7%. OVER 70% AS RECURRING REVENUES. THE DATA BUSINESS, THE INDEX BUSINESS. 23% OR SO OF OUR BUSINESS IS EXPOSED TO MARKET VOLATILITY, TRANSACTIONS. THE VOLUMES WE SAW IN THE FIRST HALF, VERY GOOD FOR THE BANKS. VERY GOOD FOR US. EQUITIES, REIT’S BUSINESS. >> DOESN’T FEED THROUGH INTO THE RECURRING BUSINESS? WE HAVE THIS POIGNANT ENVIRONMENT RIGHT NOW. DOES THE DESIRE FOR DATA AND ANALYTICS AND ALL THE OTHER STUFF — I KNOW IT’S NOT AS DIRECTLY CORRELATED. THIS IS A PRETTY BORING AT MARKET RIGHT NOW. A HEALTHY MARKET. THE AI STORY IS GOING AROUND AS WELL. ARE THE TWO COMPLETELY UNCORRELATED? I CAN’T IMAGINE THAT THEY ARE. >> I WOULDN’T SAY THAT THEY AREN’T CORRELATED. OUR BUSINESS TENDS TO BE AN ALL WEATHER MODEL. BECAUSE OF THE NATURE OF THE PRODUCT THAT WE PROVIDE, IT’S CRITICAL FOR OUR USERS AND CUSTOMERS AND BANKS. REAL-TIME DATA, THE KIND OF INFORMATION THAT THEY REQUIRED TO TRADE EVERY DAY TO INTERACT WITH THE MARKETS EVERY DAY. IS THERE MORE ACTIVITY AND CONSUMPTION OF OUR DATA WHEN THERE’S A LOT OF VOLATILITY? YES. IT’S ABOUT ACTIVITY AND VOLATILITY. AS YOU SAY, IT’S FROTHY RIGHT NOW. THINGS ARE GOING WELL AND A LOT OF MARKETS. DO WE SEE THE BENEFITS OF THAT? YES. IF THINGS GET BUMPY OR CHOPPY AND THAT CREATES VOLATILITY, THERE IS STILL ACTIVITY AND TRADING. THERE’S A LOT OF RISK MANAGEMENT AND THAT KIND OF ENVIRONMENT. WE SEE THE BENEFITS OF THAT. IT’S THE NATURE OF OUR BUSINESS. ANNA: GOOD MORNING. VERY MUCH A DATA AND ANALYTICS BUSINESS. EVERY TIME WE GET READY FOR THIS CONVERSATION, I REMIND MYSELF HOW MUCH OF THE BUSINESSES THAT. ABOUT HALF BEFORE TODAY. I’M NOT SURE WHAT TODAY’S NUMBERS SHOW. 47% REVENUE DATA AND ANALYTICS. A VERY SMALL PART IS THE LONDON STOCK EXCHANGE AND THAT PART OF THE BUSINESS. DO YOU HAVE TO KEEP EXPANDING TO INVESTORS THE RATIONALE FOR HAVING THAT PART OF THE BUSINESS? SO MUCH OF THE NAME AND HISTORY COMES FROM THERE. IS THAT SOMETHING YOU HAVE TO KEEP EXPLAINING? >> NOT AT ALL. OUR INVESTORS UNDERSTAND THE STRATEGY WE HAVE. THEY RECOGNIZE THAT THE STOCK EXCHANGE IS A RELATIVELY SMALL PART AND IS A CRITICAL PART OF THE OVERALL BUSINESS. THE FRANCHISE THAT WE HAVE, THE EQUITY TRADING, THE FX TRADING, THE FIXED INCOME TRADING. CRITICAL PART OF THE BUSINESS AND IT FEEDS VERY WELL. THERE’S A NATURAL FLYWHEEL EFFECT IN TERMS OF THE DATA THAT WE CREATE IN THE EXECUTION BUSINESSES. WE PROVIDE THAT TO OUR CUSTOMERS. OUR CUSTOMERS USE THAT TO TRADE MORE TO GET STRATEGICALLY IT FITS IN VERY WELL. ANNA: HOW DOES THAT BUSINESS PREPARE ITSELF OR STANDUP TO A MARKET THAT’S INCREASINGLY PRIVATE AND NOT QUITE SO PUBLIC? THERE’S ANOTHER HEADLINE ACROSS THE BLOOMBERG TERMINAL THIS MORNING. 220 SHARES. NOT LOOKING FOR YOUR CLIENT ON THAT. IT’S ANOTHER EXAMPLE OF A BUSINESS LISTED IN LONDON GOING INTO PRIVATE HANDS. IS THE RISE OF PRIVATE MARKETS SOMETHING YOUR BUSINESS IS RESILIENT TO? >> THERE’S A NUMBER OF ASPECTS WERE A NUMBER OF ASPECTS WHERE BUSINESS PROVIDES INFORMATION DATA FOR COMPANIES THAT ARE PRIVATE COMPANIES THEMSELVES OR THE MARKETS THAT ARE LOOKING TO DEAL WITH PRIVATE COMPANIES. THEN ALSO LATER THIS YEAR, WE ARE LAUNCHING OUR PRIVATE SECURITIES MARKET ON TOP OF THE GOVERNMENT CRISES — PISCES FRAMEWORK. THIS IS A NEW MARKET REGULATED HERE IN THE U.K. THAT ALLOWS COMPANIES, PRIVATE COMPANIES TO EFFECTIVELY BE PUBLIC FOR A DAY AND USE THE LONDON STOCK EXCHANGE INFRASTRUCTURE TO TRADE . INSTITUTIONAL INVESTORS THAT HAVE ACCESS TO THE LONDON STOCK EXCHANGE WHICH IS EVERY MAJOR INSTITUTIONAL INVESTOR IN THE WORLD. THEY CAN PARTICIPATE IN PROVIDING LIQUIDITY TO PRIVATE COMPANIES. AFTER THAT EXECUTION WINDOW CLOSES, PRIVATE COMPANIES GO BACK TO BEING PRIVATE. A REAL INNOVATION IN THE MARKETS OVER THE NEXT SEVERAL MONTHS. KRITI: BEING PUBLIC FOR A DAY. WHAT A TREAT. WHAT ELSE — WHAT ABOUT THE REST OF THE DAYS OF THE YEAR? HOW ARE YOU VIEWING CAPITAL MARKETS AND THE U.K. GOVERNMENT EFFORTS TO REVAMP THEM? WHERE ARE WE IN THAT JOURNEY? >> WE’VE MADE A LOT OF PROGRESS IN THAT. THIS IS BEEN A FEW YEARS IN THE WORKS. YOU GO BACK A FEW YEARS, IT WAS CHANGE IT JUST CHANGES TO THE STRUCTURE. OVER THE LAST YEAR, WE’VE SEEN A LOT OF ADDITIONAL CHANGES WITH RESPECT TO THE RULES, THE LISTING REQUIREMENTS. WE’VE SEEN CHANGES IN THE FTSE INCLUSION RULES. FAST-TRACK ENTRY INTO THE INDEX. YOU CAN BE LISTED IN EUROS OR DOLLARS AND STILL BE IN THE INDEX. LOTS OF CHANGES GOING ON. WHAT’S INTERESTING IS THE CONTINUING DISCUSSION GOING ON WITH RESPECT TO PENSION FUNDS. I THINK A LOT OF PROGRESS MADE. MORE DISCUSSION AHEAD. KRITI: WE TALKED ABOUT ONE OF THE DISADVANTAGES, TALKING ABOUT THE MULTIPLES THAT ULTIMATELY GET TRADED ON WHEN YOU ARE BASED IN LONDON OR LISTED IN LONDON VERSUS WHAT YOU ARE SEEING IN THE LIKES OF NEW YORK. A COMPANY LIKE YOURS THAT’S LEADING INTO THE DANNA — DATA HAS A MULTIYEAR PARTNERSHIP WITH THE LIGHTS OF MICROSOFT. SOME WOULD ARGUE THAT WOULD BE A BETTER FIT IN NEW YORK. WHAT DO YOU SAY THAT? >> COMPLETELY DISAGREE. IF YOU LOOK AT THE NARRATIVE, IT C OMES FROM TAKING A SIMPLE READ ACROSS ON THE INDICES. IF YOU LOOK AT THE FTSE 100, YES, THEY TRADE A DIFFERENT MULTIPLES. THAT’S BECAUSE THERE ARE DIFFERENT CONSTITUENTS IN THOSE INDICES THAT TRADE AT DIFFERENT MULTIPLES. IF YOU LOOK ON THE COMPANY BY COMPANY BASIS, THERE’S NO SIGNIFICANT MATERIAL DIFFERENTIAL AND IN SOME CASES THE U.K. LISTED COMPANIES TRADE AT A HIGHER MULTIPLE BASED ON WHEN YOU ADJUST FOR RETURN ON CAPITAL, GROWTH RATES, ETC.. A LITTLE BIT OF AN EMBEDDED AIR TO OUT THERE THAT’S ACTUALLY NOT ACCURATE. GUY: SHOULD THEY BE TRADING ON THE SAME MULTIPLE AS S & P? >> IF YOU LOOK AT THE DIFFERENT KINDS OF OUR BUSINESS, THERE ARE ASPECTS THAT ARE SIMILAR TO WHAT THEY DO. I THINK YOU HAVE TO LOOK AT DIFFERENT GROWTH RATES. YOU HAVE TO LOOK AT THE RETURN ON CAPITAL. GUY: THEY ARE ROUGHLY SIMILAR BUSINESSES. SHOULD THEY TRADE ON SIMILAR MULTIPLES? >> THE TRANSITION FROM MARKET INFRASTRUCTURE MULTIPLE WHICH IS LOWER TO AN INFORMATION SERVICES MULTIPLE WHICH IS GENERALLY HIGHER. GUY: DOES THAT TREND CONTINUE? >> I THINK IT IS CONTINUING FOR US. WE ARE SEEING IN OUR INVESTORS, MOVING US MORE AND MORE AS THEY UNDERSTAND BETTER THE TRANSFORMATION WE ARE GOING THROUGH IN TERMS OF MOVING FROM WHAT’S SEEN AS A TRADITIONAL MARKET INFRASTRUCTURE COMPANY A FEW YEARS AGO TO AN INFORMATION SERVICES COMPANY TODAY. IT DEPENDS ON THE BUSINESS. WE HAVE A LOT GOING ON WITH AI IN TERMS OF EMBEDDING IT IN THE DIFFERENT PARTS OF OUR BUSINESS, FROM AN OPERATIONAL PERSPECTIVE. THE WORK WE ARE DOING WITH MICROSOFT, IT’S REALLY HELPING US IN TERMS OF CHANGING PRODUCT BY PRODUCT IN TERMS OF WHAT WE ARE DOING WITH WORKSPACE, BRINGING NATURAL ANCHORAGE SEARCH. OUR ANALYTICS FUNCTIONALITY WHERE WE HAVE A HIGH FUNCTIONALITY THAT HELPS PEOPLE DO FINANCIAL MODELING. WE’VE BROUGHT AN AD IN ON THE POWERPOINT. A COUPLE OF YOU WERE EQUITY RESEARCH ANALYSTS IN YOUR PAST. THIS IS THE KIND OF FUNCTIONALITY THAT REPORTS — HELPS YOU TO ANNOTATE DATA. GUY: USED TO BE HARD. >> IT’S BECOMING A LOT EASIER. ANNA: THANK YOU VERY MUCH FOR JOINING US. GREAT CONVERSATION. WE APPRECIATE YOU. SINCE WE MENTIONED DATA AND ANALYTICS, WORTH POINTING OUT THAT THE PARENT COMPANY OF BLOOMBERG NEWS COMPETES WITH — TO PROVIDE NEWS TRADING SERVICES AND DATA TO THE FINANCIAL INDUSTRY. WE MENTION THAT FOR TRANSPARENCY. COMING UP, IT’S A BUSY DAY FOR C-SUITE EARNINGS. NEXT UP, THE SHELL CEO WAITING IN THE RINGS. THIS IS BLOOMBERG. KRITI: 40 MINUTES AWAY FROM THE OPENING TRADE. LET’S GET RIGHT TO THE EARNINGS PICTURE. SHELL COMING OUT WITH THEIR SECOND-QUARTER EARNINGS THIS MORNING. PROFIT IS BEATING ESTIMATES BY A WIDE MARGIN. ALSO ANNOUNCING A SHARE BUYBACK PROGRAM OF ABOUT $3.5 BILLION. WE WILL SEE HOW IT IS RECEIVED AT THE OPENING TRADE. LET’S HAVE A CONVERSATION WITH THE CEO OF THE OIL GIANT. PLEASURE TO HAVE YOU. THANK YOU FOR YOUR TIME. LET’S KICK IT OFF BY WALKING US THROUGH SOME OF THESE EARNINGS. PRETTY DECENT ADJUSTED PROFIT BEAT RELATIVE TO THE ESTIMATE BUT STILL A DROP FROM YOUR NUMBERS FROM THE LAST QUARTER. CAN YOU WALK US THROUGH THAT DYNAMIC? >> OF COURSE. THANK YOU FOR HAVING ME. OVERALL, ROBUST CASH FLOWS THIS QUARTER. PLEASED WITH THE STRONG OPERATIONAL PERFORMANCE WE’VE. IT’S BEEN QUARTER AFTER QUARTER OF STEFFI — STEADY DELIVERY. THAT HAS HELPED US CONTINUE TO TO BE ABLE TO DISTRIBUTE. 3.5 BILLION DOLLARS, 15 QUARTERS IN A ROW WHERE WE ARE DELIVERING THREE OR MORE BILLION DOLLARS PER QUARTER BUYBACKS. THAT’S KEY FOR US. MORE GENERALLY, WHAT YOU’VE SEEN IN THE SECOND QUARTER IS A WEAKER MACRO THAN THE FIRST QUARTER. I WAS PLEASED WITH HOW THE TEAM HAS RESPONDED TO THAT. WE’VE BEEN ABLE TO REALLY IMPROVE THE DELIVERY ON ALMOST ALL OF OUR BUSINESSES. THE ONE THAT IS CHALLENGED TO THE MOST IS OUR CHEMICAL BUSINESS. THERE WE CONTINUE TO HAVE IMPORTANT PLANS TO ALLEVIATE THAT. BY AND LARGE, VERY MUCH IN LINE WITH WHAT WE HAD HOPED FOR AND WE CONTINUE TRANSFORMING THE COMPANY. KRITI: A KEY ELEMENT OF THE LAST SIX MONTHS OF THE YEAR HAS BEEN TRADING VOLATILITY. YOUR COMPANY HAS BEEN EXTREMELY EXPOSED TO THE VOLATILITY NOT JUST IN THE COMMODITY MARKET BY BROADER RISK PICTURE. CAN YOU WALK US THROUGH THE NUMBERS WHEN IT COMES TO YOUR TRADING DIVISION AND SPECIFICALLY HOW THEY MIGHT COMPETE WITH YOUR PEERS. >> OVERALL, A VOLATILE QUARTER FOR TRADING. OUR OWN RESULTS WERE GOOD. I THINK A FEW THINGS TO DISAGGREGATE FROM THE BROADER PICTURE. OUR PRODUCT SEGMENT WHICH IS THE SALE OF ALL PRODUCTS AND LOW CARBON PROJECTS WITH STRONG. THE GAS AND POWER TRADING WAS A BIT SOFTER. SEASONAL REALITY. WHAT WE SAW IN OUR CRUDE BUSINESS WAS QUITE A LOT OF NON-FUNDAMENTALS BASED VOLATILITY. WHAT I MEAN BY THAT IS THAT WE SAW THE OIL PRICES GO UP AND DOWN WITH VERY LITTLE IMPETUS — IMPETUS FOR SUPPLY DEMAND OR CHANGES IN PHYSICAL FLOWS. THIS WAS REALLY PAPER-BASED VOLATILITY. WE ARE MUCH MORE OF A FUNDAMENTALS BASED TRADER SO WE CHOSE TO BE A BIT MORE RISK OFF, MORE OF A PRUDENT RISK MANAGEMENT APPROACH. FINALLY ON THE LNG SIDE, IT WAS A DECENT QUARTER FOR US. WHAT YOU SAW IN LNG IS LOWER VOLATILITY THAN THE LAST THREE YEARS POST THE RUSSIAN INVASION OF UKRAINE. THIS IS THE NEW NORMAL. THE RESULTS THIS QUARTER IS MORE IN LINE WITH THE NEW NORMAL THAT WE SEE GOING FORWARD. OF COURSE, ABSENT FURTHER VOLATILITY DRIVEN BY GEOPOLITICS OR ECONOMICS. BY AND LARGE, A DECENT QUARTER FROM OUR TRADING COLLEAGUES. GUY: GOOD MORNING. SLOW VALUE SHARE WAS IN OIL AND GAS COMPANY OR AS A TRADING COMPANY. HOW SHOULD THE MARKET PERCEIVE IT? EVERY QUARTER, TRADING HAS SUCH A BIG IMPACT IN TERMS OF THE MARKET PERCEPTION OF WHAT YOU’RE DOING. IS THAT THE CORRECT INTERPRETATION? >> I WOULD SAY WE SHOULD BE VALUED AS AN INTEGRATED ENERGY COMPANY. AT THE HEART OF WHAT WE DO, WE DON’T TRADE ON ITS OWN. AS I JUST MENTIONED, WE ARE MUCH MORE A FUNDAMENTALS BASED TRADING. WHAT I MEAN BY THAT IS THAT WE TAKE OUR EQUITY LONG POSITION, THE FLOW OF PHYSICAL MOLECULES. WE HAVE THE SHIPPING, THE ARTERY SUCH AS THE PIPELINES AND THE TERMINALS AND SO ON. WE UNDERPIN THAT WITH CREATING OPTIMIZATION OPPORTUNITIES TO CREATE VALUE. WHAT YOU FIND IS WE ARE MUCH MORE RESILIENT TO THE MACRO THAN MANY OTHERS BECAUSE WE HAVE THAT FULL INTEGRATED VALUE CHAIN. YET WE STILL HAVE MANY OF THOSE UP STREAM POSITIONS ON THE CRUDE SIDE. AT THE HEART OF WHERE WE ARE FOCUSED AS WE SIMPLIFY THE COMPANY IS OUR LNG VECTOR WHICH IS A VECTOR WE DEEPLY BELIEVE IN AND ONE WE THINK IS GOING TO CONTINUE TO GROW TO THE TUNE OF 60% BETWEEN NOW AND 2040. WE CONTINUE TO SUSTAIN OUR LIQUID PRODUCTION AND WE WANT TO BE THE MOST CUSTOMER FOCUSED ENERGY MARKETER AND TRADER. GUY: GET BACK TO THE CHEMICALS BUSINESS AND WHY THAT IS SOFT. I’M SEEING IT SHOWING UP IN THE PMI NUMBERS AROUND THE WORLD AS WELL. YOU ARE SEEING THE ELEMENT WITHIN THE DATA GLOBALLY AS BEING SOFT. IS THAT SHELL SPECIFIC OR IS IT STRUCTURAL WITHIN THE CHEMICAL SPACE? >> IT STARTS WITH THE STRUCTURAL CHALLENGES. MARGINS HAS BEEN ONE OF THE LARGEST WE’VE SEEN IN A LONG TIME. THAT’S PARTLY DRIVEN BY THE SIGNIFICANT SUPPLY THAT WE ARE SEEING CONTINUING TO COME ON STREAM OUT OF ASIA AND CHINA MORE SPECIFICALLY. THAT IS REALLY SORT OF PUTTING A DAMPER ON THE OVERALL MARGINS. WE ARE TRYING TO FOCUS ON WHAT WE CAN CONTROL. WHAT WE CAN CONTROL IS NUMBER ONE, PORTFOLIO MIGRATING. JUST THIS QUARTER, WE HAVE SOLD OUR SINGAPORE ENERGY PARK WHICH IS AN IMPORTANT ELEMENT OF OUR DESTINATION PORTFOLIO WE ARE TRYING TO DRIVE TOWARDS. SECONDLY, WE CONTINUE TO DRIVE EVEN FURTHER WITH SOME OF THE SELF-HELP MEASURES. OPEC’S MANAGEMENT, WHAT WE CAN DO AROUND INVENTORIES AND THE LIKE. I WOULD SAY THAT WHAT WE HAVE DONE IS NOT ENOUGH. WE NEED TO DO BETTER. THAT’S ONE OF THE AREAS WE ARE FOCUSED ON. WE HAVE SPECIFIC INTERVENTIONS WE ARE DOING AT THE MOMENT TO IMPROVE EVEN FURTHER. ANNA: VERY BRIEFLY. YOU PUT OUT A STATEMENT SAYING THAT YOU HAVE NO INTENTION OF BUYING BP. IS THERE ANYTHING THAT COULD PUT THAT BACK ON THE RADAR? KRITI: — >> YOU’VE SEEN THE STATEMENT THAT WE ISSUED ON JUNE 26. THE FOCUS IS DELIVERING OUR OWN STRATEGY. WE HAVE SAID TIME AND TIME AGAIN THAT WHAT WE ARE KEEN ON IS TO BE ABLE TO CREATE LONG-TERM SHAREHOLDER VALUE AND TODAY WE CONTINUE TO SEE THE APPLICATION OF CAPITAL BEST DIRECTED TOWARD BITING BACK SHELL SHARES. OUR BAR FOR ACQUISITIONS IS HIGH AND CONTINUES TO BE BUT WE LOOK AT THE MARKET FOR THE RIGHT OPPORTUNITIES WHEN THEY EMERGE. ANNA: THANK YOU VERY MUCH FOR JOINING US. COMING UP, WE ARE BACK WITH AN EARNINGS FOCUS. DON’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’S SPEAK TO CLOTILDE L’ANGEVIN, THE DEPUTY GENERAL MANAGER AT CREDIT AGRICOLE COME WHO JOINS US NOW. VERY NICE TO SPEAK TO YOU. THANK YOU SO MUCH FOR JOINING US. TELL US WHAT WE NEED TO KNOW ABOUT THE UNDERLYING PERFORMANCE OF THE CREDIT AGRICOLE BUSINESS. I UNDERSTAND THERE IS A BOOST TO DEEP CONSOLIDATING ONE PART OF THE U.S. BUSINESS. TAKE US UNDERNEATH AND TELL US THE BIG PICTURE STORY FOR THE UNDERLYING PARTS OF THE BUSINESS. CLOTILDE: ABSOLUTELY. HELLO, THANK YOU FOR HAVING ME. WE POSTED A RECORD NET INCOME THIS QUARTER, 2.4 BILLION, GROWING 30 POINT 7%. AS YOU WERE SAYING, PART OF THIS EXCELLENT PERFORMANCE PERTAINS TO THE CAPITAL GAIN RELATED TO THE D CONSOLIDATION IN THE U.S. IF WE EXCLUDE THIS ELEMENT THE NET INCOME PER SHARE INCREASES BY 14 POINT 1% THIS QUARTER, STILL A VERY EXCELLENT PERFORMANCE. THIS IS DRIVEN BY A DYNAMIC ACTIVITY ACROSS ALL OF THE BUSINESS LINES AND ALSO BY A STEADY FLOW OF STRATEGIC TRANSACTIONS. WE HAVE A LOT OF INTEGRATION PROCESSES THAT ARE STILL UNDERWAY. WE HAVE CONCLUDED A NUMBER OF STRATEGIC OPERATIONS THIS QUARTER. AND ANNOUNCED ALSO ANOTHER NUMBER OF PROJECTS AND PARTNERSHIPS. IF WE LOOK A LITTLE BIT AT THE FIGURES THE REVENUES ARE INCREASING QUITE STRONGLY, TO 7 BILLION COME UP THREE .1%. OUR EXPENSES ARE UNDER CONTROL AND WE HAVE A VERY COMPETITIVE LEVEL OF COST RATIO THIS HALF AT 53.9%. ALL OF THIS ALLOWS US TO POST VERY STRONG PROFITABILITY. OUR RETURN ON TANGIBLE EQUITY IS 16.6%. THIS IS VERY STRONG. BUT ALSO A VERY STRONG SOLVENCY LEVEL, OUR CAPITAL RATIO IS 11.9% THIS QUARTER. ANNA: DO YOU FIND THINKING ABOUT HOW YOUR CLIENTS, HOW THE BUSINESSES THAT YOU SERVE STANDING UP TO ALL THE GEOPOLITICAL HEADWINDS AND THE CONVERSATIONS AND THE RULE CHANGES AROUND TRADE AND TRIPS AND ALL THAT UNCERTAINTY? I NOTICED THAT THE PROVISIONS HAVE COME IN LOWER-THAN-EXPECTED. DO YOU HAVE CONCERNS AS YOU LOOK AT YOUR PORTFOLIO INTO THE REST OF THE YEAR, CONCERNS ABOUT ANY OF THE BUSINESSES THAT YOU SERVE, HOW THEY WILL STAND UP TO THE TEST OF TARIFFS? CLOTILDE: OUR BUSINESSES ARE VERY STRONG. THE ACTIVITY THIS QUARTER BEARS WITNESS TO THAT. WE HAVE PICK UP IN CREDIT PRODUCTION IN FRANCE. WE HAVE DYNAMIC CREDIT DEVELOPMENT INTERNATIONALLY. OUR INSURANCE ACTIVITY IS PERFORMING EXCELLENTLY THANKS TO VERY STRONG INFLOWS. OUR ASSET MANAGEMENT ALSO HAS STRONG A UM’S. IF WE LOOK INTO THE CIBA BUSINESS, WHICH COULD BE THE BUSINESS THAT COULD BE MORE SENSITIVE TO THE EVOLUTION OF TARIFFS, WE HAVE HAD STRONG ACTIVITY, RECORD ACTIVITY THIS HALF YEAR THANKS TO MARKET ACTIVITIES. THIS QUARTER WE HAVE HAD VERY STRONG STRUCTURED FINANCE ACTIVITIES. WE ARE VERY WELL POSITIONED TO SUPPORT OUR CUSTOMERS IN UNCERTAIN TIMES. WHY? BECAUSE WHEN CUSTOMERS NEED TO HEDGE THEIR SITUATION IN THE FACE OF VOLATILITY, WE CAN PROVIDE HEDGING SOLUTIONS. WE ALSO HAVE VERY STRONG FRANCHISES AND INFRASTRUCTURE, TELECOM, ENERGY TRANSITION. IF WE LOOK AT THE TARIFF DECISION ITSELF, IT IS TRUE ONE FIRST POSITIVE ELEMENT IS UNCERTAINTY HAS BEEN LIFTED. WE KNOW THAT UNCERTAINTY IS SOMETHING THAT IS VERY DETRIMENTAL TO THE MARKETS AND ECONOMIC ACTIVITY. SO WE ARE GOING TO LOOK INTO A LITTLE MORE DETAIL AT THE AGREEMENT. THERE ARE POSITIVES, THERE ARE MORE NEGATIVES. WE HAVE A LOWER RATE ON AIRPLANES, WHICH ARE EXCLUDED. THERE IS STILL UNCERTAINTY REGARDING FOR EXAMPLE WINE AND SPIRITS OR PHARMACEUTICAL PRODUCTS. SO INDEED IN THIS CONTEXT OF UNCERTAINTY THE SITUATION COULD HAVE A NEGATIVE IMPACT ON EUROPEAN GROWTH. THAT’S WHY YOU WERE TALKING ABOUT THE LOAN MAS RESERVES. THEY ARE VERY HIGH, AT THE LEVEL OF THE GROUP, MORE THAN 21 BILLION, AND WE HAVE TODAY A COST OF RISK OUT OF OUTSTANDINGS THAT IS AT A LEVEL. KRITI: CLOTILDE, YOU MADE A POINT ABOUT THE LOAN LOSS PROVISIONS. I WANT TO GO AT A DIFFERENT ANGLE. WE HEARD NEWS EARLIER THIS MONTH UNICREDIT HAS DROPPED THEIR TAKEOVER BID FOR BANKO BPM. AGRICOLE HAS A 12.5% STAKE. DOES THAT DECISION IMPACT YOUR LOAN LOSS PROVISIONS OR YOUR RISK PROFILE AND ANYWAY? HOW ARE YOU READING THAT DEVELOPMENT? CLOTILDE: SO WE HAVE A LONG-STANDING PARTNERSHIP WITH BANKO BPM AND WE HAVE INCREASED OUR PARTICIPATION IN BANKO PPM FROM 9.9% TO 19.8%. SO WE ARE ORGANIZED TO BE THE FIRST SHAREHOLDER OF BANKO BPM, OF AN AUTONOMOUS BANKO BPM WHICH WE WILL HELP TO DEVELOP. NO OF COURSE THERE ARE MANY SCENARIOS THAT ARE ON THE TABLE. MOST OF THESE SCENARIOS DO NOT DEPEND ON OURSELVES. WE WILL TRY TO MAKE THE BEST OF EVERY SCENARIO, BUT WE ARE A LONG-STANDING PLAYER. MAYBE JUST ON BANKO BPM WE HAVE JUST ANNOUNCED A PLAN TO ACQUIRE A SUFFICIENT AMOUNT OF SHARES TO POSITION OUR STAKE IN BANKO BPM JUST ABOVE THE 20% THRESHOLD. THIS WILL ALLOW US TO CONSOLIDATE THE STATE USING THE EQUITY METHOD, WHICH ALLOWS US TO LIMIT THE VOLATILITY IN OUR P & L RESULTS LINKED TO THIS PARTICIPATION. IN ITALY AS YOU KNOW OUR PRESENCE IN ITALY DOES NOT ONLY PERTAIN TO OUR PARTICIPATION IN BANKO BPM. WE HAVE A RETAIL NETWORK WHICH HAS BEEN GROWING QUITE REGULARLY THE PAST 15 YEARS WHICH NOW HAS MORE THAN 5% MARKET SHARE, AND WE ALSO HAVE SPECIALIZED BUSINESSES WHO HAVE STRONG POSITIONS. THE STRONG POSITIONS IN CONSUMER FINANCE AND ASSET MANAGEMENT AND INSURANCE, WE HAVE THE STRONG POSITIONS THANKS TO THE LINK WITH OUR NETWORK AND THE LINK WITH OTHER PARTNERS. KRITI: YOU TALK ABOUT THE EXPANSION, YOUR MASSIVE PRESENCE IN ITALY, WHICH ADMIRABLY IS QUITE NOTABLE FOR A BANK THAT IS NOT ITALIAN. TALK TO US ABOUT HOW EASY IT IS TO HAVE AN INCREASE IN THAT PRESENCE NOT JUST IN ITALY BUT OTHER PARTS OF EUROPE AS WELL. DOES THIS DEVELOPMENT WITH BANKO BPM AND SOME OF THE PRESSURES OF THE BANKING CONSOLIDATION STORY IN EUROPE FACING CHANGE CREDIT AGRICOLE’S ATTITUDE TOWARD THE CREDIT EXPANSION IN EUROPE? CLOTILDE: OUR ATTITUDE HAS NOT CHANGED REGARDING CONSOLIDATION IN EUROPE. WE ARE EUROPEAN PLAYER. WE HAVE STRONG DOMESTIC MARKETS IN FRANCE, ITALY, ALSO POLAND. WE ALSO HAVE PRESENCES IN SPAIN AND GERMANY THANKS TO OUR BUSINESS LOANS. SO WE HAVE ALWAYS BEEN IN FACT BALANCING BETWEEN ORGANIC GROWTH AND INORGANIC GROWTH, IN PARTICULAR THROUGH THE DEVELOPMENT AND EUROPE IN PARTICULAR OF OUR SPECIALIZED BUSINESS LOANS. ASSETS MANAGEMENT, WEALTH MANAGEMENT, CONSUMER FINANCE, MOBILITY, AND SALARY — ETC. WE HAVE BEEN ROLLING OUT OUR DEVELOPMENT MODEL BASED ON THE UNIVERSAL BANKING MODEL, WHICH EXPANDS ALSO THROUGH PARTNERSHIPS, THROUGH STRATEGIC ACQUISITIONS. BUT IT’’S TRUE THAT TODAY BANKING CONSOLIDATION HAS SLOWED DOWN BY REGULATION. AND IT’S TRUE WE NEED TO HAVE A STRONGER CAPITAL MARKET. THERE’S LOTS OF DISCUSSIONS AROUND THE SAVINGS AND INVESTMENT UNIT TODAY WHICH IS A GOOD THING BECAUSE THE EU ECONOMY SUFFERS FROM A DEFICIT IN TERMS OF COMPETITIVENESS. WE HAVE TO INVEST MORE COLLECTIVELY IN TERMS OF DIGITIZATION, ENERGY, AND WE NEED TO CHANNEL THE SAVINGS TOWARDS THAT NEED. IN ORDER TO DO THAT WE NEED TO HAVE SMOOTHER CAPITAL MARKETS, BUT ALSO A BANKING UNION BECAUSE REGULATION TODAY PROHIBITS, IMPEDES THE TRANSFER OF LIQUIDITY BETWEEN ENTITIES. WE WANT TO HAVE STRONG BANKS THAT CAN SUPPORT THE ECONOMY, THE EUROPEAN ECONOMY IN THIS EFFORT TO IMPROVE COMPETITIVENESS. KRITI: THANK YOU SO MUCH FOR YOUR TIME. WE LOOK FORWARD TO HOW THAT DEVELOPMENT PLAYS OUT. CLOTILDE L’ANGEVIN, CREDIT AGRICOLE’S DEPUTY GENERAL MANAGER. GUY: THE BANK OF JAPAN GOVERNOR IS STILL SPEAKING. NOT MUCH REACTION IN THE DOLLAR-YEN. IN TERMS OF WHAT HE IS SAYING, HE IS BASICALLY SAYING UNCERTAINTY REMAINS HIGH. WE ARE WATCHING A SITUATION THAT IS MAYBE LESS UNCERTAIN BECAUSE WHAT WE’VE SEEN IN TERMS OF THE TRADE DEAL WITH JAPAN. NEVERTHELESS, HIS EXPECTATION IS THE AT INFLATION UPTICK JAPAN WILL CONTINUE. IF THE OUTLOOK THEY CURRENTLY HAVE AT THE BOJ IS MAINTAINED THERE IS A NEED TO POTENTIALLY RAISE RATES FURTHER DOWN THE ROAD. THE REAL RATE CURRENTLY IS VERY LOW HE SAYS. BUT THE UNDERLYING EXPECTATION IS INFLATION WILL KEEP STRENGTHENING, WAGE CYCLE WILL KEEP MOVING UPWARDS AND THE BOJ WILL RAISE RATES IF THE ECONOMIC OUTLOOK IS REALIZED. I DON’T THINK THERE IS MUCH IN THEIR DIFFERENT FROM WHAT WAS ANTICIPATED. HE IS BASICALLY REITERATING THE FACT RATES ARE LIKELY TO GO HIGHER, INFLATION WILL KEEP STRENGTHENING. GENERALLY IT IS STILL A VERY HIGH UNCERTAINTY. KRITI: I FELT THE BOJ –ANNA: TAKING US FROM A PLACE WHERE WE HAD EXTREMELY HIGH UNCERTAINTY TO A PLACE WHERE WE HAVE JUST HIGH UNCERTAINTY. GUY: THAT FEELS LIKE A WIN, WEIRDLY. ANNA: PERHAPS THAT IS GOOD. THAT IS THE BOJ, UEDA CONTINUING TO DELIVER REMARKS AND TAKE QUESTIONS FROM THE JEW OR LESS. THE YET IS STILL UP BY .4% THIS MORNING AGAINST THE U.S. DOLLAR. COMING UP ANOTHER BANK, ANOTHER BUYBACK. SOCGEN BUYING ONE BILLION EUROS OF ITS OWN SHARES. STOCKS TO WATCH NEXT. THIS IS BLOOMBERG. GUY: 45 MINUTES PAST THE HOUR. FRENCH CPI DROPPING ONTO THE BLOOMBERG TERMINAL MAY BE A LITTLE FIRMER THAN ANTICIPATED BY THE ECONOMIST WE SURVEYED. THE YEARLY NUMBER COMES THROUGH AT .9. THE YEARLY NUMBER IS BANG IN LINE WITH WHERE IT WAS LAST TIME. IT IS HIGHER THAN WHAT WE SAW IN THE SURVEY. SO INFLATION KICKING AROUND STILL AT THE KIND OF LEVELS I THINK PROBABLY WON’T ALARM THE ECB, NEVERTHELESS A LITTLE FIRMER. ANNA: WE WILL PAY ATTENTION TO THAT POTENTIAL RISK. U.S. FUTURES GO HIGHER, THE NASDAQ FUTURES UP 1.3%. THE MARKETS ARE FOCUSED ON THE BIG TECH EARNINGS STORY OVERNIGHT. ALSO OF COURSE OF A LIMBS AND COMMENTARY COMING FROM THE FED. — ALSO OF COURSE COMMENTS COMING FROM THE FED. REPORTER: DESPITE THE DISSENTS AND SOME ACKNOWLEDGMENT GROWTH HAS MODERATED, POWELL WAS HARPING ON THE FACT THE LABOR MARKET IS STILL SOLID. HE SEES NO SIGNS OF WEAKNESS. WITH INFLATION LOVING ABOVE TARGET — RUNNING ABOVE TARGET, HE LIKES RATES WHERE THEY ARE, WHICH IN HIS MIND IS STILL MODERATELY RESTRICTIVE. THIS HAWKISH LEG WHICH — LANGUAGE OVER THE COURSE OF THE PRESS CONFERENCE. THE DOLLAR RISING .8%. IT IS ON A SEVEN-DAY WINNING STREAK NOW UP NEARLY 2% IN THAT TIMEFRAME. A HAWKISH FED CAN REALLY TURN AROUND THE NARRATIVE WHEN IT COMES TO THE DOLLAR DECLINE OF THE FIRST HALF, PERHAPS COMING TO AN END OF THE SECOND HALF. MAYBE THAT IS A RETURN TO THIS U.S. EXCEPTIONALISM. WITH THAT WE HAVE TO TALK ABOUT THE BIG BEEF WHEN IT CAME TO THE MAG 7 YESTERDAY. MICROSOFT BEATING REVENUE SAYING UP TO MEET THINGS WHEN IT’ COMES TO CAPEX. MICROSOFT’S CURRENT GUIDANCE FOR THE CURRENT QUARTER’S THEY ARE SPINNING AROUND $30 BILLION ON CAPITAL EXPENDITURES. THAT IS A RUN RATE OF 120 BILLION DOLLARS IF THEY KEEP UP THAT PACE. MEDA HAD ROSY THINGS TO SAY ABOUT CAPEX SPENDING IN 2026. SEEING A SIGNIFICANT INCREASE TO CAPEX WHEN IT COMES TO NEXT YEAR FOR META. APPLE AND AMAZON REPORTING TONIGHT AFTER THE BELL. WITH APPLE THE FOCUS WILL BE ON THE TARIFF PICTURE. WE KNOW THEY ARE EXPOSED TO ASIAN TARIFFS, WHICH WE GOT AN UPDATE ON OVERNIGHT. KRITI: WE ARE GOING THROUGH EARNINGS, WE ARE GOING THROUGH TECH, THERE IS SO MUCH TRADE NEWS WE ARE DRINKING OUT OF A FIRE HOSE THIS MORNING. JUST WALKING THROUGH SOME OF THESE. THIS IS NOT A COPPER HAS OF LIST OF THE TRADE DEALS WE GOT OUT OF ASIA. — THIS IS NOT A COMPREHENSIVE LIST. CAMBODIA AND THAILAND ARE TRYING TO NEGOTIATE NOT ONLY A CEASE-FIRE FROM SOME OF THEIR BORDER TENSIONS BUT ALSO BRING DOWN THE RATES. THE U.S. REALLY INVOLVED ON BOTH FRONTS. AT THE MOMENT IT IS 36%. THEY ARE TRYING TO PULL IT SOMEWHERE DOWN INTO THE HIGH TEENS AND 20’S ACCORDING TO THE COMMERCE SECRETARY HOWARD LUTNICK. 25% ON MALAYSIA, JAPAN AND SOUTH KOREA AT 15%. I’M GOING TO DIVE IT IS SOUTH KOREA IN A MOMENT. LET’S ALSO FOCUS ON THE 20% THAT APPLIES FOR INDIA. THERE WAS A LOT GOING ON IN TERMS OF HOW RESTRICTED THE INDIAN MARKET IS TOWARDS EXTERNAL COMPANIES. THOSE ARE THE BARRIERS DONALD TRUMP IS TRYING TO BREAK DOWN, SPECIFICALLY WHEN IT COMES TO AGRICULTURAL IMPORTS. A BIG FOCUS FOR APPLE THIS AFTERNOON AFTER THE BELL WITH THE RESULTS COME IN THE U.S. SESSION IS GOING TO BE THE TARIFF IMPACT AS THEY MOVE THEIR SUPPLY CHAIN FROM CHINA INTO INDIA. THAT IS WHERE THE 25% COULD HIT THE END CONSUMER. THAT BRINGS US TO SOUTH KOREA. THERE WE HAVE THE MAGIC NUMBER 50%, — 15%, INCLUDING AUTOS, A KEY PART OF THE EXPORT INFRASTRUCTURE FROM SOUTH KOREA INTO THE U.S. WE ARE WAITING ON OTHER DEVELOPMENTS, THINGS LIKE CHIPS. SAMSUNG IS A KEY PART OF THE KOSPI INDEX. PHARMACEUTICALS AND AGRICULTURE IS A KEY TOUCH POINT WITH SOUTH KOREA. FOR NOW 15% IS THE MAGIC NUMBER. I WANT TO SEE HOW THE ASIAN MARKETS ARE INTERPRETING THE DEVELOPMENT’S. WE HAVE THE PERFECT GUESTS THI S MONEY, OUR EXECUTIVE EDITOR JOINING US ON THESE MARKETS. HOW SHOULD WE BE THINKING ABOUT THESE TARIFF RATES? IS THIS A WELCOME SURPRISE FOR ASIAN MARKETS? PAUL: GOOD MORNING. AS FAR AS SOUTH KOREA IS CONCERNED, 15% IS NOT THAT MUCH OF A MAGIC NUMBER FOR MARKETS. IT MAY BE A LITTLE SURPRISING, THE COST BE MOVING A LITTLE LOWER AFTER OPTIMISM. IT IS DOWN A FEW TENTHS. SOME OF THE BIGGEST RAGS IN THE INDEX. THERE HAD BEEN SPECULATION KOREA MIGHT BE ABLE TO GET BELOW 50% BECAUSE OF A MORE FAVORABLE TRADE TERMS THAN WHAT JAPAN HAS BEEN ABLE TO WIN. THAT WAS NOT THE CASE IN THE END. RATHER THAN THE HUGE EXCITEMENT AND BOOST WE GOT WITH JAPANESE MARKETS WHEN THEY RECEIVED THE 15% TARIFF A WEEK AGO, FOR SOUTH KOREA IT WAS GREETED WITH A LITTLE MORE INDIFFERENCE OR A LITTLE DISAPPOINTMENT. LIKEWISE THE YUAN DRIBBLED LOWER. FOR THE STOCKS, KOREA HAS BEEN A STRONG PERFORMER. THERE IS A POSSIBILITY PEOPLE WERE MAY BE LOOKING FOR A PROFIT TAKE. IT WAS GETTING CLOSE TO A RECORD HIGH ON THE KOSPI. YOU GET THE SENSE EACH OF THESE NEW TRADE DEALS IS NOT GIVING THE MARKET THE SAME SORT OF BENTS THE INITIAL ONES WERE. GUY: PAUL, GOOD MORNING, IT’S GUY. THERE ARE MULTIPLE THINGS THEY NEED TO FOCUS ON WITH THE MARKETS RIGHT NOW. YOU’VE GOT WHAT IS HAPPENING WITH TRADE. YOU’VE GOT WHAT’S HAPPENING WITH THE FED, THE BOJ CURRENTLY LIVE. YOU GOT A STORY SURROUNDING BIG TECH. WHICH ONES SHOULD I FOCUS ON? WHAT DO YOU THINK THE MARKETS SHOULD FOCUS ON RIGHT NOW? PAUL: LIKE YOU SAID A FIRE HOSE. I DID NOT KNOW WHAT WAS ON THE BINGO CARD THIS MORNING. I DON’T THINK I HAD U.S. TECH EARNINGS WOULD BE THE THINGS THAT STOLE THE SHOW. THOSE BIG BEATS AND OPTIMISM FOR MICROSOFT AND META REALLY DROVE THE NARRATIVE IN THE EARLY STAGES OF TRADE TODAY. TAKING IT AWAY FROM THE FED, TAKING IT AWAY FROM THE BOJ TO A CERTAIN EXTENT AS WELL FOR IT’S REALLY INTERESTING. ULTIMATELY IT IS THE EARNINGS OUTLOOK AND WHETHER THEY ARE ABLE TO WITHSTAND THE IMPACTS OF THE TARIFFS AND CONTINUE TO HAVE PRICING POWER AND PUT THE CAPEX INTO THE AI. THAT IS ONE OF THE BIG GROWTH STORIES FOR THE MARKETS. THE FACT WE HAD THAT BIG UPSIDE SURPRISE GAVE US THIS HEADLINE STEALING PART OF THE SHOW TODAY. ANNA: INCREDIBLE VOLATILITY IN METALS PRICES. THE FACT THAT TRUMP ADMINISTRATION HAS EXCLUDED REFINED PRODUCT ON THE TARIFFS AROUND THE COPPER. ASIAN MARKETS WE ARE SEEING LOTS OF COMMODITIES UNDER PRESSURE. JUST BRIEFLY. PAUL: REALLY INTERESTING, WE’VE SEEN THAT SPREAD BETWEEN THE U.S. AND COPPER AND EUROPEAN COPPER COMPLETELY COLLAPSE OVERNIGHT BASICALLY, REALLY DISRUPTIVE FOR THE MARKETS. THERE WAS A LOT MORE WHIPLASH TO COME I’M SURE. ANNA: PAUL, THANK YOU VERY MUCH. PAUL DOBSON. WE WILL KEEP RETURNING TO THE COPPER PRICE. OUR EXECUTIVE EDITOR PAUL DOBSON, THANK YOU. LET’S CHECK ON THE INDIVIDUAL FOLKS TO WATCH. REPORTER: WE’VE GOT A ONE BILLION EURO — INTERIM DIVIDEND AND WE ALSO HAVE A LIFT SOCGEN A POSSIBILITY OUTLOOK WITH SOCGEN, THE SHARES ARE UP 118% OUTPERFORMING ITS PEERS,. WE WILL SEE IF THE GAP KEEPS WIDENING. WE CAN SEE THE OUTPERFORMERS WHICH IS MASSIVE. WE WILL SEE HOW WIDE THE GAP GETS. QUITE DISAPPOINTING RESULTS FROM AIRBUS, BIGGER THAN EXPECTED. CASH OUTFLOW SLOW, AIRCRAFT DELIVERIES HAVE BEEN DOING BETTER THAN BOEING OVER THE LAST FEW MONTHS. BLOOMBERG INTELLIGENCE SAID AIRBUS REALLY NEEDED TO GET A REALLY GOOD FOURTH-QUARTER TO MEET THAT GUIDANCE. WE WILL SEE HOW MUCH WEAKNESS WE GET AT THE OPEN ON THE BACK OF THAT. AT THE MOMENT DELIVERIES ARE BELOW TARGET. FINALLY, ARCELORMITTA, A STEELMAKER CUT ITS OUTLOOK FOR STEEL DEMAND GOING FORWARD OUTSIDE OF CHINA. IT SAYS THEIR CUSTOMER HESITANCY IS A PROBLEM, PEOPLE WERE WAITING AND SEEING BECAUSE OF TARIFFS. WE WILL PROBABLY SEE A BIT OF WEAKNESS ON THE BACK OF THAT. ANNA: THANK YOU VERY MUCH. LOTS OF SECTORS AND FOCUS. THE BANKING SECTOR IN FOCUS. ALL THE BUYBACKS AND GUIDING HIGHER. WE WILL BE BACK WITH THE MARKET OPEN. THIS IS BLOOMBERG. GUY: GOOD MORNING. THERE IS A LOT GOING ON. ONE OF THE THINGS RIGHT NOW IS IN JAPAN THE BANK OF JAPAN GOVERNOR UEDA IS BRIEFING REPORTERS, TAKING QUESTIONS, GIVING AN INDICATION RATES WILL GO HIGHER, ASSUMING A LOT OF THINGS FALL INTO PLACE. THAT IS GENERALLY THE BIAS GOING FORWARD. THE MARKET PRETTY MUCH ALREADY KNEW THAT. A LITTLE MORE UNCERTAINTY BUT WE LIVE IN A HIGHLY UNCERTAIN WORLD. A LOT TO FACTOR INTO YOUR THINKING. YESTERDAY THE BULK OF THE EUROPEAN SESSION NAVY HOLDING SESSION. — A BIT OF A HOLDING SESSION. YOU GET THE FED MOVE THEN THE AFTER HOURS AI TRADE COMING FROM THE MAGNIFICENT SEVEN, MICROSOFT AND META COMING OUT YESTERDAY. THAT WE PRICED INTO THE U.S. STORY. FOR THE MOMENT FUTURES IN EUROPE LOOK KIND OF OK. KRITI: IT’S A MELLOW PRICE ACTION STORY IN EUROPE. THE TECH STORY HAS NOT SHOWN UP. IT IS MORE OF AN EARNINGS FOCUS TODAY. THE DAX AND CAC FEELS LIKE INDIVIDUAL INFORMATION. ANNA: WE WILL FOCUS ON THE BANKING SECTOR, TALKING EARNINGS. NUMBERS COMING THROUGH BEAT ESTIMATES FOR LOTS OF THE EUROPEAN BANKING NAMES AND BUYBACKS A BIG FEATURE OF THAT SECTOR. WE WILL FOCUS ON THAT SECTOR AND SEE IF IT CAN DELIVER. IN TERMS OF AND JEWEL STOCKS, ROLLS-ROYCE RAISING ITS OUTLOOK FOR THE YEAR — IN TERMS OF INDIVIDUAL STOCKS. THEY ARE WARNING OPERATING PROFITS WILL BE LOWER THE REST OF THE YEAR BECAUSE OF HIGHER MAINTENANCE COSTS. AB INBEV IN FOCUS, BEER SALES DROPPING ON SLIDING DEMAND IN CHINA AND BRAZIL. WE WILL WATCH THOSE INDIVIDUAL NAMES AS WELL AS THE BANKING SECTOR AND AUTOS AND EVERYTHING ELSE. GUY: THERE WAS AN AWFUL LOT OF EVERYTHING ELSE. THE INDEX LEVELS, LET’S SHOW YOU THE NUMBERS. THE FTSE 100 DOING NOTHING AS INDICATED. KEEP AN EYE ON WHAT’S HAPPENING WITH SHELL, BAE SYSTEMS. THEY POSTED NUMBERS YESTERDAY. THERE IS A LOT GOING ON BELOW THE SURFACE. STOXX 600 MOVING SIDEWAYS. WE WILL TALK TO OUR MARKETS TEAM. HAS THE BAD NEWS EXPECTATION ON THE EUROPEAN EARNINGS BEEN PRICED INTO THESE MARKETS? IT SEEMS SO AT THE MOMENT, NOT GOING ANYWHERE IN A HURRY. THE IBEX IS UP .6% OF 1%. WE WILL WAIT FOR THE CAC AND THE DAX. KRITI: RIGHT OFF THE BAT SHELL SEEMS TO BE THE BIGGEST CONTRIBUTOR TO THE UPSIDE AND THE BIGGEST WINNER. SEEING A LOT OF VOLUME. THAT IS ON A BIG EARNINGS BEAT THEY CAME ACROSS AS WELL AS AN UPDATE ON SOME OF THE TRADING BUSINESSES, CHEMICAL BUSINESSES DON’T SEEM AS BAD AS EXPECTED. I’M SEEING A LOT OF ROTATION AS WELL WHEN WE LOOK AT THE PACIFIC SECTOR. YESTERDAY’S ON TODAY’S OUTPERFORMERS. HEALTH CARE SEEMS TO BE IN THE LEAD, A LOT OF THOSE NAMES AS WELL. THE BANKING STORY IS A MIXED BAG. ANNA: RIGHT, THE BUYBACK THEME UNITES ENERGY AND BANKS, A BIG BUY BACK FROM SHELL. THAT STOCK IS UP MORE THAN 2%. THE BANKING SECTOR GAINING. SOCGEN IS UP NEARLY 7%. WE HAVE SOME OTHER STRONG PERFORMERS FROM SOME OF THE OTHER NAMES OF THE BANKING SECTOR. STANDARD CHARTERED A LITTLE BIT OF A MOVE HIGHER. KIND OF A MIXED PICTURE. MY EYE IS ALSO DRAWN TO THE BOTTOM OF THE SECTOR PICTURE AND WHAT’S GOING ON WITH BASIC RESOURCES. IT’S A COMPLICATED PICTURE AROUND COPPER. THAT IS A SEPARATE CONVERSATION PERHAPS. WE HAD DISAPPOINTING DATA FROM CHINA AROUND MANUFACTURING. IRON ORE PRICES IN STEEL PRICES HAVE BEEN REALLY WEAK, STEAL A PARTICULAR DOWN MORE THAN 4%. ON TOP OF THAT WE HAVE THE ANGLO AMERICAN NUMBERS. THE SECTOR AS A WHOLE IS BEING WEIGHED DOWN BY SOMETHING BIGGER. GUY: AND THE COPPER STORY AS WELL FOR CRAZY NEWS YESTERDAY IN THE COPPER PRICE. GLENCOE TRACKING A LITTLE LOWER, ANGLO IS SOFTER AS WELL. THERE IS WEAKNESS. SOME FORM OR STOCKS — SOME PHARMA STOCKS ARE GIVING UP GROUND AS WELL. THEY OBEY SECTOR, AIRBUS HAVING A SLIGHTLY TOUGHER TIME OF THINGS IN THE ARROW SECTOR. IT IS HARD TO GET A CLEAR, ARE THERE THEMES WE SHOULD BE PICKING UP ON IN TERMS OF WHERE WE ARE SEEING MOVEMENT, OR IS IT SIMPLY STOCK BUY STOCK IN TERMS OF HOW YOU SHOULD BE RECEIVING THIS MARKET? SOCGEN IS UP. THE ONLY TAKEAWAY I SEE THIS MORNING IS BANKS ARE DOING BETTER. THAT’S THE ONLY CLEAR NARRATIVE I CAN TAKE AWAY EVEN WITHIN THE SECTOR STORY, THAT BANKS SEEM TO BE ON THE FRONT FOOT, BY FAR AND AWAY THE BEST PERFORMING SECTOR SO FAR TODAY. ANNA: ABSOLUTELY. THERE IS A LATE ENTRANT FOR THE THEME OF THE MORNING, TECHNOLOGY STOCKS NOW THE BEST PERFORMING SECTOR IN EUROPE. IT IS DIFFICULT FROM THE LIKES OF MICROSOFT AND META INTO EUROPE, BUT THE TECHNOLOGY SECTOR IS UP .9%, THE NASDAQ FUTURES UP 1.3 PERCENT. I’M NOT SURE IF THE INDIVIDUAL NAMES AT UP TO A REAL DIRECT READ ACROSS FROM U.S. MEGA TECH, BUT FOR WHAT IT’S WORTH THAT IS NOW THE BEST-PERFORMING SECTOR. KRITI: I WONDER HOW MUCH COLD WATER GETS THROWN ON THAT AFTER THE U.S. BELL TODAY. SENIOR STRATEGIST OVER BNY JOINS US AROUND THE TABLE THIS MORNING FOR JEFF, PLEASURE TO HAVE YOU. ARE BUYBACKS HOLDING UP THE EUROPEAN MARKET RIGHT NOW? JEFF: ON A SECTOR BY SECTOR BASIS, THE NON-BAD NEWS IS IF THERE IS GOING TO BE MORE EASING BY THE ECB. PROBABLY JUST ONE MORE PRECAUTIONARY MOVE AT THE END OF SEPTEMBER. IF WE ARE NOT GOING TO DEVIATE TOO MUCH FROM THAT OUTLOOK FOR FINANCIALS, THEY CONTINUE TO MOVE AHEAD. WE ARE ALWAYS HOPING LONGER-TERM THERE COULD BE CONSOLIDATION, CAPITAL MARKETS, THINGS LIKE THAT, ESPECIALLY NOW, THEY REACTION TO THE TRADE DEAL, EUROPE, LET’S JUST FOCUS ON WHAT CAN BE DONE HERE RATHER THAN THE EXTERNAL FRONT. KRITI: WHAT ABOUT THE TRADE READ THROUGH? ALL THESEG EUROPEAN CORPORATE HAVE EXPOSURE TO PARTS OF ASIA, PARTS OF LATIN AMERICA. EOFF HOW DO WE PRICED THAT IN? GEOFFREY: THERE WAS A MILD SCENARIO, A VERY ADVERSE SCENARIO. I THINK WE ARE LANDING SOMEWHERE IN BETWEEN. YOU ARE AVOIDING MAXIMUM TARIFFS SO TO SPEAK, BUT YOU ARE RIGHT ON THE EXTERNAL DEMAND SIDE YOU TAKE A HIT. ALSO AS MENTIONED EARLIER THE CHINESE DEMAND IS NOT REALLY PICKING UP. WE SAW THAT FROM THE DATA OVERNIGHT. THE OUTLOOK WILL BE ON THE TOP LINE BASIS. PERHAPS THEY HAVE TO LEAN BACK INTO THE CASH RESERVES AND LOOK AT BUYBACKS SUPPORTING SHARE PRICES AND VALUATIONS RIGHT NOW. ANNA: HELP US UNDERSTAND THE LATEST DATA FROM CHINA AND ITS SIGNIFICANCE FOR YOU DON’T SEE STEEL PRICES MOVE BY MORE THAN 4% ON A REGULAR BASIS. BASIC RESOURCES THE WORST PERFORMING SECTOR IN EUROPE. WE ALSO HAVE EARNINGS OUT. COPPER PRICES ARE DOING INCREDIBLY WEIRD THINGS BECAUSE IT DROPPED THE MOST EVER IN THE U.S. BECAUSE OF THE ABOUT-FACE ON TARIFFS. HELP US UNDERSTAND THE UNDYING STORY. ANDWHAT MATTERS GEOFFREY: COPPER, WHY HASN’T ANYBODY LOOKED AT THE CENTRAL BANK OF CHILLY? ANNA: TELL US. GEOFFREY: IT’S ON THE LIST SOMEWHERE. CHILE HAD A LINE IN THERE ACKNOWLEDGING THE SHORT TERM THERE IS A BIT OF A SUPPLY AND DEMAND A MISMATCH VERSUS CHINESE GROWTH. BUT THEY SAW NO REASON TO REVISE 2025-2027 SO THE LACK OF UP SIDE CHINESE GROWTH. CHINA HAS MENTIONED IT IS REALLY QUANTITY OVER QUALITY. STUFF THAT SHOULD BOOST DEMAND FOR RESOURCES, IRON ORE, COPPER, EVERYTHING ELSE, THAT WAS ONLY STATED IN THE CONTEXT OF HOW TO IMPROVE HOUSEHOLD EXPECTATIONS. I THINK THAT SAYS IT ALL. YOU HAVE CHILE, YOU WILL NOT SEE A BIG INVESTMENT GROWTH, CHINA FOCUSING ON QUALITY OVER QUANTITY. THAT’S NOT GOING TO BE THE MAIN DRIVER UP AHEAD. BUT FROM THE CHINESE EQUITIES PERSPE CTIVE, IF YOU SEE BETTER MARGINS BECAUSE OF THIS ANTI- EVOLUTION CAMPAIGN GOING ON AND YOU SEE BETTER QUALITY, I’M ACTUALLY QUITE OPTIMISTIC FOR HOUSEHOLD INCOMES. THE VOLUME DEMAND IS THERE, THE QUESTION IS PRICING LEVEL. ANNA: SO THERE IS NOTHING TO BE EXCITED ABOUT PERHAPS ABOUT THE CHINESE GROWTH STORY FROM HERE. EVERY TIME WE SEE NEGATIVE NUMBERS OR DISAPPOINTING NUMBERS PEOPLE SAY THE CHINESE WILL STEP IN AND STIMULATE AND THAT WILL CHANGE THINGS. THE EXPECTATION OF THAT? GEOFFREY: I THINK THE STIMULUS WILL NOT LOOK LIKE THE STIMULUS THAT WE ARE USED TO IN THE PAST. LIKE THE CHINESE REAL ESTATE MARKET, THAT IS THE MOST IMPORTANT PART OF THE UNIVERSE. THAT IS CERTAINLY NO LONGER THE CASE WILL FOCUS ON HOUSEHOLD SPENDING AND VOLUME. THE CHILDCARE SUPPORT PACKAGE, THE NATIONAL HEALTH COMMISSION YESTERDAY SAID THIS IS THE BIGGEST DIRECT FORM OF HOUSEHOLD SUPPORT SINCE THE FOUNDING OF THE REPUBLIC. PROBABLY NOT AS LARGE AS SOME EXPECTATIONS, BUT THEY ARE MOVING IN A DIFFERENT DIRECTION RIGHT NOW. THEY ARE GIVING DIRECT INJECTIONS TO THE HOUSEHOLD, AND THAT COULD BOOST SPENDING, FOCUS ON SPENDING AND HOUSEHOLD DEMAND. THERE ARE SECTORS THAT CAN BENEFIT FROM THAT. GUY: YOU SEE A LOT OF FLOW DATA. HAS SOMETHING CHANGED OVER THE LAST FEW WEEKS SINCE THE EUROPEAN DEAL WAS ANNOUNCED? IS THE EUROPE TRADE OVER? IS THAT MONEY STARTING TO MOVE AROUND? GEOFFREY: I GO BACK TO THE THREE KEY SECTORS. AEROSPACE AND DEFENSE, 60% ABOVE THE ROLLING 12 MONTH AVERAGE. THEN YOU LOOK AT AUTOS, STRUGGLING TO MATCH STILL THE ROLLING 12-MONTH AVERAGE. WE TALK ABOUT CONCENTRATION IN TERMS OF HOLDINGS, IN TERMS OF TECH. CONCENTRATION IN AEROSPACE AND DEFENSE. FINANCIALS HAVE DONE WELL. BUT THEY ARE NOWHERE NEAR AEROSPACE. IF YOU LOOK AT THE EXTERNAL DEMAND, EUROPEAN AEROSPACE SECTORS ARE STILL SEEING DEMAND. THAT IS WHERE MAYBE SOME ROTATION NEEDS TO HAPPEN. GUY: OK, SO WHAT DO YOU THINK HAPPENS ON THE BACK OF THAT? IF THAT IS THE TREND FOR THE MOMENT, EXTRAPOLATE FORWARD FOR ME. IF I’M LOOKING TO INVEST MONEY, DO I JUST KEEP GOING WITH THE BULLETPROOF, TO EXCUSE THE PUN, OR DO I GO WITH SOMETHING THAT LOOKS BETTER VALUE? BECAUSE IT’S A REALLY CONFUSING PICTURE IN EUROPE. GEOFFREY: THE TENDENCY IS ALWAYS IF IT AIN’T BROKE, DON’T FIX IT. I HAD ANTICIPATED ONCE WE CROSSED 40% FOR THAT TO COME OFF. IT CERTAINLY HAS BEEN OVEREXTENDED. THE QUESTION IS WHY IS THERE NO CONFIDENCE IN THE OTHER SECTORS. IF AEROSPACE IS THE EUROPEAN DOMESTIC INVESTMENT STORY, FINE, BUT AS TIME WE LOOKED AT THE TERTIARY EFFECT OF THAT. CAN IT START TO BOOST EUROPEAN HOUSEHOLDS? GUY: WHERE WOULD THAT BE? GEOFFREY: IN TERMS OF SECTORS COME IN TERMS OF THE CONSUMER SIDE OF THING, CONSUMER STAPLES AND ALSO HEALTH CARE, WHERE YOU CAN SEE INTRINSICALLY REPEATED DEMAND. THE DIFFICULTY FOR CLIENTS IN TERMS OF PRICING IS HOW DO I DRAW THIS LARGE DEFENSE BUDGET INTO THE HOUSEHOLD SIDE. AGAIN, IT IS ABOUT HOUSEHOLD INCOME. IT IS LIKE WHAT CHINA IS DOING RIGHT NOW. LET’S FOCUS LESS ON THE NUMBERS, FOCUS MORE ON THE QUALITY. THE CONTROVERSIAL PHRASE, TRICKLE-DOWN EFFECT, GOING INTO THE INDUSTRIAL SIDE. BOOSTING HOUSEHOLD INCOMES AND REAL INCOMES, AND INFLATION IS COMING DOWN. LET’S SEE WHAT THE GERMAN NUMBERS WILL BE TODAY. REAL INCOMES COULD BE GROWING UP AND HOUSEHOLDS COULD START TO SPEND. THAT IS ALWAYS TRICKY WHEN IT COMES TO EUROPE AND ASIA RELATIVE THE U.S. AND U.K. GUY: GEOFFREY, THANK YOU FOR JOINING US. GEOFFREY YU JOINING US FROM BNY. THERE IS A BUNCH OF 52 WEEK HIGHS OF THE BANKING SECTOR. IT’S NOT THE ENTIRE SECTOR, BUT THAT IS THE BROAD PICTURE. TWO 52 WEEK HIGHS IN THE AEROSPACE SECTOR. LVMH IS SOFTER, FERRARI IS UP A LITTLE BIT, ASML IS THE TECH PLAY. SCHNIDER, THE NUMBERS VERSUS THE OVERALL TREND, DOWN .8%. BUT LOOK AT THE BEER SECTOR WITH AB INBEV. LET’S START WITH THE BANKING SECTOR STORE IN MORE DETAIL. REPORTER: WE ARE UP MORE THAN 7% THIS MORNING ON THE BACK OF A NEW INTERIM DIVIDEND, BUYBACK, AND A LIFTED OUTLOOK. INVESTORS SEEM HAPPY ABOUT THAT. SOCGEN HAD ALREADY BEEN DOING SO WELL OVER THE LAST YEAR AND WE GOT AN EXTENDED BOOST TODAY WITH THOSE RESULTS. AB INBEV IS DOWN ALMOST 10% THIS MORNING. THEY REPORTED REALLY WEAK SALES ESPECIALLY IN BRAZIL AND CHINA WHERE THERE IS WEAK CONSUMER SPENDING. THAT DRAG TO TOWN SALES AND VOLUMES AND SHARES DOWN THIS MORNING 9.6%. MOVING ON TO THE STEELMAKER ARCE LORMITTAL, STILL DEMAND HAS BEEN CUT ACROSS THE WORLD. THAT KIND OF FEEDS INTO THE CUSTOMER HESITANCY. THEY ARE DOWN 4.4%. MOVING ON TO THE ENGINE SECTOR, ROLLS-ROYCE UP 11%. IT LIFTED ITS OUTLOOK THIS MORNING AND SAID THERE WAS REALLY STRONG DEMAND FOR JET ENGINES AND A COST-SAVING PROGRAM IS A REAL BENEFIT. FINALLY, WE HAVE THE 50% TARIFF ON COPPER THAT WAS ANNOUNCED. THAT IS DRAGGING DOWN ALL OF THOSE NAMES ACROSS THE MINING SECTOR, GLENCOE AND AGRO AMERICAN COME ALL OF THEM DOWN THIS MORNING BY QUITE A BIT. ANNA: THANK YOU VERY MUCH. SO MANY TO CHOOSE FROM. HERE IS ANOTHER ONE, IN THE INSURANCE SPACE IN LONDON, OFFER FROM BROOKFIELD WEALTH FOR THE BUSINESS. THE STOCK GOES HIGHER BY 68% THIS MORNING. NOT UP TO THE OFFER PRICE, SO PERHAPS SOME EXECUTION RISK, BUT NOT FAR FROM IT. 212 IS WHERE IT TRADES. COMING UP, BACK TO THE EARNINGS STORY. ANGLO CUTTING ITS DIVIDEND AS LOWER COMMODITY PRICES DRAG. WE WILL SPEAK TO THE CEO NEXT. THIS IS BLOOMBERG. GUY: WELCOME BACK. INDICES ARE PROBABLY HIGHER. TECH STOCK STORY FOCUSED VERY MUCH ON WHAT IS HAPPENING OVER IN THE U.S. A BANKING SECTOR HITTING 52 WEEK HIGHS AND LOWS IN A LITTLE BIT, BUT THE BANKING SECTOR IS CHOCK-FULL THIS MORNING A 52 WEEK EYES. — 52 WEEK HIGHS. THE DEFENSE SECTOR IS ALSO DOING WELL. BA SYSTEMS, ROLLS-ROYCE, ALL HAVING REALLY INTERESTING STORIES THE PAST 24 HOURS. THIS COPPER STORY IS MIND BLOWING. THE MOVE THAT YOU SAW YESTERDAY WAS JUST ABSOLUTELY SENSATIONAL. WE KNOW THERE HAS BEEN THIS ARBITRAGE TRADE BETWEEN COPPER IN THE U.S. AND THE REST OF THE WORLD BECAUSE WHAT’S HAPPENING WITH THE TARIFFS. TRUMP LIKE THAT CLOSES IT YESTERDAY. AND DID YOU SEE THIS EPIC MOVE? ANNA: THIS IS THE SPREAD BETWEEN THE PREMIUM FOR U.S. COPPER OVER IN LONDON. IT ACTUALLY COLLAPSED. IT WAS CREATED BY THE TRUMP TARIFF NARRATIVE AND A COLLAPSE YESTERDAY WHEN THE ANNOUNCEMENT CAME THROUGH THEY WERE EXCLUDING REFINED COPPER. SOMEBODY WE KNOW WHO MAY HAVE VIEWS ON THIS IS WAITING IN THE WINGS. LET’S START THE CONVERSATION WITH DUNCAN. THEY CUT THEIR DIVIDEND THIS MORNING. THEY HAVE ANNOUNCED EARNINGS. LET’S GET INTO THE CONVERSATION WITH THIS MINING BUSINESS AROUND RESTRUCTURING. CEO DUNCAN WAGMAN JOINS US. TELL US ABOUT THE UNDERLYING MESSAGE FROM THE EARNINGS. WE HAVE A 20% DROP IN UNDERLYING PROFITS, 83% REDUCTION IN DIVIDEND, BUT THERE IS A NARRATIVE THAT SUGGESTS THAT THE DOWNDRAFT IS COMING FROM THE BUSINESS AS YOU ARE SELLING. IS THAT THE CORRECT INTERPRETATION OF THE NUMBERS THIS MORNING? DUNCAN: GOOD MORNING. YES, THAT WOULD BE CORRECT. BASICALLY THE EARNINGS WERE COMPRISED OF THREE KEY THINGS. ONE WAS THE MASSIVE FLOODING IN SOUTH AFRICA WHICH TOOK OUT ONE OF THE PLATINUM LINES — PLATINUM MINES. THE SECOND WAS THE FACT WE HAVE TWO COAL MINES THAT ARE NOT IN OPERATION IN AUSTRALIA AT THE MOMENT. THE THIRD OF COURSE IS THE CONTINUING WEAKNESS IN THE DIAMOND MARKETS. THE BALANCE OF THE BUSINESS IS PERFORMING EXTREMELY WELL. THOSE THREE ALSO HAPPENED TO BE PART OF THE EXIGENT BUSINESSES. THE REMAINING BUSINESSES ARE PERFORMING REALLY WELL. ANNA: OK, WE WILL RETURN TO SOME OF THE BITS OF THE BUSINESS YOU ARE SELLING, BUT I WANT TO ASK ABOUT THE COPPER STORY. WHAT WAS THE IMPACT OF TARIFFS ON THE COPPER BUSINESS AT ANGLO AMERICAN? OR IS IT VERY DIFFICULT TO KEEP TRACK OF THE NEWS FLOW AND DIFFICULT TO SAY? WE HAVE HAD SOME DEVELOPERS OVERNIGHT SUGGESTING REFINED COPPER IS EXCLUDED FROM U.S. TARIFFS. DUNCAN: THERE WAS AN AMOUNT OF VOLATILITY, NOT ONLY IN COPPER BUT OTHER METALS ON THE MARKET AT THE MOMENT RELATIVE TO WHAT’S ACTUALLY GOING ON WITH TARIFFS AND WHERE THEY ULTIMATELY ARE GOING TO LAND. AS FAR AS COPPER IS CONCERNED I THINK WHAT WE ARE REALLY SAYING IS THE SHORT-TERM RECTIFICATION OF WHAT WAS A BIG ARBITRAGE BETWEEN WE’RE FINISHED GOODS FOUND THEMSELVES JUST IN ANTICIPATION OF THE TARIFFS. SO EITHER IN THE U.S. MARKETS OR IN EUROPEAN MARKETS, ETC. THAT IS GOING TO TAKE A LITTLE BIT OF TIME TO TURN AROUND. I THINK MORE FUNDAMENTALLY FOR US, AS WE LOOK AT THE BUSINESS WITH A TIME FRAME OF THE ASSETS THAT, WE HAVE UNDER MANAGEMENT WE HAVE TO SET OURSELVES UP FOR LONG-TERM OUTCOMES. BUT THE SHORT RUN IS VERY NOISY IN TERMS OF WHAT HAPPENS WITH METAL PRICES. LONG-TERM, THE FUNDAMENTALS FOR COPPER REMAIN FANTASTIC. THERE’S GOING TO BE GREAT DEMAND FOR THE METAL IN TERMS OF THE ENERGY TRANSITION IN PARTICULAR. BUT THERE’S ALSO GOING TO BE A REAL SQUEEZE ON SUPPLY AS IT CERTAINLY TAKES A LOT LONGER TO BRING PROJECTS INTO PLAY. SHORT-TERM VOLATILITY, LONG-TERM STABILITY I THINK. GUY: DUNCAN, GOOD MORNING, IT’S GUY. SO YOU ARE GOING TO BECOME MORE FOCUSED ON THE COPPER BUSINESS GOING FORWARD. THAT IS AN INTERESTING PLACE TO BE. AS YOU SAID YOU WILL BE GETTING RID OF SOME BUSINESSES. DIAMONDS IS AN AREA PEOPLE ARE LOOKING AT, THE SOFTNESS IN THE DIAMOND SPACE CONTINUES. WHAT IS THE CURRENT PLAN FOR DEBEERS? WHAT IS THE TIMELINE? CAN YOU UPDATE US ON THE CURRENT THINKING FOR WHEN AND HOW THAT EXIT HAPPENS? DUNCAN: SURE, GUY, FIRST OF ALL LET ME SAY WHILST THE MARKETS ARE STILL UNDER QUITE A LOT OF PRESSURE, I THINK WE ARE STARTING TO SEE SHOOTS. DEMAND FROM INDIA AND CHINA AND THE U.S. FOR THE ROUGH LOOKS PRETTY REASONABLE DURING THE FIRST HALF OF THIS YEAR. FINGERS CROSSED HERE, WE ARE STARTING TO LOOK AT A BIT OF A TURN IN THE MARKET. AS FAR AS THE PROCESS IS CONCERNED, AS I’VE SAID BEFORE WE ARE RUNNING ON TRACK. OUR PREFERENCE WOULD BE TO TRY TO DO A TRADE SALE OF OUR STAKE IN THIS BUSINESS TO THE RIGHT BUYER. BUT TO THE EXTENT THAT IS NOT POSSIBLE FOR WHATEVER REASON, WE ARE VERY HAPPY ON A MARKET RECOVERY TO RUN THIS THROUGH AN IPO. IN TERMS OF TIMINGS, WE ARE IN THE PROCESS NOW WITH A NUMBER OF VERY CREDIBLE AND INTERESTED BUYERS. SO THERE IS SOME HOPE THAT WE MAY BE ABLE TO CONCLUDE THAT TOWARDS THE BACK END OF THIS YEAR OR EARLY NEXT YEAR. AN IPO WILL PROBABLY BE MORE LIKELY IN THE MIDDLE OF NEXT YEAR. GUY: DO YOU THINK THE IPO IS BECOMING MORE LIKELY? IS THAT A FAIR ASSESSMENT? DUNCAN: I CERTAINLY AM NOT TAKING MY FOOT OFF THE GAS IN TERMS OF KEEPING THE OPTION OPEN FOR AN IPO IF THAT IS WHAT WE NEED TO DO. KRITI: DUNCAN, ANOTHER ONE OF YOUR BUSINESSES ALSO CURRENTLY BEING IN THE SELLING PROCESS IS THE STEELMAKING COAL BUSINESS TO PEABODY FOR ABOUT $3.8 BILLION. THERE HAVE BEEN SOME QUESTIONS ABOUT WHETHER THE DEAL SHOULD BE SCRAPPED, PEABODY CLIMBING AFTER A FIRE. CAN YOU WALK US THROUGH THE UPDATE IN TERMS OF THOSE NEGOTIATIONS OF THAT SALE PROCESS? DUNCAN: YEAH, WE ACTUALLY CONCLUDED THE SALE AGREEMENT WITH PEABODY, SO WE HAVE A CONTRACT WITH PEABODY. WE ARE JUST IN THAT BIT OF THE CONTRACT WHERE IT’S BETWEEN SIGNING AND CLOSING. AS YOU SAY, WE DID HAVE THIS RATHER UNFORTUNATE INCIDENT AT ONE OF THE MINES IN AP RIL. SUBSEQUENTLY WE HAVE DETERMINED THERE IS ABSOLUTELY NO DAMAGE TO THE MINE AT ALL AND THERE IS NO DAMAGE TO ANY OF THE EQUIPMENT IN THE MINE. WE ARE CONTINUING WITH A REALLY COLLABORATIVE TRANSFER AN OPEN PROCESS WITH A NUMBER OF PARTIES, STAKEHOLDERS, INCLUDING UNIONS, THE GOVERNMENT, REGULATORS, ETC., IN A STAGED PROCESS TO REOPEN THE MINE. CERTAINLY EVERYTHING THAT WE CAN SEE TODAY IN OUR UNDERSTANDING OF THE PROGRESS WE ARE MAKING AND CERTAINLY THE FACT THERE IS NO DAMAGE AT ALL TO THE RESOURCE, THERE IS NO POSSIBLE WAY THIS IS A MATERIAL ADVERSE EVENT UNDER THIS PARTICULAR CONTRACT. A LITTLE BIT OF WORK TO GO STILL WITH THE REGULATORS TO GET THE FINAL APPROVALS FOR A RESTART, BUT MAKING VERY POSITIVE PROGRESS ON THAT JOURNEY. KRITI: DUNCAN, FINAL QUESTION ON SIMPLY THE BROADER PICTURE OF THANKS. YOU TALKED ABOUT THE COPPER TARIFF SITUATION. BROADLY SO MANY TERRIFIC DEALS ARE GETTING SIGNED AROUND THE WORLD COME HOW DOES IT AFFECT THINGS LIKE INVESTMENT, SUPPLY CHAIN MANAGEMENT OR UNDERLYING DEMAND FOR THE METAL FROM YOUR PERSPECTIVE WITH REGARD TO THE TARIFFS? DUNCAN: IT’S A GREAT QUESTION. HOPEFULLY ULTIMATELY THERE WILL BE SOME STABILITY THAT GETS BROUGHT BACK IN WHEN EVERYBODY UNDERSTANDS EXACTLY WHAT TARIFFS ARE GOING TO BE SET WHERE. FUNDAMENTALLY I THINK FROM THE FIRST ORDER IMPACT IN TERMS OF BUSINESSES LIKE MINING, THERE’S NOT NECESSARILY A DIRECT CONSEQUENCE OF THESE TARIFFS. GENERALLY SPEAKING THAT WOULD BE. BUT MORE FUNDAMENTALLY I THINK THE SECOND ORDER IS AROUND THE WORLD I THINK WE WILL EXPERIENCE SOME VERY SERIOUS INFLATION OVER TIME, AND THAT’S GOING TO AFFECT A NUMBER OF THE INPUTS TO PRODUCTION FROM A SUPPLY CHAIN POINT OF VIEW. IT IS CERTAINLY GOING TO IMPACT FINISHED GOODS PRICES AND SO ON. THE CONSEQUENCE OF WHICH IS I THINK GENERALLY AND GLOBALLY COSTS ARE GOING TO GO UP. I THINK WE ALL HAVE TO GET READY IN TERMS OF DEALING WITH THAT AND DIMINISHING THAT IN OUR BUSINESSES. UNTIL SUCH TIME AS THE PRICE ADJUSTS. BECAUSE THE PRICE OF COURSE MUCH JUST TO ACCOMMODATE THAT OTHERWISE MATERIAL DOES NOT FLOW EVENTUALLY. AND THEN IMPERATIVE — IN TIMES OF GREAT VOLATILITY, PEOPLE FIND IT DIFFICULT TO MAKE BIG INVESTMENT DECISIONS AND MINES. KRITI: DUNCAN WANBLAD, WE HAVE TO LEAVE THE CONVERSATION THERE BUT WE APPRECIATE YOUR TIME THIS MORNING. THIS IS BLOOMBERG. KRITI: THIS IS THE OPENING TRADE. ABOUT 30 MINUTES INTO THE OPENING SESSION AND WE ARE SEEING OPTIMISM BAKED INTO THINGS. THERE’S A LITTLE BIT OF A TECH, BUT ALSO BUYBACKS IN THE BANKING SECTOR AND EVEN THAT SECONDHAND AFFECT OF THE TARIFF WOES NOT SHOWING UP IN THIS MARKET TODAY. THAT IS FOLLOWING THE U.S. PICTURE, OUTPERFORMED BY THE DAX BEING HIGHER .6 PERCENT. GUY: LET’S TALK ABOUT WHERE WE ARE SEEING THE DETAIL OF THAT STORY EVOLVE. A BUNCH OF THINGS ARE GOING ON. IT IS WORTH GOING INTO THESE MARKETS TO UNDERSTAND WHAT’S HAPPENING. CLEARLY THIS MORNING THERE ARE MORE BUYERS THAN SELLERS. YOU HAVE 363 UP, 223 DOWN, BUT THE 52 WEEK HIGHS AND LOWS ARE INTERESTING. THE VOLUME CHART IS QUITE GOOD. ABOVE AVERAGE. THERE’S A LOT TO GET THROUGH, A LOT OF SINGLE STOCK NAMES YOU NEED TO FOCUS ON, AND A LOT OF VARIETY WITHIN THIS MARKET. THE KEY THEMES CONTINUE TO STAND OUT. DEFENSE AND BANKING ARE THE TWO AREAS THAT HAVE DOMINATED IT EUROPE OF LATE. THAT TREND IS VERY MUCH EVIDENCED IN THE 52 WEEK HIGHS. ROLLS-ROYCE UP 9%. WE ARE WATCHING THE DEFENSE SPACE CONTINUE TO DO REALLY WELL . ROLLS-ROYCE TRACKING HIGHER, 52-WEEK HIGHER. THE BANKS HAVE BEEN A REAL STANDOUT STORY. LET’S GO TO THE 52 WEEK HIGHS COME A SERIES OF BANKS HITTING 52 WEEK HIGHS. SOCGEN STANDS UP UP 6%, BBVA UP AS WELL, TO STOCKS HITTING 52 WEEK HIGHS. THERE ARE SOME LOWS, THIS IS NOT A SINGLE MARKET STORY. NESTLE IS FLAT THIS MORNING, 52 WEEK LOW EARLIER. HALEON IN THE CONSUMER PHARMA SPACE DOWN 3.2%. RENAULT, ARE WE SAYING THE CAR SPACE BOTTOMING OUT, BUT THIS IS WHERE THE 52 WEEKS HIGHS AND LOWS ARE. IT IS BASICALLY JUST BANKS AND DEFENSE. THAT IS THE EUROPEAN STORY RIGHT NOW AND IT CONTINUES TO BE THIS MORNING F. ANNA: BANKS AND DEFENSE WITH THE STOCK MARKET MOVES. OTHER THINGS WE ARE TRACKING. TRADE IS PART OF THAT. PRESIDENT TRUMP SAYS HE WILL IMPOSE A TARIFF OF AT LEAST 25% ON INDIA’S EXPORTS STARTING FRIDAY, THOUGH HE LATER SAID THE SIDES ARE STILL IN TALKS. PRESIDENT TRUMP HAS DELAYED THE IMPLEMENTATION OF 50% TARIFFS ON BRAZILIAN EXPORTS BY SEVEN DAYS WHILE EXEMPTING ANY PRODUCTS FROM THE LEVY, CAUSING THE COUNTRY’S CURRENCY TO RALLY. BRITISH RETAILERS ARE WEARING FOOD INFLATION COULD HIT 6% BY THE END OF THE YEAR AS THEY RAISE PRICES IN RESPONSE TO APRIL’S HIKE IN PAYROLL TAXES AND THE MINIMUM WAGE. 2/3 OF COMPANIES SURVEYED BY THE BRITISH RETAIL CONSORTIUM PLAN TO INCREASE PRICES FURTHER TO OFFSET HIGHER COSTS. FOOD INFLATION HIT A 16 MONTH HIGHER IN JUNE. AUTHORITIES IN CHINA HAVE SUMMONED NVIDIA REPRESENTATIVES TO INVESTIGATE ALLEGED SECURITY RISKS RELATED TO THE ARTIFICIAL INTELLIGENCE CHIP MADE BY NVIDIA. THE MOVE MARKS AN ABRUPT CHANGE IN TONE AFTER THE STOCKHOLM SUMMIT BETWEEN THE U.S. AND CHINA AND THE TRADE OFFICIALS FROM BOTH COUNTRIES GATHERED THERE. THE PRODUCT HAS BEEN BANNED FOR SALE TO CHINA FROM THE TRUMP ADMINISTRATION SINCE APRIL AND HAD ONLY BEEN RECENTLY CLEARED TO RETURN TO THE MARKET. JUST AS YOU THOUGHT THE MOOD BETWEEN CHINA AND THE U.S. HAD IMPROVED, YOU GET THIS KIND OF STORY AROUND NVIDIA WHICH MAKES YOU THINK. KRITI: YEAH, WE GOT SOME MASSIVELY STRONG EARNINGS WHEN IT CAME FROM THE TECH SPACE. WE ARE TALKING ABOUT THE TUG-OF-WAR IN THE TECH SPACE. EARNINGS RIGHT NOW ARE BEATING THE GEOPOLITICAL RISKS. WE ARE JOINED BY SENIOR STRATEGIST AROUND THE TABLE. MICHAEL, YOU HAVE A VERY COOL CHART THIS MORNING. YOU WERE TALKING ABOUT HOW THE TARIFFS AND THE GEOPOLITICS AFFECTS THE EUROPEAN CORPORATE’S. CAN YOU WALK US THROUGH THE ANALYSIS? MICHAEL: IT IS A STRANGE THING, YOU HAVE THE PRICING FROM THE TARIFFS AT THE BEGINNING OF THE YEAR, ESPECIALLY AFTER LIBERATION DAY. EARNINGS HAVE BEEN CUT MASSIVELY FOR THE PAST FEW MONTHS IN EUROPE. IT SEEMED ABOUT 20% WAS PRICED IN. NOW WE HAVE 15%, SO IT’S LIKE WE ARE ALMOST AT THE POINT WHERE THE PEAK UNCERTAINTY IS GONE AND WHAT WAS BAKED IN HIS MUCH STRONGER. SO WE WILL START SEEING MORE UPGRADES ON EARNINGS. WE HAVE SEEN IT IN STOCKS ALREADY. COMPANIES ARE TALKING ABOUT TARIFFS, THAT THERE IS AN IMPACT, BUT A LOT OF THEM WILL GET THROUGH THOSE THROUGH PRICE INCREASE, CHANGES IN THE SUPPLY CHAIN, THEY ARE ADAPTING. THEY ARE ADAPTING AND INVESTORS ARE RESPONDING TO THAT. GUY: IN TERMS OF WHERE WE GO FROM HERE, 52 WEEK HIGHS THIS MORNING FROM THE DEFENSE AND BANKING SECTORS, THOSE ARE THE TWO AREAS THAT HAVE DELIVERED. WE SEE A BROADENING OUT NOW. DO WE START TO SEE OTHER SECTORS BEGINNING TO PERFORM A LITTLE BETTER? MICHAEL: YOU NEED A BIT OF CONVINCING FOR THAT. WE MIGHT BE AT THE BOTTOM, BUT DO YOU WANT TO BUY? IT IS A BIG QUESTION. YOU HAVE A LOT OF SECTORS WHICH STILL CARRIES UNCERTAINTY, WHETHER IT IS FROM THE ACTUAL IMPACT OF TARIFFS DOWN THE ROAD OR VERY STIFF COMPETITION FROM CHINA. SO IT’S TRICKY. BUT YOU HAVE TWO BIG STORIES. THE BIG STORY IS BANKS. WE’VE SEEN OVER THE PAST FEW QUARTERS THAT EVEN THE ECB HAS CUT RATES. IT HAS NOT AFFECTED THE PROFITABILITY OF BANKS. THEY’VE BEEN DOING VERY WELL, THEY KEEP DOING BUYBACKS, HEFTY DIVIDENDS. THEY WILL BE RESPONSIBLE FOR MOST OF THE SHAREHOLDER PAYOUTS THIS YEAR IN EUROPE AGAIN. IT IS A TREND THAT KEEPS ON GIVING, AND INVESTORS KEEP WRITING IT. AS FOR DEFENSE, THIS IS THE ONLY STORY WHERE THERE IS ACTUAL COMMITMENT FROM THE EUROPEAN UNION, FROM COUNTRIES AS WELL. AGAIN, IT IS SOMETHING THAT IS REALLY SET AND INVESTORS KEEP RIDING. DO YOU WANT TO BROAD ENOUGH FROM THAT? MAYBE, BUT YOU NEED CONVINCING. ANNA: DEUTSCHE BANK YESTERDAY ARE NOT SURE IF THE THEME CONTINUES, WHETHER IT IS IN THE POINTS FOR NOW WAS THE QUESTION WE WERE ASKING. IF YOU SEEM TO BE MAYBE IT WAS FULL TO LET ME ASK ABOUT TECH. IT IS AN AWKWARD READ THROUGH FROM A LOT OF THE U.S. EARNINGS NEWS. NASDAQ FUTURES ARE UP 1.4% BECAUSE OF ALL THE STRONG PERFORMANCE IN THE MAG 7. WHAT CAN EUROPE DO WITH THAT? TECH IS THE SECOND-BEST PERFORMING SECTOR THIS MONEY. IS THERE ANYTHING WE CAN TAKE AWAY FROM THAT? MICHAEL: IT’S THE SAME THING, IF YOU LOOK AT HOW WE CAME INTO THE EARNINGS SEASON THERE WAS A BIG CATCH UP FROM THE U.S. MARKETS LED BY TECH. EXPECTATIONS ARE MUCH MUCH HIGHER IN EUROPE. AT THE SAME TIME WE SEE THOSE COMPANIES LIKE MICROSOFT AND NVIDIA, NO MATTER HOW HIGH THE EXPECTATIONS ARE THEY KEEP BEATING AND THEY RAISE GUIDANCE AND THEY KEEP BEATING. SO INVESTORS SEEM TO HAVE BEEN CONVINCED THIS IS STILL THE TREND TO BE IN. IT HAD A BIT OF A WOBBLE AT THE BEGINNING OF THE YEAR, BUT NOW THE POSITION IS RISING MASSIVELY ON THAT SECTOR. WE ARE GETTING TO A STRETCH LEVEL NOW FOR SOME THAT IS THE INDICATORS WE ARE HAVING. BUT YOU CAN BE AT A STRETCH LEVEL FOR A VERY LONG TIME. GUY: IS THIS THE ONLY STORY NOW? IN EUROPE YOU HAVE DEFENSE AND A BIT OF BANKING, YES, THE NUMBERS LOOK GOOD, BUT ARE WE BASICALLY THE LAST 15 YEARS THAT THE ONLY STORY IS THERE IS NO ALTERNATIVE COME JUST BY U.S. TECH? AS LONG AS THE TREND CONTINUES, STUCK MYERS KEEP GETTING DRAGGED HIGHER? KRITI: ISN’T THAT THE EXACT NARRATIVE WITH DEFENSE, EVERYBODY IS FILING INTO THIS BECAUSE THERE IS NO OTHER PLACE TO FEEL SAFE, LITERALLY? MICHAEL: IT IS THE SAME THING IN THE U.S. YOU BUY A U.S. TECH BECAUSE THAT IS A PLACE WHERE YOU HAVE GROWTH, THAT IS WHERE YOU HAVE THE BIG DEMAND FOR AI SHOWING NO SIGNS OF ABATING. IT SEEMS IT’S OK. RATE CUTS, AS LONG AS TECH DELIVERS EVEN 4.5% INTEREST RATES, IT’S FINE, NO PROBLEM. INVESTORS KEEP COMING IN FOR THIS. GUY: THERE IS LOADS OF NOISE, TARIFFS, THE FED, BOJ, LOTS OF STUFF GOING ON. CAN I JUST IGNORE ALL OF THAT AT THE MOMENT AND JUST U.S. TECH? MAYBE EUROPEAN DEFENSE, BUT U.S. TECH, THAT IS THE ONLY NEEDLE IN MY COMPASS? MICHAEL: YES, IT IS KIND OF THAT. IT IS DELIVERING. IT IS DOING BETTER THAN ANYTHING ELSE. AND LIKE I SAID, THE PROBLEM WAS FOR A FEW MONTHS THERE WAS A BIG DRAG ON U.S. TECH. NOW THERE IS A CATCH UP. SWELL THE HEDGE FUNDS ARE LEVERAGING, MUTUAL FUNDS ARE LEVERAGING ON THAT. THEY ARE BUYING MORE OF IT. THE THING IS THE HIGHER IT GOES IN THE MORE THEY CATCH UP. I WAS TALKING TO FUND MANAGERS, EVEN IF THEY HAVE A LONG-TERM VIEW LIKE 3, 5 YEARS IN THE MARKET IS DOING WHAT IS DOING RIGHT NOW AND YOU WERE NOT OVERWEIGHT OR JUST MARKET WEIGHT ON THAT SECTOR, YOU KEEP BUYING BECAUSE YOU NEED TO CATCH UP. IT DOESN’T MATTER IF YOU HAVE A THREE OR FIVE YEAR VIEW, YOU STILL HAVE MANAGEMENT COMING AND SAYING, OH, TECH IS GOING CRAZY, THE S & P IS GOING CRAZY AND WE ARE NOT MAKING THE MONEY WE ARE SUPPOSED TO MAKE. SO YOU KEEP CHASING. THAT’S WHAT’S GOING ON HERE. KRITI: AS YOU WERE SPEAKING I JUST DID A LITTLE TERMINAL SEARCH ON P/E RATIOS OF MICROSOFT. MICROSOFT IS TRADING AT A 3030 MULTIPLE. IS THERE AN ARGUMENT HERE PEOPLE ARE QUITE LITERALLY — THIS IS CONTROVERSY ALL, BUT YOU ARE BUYING AMERICAN TECH AT RELATIVELY CHEAP MULTIPLES? MICHAEL: COMPARED TO A DIFFERENT STOCK, MA YBE. THE DIFFERENCES IN A DIFFERENT COMPANY YOU HAVE A VERY HEAVY COMMITMENT FROM THE REGION — KRITI:. YES, YOU ARE BUYING A PROMISE. BUT YOU ARE PROBABLY MORE CERTAIN THE PROMISE WILL BE DELIVERED BECAUSE THEY HAVE TARGETS THAN TECH THAT CAN BE A BIT MORE, LET’S SAY, WOBBLY IN TERMS OF CYCLICALITY. IT IS A TRADE-OFF. AT THE SAME TIME YOU HAVE TO BEAR IN MIND ONE IS LIQUID AND THE OTHER IS NOT VERY LIQUID. SO IF YOU HAVE ONE THING IN EUROPE AND YOU WERE HOPING TO BE EXPOSED TO EUROPE AND YOU WANT TO HAVE EXPOSURE TO SOMETHING, IT DOESN’T REALLY MATTER WHAT YOU PAY FOR IT. BECAUSE IF YOU ARE CONVINCED THEY WILL DELIVER AND THAT THIS PROMISE WILL BE DELIVERED IN TERMS OF SPENDING DIFFERENCE, THAT IS A TREND THAT YOU WANT TO RIDE. ANNA: MICHAEL, THANK YOU VERY MUCH FOR THE LATEST ON EQUITIES. COMING UP, TALKING A LOT ABOUT DEFENSE. THAT BEING ONE OF THE KEY THEMES INVESTORS HAVE BEEN BUYING INTO. WE WILL CONTINUE THAT CONVERSATION WITH BAE SYSTEMS CFO. THAT CONVERSATION AROUND THE EARNINGS STORY AND THE DEFENSE BROADER OUTLOOK, REALLY INTERESTING, THAT IS COMING UP NEXT. THIS IS BLOOMBERG. GUY: 45 MINUTES PAST THE HOUR. THE SECTORS THAT STAND OUT AND THE EUROPEAN EQUITY SPACE, ONE IS BANKS, THE OTHER IS WHAT IS HAPPENING IN THE DEFENSE SPACE. LET’S CAREY ON THE CONVERSATION WITH BAE SYSTEMS COME RAISING THE EARNINGS OUTLOOK FOR THE FULL YEAR. THE DEFENSE CONTRACTOR BENEFITING FROM INCREASED DEFENSE SPENDING. THERE WAS AN UPGRADE BROADLY IN TERMS OF THE OVERALL PICTURE. I THINK THE MARKET — I HAVE NOT GOTTEN TO THE BOTTOM OF THIS TO BE HONEST, MAYBE THE LACK OF THE EPS CASH FLOW UPGRADE AS WELL FOR STOPPED LET’S TRY TO ANSWER SOME OF THOSE QUESTIONS WITH THE CFO OF BAE SYSTEMS, BRAD GREVE, WHO JOINS US AROUND THE TABLE. GOOD MORNING. BRAD:. — GOOD MORNING. GUY: THE QUESTION BEING ASKED IS WHY DID WE GET THE UPGRADES WHEN IT CAME TO CASH FLOW AND THE EPS LINES? IS THERE AN EASY ANSWER TO THAT? BRAD: THERE IS, WE DID UPGRADE SALES BY 100 BASIS POINTS. EPS DID NOT GET UPGRADED BECAUSE WE HAD A HIGHER TAX RATE IN FRANCE. THAT IS OUR JOINT VENTURE WE ARE INVOLVED IN. FRANCE IS GROWING, SO OUR PROFITS ARE GROWING AND FRANCE WILL TOP IT’S A LITTLE HIGHER. BECAUSE THE SHARE PRICE HAS GONE UP AS MUCH AS IT HAS, WE ARE NOT TAKING OUT AS MANY SHARES IN THE BUYBACK PROGRAM. WE ARE STILL SPENDING AS MUCH BUT WE ARE TAKING ON FEWER SHARES. GUY: THAT’S A NICE PROBLEM TO HAVE. BRAD: THAT IS WHY WE DID NOT UPGRADE EPS BY 100 BASIS POINTS. GUY: SO FUNDAMENTALLY EVERYTHING LOOKING GOOD. JUST TALKING ABOUT THE DEFENSE SPACE, IS IT A PROMISE NOW EUROPE IS GOING TO CONTINUE TO DELIVER? CAN SHAREHOLDERS TAKE THIS TO THE BANK THAT GOVERNMENTS WILL BE SPENDING MORE IN EUROPE AND THEY WILL BE SPENDING IT ON EUROPEAN KIT? IS THAT JUST A REALITY WE FIND OURSELVES WITH? IS THAT CAST-IRON, TAKE IT TO THE BANK? IT IS ALREADY REFLECTED IN THE SHARE PRICE TO A CERTAIN EXTENT, BUT IS THERE ANY DOUBT IN YOUR MIND THAT IS THE NARRATIVE WE ARE NOW DEALING WITH? BRAD: I’VE SAID THIS MANY TIMES BEFORE, THERE’S BEEN A MASSIVE UNDERINVESTMENT IN DEFENSE IN EUROPE SINCE THE END OF THE COLD WAR. IT IS MASSIVE. SO NOW EUROPE HAS TO PLAY CATCH UP. YOU ARE SEEING THE COMMITMENTS OF 3.5% ON CORE DEFENSE SPENDING ACROSS NATO AND ADDITIONAL INFRASTRUCTURE AND INDUSTRIAL CAPABILITY. THOSE COMMITMENTS ARE THERE. IT’S GOING TO TAKE TIME TO GET TO THOSE LEVELS. BUT SOME COUNTRIES ACROSS EASTERN EUROPE ARE ALREADY ABOVE THOSE LEVELS. THAT IS A REFLECTION OF THE THREAT THAT WE SEE ON THE CONTINENT NOW. I THINK THE CHRONIC UNDERINVESTMENT NOW, THERE IS A KETCHUP THAT HAS TO BE FULFILLED. ON TOP OF THAT REPLENISHING INVENTORIES THAT WERE CONTRIBUTED TO UKRAINE IS ANOTHER PART OF THAT. AS FAR AS THERE IS THIS SUPER CYCLE OF SPENDING WE SEE — GUY: ARE WE JUST AT THE BEGINNING OF THAT? BRAD: I THINK SO BECAUSE WE HAVE NOT SEEN THAT BIG INCREASE TO GET TO THE 3.5% LEVEL, AND THEN THERE IS ADDITIONAL ON TOP OF THAT. 5% OF GDP ON DEFENSE IS A MASSIVE INCREASE WHEN WE ONLY JUST GOT 2% IN 2024. ANNA: IT IS. I’M INTERESTED IN THE TIMESCALES. HOW LONG DOES IT TAKE FOR THE COMMITMENTS TO TURN INTO ORDERS? FOR YOUR RUNNING A BUSINESS, THAT IS WHAT WILL MATTER TO YOU IS HOW QUICKLY THE ORDERS COME THROUGH. WHAT ARE YOU ALREADY SING ON THE ORDERS SIDE? BRAD: WE TALK ABOUT ORDERS AND HOW THEY FEED INTO BACKLOG. WE HAVE A BACKLOG TODAY OF 75 BILLION POUNDS. THE ON THE BACKLOG WE HAVE A PIPELINE ON POSITIONS THAT WILL EVENTUALLY TURN INTO BACKLOG AND THAT NUMBER IS LIKE 180 BILLION POUNDS. YOU ADD THOSE TWO NUMBERS TOGETHER IT IS EIGHT TIMES CURRENT LEVEL. WHAT WE SEE IS A CURRENT HIGH DEMAND. WE SEE A STRONG BACKLOG IN THE PIPELINE. ALL THESE THINGS ARE GOING TO DRIVE GROWTH GOING FORWARD. WE ARE REALLY WELL-POSITIONED. WE ARE ALREADY SEEING HIGH GROWTH, 11% GROWTH YESTERDAY IN THE HALF-YEAR RESULTS, AND WE ARE WELL POSITIONED FOR CONTINUED GROWTH AT A REALLY HIGH BASE. ANNA: IT SOUNDS LIKE CAPEX, CAN YOU DELIVER THOSE NUMBERS THAT YOU DESCRIBE COME EIGHT TIMES CURRENT REVENUE? IS THE BUSINESS ABLE TO DELIVER THAT, THE SUPPLY CHAINS ABLE TO DELIVER THE KIND OF GROWTH YOU’RE TALKING ABOUT? BRAD: IT’S CHALLENGING, WE SPEND A BILLION DOLLARS ON CAPEX NEXT YEAR — LAST YEAR AND WE WILL SPEND CLOSE TO THAT THIS YEAR. ANNA: WILL IT BE MORE? SIX MONTHS AGO IT WAS THAT KIND OF NUMBER THEN. HAVE WE SEEN A STEP CHANGE IN THE CAPEX COMMITMENTS? ARE YOU SPENDING MORE TO BE A BIGGER COMPANY? BRAD: WE ARE ALREADY SPENDING AT HIGH LEVELS. I THINK WHAT WE ARE SPENDING AND INVESTING IN HIS CAPACITY AND SCALE. SO THE BILLION POUNDS LAST YEAR AND THE BILLION WE SPEND THIS YEAR IS GOING TO THINGS LIKE THE JACKSONVILLE SHIFT LIFT IN FLORIDA WHERE WE GET INTO SHIP REPAIR FOR THE U.S. NAVY, THE ARTERIAL AIR — ARTILLERY HALLS AND THE CALLS WERE WE BUILD MATERIAL. ALL OF THESE INVESTMENTS ACROSS THE WORLD IS GEARED ON CAPACITY EXPANSION. THIS IS THE TIME, FROM STARTING THE GREENFIELD PROJECT TO GETTING PRODUCTIVITY COULD BE 3, 4 YEARS IN SOME CASES. THAT IS WHY I THINK THERE IS A BIT OF A GAP BETWEEN THE SPENDING INCREASES AND ORDERS COMING THROUGH. IT TAKES TIME TO GET THAT CAPACITY FOR TOP THAT IS WHY EVEN THE U.S. BUSINESSES WELL-POSITIONED TO HAVE FOREIGN MILITARY SALES FROM THE U.S. WORKFLOW THAT WE HAVE. KRITI: BRAD, MARIO DRAGHI QUOTED WOMAN SING ALL THE EUROPEAN SPENDING, 70% TO 80% LEAKS TO THE AMERICAN DEFENSE MANUFACTURERS. PART OF THE TRADE DEALS INKED WITH EUROPE SPECIFICALLY AND EVEN ACROSS ASIA HAS BEEN ACTIVE SPEND ON AMERICAN DEFENSE TECHNOLOGY. HOW MUCH OF A DENT DOES THAT PUT IN COMMITMENTS AND CONTRACTS FOR YOU? BRAD: WE HAVE A GREAT BUSINESS AND THE U.S. ALMOST HALF OF OUR SALES ARE IN THE U.S. THOSE ARE PROGRAMS THAT ARE REALLY ALIGNED WITH NATIONAL DEFENSE IN THE U.S. OUR U.S. BUSINESS IS WELL POSITIONED FOR GROWTH. EUROPE NEEDS TO HAVE DOMESTIC CAPABILITY AND CAPACITY. SO EUROPE NEEDS TO INVEST IN ITS OWN CAPABILITIES AND SOVEREIGN CAPABILITY. WE PLAN TO THAT AS WELL. 11% OF OUR REVENUE TODAY IS U.K. EUROPE. IF YOU LOOK AT THE BACKLOG, THE 75 BILLION POUND NUMBER I TALKED ABOUT, 30% OF THAT IS U.K. EUROPE. BAE SYSTEMS IS WELL-POSITIONED FOR THAT GROWTH VECTOR IN EUROPE THAT WE SEE. BUT ALL ACROSS OUR PORTFOLIO I THINK WE ARE WELL-POSITIONED. I THINK THAT IS WHAT MAKES BAE SYSTEMS SPECIAL IS THE GEOGRAPHIC SYSTEM WE HAVE NONE OF OUR PEERS HAVE. KRITI: YOU SAID 50% OF YOUR SALES COME FROM THE STATES, A PORTFOLIO BUSINESS THERE. IF YOU’RE TALKING ABOUT ACTIVE SPENDING ON U.S. DEFENSE MANUFACTURING ARE YOU BENEFITING FROM THAT WERE GETTING HURT BY THAT? BRAD: WE. ARE BENEFITING FROM THAT KRITI: TO WHAT EXTENT? BRAD: IT’S A 13% INCREASE. SO THE BUDGET PLUS THE RESOLUTION. KRITI: THAT IS FROM U.S. DEFENSE SPENDING, NOT NECESSARILY FROM THE TRADE DEALS, THE PROMISES THAT ARE BEING INKED WITH JAPAN, SOUTH KOREA, INDIA. BRAD: YEAH, I GUESS WHAT I’M TRYING TO SAY, KRITI, AS WE HAVE A PORTFOLIO THAT ALIGNS WITH ALL THE THEMES HAPPENING IN ALL THOSE PLACES. AUSTRALIA, JAPAN, U.S. BUSINESS, VERY WELL ALIGNED WITH THE PRIORITIES OF THE INDO PACIFIC THEATER, WHICH IS WHAT THE WESTAR ENERGY IS AIMED AT. WE LOOK AT EUROPE, I’VE TALKED ABOUT THE KEY WAYS WE BENEFIT FROM THE EUROPEAN INCREASED SPENDING. AND ALL THE PLACES IN THE WORLD WHERE WE OPERATE WE ARE WELL-POSITIONED TO BENEFIT FROM SPENDING. GUY: THE SIX GENERATION FIGHTER, CALLED THE TYPHOON. BRAD: IT’S ACTUALLY THE TEMPEST. GUY: I GOT MY AIRCRAFT MIXED UP. THERE IS SOME DISAGREEMENT AT THE PARIS AIR SHOW, THERE’S DISAGREEMENT WITH THE OTHER PROGRAM THEY ARE RUNNING. WHY DO YOU THINK THIS –WHERE DO YOU THINK THIS ULTIMATELY SETTLES? YOU HAVE THESE TWO BIG PROGRAMS. THE FRENCH WANT TO HAVE THEIR OWN PROGRAM. HOW MUCH INTEROPERABILITY CAN THERE BE HERE? IS IT POSSIBLE FOR AIRBUS TO SHIFT ALLEGIANCES IN TERMS OF WHERE IT PUTS ITS CHIPS? HOW FLUID IS THE SITUATION FROM YOUR POINT OF VIEW? YOU ARE CRACKING ON WHAT THE TEMPEST, AND IT’S MOVING ALONG WHILE THERE IS A DISAGREEMENT WITH THE OTHER PROGRAM. HOW DO YOU SEE THIS EVOLVING? BRAD: HARD TO SEE, WE REALLY DON’T — WE ARE NOT CONCERNED ABOUT THAT PROGRAM FOR SUP WHAT WE ARE CONCERNED ABOUT IS MAKE SURE WE DELIVER TO OUR TIMETABLES. INITIAL OPERATING CAPABILITY BY 2035 FOR THE SIX JEN IS WHAT OUR FOCUS IS AND WE ARE MAKING EXCELLENT PROGRESS ON THAT. WE’LL HAVE A FLYING DEMONSTRATOR FOR THE TEMPEST IN 2027. GUY: HOW MUCH INTEROPERABILITY COULD THERE BE? BRAD: WEAPONS PACKAGES WILL BE THE SAME. IT WILL BE THE SAME WEAPONS PACKAGE. GUY: IF THEY HAVE A PROGRAM OR NOT? BRAD: THAT’S UP TO THEM TO RESOLVE. I THINK IT IS WELL WRITTEN ABOUT HOW CHALLENGING THAT PROGRAM IS. WE LET THEM TAKE CARE OF THAT. GUY: WOULD BE BETTER IF EUROPE HAD ONE PROGRAM? BRAD: WE ARE FOCUSING ON OUR PROGRAM. WE ARE MAKING EXCELLENT PROGRESS. I THINK TIME TO MARKET WITH SOMETHING LIKE THIS IS IMPORTANT AND WE HAVE A REALLY STRONG LEAD ON THAT. ANNA: THANK YOU SO MUCH FOR SPENDING TIME WITH US, BRAD GREVE, CFO OF BAE SYSTEMS. COMING UP ON 9:00 IN LONDON, I FEEL LIKE A WHOLE DAY MUST HAVE HAPPENED THERE HAS BEEN SO MUCH NEWS, BUT WE STILL HAVE OTHER THINGS COMING. GERMAN CPI, USCP E, THINGS AFTER THE MARKET, APPLE, AMAZON. THE TECH STORY IN THE STATES NOW AFFECTING FUTURES. KRITI: IT IS THE BEST AS WE LINED UP TO THE APPLE AND AMAZON STORY. MICROSOFT AND META WAS ALL ABOUT CAPEX AND AI INVESTMENT. WILL APPLE AND AMAZON BE ABOUT THE TRADE STORY? LOTS TO DIGEST. STAY WITH BLOOMBERG FOR FULL COVERAGE OF THAT CONVERSATION AND INTERVIEWS WITH THE FORMER KANSAS CITY FED PRESIDENT ESTHER GEORGE. CATCH THAT CONVERSATION AT 12:30 P.M. LONDON TIME. THAT IS FASCINATING ON THE BACK OF DISSENTING WHAT THE FED. GUY: WAS FED THE STORE YESTERDAY OR ARE THE TECH? WHO CARES ABOUT RATE CUTS AND ALL THAT STUFF.Stream Schedule:US BTV+
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