Nejra welcome to daybreak europe. It has just gone 6 00 in london. An absolute earnings long on spot. The Second Quarter adjusted operating income comes in at 225 million euros. The estimate was 289 million euros. On the Second Quarter, adjusted operating income, that looks to be a miss. 225 versus the estimate of 289. The secondquarter adjusted operating income there at 305. The estimate at 289. Thats a correction coming through there. That secondquarter adjusted operating income is a beat. The initial number look like a mess. Miss. Secondquarter revenue. 2. 4 5 billion euros. The estimate was 2. 47. A slight miss on the revenue. To their ceo. Dont miss that interview at 7 30 a. M. London time. Deutsche bank, we are getting numbers from that. The big focus for investors is going to be the execution of the turnaround plan. If i could get to the headline numbers right now. Secondquarter trading revenue at 1. 6 9 billion euros. The estimate was 1. 7 9 billion. Givent a huge a prize what we have seen across other banks in europe and the u. S. Secondquarter fix sales in trading revenue. 1. 3 2 billion. A slight be on fixed trails. 369 millions in at euros. The Second Quarter, missing estimates. 13. 4 . The estimate was 13. 5. Slight miss. Asset management revenue. Asset on Second Quarter management revenue. With Deutsche Bank, the firm basically, we heard that its going to be equity sales and trading business. No dividend for this year amid the overhaul. The radical overhaul was announced earlier this month. Also talking about the Second Quarter loss. Cutting the workforce by 1 5 to adjust a slide in profitability. That was big news. The Deutsche Bank cfo. Cats that interview at 7 00 london time. Lots to talk about in terms of the turnaround plan. Trading butut the then the Asset Management revenue coming in at a beat. That takes me onto dws. Just getting those numbers appear as well. Its an earnings onslaught this morning. If we take a look at dws secondquarter adjusted, 185 million euros. The estimate was 181. Thats a big beat. It had 6. 7 billion euros of net new assets in the first half. The broader context is that the firm has accelerated expense cuts. It has been exploring mergers. Dws group has said it wants to play an active role in the consolidation of the Asset Management industry with pressure on fees and the Challenging Market force. Scale. To with no acquisitions on the card, the ceo has been focusing on cost cuts as the mainly for. Main lever. Taking a look at what else we have. It doesnt stop. Speaking to the cfo of dws. Dont miss that interview either. Moving on to daimler. 42. 7 billion euros. Improvement of cash flow in the second half. Total unit sales declining by 1 to 822,000 units. The secondquarter loss comes in at 1. 2 billion euro. A lot of earnings to get through. We are deep in earnings season in the u. S. Lets take a look at the broader market. We had cocacola in yesterdays session. United technologies. Snap as well. S p futures flat right now. The index when above 3000 yesterday. What gave equities of left a lift was this report that we could have facetoface trade talks by the u. S. And china on monday. In terms of the tech earnings, Semiconductor Stocks trading near a record high. Numbers from Texas Instruments as well. What is giving nasdaq futures more of a hit seems to be this report out that theres going to be a broadbased antitrust probe into tech stocks in the u. S. That is hitting nasdaq futures little bit. The 10 year yield takes lower. Switch of the board and take a look at fx. The imf cutting its Global Growth outlook. It did upgrade the u. S. We saw Dollar Strength off of the back of that. Crude also on the front foot. Stockpiles feeding into this. Optimism given the news weve had on the potential for further trade talks. Wti trading at 56. 95. A new Prime Minister and the. Orest johnson. How is he going to deliver brexit . The markets in asia. Juliette saly in singapore has more. Good to see you. Has it looking house it looking . Asian stocks higher for a second session amid the trade talk optimism. A lot of money going into chinese stocks today. Holding onto gains coming out of the lunch break. The nikkei looking pretty good. Australia is asx 200 is headed towards alltime highs. T level since news that november 2007. Fall. Uing to we heard from ubs today. He things iron ore could drop below 100 in the Fourth Quarter as valley moves to boost output. I want to show you whats been happening with the all he does or aussie dollar. Bill evans coming through. Hes known us as the doyenne. You could see a rate cut from the r. B. I. As early as october to point 0. 75 . Look at how the aussie dollar has really tried to break out of this resistance. It has failed four times. We are continuing to see weakness in this aussie doar. You could see a catalyst when we hear from the rba governor philip lowe on thursday. Bulls watching to see if we could break out of that resistance level. More weakness coming through on the back of the rba rate cut today. Nejra thank you. Set to. And china are resume facetoface trade talks for the First Time Since may. Sources tell us that Robert Lighthizer will fly to shanghai on monday. Negotiations are scheduled to run through wednesday and are expected to review issues dividing the two sides. The imf has cut its global close outlook again. It says the World Economy will expand 3. 2 this year. Joining us now for the hour is our guest host. Head of equity strategy at Standard Chartered private bank. Us. T to have you with lets start with the outlook for trade. Yesterday, we saw the s p 500 get a lift on this news. We close above 3000. You have a preference for u. S. Equities. Is that because you think they will be more shielded than other Global Equities . In general, when you look at lewis u. S. Equities, they are more trait less trade oriented than your area. If we are correct in our view that there is not a trade deal between the u. S. And china, you want to be in markets that are less exposed to trade. The u. S. Stands out as one of those markets. Nejra what if we get more positive developments on trade . Easing cycle short and that could put some pressure on u. S. Equities. I think that the fed is looking at 69 months. Even if we are wrong and we were to get a trade deal in the shortterm, the damage has been done with regard to growth. Inflection point when it comes to Global Growth or global contraction in our mind. The fed is taking an insurance policy on growth by trimming this month. Nejra the imf cutting its outlook for Global Growth, he did upgraded slightly for the u. S. The outlook is quite dam. You have a preference for equities over other asset classes. Whats the reason for that . It reflects the view that we are in a low inflation world. Interest rates in the u. S. Down towards 2 . When we look at the alternatives out there, equities standout. Nextovery of earnings into year. We had knowledge the concerns about the secondquarter inflow. Doubledigit Earnings Growth coming through next year. That highlights the attractiveness of equities as an asset class, compared to bonds. Nejra youre not expecting an earnings recession. As a phrase ive heard over and over again. Correct. Consensus is about 1 growth. Its very tight. In our minds, the market is a discounting mechanism. It is looking ahead into next year. Given where the s p is, clearly its taking a glass halffull view in terms of the outlook for earnings. Nejra given that you dont expect a full resolution to these trade talks anytime soon, at one point to these trade tensions actually start to hit Company Profits . If you are not concerned about an earnings recession, perhaps you think the companies can whether those challenges. The absence of a trade deal is already impacting corporate Earnings Growth. Just not in the u. S. Europe, wetowards are seeing those trade sensitive stocks already being impacted by the slowdown in trade that we are seeing in china. The drag that is having on export growth in europe. The impact on consumption as well in china which is impacting some of the auto companies. It is materializing. Its just not materializing in the u. S. It is materializing in trade sensitive markets like europe and singapore. Nejra im guessing your equity trade. Ions reflect i wonder how brexit fits into all this. That was something that was mentioned about the imf as well. You have a new Prime Minister in the u. K. , Boris Johnson. How does brexit and the risk of a no deal sit into your global Asset Allocation and equities . In equities . The risks are significant for the pay. The u. K. Its relatively modest. We have a neutral allocation towards the u. K. Ultimately, we believe that there wont be the u. K. Wont crash out of the euro area. Admittedly, the odds of a no deal exit have increased. We are looking at 40 . Thats up from 25 before. We retain our view that there will be a deal ultimately. Hence, the damage to the euro area will be contained in our mind. Nejra great to have you. Our guest is with us. Lets go to bloomberg first word news now. Boris johnson will formally take office as u. K. Prime minister today. He will be invited to form a government by the queen after theresa may resigns. Many mps fear johnson will be forced to colin early election to break the parliamentary deadlock. Weve learned hes assured colleagues that is in his intention. President trump is considering how to respond to turkeys decision to buy a Russian Missile defense system. Thats according to senators who met with the president yesterday. Trump said he wasnt looking at economic sanctions last week. Now the u. S. Has suspended the countrys ability to buy and build f35 fighter jets. The eu has almost doubled the amount of u. S. Goods it would. It with retaliatory tariffs thats if President Trump imposes duties on eu cars and auto cars auto parts. The eu says it will reject u. S. Demand to limit auto shipments on National Security grounds. China has accused the u. S. Of undermining global civility. The country has released its the militaryince in 2015. It represents a departure from the Previous Report that have focused on efforts to improve military cooperation with the u. S. Tosident trump is suing block Congressional Democrats from obtaining his tax records. Keepthe latest attempt to his personal Financial Information out of public view. This comes three weeks after the house ways and Means Committee sued to get trumps tax records for the past six years. Global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Nejra thank you so much. Coming up, Deutsche Bank reports a net loss of 3. 2 billion euros on higher restructuring costs. Thats a wider loss than expected. Secondquarter trading revenue missing as well. Its a little bit of a boost as dws posts a Second Quarter of inflows. We speak to the banks cfo about the rebound. Cats that interview at 7 00 london time. Tune in to Bloomberg Radio, live on your mobile device. This is bloomberg. Nejra this is bloomberg daybreak europe. Lets get a check on the markets. Green on the screen in asia. Heard that the u. S. And china will have facetoface talks on monday, according to bloomberg reporting. Of thesie dollar is one underperformers in terms of g10 currencies. Falling after westpac said the central bank may cut rates as soon as october. In terms of the dollar, you seen strength over the past couple days. Part of that was down to that debt ceiling deal. The imf cutting its Growth Outlook but updating the u. S. Slightly. Nasdaq futures taking a hit. U. S. Antitrust foot profeeding into that. Wti on the front foot. The trade tension is something to do with that. Cable is steady after three days of losses. A new Prime Minister in the u. K. In the form of Boris Johnson. Lets get the Bloomberg Business flash. Tradingche banks revenue has missed estimates. They are reporting a secondquarter net loss of over 3 billion euros. The bank previously announced plans to cut 18,000 jobs and shrink the Balance Sheet by exiting equity trading. They announced its 2019 revenue coming lower than last year. Agreed to pay 5 billion for wireless assets in a deal with tmobile and sprint. The satellitetv provider is paying about 1. 5 billion for prepaid mobilege for the Justice Department to approve the merger. Starwood capital and Apollo Global management are reportedly buying an Aircraft Finance unit owned by general electric. A could fetch around 4 billion. As you would accelerate the. Ismantling of ges we work is looking to go public in september. Its expected to be the secondbiggest ipo of the year. The company is targeting a share sale of 3. 5 billion. Largest backerir in values the business at 47 billion. That your Bloomberg Business flash. Nejra thank you so much. Turning to tech. The u. S. Department Justice Department is investigating technology firms. The antitrust probe will look at concerns expressed by consumers, businesses, and entrepreneurs about social media and online retail. Shares of facebook, amazon, and alphabet also on the news. Futures taking ahead overnight as well. Clyde mcdonald is still with us. How concerned are you about antitrust probes like this, in terms of how it might impact the Business Models of these Big Tech Companies . The real issue facing the u. S. Technology companies is much more related to the use of personal data. In terms of the antitrust, the ultimate penalty will be the reversal of facebooks takeover of whatsapp or instagram. Thats highly unlikely. Rather, a severe penalty is a potential outcome. The real issue is whether or not u. S. Authorities go after these companies in terms of their use of personal data. Personal data is their raw material. At the moment, that is free. If there are changes to that, if the u. S. Takes a more aggressive attitude as the europeans have, that could be in existential threat. Nejra does that make you want to stay away from tech altogether . It is about picking onetwo. We pare back our exposure to u. S. Technology. We have taken social Media Companies out of our conviction list. We still have exposure to tech. Names such as amazon, microsoft that give us nice exposure to the cloud specifically. More in the corporate market, those are the types of names we like. Nejra what about chip stocks . They have been a big concern. If you look at the Philadelphia Semiconductor index, thats near a record high. Texas instruments lifting spirits overnight. The ams numbers yesterday. We also had tsmc out of asia. Are you feeling how are you feeling about chip stocks . You mentioned a number of Earnings Releases that were quite positive. Ne we honed on was asml its a chip manufacturing stock. It makes the machines that produce the chips. They started to guide positively. You are seeing an increase in the orders that make the chips, they must be confident on the supply and demand balance looking forward. That justifies a more you towards the view towards the Chip Companies themselves such as my crime. Micron. Nejra this fits with our discussion earlier in terms of trade. Tout u. And china. In terms of the japan korea spat, im sure youve got great insight on this. Do you see that posing a lot of risk to Tech Companies globally . Riskdont see it as a real , globally. I see it as a risk to japan. The logic that we see there is that, if you look at the past when you had china which started to clamp down supplofearth matew was japan starting to diversify and look for other sources. When it comes to this supply of Specialty Chemicals from the japanese to the koreans, korea is likely to diversify. We dont see it as a structural threat in terms of the korean companies. We see it as a localized spat, more to do with politics than economics. Nejra when you choose the Company Think . Industry group by industry group. Its a global sector. We hone in on the likes of asml which manufactures machines. We dont have any of the social Media Companies. That industry group. Nejra what about software . Thats the area that we are most constructive towards. You look at microsofts recent results, fairly positive. Next up we will have amazon which is out this week. We will be focused on Amazon Web Services and the growth we are getting there. Our guest is with us. Lots more to discuss including, deliver brexit, unite the country, and defeat jeremy corbyn. The new