Election day in what could be the most volatile week of the year. But, tech is still lagging. We will preview upcoming earnings. My exclusive interview with snp ceo klein. Could this mean bad news for the rest of tech . First, the earnings parade continues with posting its annual profit forecast with new accounts searching. Net new accounts jumping 55 from a year earlier. We will get to that in a moment. First, Abigail Doolittle has been looking at the broader markets today as we head into the big day. A lot of anxiety going into tomorrow. How are investors digesting it . Abigail anxiety describes it well. More jitters on the part of stock investors. Another wild day. Sharply higher. Afternoon, then finishing up just a little bit after the close. Investors were selling the tech stocks, or some of the tech stocks, and buying up some of the cyclical, growth sectors such as energy, industrial, materials. On the other hand, volatility, still very,0 fix very elevated. The investors are concerned about the overall macro sure, throwing some fire into the the picture. Into bonds were higher. Work, one of the bigger thecs, a big mover around resurgence of the virus. In europe, the u. K. Back under lockdown. Travel and leisure stocks falling. On the other hand, clorox, on their bleach and other cleaning products, they put up a blowout quarter. As is cosco. Rging, wild trading day with all of these macro factors and especially the election. Emily we will get to that with Christian Klein later in the show. Less techut how the heavy indexes climbed. Abigail i think some of it has to do with the week Third Quarter or lessthanperfect Third Quarter that some of these Companies Put up last week. Withigger story has to do too far, too fast, as we have been talking about for weeks, months even. These stocks have gone up in an astronomical fashion on the year. They sold those stocks once again today. Another piece could be the rotation into the cyclical second is where we have some this after hours. Paypal down about 5 in the after hours. It looks like a Profit Guidance that eat. The revenue guidance missing the mark a little bit. Of course, the big headlining event tomorrow, needless to say, the election. Emily absolutely. Abigail doolittle watching all the back and forth for us. Now, to more on how tech investors are bracing for the potential volatility that might follow election results. Portfolio manager at independent Solutions Wealth Management joins us. Going to be an Inflection Point . If so, how . Paul i dont think it will be an Inflection Point, particularly for the tech sector. I think the key issue is the final passage by congress of the fiscal stimulus. That is what i am looking for before i get too excited about going back into particularly tech stocks. Emily you have a similar Market Outlook whether it is biden or house . N the white paul i think there is not going to be that big of a difference. I know that sounds a bit weird. If you take a look over time, no matter who is in the white house, democrat or, if they have control of both houses of congress were not, there is not that much of a difference. This,hink coming out of aggressives will be and as long as we dont have to shut down the usa again and we dont have a repeat of the business closures from march and april, regardless of who wins the election, i think we will be in a pretty good position for a as therket in stocks smoke clears. Tech, talkt comes to to us about what you are buying at not buying. Latewas around in the 1990s. At that time, i ran some tech portfolios for merrill lynch. I dont think that this is a bubble, at least of the same magnitude. Today, the publicly traded companies, even if they are emerging companies, are much more real. Back then, you had a lot being foisted upon investors by investment bankers. I could tell, when they came through our offices, that these companies were not real. We dont have that today. These days, it is much more difficult to have a company that is still needing to be baked, to come through the ipo pipeline. And Interest Rates so low growth forecasts so low, i cannot see tech stocks not outperforming in the future. Growth should outperform value in that scenario and the tech company should do well. Again, this is not a perfect below. Not as worrisome as heading into the top of the internet bubble in the early 2000s. Emily a question coming in from a viewer on the terminal, asking, what do you see as an appropriate hedge for tech and mega cap stocks . Paul what i try to do for my portfolio that i manage for i thinktake all all u. S. Equity investors once the smoke clears should get back to neutral weight. On the 60 side, i do have companies that are nontech. I dont buy them unless they yield 2 . You have a nice balance. Some volatile tech names. Of yield orth 60 companies that still have price appreciation potential but are much less solid and more volatile. Emily when you look ahead, what do you think are the biggest risks or threats to tech stocks . Obviously, we are dealing with regulation. I think it is a couple of things. One of the things you are seeing playing out right now, and that is why i am cautious, you have Companies Like paypal announced results tonight. A covidun in 2020, beneficiary. Wall street will raise those numbers for the rest of the year but the stock will be down 5 tomorrow and has to drop another 5 before i get reinterested. The biggest risk is too far, too fast. Nothing fundamental, just too far, too fast. Then, of course there is the , days if not weeks if not months, and that pushes back my key catalyst, which is congressional passage of the fiscal stimulus. Once we get through that, i am feeling very good about growth over value and stocks. There is probably no asset class. Tot you have to be exposed in that kind of background. Always appreciate your insight on the show. So much forthanks stop by. Coming up German Software maker sap alarming investors with signs of slowing revenue growth. A revenue point for the business. Bringing you my exclusive conversation with ceo Christian Klein next. This is bloomberg. Emily when German Software maker sap cut its forecast last week, shares plummeted. That it mighted be shortlived. In an exclusive interview, i spoke with sap ceo Christian Klein. He says the pandemic is an Inflection Point as customers move to the cloud. Take a listen. We want to invest in now. We want to invest into our aunt d with our customers because they need us now. To comea key enabler out stronger. Shares have now plummeted, wipe tens of billions of dollars off your market cap. How can investors have confidence after such a massive blow . As i mentioned, we have guidance out there i dont want to trade the success of our customers by forcing them to buy more while they want to move to the cloud. This is why we are now shifting parts of our guidance. We will accelerate the growth in the cloud even more. Numbers,look at our q3 why is revenue 14 . If you exclude our travel and who can blame this crisis for not and their business. This is a time after covid that this business will bounce back. I am extremely confident that we will even accelerate our growth in the cloud for years to come. Emily salesforce Ceo Marc Benioff rejected the idea that this a bad omen for the rest of the industry. He said you are still going through a ceo transition. Do you think Companies Like oracle need to worry about the forecast ahead . Met in davos and we had a friendly conversation. What we are focused on is the success of our customers. Leader andrket skyrocketing. Focused on making the connection work between the front office and the supply chain. This is what we are focused on. Emily do you think this is accelerating a shift away from on premise permanently . Christian absolutely. This is part why we changed the guidance. I also talked to many of the investors. While they were disappointed about the shortterm change of guidance, everyone said this is the right thing to do, because the cloud is the way to go. This is what makes sap successful especially in the midand longterm. Not one single customer reached out to me and complained. Everyone actually reached out and said, thanks for listening to us, thanks for moving us to the cloud. , ande u. S. , we have many now we are going to hire more engineers. There is no other Software Company in the world who can really make this transformation for our customers. Emily speaking of the u. S. , you have an interesting outsiders Vantage Point from germany. We are heading into a president ial election here. How does whether it is biden or trump in the white house impact your outlook . Christian i am a german, so i will be a close observer tomorrow. A great partner for you and also for s. A. P. I wish the country all the best for tomorrow. Can catch the full interview at bloomberg. Com. Coming up, facebook and twitter ramping up to prepare for a potentially chaotic Election Night. But, are there guardrails enough . We will speak to the president and ceo of the Leadership Conference on civil and human rights next. This is bloomberg. Twitter reiterating its policy today that it will flag tweets from certain accounts including those of President Trump and former Vice President joe biden that claim an election victory before at least two authoritative Media Outlets confirm the outcome. Are these actions enough to protect the integrity of the election or should social Media Companies do more . I posed that question to vanita gupta. Vanita i think that they have made significant progress through the summer and even in recent weeks, announcing efforts to protect the legitimacy of the it ison, recognizing that not just to make sure the platforms do not amplify Voter Suppression or efforts to dissuade voters, but recognizing the really Important Role that the platforms will play in making sure that disinformation about results and the like are not are not elevated. Do i think it is too late . Do i wish they had taken these actions up earlier . Yes. We went through a primary season that was infected with disinformation. I think it is important that the platforms have taken the steps they have. We are continuing to push them , but these steps are crucially important, especially amid covid where people are getting their information online, the importance of fighting disinformation on these platforms is as important as ever. Emily facebook did take the dramatic step recently to ban qanon. Do you think that had the impact you want to see and are you still worried about violence on election day . Vanita i am heartened that facebook did that find it was too late. We have been pushing facebook to take action. It is really important that they did take action. Qanon,ill worried about proud boys, other entities that can make people feel scared, regardless of what comes to pass. This is the important message, that we have had a record , even though there is activity,out militia white supremacist activity, voter intimidation at the polls, the fact that we have had tens of millions of americans showing up, casting their ballots in person or absentee has been really heartening and, frankly, wehink the best fight back can have for concerns about the. High turnout could bring a decisive victory. Well have to see how this all plays out. That was my next question, what is your confidence in the integrity of the election . Will this be a Fair Election . Vanita gupta i believe in the vanita i believe in the end that this is a strong democracy. The high voter turnout, we have systems in place, lawyers at the ready, i believe we will do everything we can to safeguard our democracy to make sure that votes are counted. Americans need to be patient. This is an unprecedented election. It is quite possible that on the night of november 3 we will not know the final results. It will be important in states that dont even start counting the ballots until after november 3 that they will have the space to do that and ensure that every vote is counted. It is taking all of us doing everything we can to ensure that our democracy remains protected. Emily how concerned are you about poll watchers scaring voters away, Election Night and post Election Night chaos and violence . Vanita i am always vigilant around what poll watchers will do. Anecdotal stories have got national attention. As ad large, we always country have dealt with voter intimidation especially against black and brown voters. Local Law Enforcement are making clear that we are not going to be tolerating voter intimidation. That voters need to feel safe, be safe. That platforms have a role to that organizing to scare voters are not amplified and are actually shut down. These are all part of the efforts to ensure that voters feel safe and have confidence in casting their ballot and make sure their ballot will be counted. , president ta gupta and ceo of the Leadership Conference on civil and human rights. Coming up, just a day out from one of the most crucial elections in american history. We lied arizona, one of the key battleground states, to get the latest. This is bloomberg. Emily this is bloomberg technology. On the eve of the election, we look at arizona. A once republican stronghold now and play. Biden has led in the polls by around three point since the summer. Changing demographics and growing suburbs, the pandemic and influx of Median Income workers are a factor in the state that President Trump won in 20176. Joining us to discuss what could turn arizona blue is ed ludlow who is on the ground in chandler, arizona right now. Talk to us about this influx of new workers from Silicon Valley could play in the arizona results. Of massive a story population growth and changing demographics. It applies to arizona statewide. Am, therer where i about 30,000 workers employed in Hightech Industries including semiconductors. Intel employs 12,000 people here. Software, you have the likes of paypal, godaddy. Com. Underpinning all of this as it relates to the election is strategists and policy officials on both sides who feel that collegeeducated, medium income workers and their families are not going to be voting republican or for president in this election. An area of focus for both parties. The democrats made progress in chandler and broadly in arizona in the 2018 midterm. Even in the case of registered republicans and collegeeducated women, they are seeing signs that those types of voters are breaking with the president and the republican party, and moving towards democrats. Almost 50 of the workforce holds a bachelor degree or higher and that is an area of focus from both parties. That the republicans do not feel they can pull back those voters over the next 36 hours and the democrats feel they have made Real Progress this election cycle. 100 Million People have cast ballots early. Talk to us about arizonas early Voting System and the processes there. Ed yeah, so arizona is good at counting votes. They had an early Voting System since the early 1990s. 2. 6 million early votes either by mail or in person have been counted so far. 800,000 that are yet to be counted. That is statewide. The feeling from democrats and republicans i have spoken to his this is going to be a very close race. They will publish a preliminary a result around 10 p. M. Eastern time on tuesday but the feeling is we could still be counting for some time. There is confidence in the security of the Voting System here. Both digitally and in the physical mailin ballots in terms of antitampering technology. Even though biden has led in the polls by about three Percentage Points through the cycle, another nbc poll has him even. The feeling is we will still be counting votes for days to come. And even though there is a swing state status for the first time you much ever here, they will make sure they get it absolutely right this time around. Emily we will talk more about the technology being used to count the votes in a moment, but first you have been on the ground, you have been talking to voters. What are you hearing from them in arizona . Ed yeah, covid is front and center for many voters. The president has been here on a number of occasions. Vice president pence has been here. On covid, they have been saying we brought you ppe, we got the economy open. The president was pressuring the Arizona Governor to reopen. On the democratic side, they are pushing hidard with latino voters, saying the republicans dont have a plan when it comes to covid. We are seeing the recent uptick in cases in recent weeks. They are also targeting latino workers. Especially around the economy, President Trump was promising job creation, promising to support latino owned businesses. You also have the democrats out and they feel they have the strongest Grassroots Movement they have ever had. They are really focused in the last 36 hours on the latino vote, which is 30 of the states population. Particularly because it is a demographic that does not work proportionately high. They are out in the grassroots areas, pushing the vote, pushing people to go out that normally would not. Beyond covid, beyond the economy, education is also an issue. There is a shortage of teach