Powered by more than 27 journalists and analysts in more than 120 countries. I am Alisa Parenti. This is bloomberg. Bloomberg technology is next. Caroline i am caroline hyde. This is Bloomberg Technology from london. Coming up, the tech selloff goes global. Investors weighing the sectors biggest names. We will analyze every turn of the worst two days contact this year. Uber ousts its head of business. We have the inside track on the surprise exit. He joins us at the launch of london tech week for a bloomberg exclusive. Lead, stocks follow around the globe led lower by tech shares. Biggeste, it had the decline in almost a year since june 27 of 2016. The slide continued in the united states. Some of the largest firms posted the biggest declines including apple, netflix, and alphabetic. Oliver renick joins us from new york. You my firstbring one. I am digging into the terminal. 9317. I am looking at the slump in european stocks, down 3. 6 . Im looking at the slump in the u. S. Nasdaq in the blue line. We see the biggest twoday selloff, 230 billion of market value wiped off. Asia is being hit as well. Big players, apple, netflix. This seems to be worldwide. It is not pretty. When you look at what happened overnight, your came into the u. S. Today. We saw a repeat of what happened friday. I think what happened is it is not just about technology or the fundamentals of these companies. I think it is about a reversal that is unique given how far some of these companies have gone in the past six months. We had a first reversal in the equity market at the beginning of the year. Then we saw investors looking to growth. We saw investors looking for momentum. Companies build up momentum over the past six months. Now that trade unwound. It is taking down Tech Companies that had done very well over the past six months. Invest in strategies more than companies specifically. That is breaking down a little bit. Caroline it is fascinating as to why the unwind starts here. Morgan stanley saying they have further to go. Im interested in if we could see not just a correction but a air market. Chart. Gnals my next in64 6423. This shows how far we came before the turnaround. Close toology stocks 50 reaching 52week highs. 1995ve not seen that since and 1997. After those two years, down 20 . Are we about to have a bear market . I love that chart. I like it because that signals what has happened and to what degree. It is nice while it is working and painful when it does not. In the tech sector in particular, it has not happened many times before. There are a lot of things that have not happened since the. Com era. Familiare signals look imately, the mental mental fundamental picture is different. Valuations are below where they were. There was not a lot of fundamental backing to the selloff. We dont see demand for iphones or products. That was not the case. It was a few things that coalesced into this moment in at theeople looked investing they have been doing and said it does not make sense. I will kick it off with my chart. This is breaking down the losses. In white, semiconductors. Blue, the growth index for the russell 1000. Gray, momentum. Orange is straight up tech. That is telling us the specific selloff. Semiconductors hardest hit. You can see where tech got hit. You can see the momentum and growth badly hurt. What is most interesting is the fact at the end of the day the s p 500 only down about 20. Worriedthose people about concentration, they got hit hard today. The market has been able to shrug it off. That is important for underlying strength. Caroline we will see if earnings managed to be a supporting factor going into the next quarter. Brilliant reporting, oliver renick. Ahead atg announcement the e3 gaming conference kicking off tuesday. Microsoft is targeting hardcore gamers with the new version of the xbox. Its smallest and most powerful ever. It is designed to work with a new generation of tv sets as well as with games that offer more realistic scenes. We will be live at the conference with the c. E. O. And the Nintendo America president wednesday at 5 00 in new york, 2 00 in san francisco, and 10 00 p. M. In london. Uber ousts its Senior Vice President for business. Where uber can go from here. Exclusivehe show, our conversation with the london mayor on keeping innovation growing in the u. K. Capital and his relationship with President Trump. This is bloomberg. To offera may decided that. It was wrong for a number of reasons. It was wrong because of him changing the longstanding policy on refugees and a host of policies and views he has. Caroline after years of watching Silicon Valley innovate, wall street is ready to unveil its own answer. More than 30 banks are teaming up to form a new peertopeer Lending Service that will soon be offered to about 80 million banking customers. Like appleetitors pay. Uber has decided to part ways with the head of business, a male michael, after internal probes revealed a series of misdeeds. The embattled ridehailing giant held a six hour Board Meeting to discuss a variety of issues including workplace them nt and of leave a leave of absence for Travis Kalanick. And ericeide newcomer, welcome to both of you. This follows eric holders report on the series of scandals. Is emil michael leaving a big deal . It is a huge deal. This is travis top confidence, a great friend of his, and sort of the guy that helped the company raise more than 10 million in strike a deal in china and make partnerships with automakers like daimler. The hugely important executive who has been a central figure in many of ubers scandals. It is a big deal the board came to this decision. Overall, things at uber are crazy right now with this report supposed to drop tomorrow. Caroline crazy indeed. It seems emil michael is fighting talk saying he blames the board of directors and the legal team. Your expertise focuses on corporate governance. This is the right step to be taking . Should they be pushing for Travis Kalanick to be taking a leave of absence . I think the personal issues travis has been facing have been significant for him. It may be a good time for him to step back. Now with the leaving of his righthand man, you have several open positions. For these to remain open while he is taking a leave of absence would leave management and turmoil because there would be nobody steering the ship at the time. Caroline talk about these independent Board Members being called for by the eric holder report. It feels as though perhaps they are too hard to fill at the moment. How independent is the board compared to other companies . Founders and Company Leaders have a lot of control when it comes to the boards. Correct. The dual structure for control of the company has been around since the 1920s. It has recently become more prevalent at technology firms, especially in Silicon Valley. The way the dual structure works is you have two different classes. One class of stock has significant voting rights, more than the other. Perhaps the other has none. Sharesclass b voting have a voting right of 10 to one. The other only have a 11 share vote. Power tos significant those who hold the class b shares. Those are the managers, travis, and those who were founders of the company when the company began. Caroline eric, he said this is a crazy time at uber. We are hearing what could happen if they are asked to have more independent Board Members. What about the potential for Travis Kalanick to step aside . We know he is under personal pressure. The poor man just lost his mother. The funeral was on friday in los angeles. It has been a hard time for him. Puts theg we have seen decision to take a leave of absence on his shoulders. He would need to decide himself. The big question is who would lead the company. We reported there could be a Management Committee of top executives. But there is not a key person that could take over. There is no chief operating officer, no chief financial officer. They do not have a clear number two, to take the reins. Advising when you are clients you represent, when we see such a Company Gearing up potentially in the foreseeable future for some sort of ipo, how crucial is it to ensure we have clear corporate governments governance . How much does uber need to do . There have been roads paved by facebook, etc. , regarding the dual corporate structure. This is not unusual. Investors have seen it before. When you are guiding a company as to what to do, yuma you want to make sure everything is fair and equitable and to keep the concerns of the shareholders in mind. What youect to uber, would want to see is more independent directors join the board. Act in directors must the best interest of the shareholders. As you add more shareholders more independent directors, the actions of the board become more focused on actions that benefit the company as a whole. That is not to say the founders acting with these class b Common Shares are not acting in the best interests of the company. The argument has always been that allowing the founders to maintain control over the company will allow the company to continue to push forward on the Business Plan which is the basis for why everyone has invested in the company in the first place. It is a very delicate balance. Having more independent Board Members is a very important step. Caroline we will see how that continues to unfold as we get more news of the eric holder report. Newcomer has been following this story for us. Nanette heide, thank you. Thousands of Tech Professionals are gathering in london for the launch of Technology Week. The major hurdles facing the sector in the u. K. Capital. That is next. A feature i would like to bring to your attention is our new interactive tv function. You can watch us live. You can send our produces a message and play along with the charts on air. This is for bloomberg subscribers only. Check it out at tv. This is bloomberg. Caroline the democratic representative of Illinois Communications for engagement act. The legislation has the same twitteras an infamous typos sent by President Trump seeks to have them recognized as president ial records. It would prevent a president from deleting tweets or other social media postings. It is not the first time the representative has taken aim at President Trump. Another, he introduced act also known as the maralago, a nod to the president s private club are treat retreat in florida. London Technology Week has officially kicked off. The tech extravaganza is touted as europes largest showcase for technology. Since its launch in 2014, it has included more than 700 events and welcomed delegations from around the world. Joining us to discuss is someone who is no stranger to the local scene. He was the chairman of the Marketing Group and Vice President and general manager of skype. We know each other well. It is great to have you here. Is one of the founders of tech week. Talk about how important it is to ensure we are showing ourselves off that technology in london as a hub still exists and gets talent. London tech continues to go from strength to strength in terms of investment, talents, and startups being created. We are also in an uncertain climate the election and upcoming brexit negotiations at the top of the agenda. A week for celebrations. Excited to kick it off today. But some challenges we have to address. Caroline talk about the survey after the election. The key concern is getting talent into london. The day after the general election, we asked a lot of questions around the position on partys immigration talent, third hardy sponsors for visas. The consensus for the community is strongly against the antiimmigration approach, wanting to make sure we get access to skilled migrants weather from the e. U. Or beyond. I think a real wakeup call. Theynk we had 75 saying are unhappy with the current policies and they need to change. The same sort of theory we are hearing from the mayor of london. Are 4000 applicants now . We are about to hit 5000 around the world. Caroline having come back from Silicon Valley, that is often slightly less bigger pace in london. We dont have the foundation of cash. They have to go to the u. S. For money. Is that changing . I think it is. Last month, i had a showcase. We brought together angels, private equity funds to talk about the state of london tech in terms of investing. Where is it going with article 50 being triggered . I think there was cautious optimism. We dont want to compare ourselves to Silicon Valley. We are five or six years into it. We are seeing funds being raised. Britt hoberman announced a 60 million fund. Big Tech Companies are investing. It is still a challenge to raise money where you are and whatever stage you are in, but the money is there in london. If you have a great business and are a strong leader, we should not have its a difficult to get that. Caroline i spoke to the c. E. O. Of improbable today who managed to locate 500 million from softbank. He has headquarters in london. He has branches in san francisco. Hes not moving anytime soon. There is still the viewpoint that when you are an entrepreneur that if you really want to make it, go to Silicon Valley. Do you think that still is the viewpoint of phosphor nerves . Entrepreneurs . I think that is still the viewpoint but it is starting to change. I have seen big exits from london. I think the message coming back is five or six years ago, you had to go to Silicon Valley if you wanted to have a good exit. But not anymore. I think that is an encouraging signal. We have seen a couple of unicorns fail spectacularly. Yet london is still on track in terms of the investment, capital, and vibrancy of the community you saw this morning. Caroline you will be sticking with us. Thank you for digging into all of the london tech scene for us. He is going to be discussing more with us about the tech scene. London tech week does not stop here. Our exclusive conversation they are conscious later this hour with mayor khan is coming up later this hour. Towill discuss if it is time change the outlook for big cap techs. If you like bloomberg news, check us out on the radio. This is bloomberg. Alisa i am Alisa Parenti in washington and you are watching Bloomberg Technology. Lets start with a check of your first word news. Maryland and washington, d. C. , are suing President Trump. They claim the president is violating the constitution by accepting foreign payments through his businesses. Todays announcement joins a january lawsuit filed in federal court. Theresa may is telling fellow tories i got us into this mess and will get us out of it. Her Government Faces uncertainty following last weeks Election Results that cost the party its parliamentary majority. Police detained hundreds of antikremlin protesters across russia, including the Opposition Leader. He is russias most prominent Opposition Leader and president ial hopeful. He called on supporters to defy official refusal to permit rallies. Will meetime minister President Trump in washington on june 26. Mr. Trump said last month indias participation in the paris climate agreement was contingent on new delhi receiving billions in foreign aid. Ties between washington and new delhi have prospered under the previous u. S. Administration. Is vowingos governor to turn the territory into the 51st state. The island voted for statehood in a nonbinding referendum the spy a boycott and low turnout that raised questions about the votes legitimacy. The u. S. Congress must approve any changes to the status. Global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. I am Alisa Parenti and this is bloomberg. It is just after 5 30 p. M. In washington. Already 7 30 Tuesday Morning in sydney. We are joined by paul allen with a look at the market. Good morning. Good morning. It is back to business in sydney. The asx was closed on monday for the queens birthday holiday. Trading resumes today. It is the first chance for stocks to react to the significant tech selloff now in its second day across the u. S. In australia, we will have the Business Confidence survey later on. Dragon. Eye on net it has been a bumpy year. It will be out with firstquarter earnings later today. This is an Online Internet games company. It will be interesting to see how the market reacts in the context of the tech selloff. Nikkei futures looking weaker. That is what we are watching around the region today. I am paul allen in sydney. More from Bloomberg Technology next. Caroline this is Bloomberg Technology from london. I am caroline hyde. Lets return to our top story, the selloff of tech stocks. At the heart of the selloff is pressure on big cap tech stocks that have previously seen Massive Gains in the market this year. He is in analyst at rbc and covers some of the biggest tech firms. He joins us now from new york. Always great to have you on the show. Im looking at a note you put out on may 18 saying valuations are more robust, saying having climbed from 15 to 17 times they are more robust. Do you stan