It has got for Sports Companies later this hour. Have a look at where european equities are trading right now. We are under 30 minutes away from the end of the wednesday session. Stocks are rising for a consecutive fifth day, the best run since september 12, the highest run for the stoxx 600 since july 19. All of these currencies falling against the dollar, bond yields gaining. Some Corporate News to tell you h utility fortum could turn into europes biggest acquisition. For a deal were e. On the offer of 22 euros per share of all unit per investors. Niper is thebuy upi biggest plan since germany split their utilities in 2016. Shares are down one half of 1 . A tough month for precious metals. Buying as little as. 71 ounce of gold on tuesday. That is the least going back to 1987. Taking a hit for diesel cars is compounding the impact for the diverting and diverting some investors from metals. That is the focus of that chart. More thanrst time in a year, local currency and egyptian bonds are the highest yielding among major emerging markets. The average rate culmination debt plunging about 400 basis points since july, dragging the yield below that of nigeria, whose multiple Exchange Rates have perturbed investors. Egypt benefits from high inflows after it allowed its currency to devalue last year, securing that 12 billion international on a terry fund deal. Monetary fund deal. 90 minutes into the trading day in the u. S. We are seeing the Dow Jones Industrial average negative by about four points, but could not hold the rally. The s p 500 also having Trouble Holding its level. The nasdaq is slightly in the green. This smallcap, large cap dichotomy continuing for some to some extent he read if you look at the last five days, it has failed several times to hold gains attempted over the last several days. We will see if it can rebound today or will continue the downward trend. Some of the drags on the dow and s p 500 include nike, nike and pmg in the dow and s p. Nike down after the company came out with a forecast specifically for north america for sales to decline again this quarter and they fell 3 last quarter. It is the north American Market that is the focus of consternation from investors. Scana is weighing approval for potential right related to its canceled nuclear plan expansion plant expansion in south carolina. Dr. And gamble down as well. Cult gaining more support for his quest to make some changes at proctor and gamble. Outside of stocks, we are looking at yields. The two year yield is now at its highest since 2008. We have seen the 10 year yield the 30 year as well. The dollar has been bouncing, but its bounce is much more muted, held back by some of the geopolitical concerns, north korean rhetoric, etc. So it has long way to go. A check on oil prices as , a halfhour out of the inventories report, we got a big unexpected drop in the headline number but we see a building gasoline stockpile and a dwindling distillates. Oil has had a dramatic bounce over the last couple of months. Mark before we get to tax reform, want to highlight some news from amazon. Officially announcing it will be holding an event to unveil new tech products. The has been working on details and join us joins us from outside amazons offices. What will be the big reveal . We are outside of one of amazons seattle headquarters. Today they are holding an event at 10 30 pacific time to announce a whole slew of new gadgets. Will let you plug in the device twoyear td and shout commands, change the channel, search alexa. Like the apple tv, you have to talk into the remote but this one will have its own microphone so you will basically be able to shout commands across the room. They are working on a pair of alexa glasses so you will be able to call alexa up and make searches from your face, not sure why anybody would want that. If they announce it today i am sure we will find out why. Also, a better version of echo. Whichcompany, vonnie company is shaking in its boots most . Been workingon has on these Consumer Devices for a year now and they are finally stepping up their game. Google and apple are having big events. Middleis smack in the and will be joining this chorus of a number of potentially blockbuster products for the holiday season. Vonnie our thanks to bloombergs mark gurman, with continued coverage on the amazon event all day long. President donald trump and Republican Leaders will publicly unveil details of their tax plan to fix our broken tax code in about three hours. The plan slashes the Corporate Tax rate to 20 and lets congress decide on the top rate for on the rate for top earners. Congress will decide. Eliminate deductions for state and local taxes. Joining us from capitol hill is kapoor. We have a heat map which shows which states this will affect most, this allowance or part of the plan. It is democratic states. Sal right, this is a central is an essential piece and we reported on this as early as april. Elevating the local state and tax reduction including new york and new jersey and california. They will eat up about one third of the benefits. That is probably the biggest one on the table. There is a lot of sugar on this cuts andlot of tax things people want but as far as the vegetables, that is one of the rare pieces. I do want to mention ,ome headlines from paul ryan saying it is the best opportunity in a generation and it will be a template template for taxwriting committees. I want to ask about the carried interest loophole. There is no mention of that in this nine page gop framework. Sahil this is the moment speaker ryan has been waiting for, this is what he has been wanting to do all year, and he will have a major role in the tax overhaul debate. As far as they carried interest , President Trump campaigned on closing this loophole. Politically popular move to talk about ending it because the people who benefit are not the most sympathetic to voters, but this makes no mention and that is part and parcel of the fact that there is a debate within the Republican Party to end it. Some of the republican advisers are torn. The president will try to preserve the carried interest loophole. Mark there is a sense of urgency within the white house to a cane a legislative win attain a legislative win in 2017. How likely is that to be achieved with this tax proposal . Sahil it is the last big chance they have to achieve something major in 2017. They set off with a highly ambitious agenda of reforming the immigration system, building a wall, repealing and replacing obamacare, and tax reform. Whether this gets done in the next year months, this would be pretty miraculous to pull off something this ambitious as quickly. Senate Majority Leader Mitch Mcconnell is among those most eager to get this done after announcing yet another failure in the effort to repeal and replace obamacare. This is our once in a generation opportunity, to fundamentally rethink our tax code. We can unleash the economy, promoting growth, attracting jobs, and improving american competitiveness in the global market. There you have it, senate Majority Leader Mitch Mcconnell making the case for a major tax reform. We will have all here a lot about this in the coming months. What we see in the blueprint serves as the guide coast for committees to begin crafting legislation. Vonnie we will be speaking to you much more about this. Lets get more insight on how it could affect the u. S. Economy. With us is the founder of kumar global strategies. We had a lot of these details in advance. Have you been able to do some math on what this might mean for whether itonomy, and would be more than a one quarter boost for gdp if it does pass . Question. Great i have been following the tax legislation as well as your program earlier this morning. Saideal question as sahil moments ago, whether this will be implemented this year or even in 2018. With the integral parts intact. As far as this year is concerned, the major issue will be between now and year end. The ability to run the government comes to an end in december. The debt ceiling has to be raised again and you will see a big conflict between the president , who last time worked with the Democratic Leaders and the conservatives on the republican side. That will be more of a priority than tax reform. Once you go into 2018, the real issue is the socalled salt deduction, state and local taxes deduction will be a big issue. Of health the case care, you had some republican senators who did not want to vote for it. You will have republican senators and representatives in the case of state and local Tax Deduction who will say, i am from california, i am from new york, i am republican but i cannot go with it because my voters do not want it. Vonnie not just that but also the corporate interest the duction which looks like it may be going away interest reduction which looks like it may be going away. Do you see other things in here that might sink this legislation . Komal you mentioned a couple of them. State and local taxes, the Interest Rate deduction, particularly as it appeals to mortgage Interest Rate deduction. Then you have the other touchy issue, is going to be overall in terms of how much of the tax gains are reform going to go to the higher income groups as opposed to the lower income groups. The cancellation of the state tax is going to be i think questioned because it principally goes to the richer individuals in the United States. You will have a lot of democrat versus republican conflict, and a lot of conflict across states which are trying to protect their rights. I think it will be a difficult part, even in 2018, and less significant concessions are made. Mark can we move from politics to monetary policy, given Janet Yellens speech yesterday . Withins some bafflement the fed of why inflation is not responding in a typical manner. Said inind us what you your Bloomberg View piece about inflation. Komal thank you, mark. The bloomberg prophet speech as part of Bloomberg View argued there were two major reasons why inflation had not picked up. First, the consumers were deprived of Interest Income and that a huge majority of the u. S. Population depends on it, especially the retired community. Reason turn was a major why consumption demand has been weak. Second, on the bank lending side , the banks were unable to increase lending as a result of these regulations post 2008. When you put them both together, when you put them both together, mark, when you create a lot of money it does not go outside the Banking System and reach the economy. Then it does not create inflation and jobs. That is my major problem with the monetary policy. Coming to the janet yellen statement this week that you to, she has faith inflation will pick up. Based on what . The fed has been wrong repeatedly for so many years since 2008, you just have to wonder what credibility they have to make in terms of inflation projection. Is the fed no longer data dependent . Is the fed in actuality responding to hard asset markets . Komal that is a great question. I believe the feds calendar dependent. They do what they want at certain times on the calendar. Think about the december first 2005 rate hike that was done because they repeatedly promised it would increase rate hikes by the end of the year. More recently, it is a transition that could be coming in the fed chairmanship. Five new members of the fed being nominated by President Trump in the forthcoming months, so i think janet yellen feels the pressure to do it. I would say more determined by and much lessar, dependent on data which do not support fed policy. Why does the stock market why does the stock market in the u. S. Continue to grind higher every day . Komal two reasons. One is you have a big amount of liquidity that is available. The Interest Rates still are very, very low if you want to keep it in a bank account or anything in a short duration. You have to go into equities. You have to go into highyield. You have to go into distress, whether you understand the risk or not here at what is happening is people are i people are reaching out for yield, looking for capital appreciation, playing the momentum game, and they continue to go up. The second reason it is increasing is because corporate earnings so far have continued to do well with optimism on the trump policy. December, thet bond market suggested there was a lot of optimism. The 10 year yield rose over 2. 6 since last december and it came back. The risk is the stock market is unable to keep up its strength with the passage of time. Vonnie lets have a look at this chart, 2293 in the bloomberg library. It shows we have record u. S. Cold Equity Holding to gdp. This happened in 1999 and is topening now, and forecast continue to rise. Is that a cautionary signal . Komal i think it is. 1999 was three years after Alan Greenspan warned in december exuberanceirrational , and we had the stock market surge in the following three years rather than restrain itself. The problems arose in 2000 and the recession of 2001. I think here we are not talking about the recession yet, but the stock market surge is not supported by Economic Growth projections. That is the problem, two days ago the two to 10 year treasury. Pread was down 79 basis points today, we are up to 83 based on the optimism of the tax reform and about the yellen speech. My expectation is the spread will go down again and it does not bode well for the economy and the equity side. The u. S. Stock market is not supported by the economic fundamentals. What about the european stock market, economics and politics . We have overcome germany and a coalition needs to be formed. Is the european stock market supported by its fundamentals . I believe the European Market is better than the u. S. For two i believe the European Market is better than the u. S. For two reasons. First of all, valuations are significantly better than going into the u. S. Equity market. When you are talking about the s p 500 you are talking about 21, 22 times last months earnings, maybe 31 times if you look at the bob schiller measure of value in the price of equity multiples. Valuations are much lower in equity markets in europe. That is a big one. The second is despite the german election results, i see the Movement Toward greater ifation more or less they delay integration, i still see the eurozone go in more together as one common economic i do not think is figured into equity prices. A second reason i am optimistic on the European Equity markets. Mark a quick question on the euro. It has come down since the weekend election result is of the uncertainty over coalition building. We have come down from those 120 levels to 117. Have we seen the highs for the euro against the dollar . I suppose you have to look at the dollar side. Right, youlutely have to look at the dollar side of the equation so if you start at the dollar side, i cannot see the fed to continue to be as hawkish as they have threatened. That is negative for the dollar and positive for the euro. On the european side, i think the ecb is likely to move towards some sort of tapering during the months to come, and that will strengthen the euro. I would be surprised if the euro is not stronger than the 1. 17 at which it is trading today by the time you reach year end. Vonnie thank you. Do not miss President Trumps speech on taxes. 20 p. M. London time a programming note, on friday at 1 00 p. M. In new york, 6 00 p. M. London, an exclusive halfhour interview with the former u. S. Treasury secretary jack lew. This is bloomberg. Vonnie live from bloomberg World Headquarters in new york, i am vonnie quinn. I am live from london, mark barton with the european close roughly five minutes away. A look at some of the biggest business stories in the news. Powerhouses with the possibility to be europes next champion. Out of aa merger position of strength. , a very balanced approach has been the notion all along. Of course there will be rebalances. Mark they say the biggest redundancy challenge is the core and administrative sectors. Central america is in talks to secure part of the postbrexit move, according to people familiar with the matter. Of the. s scheduled exit e. U. In 2019 has Global Investment banks looking to move operation out of london. Bank of america executives are also considering frankfurt. That is your Bloomberg Business flash for this hour. Take a look at where European Markets are trading as we head to the close in roughly three and a half minutes time. Stocks are gaining for the fifth day. The closing is next. So new touch screens. And biometrics. In 574 branches. All done by. Yesterday. Banks arent just undergoing a face lift. Theyre undergoing a transformation. A data fueled, security driven shift in applications and customer experience. Which is why comcast business delivers Consistent Network Performance and speed across all your locations. Hello, mr. Deets. Every Branch Running like headquarters. Thats how you outmaneuver. Mark live from london and new york, this is the european close. Stocks finishing higher for the fifth consecutive day. These are the individual equity movers. The best fiveday run him a best run all five days in september 12. The highest since september 19 not near records like in the United States. Just getting to the out stop deal, shares up 4. 5 . The biggest gain since november. Siemens and the French Rail Company merging their companies, bringing together the former giantivals to make a aimed at countering conquering china. Shares are up 4. 5 . Sterling is down today for a fourth day, the worst stretch since august 8. Investors looking at the progress of talks between the u. K. And the e. U. , the fourth round of talks that end tomorrow. If you listen to donald tusk who was at downing street yesterday, we do not seem to be making enough progress to move on to october. Ks after sterling is down for a fourth day, interesting comments from shadow he said that if his party were a power, they will be a radical government and should it when among those scenarios, there could be a run of the pound. I thought, lets look at when we last saw a runs of the pound, 1992 and the u. K. Crashed on black wednesday. Sterling fell by 4 . This is a longer decline. This is during the height of the financial crisis. A record declined the day after the brexit vote when sterling fell 8 against the dollar. Getting back to saudi arabia, they will allow women to drive stateending as the only to ban half the population getting behind the wheel. Bid bid by the government to open up the society and a counterpart of this opportunity to mounir dies modernize saudi arabia. Possibly to hold a big ipo of its oil company. This is a fascinating chart. We might see people from outside the country coming to work in saudi arabia affected by this. A dedicatedlds have driver so Foreign Workers could get hit hard. This shows how remittances have moved and this is the price of oil, the blue line is oil. Remittances are coming down in 2017. That is ahead of todays historic announcement. Vonnie one of the most powerful ces and euro area fiscal Wolfgang Schaeuble is going to leave to become the president of the bundestag, according to angela merkel. More with more on this is chad thomas from berlin. How much have to would shoretel a wheeled over the bundestag . Chad this all played out since the election on sunday, and one of the reasons why he is apparently going to move over to be the bundestag president is in fact because of the entrance of this far right party, the af the come into the bundestag. Many people were saying they needed someone who is strong to run the bundestag. The bundestag president basically has a position similar to this beaker of the house in the u. S. Speaker of the house in the u. S. Said they will put up resistance and there was discussion they needed someone very senior to take on this role. It does not get any more senior than him. He has been in parliament for 40 years and is the longest member of parliament in germany and an elder statesman across europe. Vonnie given that these extreme parties are opposition and not necessarily governing, how unifying is a picture figure like shoretel a . Uble . Ha the other question is who will take over the finance ministry, a key post and already one of the smaller parties that is considered to be in contention in the coalition with chancellor merkel, the free democrats laid claim to the post telling us they would be very interested in taking that position, and that they have the wherewithal to do that. How this plays out in the Coalition Talks remains to be seen, but already there is jockeying for that position. This change the dynamic when it comes to policy within the government . This is a man who is known to be oftere in his delivery fiscal policy. Just look at the way that he viewed the whole greece crisis. A change inrompt fiscal policy outlook within the country . The free democrats were quick to say that they would continue that policy if they were able to take over the finance ministry, and it seems unlikely there would be a huge shift. While that policy has been unpopular outside of germany, it is incredibly popular within the country. Germany runs a balanced budget, in fact a surplus, and that is popular among german voters. How are the coalition discussions going . We are only day three and last week last time it took 80odd days. What are your hearing in this ongoing coalition discussion . Chad the one thing that is clear is the social democrats do not want to join another coalition with merkel. That means she will be talking to the greens and the free democrats but we have not had too much progress yet. As you said, the last Coalition Agreement did not come about until just before christmas. The expectations are that we will be some way off. , just beforection an election we have a state election coming up in one of the german states. The expectation is these coalitions will not get going until that election takes place in mid october. Mark bloomberg chad thomas in berlin today. Vonnie lets check in on the first word news. President Trump and Republican Leaders will announce their long awaited tax overhaul plan today. They will propose a top individual rate of 35 but leave to congress whether to create a higher bracket for earners. The rate on corporations would be set at 20 . President trump will talks about that will talk about that tax pan plan at 3 20 p. M. President trump is calling roy moore a fantastic race after winning the alabama probably alabama primary for the senate. Allies of senate Majority Leader Mitch Mcconnell backed Luther Strange in the race. As u. K. And European Union officials haggle over the divorce settlement, documents show European Pension costs rose more than 5 . That is a controversial part of the bill that will increase what the e. U. Thinks the u. K. Should pay, injecting additional tension. The United States sending a flotilla of ships and thousands more military personnel to puerto rico to address the. Rowing humanitarian crisis large sections of the territory are without adequate food, water, and fuel. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. Donohoe. Ney this is bloomberg. Vonnie coming up, how the ncaa bribery probe could affect Apparel Companies like adidas and nike, this after nike posted disappointing earnings yesterday. It is floundering. This is bloomberg. Live from london and new york, im mark barton. Onnie i am vonnie quinn this is the european close. It is time for our stock of the hour, nike shares falling to the lowest since june after the company gave a less than rosy. Utlook for the First Quarter there weak performance in the u. S. Is to blame. Adidas is in the spotlight amid an espn report louisville rickrsity basketball coach pitino is expected to be fired as part of the bribery controversy. For both of these stories we have Matt Townsend. To these respond . The big idea for a adidas is the u. S. Has been their biggest growth dryer. Driver. Their basketball business has not been a part of that. This will potentially be a hit to that strategy, to reestablish. Fit foothold there is no sort of big announcement on the performance. Vonnie what has the company said . Matt they were in that situation and basically that is it. They know what is going on and know the u. S. Is investigating, but from we are hearing is there will probably be more shoes to drop, so to speak, more people implicated. You have got to think may be some of the brands potentially because College Basketball is a big business, nike is a big player in endorsements and promotions. Mark you mentioned nike. Lets talk about nike. Clearly the focus is on the domestic market. What will turn the ship around . Have been executives pushing this idea they will get bringing products to market, and they will look at their top brands and selling lines of shoes and tweak them. More colors and patterns, that is how they will potentially help things in the u. S. , and they talk about their innovation pipeline. Nike has been at the forefront thatnovative products and remains to be seeing. They have been caught flatfooted in the shift of consumers going a lot more casual. They have lost a coolness factor due to adidas. Vonnie we are talking today louisvilleeport at university that rick pitino is expected to be fired. How much does basketball and mens basketball sell a deed us, and how much is it id this and how much adidas and how much is the jenners . More theis much popculture icon helping them improve their sales in the u. S. James harden in the United States, but that is not what they have been what has been driving the business. Their shoes are cool. Running has a has been a good category. Vonnie the company went through a lot of structuring restructuring. Matt they basically have refocused the brand on these core parts of the business, and really on the u. S. And on u. S. Cities. That is a big push adidas has made an nike has followed, focusing on urban areas to gain influence and get the advantage with social media and popular people. Vonnie to what i just said about espn. Espn is reporting that rick pitino is out, that is a done deal. Anticipate the halo effect . Nike is having its own problems. Matt it is hard to say at this point. It depends on how this goes. This is an ongoing problem for adidas and this could potentially help nike. Basketball has not been a big part of the adidas story in the United States. Vonnie thanks to Matt Townsend of bloomberg news. Takes placets cup every four years in the united , the best u. S. Golfers facing off against the best International Golfers minus europe. It gets underway tomorrow at Liberty National in girardi jersey city. I sat down with two opposing team reps. Listen. No, it does not get old. Pretty special every time and it is fun to hear we are the first u. S. Open champion so i do not know if i will ever get tired of it. Somebodyou are perhaps once said you are the most underappreciated sportsmen because you 13 pga tours and you are a rising star. It is good for me. Obviously im trying to finish off the year your the year well at the president s cup. Vonnie it alternates with the riders cup that gets much more publicity. Ou should have an advantage you are playing on courses you play a lot. You play in america and you live in virginia beach, so does that give your team and advantage . I do not think it gives us an advantage. The new york crowd will certainly be pretty loud and we are supporting the u. S. Team, but it is a multicultural city as well. Hopefully there will be plenty of internationals to support us. Hopefully one the internationals can come out on top. Vonnie 11 times it has been played, nine times the u. S. Have one and one time it was a tie. Do you anticipate the street to continue . I hope so. I think every guy here will say their team will win, but it will be a fun week. Being in new york city and having the fans behind us, it will be a fun tournament and i think everybody is ready to go. They have amazing assistant golfers. Tiger is an assistant golfer this time around, and an assistant cap captain. Is there anything you hope to learn . He has been blowing my phone up the last couple of weeks. It has been fun. It is pretty cool. Fun just to hear what he has to say. Last year at the ryder cup was interesting but this year to get to know him more on a personal basis. Onnie it is a huge tournament we are talking about four days but many matches. Which part you imagine will be the most difficult . The fourth is probably a waypoint so we will try to work on that. Things things tole try and get off to a better start. In the past, we have not gone off to the greatest start so we are definitely trying to improve that and find a really good team. The americans are strong, have had a stranglehold on the cup for quite a while and we are looking to change that. Vonnie it is strange because of are playing against some your best friends and teaming up with some of your worst enemies. You may be matched with them. Had to the captain strategize . Do you tell them who you feel have it is all done in advance. The americans have an idea. Tiger has come up with 50 different things. He was blowing my phone up late last night trying to figure out, who were my playing with here and there. Depending on who it might be, golf balls, some guys play with the same golf balls so what makes it easier. I think they are still trying to figure out, trying to play with different teams. Fascinating the golf balls come into play but when you think about it, that is that makes sense here it is that a factor for Team International . Definitely. The golf ball is a big part of it. Wholity, and had a has Similar Games and who complements each other. We also have a language barrier as well. That is part of it. There is a lot of things. I am sure he is experienced enough to know who to put who with. Will be the challenge at Liberty National for the both of you . The greens are very undulating, a lot of water, and the crowd, it will be a rowdy crowd. It will be a good crowd. The American Team is really strong. They are probably the two main challengers. Vonnie have you seen the nationals . I have never seen the golf course. Vonnie what day are you both most looking forward to in terms of the style of play . I would say foursomes, that is probably the most fun. There are so many things that come into play, figuring out what whole certain guys will tee off on and things like that, so i really enjoy it. Hopefully we can be on the other end and enjoy it. It gets underway tomorrow, 30 points to play with and there can be a tie, unlike the ryder cup. The International Team and the u. S. Team. Willank of canada says it not be mechanical on rates and will proceed cautiously. No predetermined path for canadian Interest Rates. The Canadian Dollar weekend by , 1. 2 430. Live from bloomberg World Headquarters in new york, i am vonnie quinn. Mark live from london, i am mark barton. Time for the Bloomberg Business flash. Airline ryanair canceling another 18,000 flights as part of its Slower Growth plan. Some 400,000 passengers who already booked flights will be impacted. Ryanair canceled more than 2000 flights earlier this month has it messed up pilot vacation time. New gadgets today and products could include updated versions of the echo and a television with microphones for alexa commands. This announcement follows apples event earlier this month as the Tech Companies vy for consumers. That is the latest Bloomberg Business flash. Vonnie President Trump delivers his tax speech today, 3 20 pm eastern, 8 20 p. M. London. P. M. New york time we have an exclusive halfhour interview with the former u. S. Treasury secretary jack lew. Vonnie it is noon in new york and midnight in hong kong. I am vonnie quinn. Ahn. i am shery welcome to bloomberg markets. From bloomberg World Headquarters in new york, here are the top stories on the bloomberg and from around the world. And Republican Leaders getting set to reveal their latest effort to get muchneeded legislative points on the board with a longawaited tax plan announcement. What that could mean for corporations, top earners, and the broader labor market. Sheila bair chair joins us today get into that plan and what it means for investors. We are awaiting a major announcement from amazon as they look to capitalize on the rush of technology, vying for consumers attention ahead of the Holiday Shopping season. Vonnie President Donald Trump and Republican Leaders urgently trying to get tax reform off the ground. They have announced a