Earnings and plans to fail to win over investors. And now the market is getting green on the board capping a difficult week in the middle of earnings season. Wall street braces for the difficult open as the nasdaq continues to drop deeper into correction territory. Ad sales surge at amazon sales nearly triple sending shares 5 higher after hours andy jassy said he is excited about the deals ahead. The company that moves slowly in an uncertain economy in 2023. We are seeing the pace of deals pick up in the strong last couple months and new deal signings happy friday julianna and myself are happy to see you all. Lets get to the markets and what is interesting about what is going on today is although at the surface, are yoyou are seeia lot of green ftse 100 is trading in the green on the last trading day of the week dax is marginal as well. There is a lot happening beneath the surface. Large, large movers today. Lets get straight to that we are going to start taking a look at nat west nat west at the bottom of the stoxx 600. Not the stoxx 600. Right at the bottom of the ftse 100. Down 11 today the bank has downgraded the fullyear margin after it met the Third Quarter pretax profit reporting 1. 3 billion pounds the earnings were overshadowed by review into the debanking scandal. This is in reference to the closure of the account the financial watchdog saw regulatory breaches in the lenders decisions over the former politician. Very adverse reaction in the stock today. Sanofi shares are considering a separate listing of the business next year. The drugmaker will allow it to focus on other medicines the company sees earnings declines by low single digit percentages next year, but expecting a rebound in 2025. Down 15 today and one of the main under performer in the stoxx 600. It is not every day you see a phama giant plunge 15 air frank klm posted a Third Quarter operating profit of 1. 3 billion euro the highest for the quarter. This on the back of strong ticket sales and yet to feel the bite of rising oil prices. The carrier left guidance for the year unchanged on to the luxury space down 6 . Montcler sales rise 6 in the Third Quarter. The company warned it had seen sales slow in september and october with warmer weather hitting demand one thing about montcler, this is just another luxury name were hearing which is struggling with sales outlook. One thing which emerged is the extremely wealthy segment of the luxury market is managing to do okay like lvmh others are beginning to struggle that is one thing emerging i just want to take viewer as tension back to what were seeing in the uk banks this is a week to forget nat west down 10 . Standard chartered down yesterday as well. A lot of disappointment on the lack of the Capital Distribution plan barclays is down 10 as a whole this week. This is tying up with the macro. Net interest margin outlook has started to be trimmed. Nat west with the regulatory breaches and from the business persp perspective, there is a lot of concern about the Net Interest Income and lack of deposit flight of course, we talk about reputational damage with nigel and barclays is saying that the guidance from nat west likely implying double digit downgreat grade. If were you investing in the uk banks with the promise of Strong Capital returns, you will get dis disap disappointed no wonder the stock is down 10 this morning the one that caught my eye is sanofi it is rare to see a defensive pharma name plunge 15 this is usually a safe place to put money. Two big issues this morning with sanofi they are planning to spin off the Consumer Health business and listing it next year and they are ramping up research and development. They are looking to low estimate declines in 2024 consensus sat at 7 . We are looking at 9 consensus downgrades next year the stock is down 15 . To my mind, thats out sized reaction if you look at the downgrades which emphasizes the fragility in the market. To your point, it is a defensive stock. European markets are negative week to date you expect the defensive sectors to be performing better. One final point on air france. This is one of the big movers we are watching today disappointing to the down side here you are seeing the impact of the inflationary environment coming through air Traffic Control charges and fuel costs are 4 higher than consensus. All of these things are beginning to weigh and this is a good example of how this inflationary environment system p is impacting the bottom line. Lets switch on. As you mentioned over the index level belie what is is happening. Cac 40 is under performing today. Air an france and montcler leading the declines you will see energy at the top oil and gas up 1. 2 as the world continues to focus on what is happening in the middle east we speak about this day in and day out. There is no ceasefire in sight. On the back of that, we are seeing a bit of a bounce in Oil Prices Today that is one of the reasons that basket is out performing good day for commodities on the flip side, sanofi is down media is down 1. 2 the food and beverage down. 50 . Lets go to wall street and the u. S. Close yesterday nasdaq ended 1. 8 lower. You had meta dropping 3. 7 microsoft and alphabet pulled back in yesterdays trade. S p lost 1 . Dow showed resilience ending 0. 8 higher. Interestingly outside of the magnificent seven of the big tech sector, it was a fairly neutral day for u. S. Equities. Magnificent seven are now down 12 in the last 15 days. On that note, lets look at markets this week and how they performed over the course of the four days. Nasdaq off 3 . S p off 2 the Dow Jones Industrial average, the resilient of the bunch, down 1 here is the picture of the treasury markets slightly higher yields this morning. 30year trading at 5. 02 all right lets bring in the head of investments. There is a lot going on in european markets today lets go to the u. S. Gdp print yesterday. Surprise to the upside 4. 9 gdp is the number that many countries around the world, including china, would be happy to see from the comments i read from the analyst community, nobody expects that strength to continue that was amazing. 4. 9 after such a brutal tightening of Monetary Policy for the past 18 months that is remarkable lets keep in mind that inventories and governments together added a bit more than two points thats a very strong contribution thats not going to stay the consumer remains extremely strong you know, this is the holdout from the pandemic. A lot of money was thrown to the consumer they have savings which they tapped into aggressively we still think eventually the consumer also is going to come down yeah, thats been the surprise of 2023. The resilience of the u. S. Economy. When you see numbers like this, the whole narrative of the fed doing too much and the fed overtightening or the fed at some point will regret all of the Monetary Policy tightening they have done makes me question the narrative. The economy has managed to continue to perform well despite the tightening credit and the monetary accumulative moves into the system are you concerned they have done too much or have they navigated this well . I think they he have navigated well will it hurt eventually . I think so the 10year treasury yield adjusted for inflation and increasing by 150 basis points since april. 350 basis points the last many couple years will create pressure in the system its true we came into this with private Balance Sheets which were healthy the pain is probably not as fast as big as it has been in the past we still think such a sharp increase in yields will hurt lets keep in mind that fiscal policy has been expensive. It is unusual we have fiscal policy pushing the other way than Monetary Policy that will change that is one of the key points to watch in congress now that we have the speaker in the house, was going to happen to fiscal policy already in the last quarter of the year, it got less expensive. This is turning and that will take some of the tailwind of the economy. Let me take you to equity markets. We have seen a plunge in sentiment in equities on both sides of the atlantic. Nasdaq down 3 this week one of the key elements of the selloff. Here in europe this morning, we are seeing huge moves as well and some unexpected big movers we were talking about sanofi in the healthcare space down 15 . What do you make of the extraordinary moves on the back of earnings . What does it tell us about how investors are positioned and sentiment is overall in the market right now it has been a pretty ugly earnings season so far in terms of the Market Reaction any miss in particular is finished badly we have seen some moves. Look at the Energy Market yesterday. The season itself is okay in the u. S. Earnings are up 12 for the season year on year. Thats pretty good thats resilient not as good in europe down 4 year on year so far for companies which have reported. The Top Line Sales are weak. We have actually only onethird of the companies in europe that are beating sales expectation. That is a low ratio. That sends a signal that this economy in europe is struggling. I would say the earnings season here is really not great and the market is pushing that we came into the earnings season with the market quite high by late july and now we have come away with the past three months with the market correcting to the downside there might be some downside especially when you look at equities compared to bonds in terms of pricing earnings are not great in europe the economic picture is not great either putting it all together, what kind of downside could we talking about for european equities and are there parts of the European Equity market you want to stay away from or short here i think, overall, you want to be cautious with the cyclicals the global when heconomy last b resilient this year. It looks like q3 is going to be soft q4 will be negative if you look at the last pmi that were quite disappointing. You want to be cautious, i think, with the cyclical side of the markets. Skewed more to defensive skewed more toward stocks that could benefit from the pullback in bond yields i there ink there is room for bd yields to decline here i think that will create some damage in the system in terms of borrowers will need to rollover the debt in the next couple of years. In the books of investors, you have a high level of unrealized losses that creates fragility in the system i think we are at the point of the cycle where there is a lot of fragility and you want to be defensive. Luckily, in terms of seasonals is a better season for stocks, especially in the u. S. Im not saying were going to collapse from here the last three weeks have been weak thank you so much for joining us, vincent h now on to amazon the shares in the tech giant are higher in premarket trade after the Company Posted a top and bottom line beat for the Third Quarter driven by stronger sales and its cost cutting measures. Revenue at aws was stronger, but growth was faster at 12 from previous quarters. Joumanna, investors are always watching amazon results. This quarter in particular with the moves being drastic on the back of the after earners. If amazon was cdisappointed, it would have been calamatous a couple of that were interesting is ecommerce is doing okay up 7 year on year improvement from last quarter up 4 from the previous quarter. Ad revenue up 26 . Listen to this ad revenue is growing faster than google and facebook and faster than snap as well they are really beating the competition with ad revenue. Aws, the leader in cloud services, and this is interesting as well. They only showed growth of 12 for the quarter. This matched the growth they had experienced in the prior quarter. Do you remember early in the week when alphabet showed growth of 20 , the market reacted negatively in the case of aws, i guess because they are the market leader, they are establishing dominance and spending from the higher base. The interpretation of the market is aws numbers were fine i thought that was interesting as well in terms of how investors view alphabet Cloud Business differently from amazon i wonder if there is a point that which the strength in amazon and microsoft becomes a negative given the concerns of an antitrust for being the market leaders in cloud that is something to keep in mind in the coming months. We will push on. Such a busy couple days. We have so much more to discuss. Next up, we will be live in paris as france prepares for ru rugbys world cup final. Arabile will be joined by dan carter after the break you deserve better than that. Im hungry, im in a hurry, i dont have time to make anything healthy. You could if you had a blendjet. Blendjet . 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South africa and new zealand for the last 20 years, there isnt a country outside of those two which havent won the world cup. That may be another issue that perhaps world rugby will look at with the investment into things like the tier two nations. We have seen competitions come to the floor lets get to the interview im joined by twotime Rugby World Cup winner dan carter. Dan, thank you for the time. I appreciate it. Good morning. Thanks forego having me on the show lets talk about what players might be feeling as a south african, i imagine what this would be like 36 hours before the Rugby World Cup final. What are the emotions like a lot of nerves the hardest thing about the week leading into the biggest game of your life is controlling your mind i was curious on the way to the interview, i rang aaron smith with his last game for the all blacks tomorrow night. He was actually really calm. He was really focused. He was doing rehab with the physio a lot of it is around controlling your emotions. Nothing they will be doing on the Training Field thats out of the ordinary it is more controlling the mental side of the week and stick to the process and not spending the whole time playing the game in your mind before the game is played and the feeling of being World Champion or how that happens you have done it twice. That feeling is insurmountable there is nothing like it it is incredible. The pinnacle for any rugby player to play in the Rugby World Cup and to be a Rugby World Cup champion a lot of the players on both teams have achieved that you know, what will be driving him . I know for the all blacks, it is about creating history doing something no other team has done before and being up against the springboks one will come out victorious and get the much beloved fourth title. Lets call it forth sight the competition has been different this time around the ones who may have seen dominance coming into the world cup are not as dominant coming into it or playing through it and same for new zealand your fourth coming into the final and what it takes to win it thats the beauty of Rugby World Cup. Just because youre favorite like ireland, doesnt mean you will be on the winning end of the competition. I have gone in as hot favorites and not made it to the final the springboks and all blacks deserve to be there with the performances at the right times. They have played huge games. For the final, it is a whole other ball game with the pressure on these players. You have seen through the world cup in particular with the playoff games with teams and individuals havent executed the basic skills under pressure. For me, this week, it is about which team can handle the pressure and execute the fundamentals of the game it will come down to one or two moments. If you take those opportunities, thats the difference between victorious or not. Dan, you spoke about the dominance of south africa. Then australia as well wbeing dominant how do you get the tier two nations rise up we have seen that with argentina, but we need more teams here. This is the focus for world ru rugby. The reason why they are in investing rugby developing nations. We were even back in the inaugural world cup and progress of the tier two nations has improved, but it is important they continue to really invest and try to help t