Stocks are following it today for the third day in four days. Commodities,ds, everything you need to know about the market and oneshot. The best of all possible worlds, european earnings. Something is going to change in stable eps revision for the stoxx 600 through midyear. This is sharply contrasting with normal negative revisions. We are going to speak to Bloomberg Intelligence in just a second. They say that guidance will be key to whether this trend continues. 2017 is the top line. Been remarkably calm in the earnings revisions. Will it continue . We will ask tim in 20 minutes. Mario draghi, are his words carry more weight than other central bankers . The man who really started this move up in yields, we have seen in the last couple of weeks. Bond markets have been signaling that europe was moving to the four and setting the tone. The curve as you can see between the two and 10 year is steepening. 2012,e First Time Since this is the twoyear spread it. The treasury is the white line. The yellow line is australia and the purple line is canada. The expectations are if you look at forward markets, the ecb will pace. That shift and expectations for the European Central bank is leading to the euro dollar. This is the best g10 currency in the first half of the year. Firsts declining to the year. The Swiss National bank only needs to stand pat to hold its place. The smb has to do nothing. They predict more downside to the swiss currency. They went through a key technical level. They are signaling expectations for a premium risk reversal. Sinces the highest february 2016. On a closing basis, how is it looking . Abigail we are looking at very small moves for the major averages. They are up slightly. We have the s p unchanged. This is similar to what we saw yesterday morning. Not a lot of conviction is earning season gets underway. They are not making big thats until we have more information. Pressure,ctor under the financial sector, the big banks. We have some pressure. This is interesting. I was talking to a long time wall street or. He was telling me you have a few factors here. Numbers have been coming down since may. We have this going up since the beginning of june on the sector rotation. This is in a waitandsee mode. Income. Fixed in you will see the tank set of the earnings season. Right now, there is some decline. On the banks reporting on friday, jpmorgan said it we may be decide by the destruction it could come from the end of quantitative easing. This represents the bulk of the Balance Sheets of the Global Financial central banks. 4. 5ite we have the fed at trillion. In the blue we have the ecb. In read it, the bank of japan. We see tons of money helping the financial markets. It makes sense what jamie dimon is saying, if this is unwound, it could be disruptive to the financial markets. Time will tell. Mark great job. Opec needs to shock and all the market otherwise, oil will slide below 40 a barrel. Crude is bouncing a bit today. By 9 10. Formbergs managing editor opec . , will tim the current policy isnt working. They need to have more political impediments for further cuts did saudi arabia has put a lot in russia. People in russia say they would be reluctant to cut more. Iran would be another. Its hard to see this going deeper, employed shock and all. Mark what about libya and nigeria . Could you put controls on them . Will they have pulled up production fast. The last few months, thats as much as saudi arabia has cut worried that has taken the edge off the opec policy. Itt has been talked about, wont take any barrels out of the market. It would put them into the deal. It wouldnt trade any shock and off. Limitedms like a policy. Vonnie it seems like they are expressing this may not be the right and to do. The market is being a little bit sulky. It once more and it gets something else. , not and on tactics necessarily pricing that long. Will i think the point they would make is compared with previous cycles, what opec has done has been quite mild. If you look at how saudi arabia has behaved in the past, they expect them to do more. There are political issues. If they did take more barrels out of the market, it would go toward ending this supply. The problem we see is opec aims to cut stock piles. They have not responded yet did we have not seen that yet. Rises this time of year. If they would cut another billion heralds a day, you might start to see that more quickly. Vonnie that is a great story by our colleague in the last two hours. This is about peak oil coming. I thought we were past peak oil at this point . Will its a different type of the. The oil industry is worried about demand. Tos is the macro background the discussion we are having. How long will opec have any sort of leverage over the oil market . These are great shifts we are seeing in Global Energy to people shift away from oil. It is striking how much people are talking about electric cars. Volvo wont make any cars without electric or hybrid engines. What does this mean for oil demand . Will it keep . Peak . Will they face a future where no one wants to buy their products anymore. Others agree. Its an existential stretch threat. Will they have the most to lose. They have a list of a lot more demand to grow the longer. Invest in solar panels. In saudi arabia, what do you do . The whole economy is based on selling oil. Theyve got billions and billions of barrels under the ground which they are expecting to sell. Will that oil ever be needed . These are questions people are starting to ask about oil. Expensiveed that very oil . Kennedy, thank you for joining us. Vonnie lets take you now to the first word news. Courtney good morning. The top democrat on the Intelligence Committee says he with everything involved the russian meeting lawyer. Congressman adam schiff says if this is true, its a very big deal. President trumps nominee to replace james commie comey will hear questions tomorrow. Did the president demand loyalty in exchange for his nomination . Can he stand up to the white house when the job wires it . James comey was fired in may. Theresa may has moved to reset her readership leadership. She says she is still determined to change written for the better. The results were not what i wanted. Changingment to written is undimmed. My belief in the potential of the british people and what we can achieve together as a nation remains steadfast area steadfast. Courtney the company is replied in rebranding itself for the future. They are powered i batteries instead of diesel fuel. This is a new face for the london taxi company. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries, this is bloomberg. I am courtney donohoe. News. just some breaking junior was told in an email russia wanted to aid the Trump Campaign. We will examine more of that in just a few minutes. This is bloomberg. Mark live from london, we are counting down to the european close in about 16 minutes or it 16 minutes. We are going to turn to the subject of hedge funds. It doesnt mean everyone is celebrating. Have returned less than 1 . We just keep hearing about that. Hedgeheaded Funds Fund Managers doing . Of firms global head capital joins us. I imagine many macro managers would say thats just arbitrary. It will be fine. We have our thesis intact. Bob i think thats fair. Most hedge funds and investors look at the performance over a fiveyear range. If they go through a sixmonth some of the systematic approaches have struggled, i do think we have seen these types of issues before. What are your investors doing . Are they moving on . Bob it looks like hedge funds have come out of a time where they were contracting. Performance was down. There were some arguments against hedge fund these. This year, it looks like performance has bounced back across the board. There are some strategies that have not made it back. On the index side, it was down 5 last year. This year, it is up 5 . It looks like investors as we track the surveys go through some type of minor rotation. It looks like most of them remain committed to the hedge fund space. We did see some slight contraction last year. We see more expansion this year. This year, its only 5. 5 in dollars. Why is that . Are people redirecting their money . Bob redemptions have run their course. We dont think its over. Its never over, there is always some pruning that takes place on the part of investors. Most of the larger redemptions have run its course. They peaked for the Third Quarter last year. It was less in the Fourth Quarter in the First Quarter this year. Were looking to see what the Second Quarter numbers are. We project that we swing back to net influence. Its always hard to pinpoint here in it seems like the trend is reversing. Vonnie 60 say they want to alec equate allocate portions. Are they doing what they say they are doing . Bob i think thats a very good question. We are waiting to see how much of this interest translates into actual allocations. Theres no question that whether , it quantitatively focused has captured interest on the investor side. Whoe are many investors said they will be looking to allocate over the next five years. Ive it more of a debenture differentiation. They end upt will incorporating into their port of along with fundamental strategies. Portfolios along with fundamental strategies. How much allocation to they actually put on . Vonnie did you have questions this time around about changes . Bob we did not get into the same depth as we get into on the annual survey. A midyear course adjustment. We are trying to find out what investors are doing. Thus far, they are doing that. There is one shift in allocation strategy. Its around fixed income arbitrage. That has fallen out of the top 10 at this point in our view is that most made those fixed income allocations early in the year and with the change in rate, they are sitting tight. Bank policy central changes, that is already priced in . Bob many of those of already been made. Strategy,f the macro earlier in the year we saw many investors who were looking to allocate equity on a targeted basis. They moved into financials and health care and t m t. There is always that i toward a policy. This is smart money . Bob we like to think so. Vonnie robert leonard, thanks for joining us once again. Mark just to recap that trumpng news, donald junior has released a string of email correspondence with wrecks goldstone who set up that meeting with the russian longer. He was told there were official documents and information that would incriminate hillary and her dealings with russia and would be very useful to the campaign. He was told it was part of the russian Government Support for mr. Trump. This comes as yesterday donald trump juniors lawyer acknowledged that he received the email. Heres whats happening to the markets. We have seen a downward move. 1 . Ow jones is we see european markets moving as well. The stoxx 600 is lower. The s p is down by. 25 . We continue to monitor this story. This is about nine minutes left in the session. Getting a little bit lower after the release of that. This is bloomberg. Vonnie live from bloomberg in new york. Mark i am mark barton with the european close about seven minutes away. Snaps focus on tech, shares are falling for the seventh straight day. It is now trading low its ipo price. Caroline is telling us once behind the slide. Caroline this is where facebook continues to compete. Whether its being thought of as what Companies Need to be rather than experimenting on snapchat this is why they are getting a downgrade. Morgan stanley was one of the underwriters of the ipo. They are getting down to 16. This is below the original ipo price of 17. Competition is offering these lenses that you can sponsor for free. Snapchats of revenue. They are worried about picking up any traction, if companies are using them. It e this price talk target, if youre looking at anr , if you look on the bloomberg, youve still got the bulk of analysts saying by the stock. Most are saying hold. Look at how we see the yellow line in price. Would onord if you some of the sites with Net Neutrality . Caroline we are looking at europe in particular. You see another fine coming from europe. This is due to the french back taxes. One billion euros could be charged. This after the get slapped with that fine coming from the eu just last week. To of this is being due ireland, where they are illegally dodging taxes. That is a new precedent in france. We are seeing this in italy in the u. K. Its amazon prime day. Take, its like a black friday in the middle of the summer. For 30 hours you can go online. Games, thats the best deals im told. Macys is coming out with its own predelivery. Mark there you go. The closes four minutes away. This is bloomberg and these days families want to be connected 24 7. Thats why at comcast were continuing to make our services more reliable than ever. Like technology that can update itself. An advanced fibernetwork infrustructure. New, more Reliable Equipment for your home. And a new culture built around customer service. It all adds up to our most Reliable Network ever. One that keeps you connected to what matters most. Vonnie emails released by donald trump junior. Tabloider british journalist, is linked through the Miss Universe pageant. Course added with donald trump junior and said the documents that this lawyer he was trying to set a meeting up with would incriminate Hillary Clinton and her dealings with russia. It would be very useful to your father. This is very high level and Sensitive Information. This is extremely important because we know donald trump junior was aware of russia trying to add support to the campaign. In that meeting that did take place, Jared Kushner and Paul Manafort were there. We are going to dig through all of this. I do want to point out that the market has taken a dive off the back of the headlines. The dow is down. 5 . Mark this is the stoxx 600. It is similar to the other charts. We have taken another leg down. We are down. 7 did i am going to push g r r. In four. He third day thats pushing this a little bit lower. We were down lower anyway. The earning season is underway. Pepsi has a report later. This is a great chart. Corporate profits may slow worldwide. Changes a signal for the local Producer Price index has an excellent correlation to global earnings delivery. So says jpmorgan. This comes as the earnings season gets underway. Line is the world index trading. We are talking earnings in detail in just a second. Thats a bit of a taste. Its a deal thats going to bolster its flu vaccine portfolio. This is frances against drug maker. Unlike traditional shots, it would be produced within weeks to adjust to new tatians in the flu virus. Wakes weeks. Its a very aggressive strain. And weare down by. 5 have retail sales, they are rising in the Second Quarter, up by 2. 5 . They are climbing the most since 2000 13. That might be a surprise giving data. Temptingher is shoppers. Consumers of been the driver of growth since the brexit referendum. S bucks the recent tram trend we have had. About a report yesterday recent showing Consumer Spending posting its worst quarter since 2013 in the three months through june. What did looking like over there . Abigail we want to look at the s p 500 after the breaking headline. He was told russia wanted to help the Trump Campaign. Right around the time of that headline, we see the stock nosedive. Look at the dow transport. This is an even more extreme reaction. This is down. 9 . We do see a little bit of the deposition investors are trying to reassess. We see a reaction for ipos. This is down 6 did this is down below the ipo price. It is being downgraded to empty weight. There is no concern about product growth. Blue apron is down sharply, well below its 10 ipo price. There is a two dollar price target. This is a bearish reaction. Look at what happened with other highprofile ipos in the past. Have in white, we facebook. 54 after the ipo. We also had the shares of twitter here down 10 . Square took a dip. That we have snapped down on the ipo price is in line with what we have seen with some of these other highprofile ipos. When will a recovery come . Twitter is the old one that has not reclaimed its ipo price. Amrita another tight version. Vonnie i want to get some perspective for investors. Revelations about the donald trump junior emails. Its literally just happened. The dow is down about point ive sent you treasury yields are down. Its not a massive reaction. Tell us what could happen if this were more serious . There is a lot of optimism in market prices that maybe we get some more policy. Any policy in the second half of the year. There was some momentum on health care. There has been more chatter on tax policy coming up. Discussions, the uncertainty that this brings for the policy package is enough to distract markets. There is an overwhelmingly upward trend. This is a constant weight on solid market prices. Risk, itslitical incredible how much equities on both sides of the pond are shrugging it off. And equities show a remarkable propensity to shrug off geopolitical risk this year. They will continue to do so on till some risk becomes policy risk. Some weight on the economy, until you see some real results, its a lot of noise. Eventually, that noise may weigh on our system. Right now, youve got the most robust earnings environment since 2011. You have extremely low interest rates. It is still very strong. There is a lot of risk, but we dont know how to price that risk. That is an important clarification. Its really difficult for an death investors to price. Mark before we get to the earnings, given the breaking news, the thread of the conversation, geopolitics and france,s in germany and now that that is passed, its a tailwind . One of the things that is supporting not only the market straight up but also hopes aware macrons could go is the revival. Its an opportunity if he can get france leading as opposed to dragging and restructuring and other activities across europe in combination with germany. Vonnie how much will currency affect earnings in europe . A lot of people say m a h