missing revenue targets. shares sinking after hours and supplies fall in european trade. a shot in the arm for novo nordisk, profits beat forecasts and the drugmaker raises its outlook. hugo boss shares fall out of fashion sinking to the bottom of the european market as investors shrug off better than expected earnings. good morning. great to have you with us once again. we have a jam packed show for you. we have plenty covered for you from earnings to the outlook for the middle east. let's kick things off with earnings. we're off by roughly 0.1%, not by too much. but it seems like there's some profit taking going on. we did see a strong performance in yesterday's trading session, the all-time high for the dax. we were at 20-month highs. i guess investors will be forgiven for taking profit today. once again we're in the thick of earnings season. this is driving some indices and shares. let's look at the markets one by one. you'll see the dax is pulling back from yesterday's high. back below the 12,500 level, off by roughly ten points. the ftse 100 is off by a third of a percent. the cac 40 losing 0.2%. when you look at the sectors, you can see where the earnings surprises are and where the earnings misses are. healthcare is up by two-thirds of a percent. chemicals, telecoms on the green. on the down side, basic resources, autos are underperforming. novo nordisk shares are topping the stoxx 600 after the company raised its 2017 guidance. the biggest diabetes drugmaker reported a better than expected 10% rise in first quarter operating profit driven by new profit sales and cost cutting. the cfo told cnbc that the figures were promising. >> if you look at the second quarter, we have a higher degree of transparency. for the full year we narrowed the guidance in terms of sales. when we started the year, we said there would be a 5 percentage point interval for sales growth. we narrowed that to 3%. we have increased transparency. >> let's talk about fashion. hugo boss shares are trading near the bottom of the stoxx 600 after u.s. sales fell 7% in the first quarter. the german fashion house's net profit increased 25% and sales were up 1%. hugo boss also reconfirming its 2017 outlook. look at shares off by 4.87%. sainsbury's has reported its third straight year of profit decline, the drop was less than expected by analysts. the british grocer warned competition would continue to remain high in the uk and the impact of price pressures was uncertain. sainsbury's cfo told kevin byrne that the numbers were improving. >> it is not that bad. what was encouraging is that where the total sales of food were up last year, and like for like was impacted by the -- because we opened some space. >> all right. let's round it up with a look at bnp paribas also out with numbers. it seeded expectations to post a 4.4% rise in first quarter profits thanks to a boost in fixed income and equities trading units. nancy is in paris speaking to the cfo of the company. this is a bank like so many of its u.s. and european peers that saw seasonality in the first quarter. >> that's right. what a difference a year makes. keep these results in perspective. yes, the revenue growth across cib was very strong. you talked about a fixed income in commodities, also for equities trading, prime services, revenue increasing more than 30% over the same period a year ago. but last year, the year got off to a dull start, if you could say a lackluster start. it is a different story coming from a low base. nevertheless the questions investors will be asking this morning is whether or not the strong performance in the cib unit is sustainable. i put that question to the cfo of bnp paribas, listen to what he had to say. >> if you look at cib, all three activities have shown good volume and profit, global markets, security services and corporate banking. it is true versus last year there is a bouncing back when it comes to global market. let's not forget that we've been starting early in our transformation program in our cib of tomorrow. so we've continued to adapt. we merged parts of our global markets. we've done that. so we believe there is a true uptick that we see. of course we have to see quarter after quarter how this continues. >> so that's the good news on the cib side for bnp paribas and management feeling vindicated with strategy because they're pouring more investment into the investment banking side. they want to increase their market share of trading business across europe at a time when many peers, including socgen are putting investment into the retail side of things, plain old vanilla strategy. on the down side we know this bank needs diversification to continue diversification because of the french retail market and the domestic markets business. in this low-rate environment that's a side of the unit where revenue growth did decrease a slip of 1.4%. so i also asked the cfo of bnp paribas whether or not he was concerned that this side of the business would continue to lag. here's what he had to say. >> the retail has in europe impacted by the low interest rates environment. you have to look at it. what you have to do in that case, you have to stand by your clients, have them grow their loans and deposits, at the same time offer them fee and commission-based products which is something, as a diversified bank, we can do. if you look at the first quarter, let's take france as an example. in french retail we had loans of 7%. deposits of 12%. fees of 3%. this bodes well. if this would continue, basically these drivers would start over time to compensate for the low interest rate environment. twlats that's what we're well prepared to do. >> so then you could have the steepening yield curve on top of that. >> you want to keep this in our own hand what we say is we want to have that impact within retail. we said when -- when we say we want to be an integrated by diversified bank, we have three pillars. we have domestic markets, international financial services and cib. we don't want one of them to be too large. we want them to have one-third. that's what our growth aims to continue. >> when you look at improving economic fundamentals in france, across europe, you talk about loan growth, do you think it's time for the ecb to start normalizing? is it your expectation that we'll see that? if so, when? >> i don't know. that's difficult. but there is, indeed, if you look at it, if you look at results in the first quarter there has been a pick up in volumes. if that would continue, we'll have to see. but then it can be expected that probably the interest rates would also evolve going forward. >> that was the cfo of bnp paribas saying there are signs of optimism on the french retail side of things, when you talk about loan growth, a bit of a steeper yield curve but it's too early to tell whether or not the ecb, when they will, i should say, start to normalize rates with a hike. banks seem to differ on their call for that expectation. so they are cautious for a rate rise that is out of their control that's why diversification is so key. the other big factor that will have a major impact on the economic back drop, not just here in france but on the broader european economy is the final round of the french presidential elections taking place on sunday. keep in mind the banks have had a sdeent run decent run up. i think in the neighborhood of 12% for the first round of election results, seem to point to a emanuel macron victory over le pen, but with a few days to go everyone is cautious. >> nancy, thank you very much for that. i want to continue that discussion with steven izags. good morning to you. nancy eluded to the run up in the banking sector after we saw that macron win in the first round. do you think the markets are maybe a little bit too complaisant when it comes to the second round? they're fully pricing in a macron win, too. >> i don't think they're complaisant about him winning. i think the french opinion polls have shown themselves to be more accurate than elsewhere. my question to mr. macron is how do you govern a company wheith 6 cheeses. that was a quote by charles de gaulle, who was the last outsider who reshaped french politics. the question for mr. macron, yes, he will win on sunday. if the momentum starts to slow and rather than him winning by 20%, it's 15% or 10% or tighter than that which is my forecast, then i think the momentum leading into the june parliamentary elections could stall and cause him some problems. he's great at his new part, he intends to stand in all 577 french constituency and is work hard to try to crush the socialists and the republicans saying i'm the party of the future. they'll fight back. and my concern is momentum may be lost. he may find the business of governing, which mr. trump has found to be rather more messy, to be a lot more difficult than he thinks. the momentum and euphoria, which is built into markets, is something i would question. >> by the way, off the top of my head, i only know one type of french cheese, that's brie. i'm sure you can educate me in the break. do you think because the euphoria may be fading somewhat, is this as good as it gets when it comes to the european equity markets? should we take profits here? >> i think so. if you look at the banks, obviously there was a rebound from some shocking figures in 2015, and the first part of 2016. and an awful lot of lunches being eaten since then. we have negative interest rates still. so in terms of interest margins, that problem has not gone away. and if you look at what's happened to the u.s. banks, with one or two exceptions, they all dwindled back to being unchanged on the year, facing a whole host of problems. so, i would say, yes. this is a cyclical business. they were all oversold last year. there's been an incredible rally, up less you believe mr. macron can really reform france. i ask that question is there any sign of reform that will take place in france? >> let me play devil's advocate. if you look at the earnings picture for europe, that's been incredibly strong. first quarter so far roughly 30% of the companies reporting, three quarters have beaten on earnings, this is a show-me quarter for european companies, they are showing they can grow margins and revenues. isn't that a positive sign? >> negative interest does work. we have had five years since draghi's famous speech saying he'll do whatever it takes. i question now how much more can be done. and i worry with inflation inching up nearing the ecb target of 2%, the political pressure from the germans are going to really start to turn the screw on the ecb. i don't think the market is positioned for a change in policy yet. >> so the taper tantrum will come in 2018. you think it will have reverberations across the market similar to what we saw with the fed, and may 2013 probably not as extreme? >> it's difficult to forecast. i think it's out there. i think you can't ignore it interest rates in europe have one way to go. that's up. how does the market handle that? then i question how it will handle it. >> steven, where do you go in the markets? where do you put your money if you're hesitant to put money into the european equities, if euphoria is fading, do you want to go back to the u.s.? >> i think you go back to u.s. corporate bonds. valuations in the u.s. are a whole different kettle of fish. we saw apple had some problems overnight. this is not the company is doing badly. they sold 50 million iphones in the quarter. not bad. they do believe -- they probably will, the next reinvention of the iphone will have greater success in the future. the problem for apple is it's up 25% on the year. it's an expensive stock. i'm not looking at equities generally. i'm looking at sensible, take money off the table, reinvest and probably reinvest in the dollar. the dollar has been the stand-out worst performing currency this year. we started the year where investors were overpositioned in the dollar. that has been unwound now. investors are negative on the dollar. there's some value that you can pick up in the dollar. that's where i'm going. >> what i here time and time again around this desk is going to the emerging markets. the mexican peso, the russian ruble have performed well against everyone's expectations given the trump notion. do you think that's a good place to go back in? >> i don't think you should look at emerging markets as one asset class. that's a big mistake. there are different countries, societies and outcomes. we like india. india is an interesting place. nowhere is cheap at the moment. we're not looking at finding an incredible value somewhere tucked away at the corner of the globe. if you look at india, a big country, it has the rule of law, democracy, strong demographics, has a large and functioning equity market. that's where we think, if one has to invest, and let's face it these are difficult choices, we think india is a better bet than some others. russia is a play on energy prices. who knows where they're going. brazil, mired in political corruption and all sorts of problems there. we're looking at india. >> all right. steven, stick around. we're talking about apple before. we'll pick that up after this short break. steven isaacs. do keep your e-mails coming. i love reading them. e-mail the show, streetsignseurope@cnbc.com. and you can send through your favorite picks for french cheeses, as we just discussed. what other cheeses do you like. follow us on twitter at streetsignseurope@cnbc and tweet me directly, @carolincnbc. taking a bite out of apple. we explain why shares in the world's biggest tech firm are trading lower despite a record breaking dividend pledge. that and much more coming up on "street signs." hey you've gotta see this. c'mon. no. alright, see you down there. mmm, fine. okay, what do we got? okay, watch this. do the thing we talked about. what do we say? it's going to be great. watch. remember what we were just saying? go irish! see that? yes! i'm gonna just go back to doing what i was doing. find your awesome with the xfinity x1 voice remote. all right. let's get back to earnings. fresenius reported a double increase profit in sales. they reported 28% increase in quarterly net profits, sales were up 19%. earnings before interest and taxes also increased 27%. and shares in apple's german listing, they are trading sharply lower. look at your screens. they're off by 2%, that's after the tech giant reported a fall in second quarter iphone sales. the news is hitting europe's biggest chipmakers, this despite earnings topping analysts expectations as the company's cash pile rose to 256$256. bil$ billion. arjun kharpal, our cnbc technology reporter joins us now and still with us is steven isaacs, chairman of the investment committee att alvine capital. tim cook has a reasonable explanation for why we saw that miss. >> he said all the hype around the new iphone, rumors, that's all good for the company. don't think tim cook is worried about that this is creating the demand analysts are expecting when we get the next set of iphones. the super cycle that will be kicked off by the new iphones. this is all good news for the company in terms of what we saw from iphone numbers, they were not surprising. we were not expecting a massive tick up. it's steady as she goes for the next quarter then analysts are laser focused on the product launch, and that has to deliver. this is one of the most important launches for apple. this phone is supposed to set the market alight and set apple's earnings alight. >> the one story is the product launches. the other story is the capital return, steven. that's where you come in you're skeptical when it comes to the current share buyback program. they've been boosted again. why do you not think this is a good sign? >> i can't stand the expression super cycle. makes me worried. remember the commodity super cycle? that's hype. bad idea. try to lower expectations. the problem for any company is quarterly earnings. having to deliver. having jump through the hoops. this time they couldn't jump through the hoops. i think they should try to manage expectations. the issue about buybacks is an interesting one. this is the easiest way to get a stock boost for five years. suddenly the market, not just for apple is getting cynical about it hang on here, is that the best you got? we're cognizant that you're buying expensive shares that are up 25% this year for apple. generally speaking, share buyback shows a lack of innovation, a lack of sense of where they can invest money. >> is that really the case for apple? they can innovate and buyback shares at the same time. >> they can do anything they want. they have 2$250 billion in cash. they have many, many options. just talking about whether this stock has gone too expensive. whether expectations have been hyped up rather than being managed. and whether they should be actually spending money on share buybacks rather than distributing it to shareholders. by the way, looking at tax reform in the u.s., there's going to be an opportunity probably later this year to do something with that cash pile and do something more efficiently for shareholders. i think tim may have missed an opportunity here. >> want to get back to the product launch later this year. it's the 10th anniversary of the iphone what are we expecting from that anniversary iphone? better screen? ar maybe? >> looking at better spec screen on the phone, reportedly coming from samsung with the display panels. advanced kaneca camera and 3-d . there's a lot of expectation built into the device. it has to deliver. where ap tple suffered and received criticism is the last devices have not been game changing and they've been skimping on innovation. these devices need to show apple can push the envelope out there and become the next big thing. that's what they have to show. >> is that also why they suffered a revenue decline of 14% in china? >> china is a massive headache for the company. apple has not kept up with the domestic players are doing, who have come up with high spec devices at almost half the pies price of an iphone. so continued pain in china, but that could turn around if apple delivers a cutting edge device later this year. >> steven, do you want to chase the returns in the tech sector and nasdaq at another record high last night, or do you think time to take profits? >> the good thing about apple t has real earnings, pays a dividend and has interesting shareholder revenue. warren buffett, a shrewd guy, buying below $100 a share, made 50% on his investment. what mr. buffet was lookingbuff looking for is every couple years you pay a monthly fee and that has a loyal customer base. i think that's what's happened in most of the western markets. that's the bold case for apple. in that sense apple has value. the rest of the tech sect, my god, fanciful prices. it's a bubble. trying to sell it or short into the bubble, it's called a widowmaker, but anybody has to say this is madness. >> or the trend may be against you. who knows. steven, thank you very much for that, steven isaacs. arjun kharpal, thank you so much. we'll go for a quick break. check out world markets live our blog which runs throughout the european trading day. we'll be back with plenty more. uk data after the short break. hello. welcome to "street signs." i'm carolin roth. these are your headlines. third time unlucky for sainsbury's. the british supermarket chain posts another year of profit declines and says price pressures remains uncertain. >> it's not that bad. what was very encouraging last year was that where the total sales of food were up last year, like for like was impacted by the -- because we opened some space. apple's ceo tim cook blames rumors around future products for missing revenue targets. shares sinking after hours and supplies fall in european trade. a shot in the arm for novo nordisk as shares top the stoxx 600 as profits beat forecasts and the drugmaker raises its outlook. hugo boss shares fall out of fashion despite a recovery of sales in the uk and china, sinking to the bottom of the european market as investors shrug off better than expected earnings. all right. let's get straight to some uk data in the form of uk april construction pmi and another surprise after yesterday's three-year high for the manufacturers pmi. a print of 53.1, versus 52.2. this is a four-month high. easily beating expectations of a print of 52. so once again, the uk construction pmi hitting a four-month high. coming straight off the back of the manufacturing pmi yesterday. do keep in mind the uk construction sector only accounts for 6% of the economy. obviously what we're waiting for is tomorrow's services pmi number which is more telling when it comes to the gdp print for the second quarter. let's get back to what sterling is doing. not reacting too much. maybe limiting some of the early declines. changing hands at 1.29, off by a few -- really a fraction on the day. let's have a look the u.s. futures. yesterday we saw a down day for u.s. markets. sorry, an up day. major averages eking out small gains. the nasdaq closing at a record high. the s&p with its second highest close ever. this morning we're looking for a bit of profit taking. the s&p 500 seen off by 4.8 points. the dow jones set to lose 37. the nasdaq seen off 18 points. we'll see whether it can eke out another record high at end of the trading session. apple shares seen off in german trade and in after-hours. that will put pressure on the markets. when it comes to european equity trading session, we are under water as well. the ftse 100 is off by a third of a percent. the dax off by 0.2. the cac 40 losing a quarter of a percent. it's all about earnings at the moment. we're seeing outperformance in the healthcare sector based on earnings there from novo nordisk and fresenius. when it comes to the fx markets, it's quiet in that it's fed day. we don't expect a change in rates today. japan is closed. less of a strayed thetrade ther. euro/dollar is still holding strong, close to 5 1/2 month highs at 1.0912, a few days before the second round of the french presidential elections. let's cast our attention to the middle east. emirates based real estate developer imkan revealed plans to build a 180,000 square meter space in abu dhabi. it will house commercial and mixed residential properties. let's get out to hadley gamble. >> what we've seen in ab due u is a lessening of real estate sales. i'm talking to the ceo of imkan. there's a focus on culture going forward. what's the strategy? >> i think abu dhabi has been smart in vision. they focused on culture as the catalyst for creating a community, a community that is a long-term vision. >> talking about bringing in the louvre. >> absolutely, the louvre, the goi going structure is what we're talking about, with all that in mind they're creating a global hub for culture. so that will establish a really big pulse in this entire region for a different city. you will see a completely different city in the next four, five years. >> you've been working on the real estate market in the gulf countries for the last decade. what's coming up next? we're coming up to dubai expo 2020, a lot of questions about overcapacity. lots of people wondering with the price of oil where it is today, are the jobs available? what's your outlook? >> my outlook for abu dhabi is a good outlook. i believe with this new airport and also the cultural hub we're talking about -- >> the transport and cultural hub. >> absolutely. the infrastructure in place will create a very attractive hub for many people that want to come and live here. but in my opinion, i think that unless the real estate industry starts to shift its way of thinking, and it's way of actually understanding the demand and the consumer behavior, i don't think the industry will do well. so they will have to actually do something about it. >> in terms of focusing on young people and what they want today and delivery time. >> absolutely. 65% to 75% of the population in this region is under the age of 30. that's a scary number. i don't think most developers in this region understand what this generation really wants or how they'll live or how they'll work. i think everybody has to do a strong attempt to try to understand that. >> at the end of the day, it is about the job situation. if jobs are here, people will come. >> absolutely. when you create a hub like we're talking about, jobs will come here. so the next question is how are you going to react to the needs of those people that will come here? >> a bit of a shift in gears. let's talk about egypt what we've seen over the past several months, movement towards fulfilling their obligations under the imf loan. they have done away with capital controls. this is a major hurdle many felt. you were bullish on egypt's real estate market. talk me through that. >> absolutely. egypt has a population of almost 100 million people. so shg, with a population like , a growth population like that, real estate will always do well. however i think that from the -- from an investor going into egypt, we look at a long-term vision. >> less risk adverse? >> absolutely. we are working on a city for 120,000 people, for instance. our outlook is a long-term outlook, not short-term. we believe in egypt. we believe in the strategy going forward now. i believe egypt will come back in five years, it will be on the global map in my opinion. >> president cici has been under pressure to deliver on an economic strategy for that country. is he there yet? >> he's not there yet. but i believe he put all the elements in place to get there. it will take some time. however i think that this entire administration is doing its beths to hebest to help investors come in from all over the world, attract them and provide the atmosphere and the basically the policies in place for them to be able to work in a safe environment. besides that, he has to take care of security, which he's been doing a good job so far. accidents will happen every now and then, but over long-term, they will be able to manage this well. >> so you're bullish on egypt and bullish on the uae, abu dhabi in particular. where is the challenge coming from in the real estate sector? what's a tough sell. >> i think maybe i'm bullish in terms of our market because i know what we're doing and in terms of a research plat formfoe are trying to understand the trends, future trends. we look at the strategies taken by geniuses like elon musk of tesla, we believe in that way. so we have that research platform that we believe is going to enable us to be successful in the region. >> we have to leave it there. carolyn, back to you. >> thank you very much. brussels has reportedly raised the brexit divorce bill to around 100 billion euros. yes. according to the financial times, eu leaders revised their calculations and are demanding more money from the uk to leave the union and cover up-front liabilities. the demand is driven by the germans and the french and is up from a previously suggested charge of 60 billion euros. so as some of you may or may not know, divorces can get messy. it's usually about who gets the dog, the house, the car this time it's about how high will the brexit bill be. theresa may says jean-claude juncker will be the next person to find out how difficult i can be. it's the hard line taken by the uk prime minister as she continues her campaign ahead of the general election. speaking in cornwall, may said talks will be tough but that a strong mandate from the uk electorate is an important step. >> i think what we've seen recently is at times these negotiations are going to be tough. during the conservative party leadership campaign, i was described by a colleague as a bloody difficult woman. i said at the time the next person to find that out will be jean-claude juncker. >> french presidential candidates, emanuel macron and marine le pen will face off tonight in a final debate. the latest polling shows emanuel macron holding a 20-point lead over his rival. french government bond yields hit the lowest level since january, while the gap with german yields are holding steady at a five-month low. let's stick with politics this time about germany. a new poll suggesting that german chancellor, angela merkel's central right party widened its lead over the central left democrats. data from pollsters put merkel's christian democratic union at 36% with the main opposition at 28%. german voters will go to the polls on september 24th for the german federal election and what many expect will be a tightly contested race. the german chancellor and russian president vladimir putin agreed to continue discussions despite disagreement over syria, ukraine, civil rights and more. the two leaders met in sochi marking merkel's first visit to russia since the annexation of crim crimea. she urged the president to implement the maersk accords. >> president trump and vladimir putin spoke by phone on tuesday for the first time since trump ordered air strikes on a syrian airfield in april. according to white house statements, the presidents agreed that all parties must do all they can to end the violence in syria. a statement by the kremlin added that trump and putin discussed a possible meeting on the sidelines of the g20 summit in july. president trump lashed out on twitter after a bipartisan spending agreement was forged to avoid a government shutdown. the white house and democrats claim victory, but the president suggested a shutdown may be exactly what washington needs. peter alexander has more. >> reporter: president trump today venting frustration on twitter, arguing the government needs a good shutdown in september to fix washington's mess. the president upset at the perception democrats got the better end of a budget compromise that avoids a government shutdown. >> after years of partisan bickering and gridlock, this bill is a clear win for the american people. >> reporter: mr. trump tried to recover a political victory from that spending agreement. >> and we didn't do any touting like the democrats did, by the way. >> reporter: but taking heat for suggesting the solution is a shutdown. >> how does the president define a good shutdown? >> if you wanted to imagine what a good shutdown was, it would be one that fixes this town. >> in the last shutdown, 800,000 federal employees were indefinitely furloughed. another 1.3 million were required to work without knowing when they'd get paid. so is that a good shutdown that fixes washington? >> back to your point, every single one of those folks got paid, right? >> reporter: with conservative critics also attacking the deal, the white house deploying two cabinet officials to boast about promises kept. more money for defense and border security. >> we are building this, okay? we are taking their taxpayer money to build this. >> reporter: the bitter back and forth as house republicans appear on the verge of another failure for their health care plan. with more republicans defecting. missouri congressman billy long backs trump but not the bill. >> just because preexisting conditions would be covered doesn't mean they can't price you out of the market. >> reporter: in arizona, breast cancer survivor tony bannister worries her preexisting condition will impact her family's coverage. >> it's not just me, it's my entire family. it's my sons. it's my future grandchildren. it's all of that. >> reporter: and tonight, word of a possible russian rendezvous. >> volkswagen reported a 40% increase in operating profit with cost cutting measures boosting the bottom line. vw is the latest german automaker to report better than expected results both daimler and bmw had strong demand in the earnings replaces but shares off by a little more than 1%. allianz confirmed guidance for the year but says market volatility and low interest rates will continue to present headwinds for the company. net profits came in line for expectations for the first quarter. operating profits beat forecasts. shares up by a third of a percent. we'll go for a quick break. still coming up on the show, business leaders are gathering in berlin for the b20 summit. we're live at the event after this short break. if you want to stay on top of your health, one simple thing to do -- is take the pledge to go and get screened for the cancers that might affect you. so stand up to cancer and take the pledge at getscreenednow.org it only takes a minute to take care of yourself, and nothing rhymes with "org"... welcome back to the show. it's fed day. the fed is expected to keep rates steady when policymakers begin a two-day meeting. steve liesman has more. >> i want to get to what the expectation is of respondents for the stock market. it is for being flat and then up a bit. you can see here, 2388 was yesterday's close. the outlook is for 2409. a little more juice for 2018, we go up 7%. that may be because of a shift of where they think fiscal stimulus will hit. i will tell you 62% of respondents say the market is too optimistic about potential outcome from president trump's policies. also when it comes to foreign policy, let's see if we have that. 60% say the president's foreign policy increased market risk. 38% say no effect. nobody is saying market risk is lower. what's behind the rally? an interesting shift here. back in december, only 18% thought it was economic fundamentals and earnings. everybody thought it was policy expectations. let's look now. a more divided response here on what is behind the market rally. 50% say it's the economy and fundamental earnings. 48% say policy expectations. first time we've seen this number be higher. let's talk about the commentary out there. neil dutta says investors continue to scale back expectations of fiscal policy in 2017. the risk rally is about stronger earnings in growth. if dc manages to surprise with tax reform, stocks will rally. and john ryding says the execution of tax reform is critical to the performance of the stock market and to the hopes of better growth in 2018 and beyond. >> in other european group solvay exceeded first quarter expectations. the first quarter profit rose to 618 million eurosment lafareholcim has beaten first quarter estimates with operating profits of 801 million swiss francs, they also surpassed rev made payments to armed groups in syria to keep the local factory running. let's look at oil prices. oil prices this morning remaining in positive territory. brent crude is up by three quarters of a percent at 50.85. wti at 47.98. according to a reuters report, iraq is choosing to refine more crude output domestically in order to skirt opec's supply cut rules. it's been a volatile start to the week for oil prices with brent futures closing at the lowest level of the year in u.s. trade yesterday. but data from the american petroleum institute which showed a bigger than expected drop in crude oil supplies has reversed some of the price declines. the german finance minister sent a strong message against protectionism at the b20, opening the business summit in berlin, the german finance minister said that if we learned anything from the past, it's that nationalism is never the right answer. annette is also at the b20, and has been speaking to many of the executives there. >> thank you very much, carolyn. the big theme here is free trade, and also where businesses are headed to in the future. so we're talking about digitalization, but also in the short and medium term, it's what the new u.s. administration might mean for free trade. difen the expegiven the experie the finance ministers had in baden-baden. it was very critical that it didn't make it to the final communique. since baden-baden which was in march, end of march and now, things might have changed a little bit, at least for schauble suggesting that the tide is moving a bit more in their favor. take a listen of what he to say about where we stand when it comes to free trade and open economies. >> i think we have made -- there's been much better than expected, even at the finance minister's meeting, bank governor's meeting at baden-baden some weeks before. so we'll be optimistic at the b20 summit, this will take place in hamburg in early july. i'm quite optimistic that we will get a lot of concrete things for the g20 summit. >> it's far too early to declare victory when it comes to open borders, the free transfer of goods to the united states and from the united states. it seems the trump administration has not made its mind up clearly where they're heading to, whether they will really see higher tariffs for some products. that's the el fantd in the room here and as well as berlin. of course yesterday we also caught up with one of the biggest car parts supplier of the world, and their ceo. he also complimented ain ee eed merkel when she first met president trump in washington. take a listen what he to say. >> was for us as sh hshgschaeff group to be a part of this trip. being a part of the roundtable about dual locational training. it's 36 years we're investing into dual locational training in the united states. we could show something to the president. i think the meeting as such was a friendly, constructive and positive meeting. the united states and germany have worked for 70 years now in corporation and with good spirit to solve jointly problems. and i put all my trust into chancellor merkel and the president of the united states that that will continue. i think there's no room for trade wars. there's only room for corporation, there's room for, you know, free trade and also as the president said, it must be fair and should be fair competition. all in all a positive meeting. in particular also for us and i do hope that, you know, the good cooperation between the united states and germany will continue. this year the b20 is a format where they can exchange ideas and express the importance of certain issues, like climate change, global warming also high on the agenda, which also didn't make it in the communique in baden-baden, also highly crucial for businesses worldwide, i would say. so one milestone or the next milestone is probably another meeting here at the finance minute stistry in the end of ma. back to you. >> annette, thank you very much. we'll be back out with you in a few minutes sfwloochlt. a quick look at european equity markets. the ftse 100 off 0.3%. similar declines for the cac cac 40 and the xetra dax. probably some troft taprofit ta going on after some earnings yesterday. when it comes to u.s. futures, we are looking at a weaker start to the trading session in the u.s. when that gets up and running in a few hours time. coming up on "street signs," we'll head back out to berlin to hear from the ceo of basf. good morning. surprise declines. shares of apple slip after iphone sales disappoint. >> today's test. the fed in focus with a policy decision due this afternoon. and we'll get a key read on jobs. and a jaw dropping price tag. a new report puts a dollar amount on the uk's divorce bill from the europe pooen yuan unio. it's wednesday, may 3, 2017, and "worldwide exchange" begins right now. good morning. welcome to "worldwide exchange." i'm sara eisen. >> i'm wilfred frost. good morning to you from me as well. welcome back. >> thank you. good to be

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