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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This is the Bloomberg Day Baker a podcast. Good morning,

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Speaker 2: It's Monday, the twenty seventh of July. I'm Caroline Hepka

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Speaker 2: in London and I'm Stephen Caroline Brussels. Coming up today.

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Speaker 1: Three hundred thousand people are forced from their homes as

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Speaker 1: firefighters battle out of control wildfires in Spain and France.

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Speaker 2: Oil prices slump as the US and Von Pool's hostilities,

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Speaker 2: raising hopes for safe passage through the Strait of Homuz.

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Speaker 1: European markets gear up for the busiest week of the

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Speaker 1: earning season, with big carmakers, banks and consumer names reporting.

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Speaker 2: Plus why palant is growing infamy in Europe is opening

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Speaker 2: doors for an obscure French challenger. Let's start with a

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Speaker 2: roundup of our top stories.

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Speaker 1: Firefighters in France and Spain are preparing for a sixth

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Speaker 1: day battling wildfires as hotter weather threatens to fuel the blazers.

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Speaker 1: More than three hundred thousand people have been evacuated from

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Speaker 1: the areas affected, with French authorities warning and uncontrolled fire

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Speaker 1: is heading towards the city of Bordeaux. These people have

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Speaker 1: been sheltering in an exhibition hall in the area.

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Speaker 3: The police arrived and told us we had to go

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Speaker 3: with them. It brought us to stay here for a

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Speaker 3: few days.

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Speaker 4: We don't know how long.

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Speaker 2: Yes, we're worried because the fire isn't stopping. People tell

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Speaker 2: us one thing and then another.

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Speaker 1: We don't know.

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Speaker 2: There's no information, so we're waiting.

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Speaker 1: What else can we do. Blaze has become so unpredictable

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Speaker 1: that officials say it's creating its own weather system. Local

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Speaker 1: officials this morning say the fire has remained largely stable. Overnight.

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Speaker 1: In Spain, the country's biggest wildfire on record has burned

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Speaker 1: around fifty thousand hectares south of Madrid. Spanish Prime Minister

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Speaker 1: Pedro Sanchez says they are still challenging hours ahead.

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Speaker 4: The little scale of disaster we're experiencing once again in

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Speaker 4: our country is sadly very difficult to comprehend. Yesterday we

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Speaker 4: reported one hundred and thirty thousand hectares had been affected

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Speaker 4: and burned so far. Thank got today that figure has

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Speaker 4: already risen to more than one hundred and fifty zero hectares.

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Speaker 1: Pedro Sanchez, speaking via translator, as more than fifteen hundred

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Speaker 1: soldiers were deployed to help firefighters, while dozens of roads

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Speaker 1: have been closed where castors say. Temperatures are set to

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Speaker 1: rise again this week, raising fears the fires could spread

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Speaker 1: even further.

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Speaker 2: Oil price is slumped after the US pause strikes against Iran,

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Speaker 2: halting a thirteen day bombing campaign that had rattled energy markets.

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Speaker 2: Iran says it's also suspended retaliatory attacks, while officials from

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Speaker 2: Tehran and Oman have assumed talks aimed at restoring shipping

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Speaker 2: through the Strait of Hormuz. The News briefly pushed breakthrough

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Speaker 2: below ninety dollars about but speaking to NBC's Meet the Press,

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Speaker 2: US Ambassador to the United Nations Mike Waltz insisted that

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Speaker 2: President Trump had not totally ruled out for the military action.

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Speaker 5: The President is keeping all options on the table. I've

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Speaker 5: spoken with the negotiators. I've spoken with Secretary Hegseth. The

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Speaker 5: President is doing right now as we've seen all along,

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Speaker 5: is giving some talks. Some space talks are ongoing. They're

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Speaker 5: happening at every level, from the more technical aspect of

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Speaker 5: it all the way to the highest levels.

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Speaker 2: Of course. Mike Well, speaking there to NBC, despite the

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Speaker 2: pause in US and Iranian attacks, traffic through the Strait

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Speaker 2: of Homer's remains essentially parallelzed, while Yemen's Iran baut Houthi

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Speaker 2: rebels claim that they've attacked Saudi energy facilities.

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Speaker 1: The suspect in the deadly van attack on Berlin's Pride

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Speaker 1: event over the weekend has been shot dead by police.

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Speaker 1: Abdul Balas was tracked to an allotment in the German

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Speaker 1: capital yesterday evening, where he was killed after rushing towards

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Speaker 1: officers with a weapon. Chanceller Friedrich Merritz says the country

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Speaker 1: won't be intimidated.

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Speaker 3: This is poison.

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Speaker 2: Our freedom.

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Speaker 3: It is continuing to attack our society. Heart of politic

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Speaker 3: school differences can be set aside. We will defend the

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Speaker 3: freedom of our society.

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Speaker 1: Germany's predect Mark, speaking there through a translator. The shooting

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Speaker 1: came after a man hunt that stretch from central Berlin

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Speaker 1: to the airport and Germany's borders, with authorities publicizing Ballot's

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Speaker 1: photo and taking the unusual step of releasing his full name.

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Speaker 1: Authorities say the German citizen had links to the Islamic

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Speaker 1: State Group.

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Speaker 2: Now to Corporate News, China's biggest memory chip maker has

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Speaker 2: opened four hundred and seventy two percent higher in its

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Speaker 2: Shanghai stock market debut. The surge made CXMT China's largest

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Speaker 2: onshore listed company, with evaluation of around four hundred and

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Speaker 2: eighty seven billion dollars. The firm raised sixty six point

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Speaker 2: six billion you run in the country's second largest initial

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Speaker 2: public offering. Shares later climbed as much as five hundred

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Speaker 2: and thirty five percent above their IPO price in morning trading,

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Speaker 2: reflecting investors confidence in cxmt's long term prospects, despite concern

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Speaker 2: that the AI driven rally in ship stocks may be peaking.

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Speaker 1: The chief executives of some of the UK's best known

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Speaker 1: companies are demanding the tax cuts for businesses should be

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Speaker 1: top of the agenda for Andy Burnham's government. Plenbrooks Ewan

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Speaker 1: Parts has more as.

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Speaker 6: Andy Burnham settles in for his second week at number

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Speaker 6: ten Downing Street. Business leaders who've spoken to Bloomberg are

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Speaker 6: renewing their calls for action to drive growth. The founder

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Speaker 6: of food chain Leon says the government should stop taxing employments. Meanwhile,

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Speaker 6: the CEO of holiday parks operator Buttlin's says that Burnham

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Speaker 6: shouldn't forget the rest of the hospitality sector after tax

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Speaker 6: cuts announced for pubs. He says a VAT cut would

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Speaker 6: help stimulate sales regardless of the government's plans. He told

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Speaker 6: us that clear messaging and communications are vital, saying, quote

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Speaker 6: more dialogue would be great in London, I'm ewing pots

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Speaker 6: Bloomberg Radio.

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Speaker 2: And those are our top stories for you this morning.

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Speaker 2: This week, of course, we have a huge rafter earnings

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Speaker 2: out plus central bank decisions which markets will be focused on.

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Speaker 2: In terms of what's happening this morning, bring cred futures

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Speaker 2: are down by four point seven percent, training at ninety

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Speaker 2: two dollars twenty seven. European natural gas prizes have also

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Speaker 2: declined sharply. We do have FED Bank of England, Bank

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Speaker 2: of Japan decisions. No change is expected, but inflation concerns

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Speaker 2: will surely weigh on those policy makers. Europeans futures this

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Speaker 2: morning are sharply heart up by about eight tenths of

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Speaker 2: one percent now as that future is up by one

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Speaker 2: point three percent this morning, But if you look at

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Speaker 2: the Asia session, more mixed there. The NICKEK two to

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Speaker 2: five cost b are up, but only about two tents

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Speaker 2: of one percent. The TAIEG struggled a little bit more,

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Speaker 2: the dollar weakening against most major currencies, ten year treasury

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Speaker 2: yields falling five basis points today to four point six

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Speaker 2: three percent, and precious metals are rallying. Those are the

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Speaker 2: markets in a moment.

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Speaker 1: More on that big week for European earnings, plus how

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Speaker 1: a French firm is emerging as a challenger to Palenteer

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Speaker 1: as European countries seek to turn away from US technology.

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Speaker 1: But first a world a word on those wild fires

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Speaker 1: in France and Spain, the situation escalating over the weekend,

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Speaker 1: both in the south of Spain and southwest of France

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Speaker 1: as well. We're watching the latest on that wildfire close

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Speaker 1: to Bordeaux as well. Largely stable, as what authorities say

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Speaker 1: things are overnight, but eighty four firefighters have been injured

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Speaker 1: of in the efforts to try and bring that fire

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Speaker 1: under control. The concern, of course now is that the

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Speaker 1: temperatures are due to rise over the next couple of

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Speaker 1: days up to forty degrees again in the Bordeaux area,

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Speaker 1: and what that will mean for making things worse. There's

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Speaker 1: also been quite a lot of talk though about one

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Speaker 1: image that's gone around the world from those fires in

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Speaker 1: Bordeaux of the two people sitting on a beach on

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Speaker 1: their sun loungers watching the blaze from Afar. The photographer

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Speaker 1: Maximilian Lami from AFP was speaking to Nuvelab's magazine about it,

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Speaker 1: and he actually defended the couple, saying they weren't in

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Speaker 1: any danger. They couldn't really do anything else but watch

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Speaker 1: as the horror unfold, and he asked the question, would

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Speaker 1: we have acted differently if we were in their position?

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Speaker 1: Of course, being used as an illustration of inaction in

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Speaker 1: the face of climate change and provoking an awful lot

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Speaker 1: of debate as well, but an incredible image captured during

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Speaker 1: the horror really of those wildfires in that area of France.

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Speaker 2: Yeah, I mean, it's also mensely difficult, isn't it to

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Speaker 2: deal with holiday makers. This is peak holiday you know

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Speaker 2: times across Europe, and so to deal with people who

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Speaker 2: are also on the move, as well as trying to

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Speaker 2: deal with these massive wildfires, it's really difficult. I mean,

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Speaker 2: in southern France, it's a lightning flashes on Saturday night

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Speaker 2: when I was there in Manumacos holding a crisis cabinet

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Speaker 2: meeting about what's happening in France today. I mean even

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Speaker 2: here in the UK. We've seen wildfires in Scotland and

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Speaker 2: we're going to have another fourth heat wave this week.

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Speaker 2: So highs just in the UK of thirty two to

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Speaker 2: thirty three degrees and incredibly dry July. People are battling

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Speaker 2: these wildfires on so many fronts and they are immensely dangerous.

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Speaker 1: Yeah idea. Of course, we're keeping an eye on the

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Speaker 1: other effects of this as well, on things like paragrids

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Speaker 1: that we've talked about before and what sort of effects

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Speaker 1: higher temperatures will have. So we'll leave that story there

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Speaker 1: for the moment and turned back to some of the

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Speaker 1: big companies going to be reporting earnings in Europe this week.

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Speaker 1: It's the busiest week in fact of the European earning season.

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Speaker 1: A third of the companies on the stock six hundred reporting,

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Speaker 1: including big carmakers, banks and consumer goods giants. But what

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Speaker 1: have we learned so far from the companies that have reported.

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Speaker 1: Let's discuss with Tim Craig at Global Chief Content Officer

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Speaker 1: at Bloomberg Intelligence. Tim, good morning, good to talk to you.

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Speaker 1: You've just published your latest earnings pulse check. What does

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Speaker 1: the overall scorecard look like at this stage? About a

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Speaker 1: third of the way through.

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Speaker 7: Yeah, sure thing, thanks for having me on. Certainly kudos

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Speaker 7: to Erequity Strategy team. Speaking of France, Laurent de Lay

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Speaker 7: is there, and I'm sure quite concerned about the whole fire.

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Speaker 7: But nonetheless, what do we seeing on earning so far?

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Speaker 7: With about a third having reported thus at this point

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Speaker 7: we're tracking about twelve percent earnings growth, which is since

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Speaker 7: inline not a little bit better than anticipated, but I

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Speaker 7: would say it looks quite narrow. There's essentially three groups

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Speaker 7: that are pushing most of this earnings growth at this point.

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Speaker 7: Financials I think BNP, Unicredito Pharma with Novartis and Roche

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Speaker 7: both having reported, and specialty semis so ASML clearly is

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Speaker 7: a special case. Unlike st Micro, which didn't have such

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Speaker 7: a good week last week, negatives haven't necessarily been so

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Speaker 7: much because they've missed terribly. Industrials and energy, for example,

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Speaker 7: big groups okay earnings, but expectations are really high, which

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Speaker 7: creates a really high bar for those companies when it

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Speaker 7: comes to, you know, the whole sort of electric electrification story.

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Speaker 7: And yeah, there have been a couple of turnarounds of

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Speaker 7: note which have been interesting to see. Richmond Montclair Better,

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Speaker 7: which was quite instructive when it comes to luxury goods,

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Speaker 7: and SAP's cloud sales were notable because there's been a

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Speaker 7: lot of concern about tech spending outside of just good

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Speaker 7: old fashioned AI, you know, which is such a big topic.

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Speaker 7: So anyway, okay, so that's so far, Yeah, stop by stock.

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Speaker 7: What's been happening and what's the broader market impact being

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Speaker 7: so far? As you say, the expectations were very elevated

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Speaker 7: for Europe. Yeah, and I think that comes out in

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Speaker 7: terms of how the market hasn't has indeed reacted. If

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Speaker 7: we look at beats versus misses, you know, we are

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Speaker 7: running close to fifty percent versus thirty percent, so you

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Speaker 7: know it is steering towards the beat. But when you beat,

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Speaker 7: the average one day impact on the stock plus point

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Speaker 7: nine percent, so barely a move. If you miss the

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Speaker 7: average or the average impact is a minus three percent,

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Speaker 7: so it's quite skewed to the negative. That's true for sales,

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Speaker 7: it's true for earnings. All the more true for sales

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Speaker 7: and earnings when you beat or miss, as the case

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Speaker 7: might be.

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Speaker 1: What's been the tone that we've got out of management

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Speaker 1: comments on analyst calls though there's so much happening in

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Speaker 1: the world, a lot of stress and markets, not only

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Speaker 1: with the questions around the future of AI, but also

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Speaker 1: of course the situation in the mid least.

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Speaker 7: Yeah, I tell you it is interesting. Whether you look

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Speaker 7: at the broad market right now Europe, US Global, we're

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Speaker 7: close to highs and you think we've had tariffs, now

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Speaker 7: we have tariffs again, we've had in the Middle East

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Speaker 7: war that has gone through another round of ratcheting up

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Speaker 7: in recent weeks, but management sentiment, management tone so far

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Speaker 7: has been quite upbeat. In fact, we have a sentiment

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Speaker 7: indicator on the European Equity Dashboard that Bloomberg subscribers can

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Speaker 7: have access to at the most positive sentiment since the

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Speaker 7: pandem Quite interesting AI. There's been discussions about productivity, cost efficiencies,

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Speaker 7: generating new revenue, all those things we would want to

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Speaker 7: start to hear to the degree that implementation is now

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Speaker 7: getting real supply chain concerns not nearly as much as

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Speaker 7: we had last jarning to reporting periods. So and that's

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Speaker 7: notwithstanding in the Middle East crisis. So is it quite

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Speaker 7: interesting from the standpoint of that dichotomy what we think

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Speaker 7: from an outside perspective versus what management are actually bringing

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Speaker 7: to the table.

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Speaker 2: Yeah. I think that's fascinating, isn't it? AI implementation actually happening,

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Speaker 2: starting to happen. Tim, Thank you so much for your time.

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Speaker 2: Thanks for being with us. Tim Craighead is Global Chief

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Speaker 2: Content obviously at Bloomberg Intelligence. Stay with us. More from

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Speaker 2: Bloomberg Daybakeube coming up after this.

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Speaker 1: European countries are growing more skeptical of Palanteer and other

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Speaker 1: big American tech firms, giving it a secure rival the

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Speaker 1: opportunity to take over a contract for France's spy agency.

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Speaker 1: Our technology reporter Mark Bergen joins us for more on

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Speaker 1: this story. Mark, good morning. First of all, just give

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Speaker 1: us the context of this. How widespread is the turn

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Speaker 1: that we're seeing against the likes of Palenteer in Europe.

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Speaker 8: I'd say it's probably the most widespread of any singular

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Speaker 8: prominent US tech company and certainly has the most intensity.

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Speaker 8: So we obviously France is the spearhead here, both because

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Speaker 8: they were introduced to the spy agency and the Prime

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Speaker 8: Minister came out very publicly and criticized Palenteer, framing it

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Speaker 8: around digital sovereignty in the US policy decisions. We have

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Speaker 8: some reporting that Poland's Ministry Defense is looking for alternatives

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Speaker 8: to Palenteer. They're reporting the Germany and Spain are doing

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Speaker 8: the same. In Holland, the Defense Ministry has said that

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Speaker 8: they're looking to phase out Palenteer in the next two

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Speaker 8: to three years with the local alternative. Obviously, here in

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Speaker 8: the UK, there's been a lot of criticism of Talenter

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Speaker 8: for its large NHS contract. It also has a big

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Speaker 8: Ministry of Defense contract that there have been some parliamentarians

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Speaker 8: that have called for reevaluating that as well.

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Speaker 2: Yeah, okay, yes, that's interesting, isn't this, you know, all

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Speaker 2: of that tell us about Chap's vision. Then this French

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Speaker 2: firm that won a key government contract to replace Talenteer.

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Speaker 8: Yeah, not very well known, I will admit I had

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Speaker 8: only recently heard about them a few months back. They

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Speaker 8: are more similar to sort of a roll up private

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Speaker 8: equity strategy than your traditional startup. They've actually today acquired

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Speaker 8: twenty nine different companies. They kind of stitch together this

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Speaker 8: platform that does compete with the main Talenteer software called

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Speaker 8: Foundry that is essentially kind of that's meant to work

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Speaker 8: with disparate databases and unstructured data and give that a

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Speaker 8: central repository and kind of much more like for corporations

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Speaker 8: an intelligent way to statitut together, governments of data together,

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Speaker 8: and for governments an intelligent way to put in various

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Speaker 8: different databases. And that is what the chapscision primary offering

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Speaker 8: is and they've been They told us they were working

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Speaker 8: with the French Intelligence agency for the past five years

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Speaker 8: to win this contract and they have also the CEO said,

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Speaker 8: they are in conversations with every single European government about

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Speaker 8: similar work.

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Speaker 1: Is it realistic though, for European governments to replace these

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Speaker 1: big US technology firms.

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Speaker 8: There's certainly two sides of the argument on that. I

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Speaker 8: think what is most interesting about Talenteer is there seems

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Speaker 8: to be an argument both i'd say, in government circles

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Speaker 8: and even on the technologist side that it is much

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Speaker 8: easier to have an alternative to a technology to Talenter

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Speaker 8: develops than say what Nthropic and open Ay have or

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Speaker 8: certainly the computing giants or chip firms, right, And there

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Speaker 8: is the argument spans from their officials and Brussels in

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Speaker 8: European capitals that argue that Europe should have every part

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Speaker 8: of the technology stack. And then there are I think

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Speaker 8: certainly more of the technologists that say that it's unrealistic.

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Speaker 8: We need to continue to partner with American firms, but

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Speaker 8: because of the sensitive data Thatalenteer works with, and there

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Speaker 8: are a lot of investors now that this is mentioned

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Speaker 8: in our story, that are just throwing money at these

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Speaker 8: Palenter alternatives that are popping up, many of them from

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Speaker 8: Palenter alums that are their primary pitcher is we can

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Speaker 8: do the exact same thing that Palenter does, and we

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Speaker 8: can do it from Europe.

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Speaker 2: Really a fascinating story, Mark, Thank you for bringing it

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Speaker 2: to us our technology reporter Mark Bergen. And also in

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Speaker 2: his story, I thought the graph and the graphic that

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Speaker 2: he showed on Palenti's sales being increasingly dominated by the

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Speaker 2: US is really an interesting point as well as so

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Speaker 2: much of this data is under so much screw to

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Speaker 2: in Europe.

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