WEBVTT - Conference Board's Franco on the June CCI Report (Audio)

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<v Speaker 1>Broadcasting live to New York Bloomberg eleven, Rio to Washington,

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<v Speaker 1>d C. Bloomberg to Boston, Bloomberg, Well under It, to

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<v Speaker 1>San Francisco Bloomberg nine to the country, US Exam General

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<v Speaker 1>one nineteen and around the globe the Bloomberg Radio Plus

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<v Speaker 1>append Bloomberg got on this is taking stock consumer confidence.

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<v Speaker 1>It rose in June to an eight month high. I

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<v Speaker 1>don't know if any Brexit impact was in there. We're

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<v Speaker 1>gonna speaking with Lynn Franco, She's director of Economic Indicators

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<v Speaker 1>at the conference Sport. I'm Kathleen Hayes, my co host

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<v Speaker 1>Pim Fox on vacation this week, and that investor confidence,

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<v Speaker 1>confidence in the stock market battered by the volatility from Brexit.

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<v Speaker 1>How about the impact of the presidential race and the

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<v Speaker 1>odds of who wins and who doesn't. What does that

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<v Speaker 1>mean about investing in the capital markets? What does it

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<v Speaker 1>mean for the broader global economy. We're gonna be think

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<v Speaker 1>about all that and more in the next half hour.

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<v Speaker 1>Now we're gonna be hearing from Catherine Caddie. She is

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<v Speaker 1>in the newsroom with a bloom Brick business flash. Thank you, Kathleen. Well,

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<v Speaker 1>the stock market is climbing for the first time since

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<v Speaker 1>Britain voted to withdraw from the European Union. There's speculation

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<v Speaker 1>that policy makers will take steps to limit any economic

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<v Speaker 1>fallout the UK's decision last week twigger to rush towards

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<v Speaker 1>safe Hagan's Global Equities lost about three point six trillion

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<v Speaker 1>dollars in market value and the smp FA under tumbled

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<v Speaker 1>five point Mark Hayfully, Global Chief Investment Office for at

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<v Speaker 1>UBS Wealth Management, makes the case for diversification. We've had

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<v Speaker 1>political uncertainty before these events, and we'll have them after.

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<v Speaker 1>I think the main point for investors is that as

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<v Speaker 1>we go further out into these experimental central bank policies

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<v Speaker 1>and referendums, you have to be diversified. Diversified across political

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<v Speaker 1>economic regimes in the world. We check the markets every

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<v Speaker 1>fifteen minutes throughout the trading day. Down industrial average is

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<v Speaker 1>of one hundred forty six point seven eights of a percent.

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<v Speaker 1>Trading at seventeen thousand, two hundred eighty six, smp F

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<v Speaker 1>I founded up twenty one points, a gain of one percent.

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<v Speaker 1>It's trading at two thousand, twenty one nasac hire by

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<v Speaker 1>sixty seven points one and a half percent. Trading at

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<v Speaker 1>forty six sixty one West Texas Center via crude oil

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<v Speaker 1>up a dollar fifty five of barrel three point three

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<v Speaker 1>percent to forty seven eighty nine spout bill down six

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<v Speaker 1>dollars ninety sents announced to thirteen seventeen eighty ten year

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<v Speaker 1>treasury down six thirty seconds with the yield of one

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<v Speaker 1>point four five percent. Among today's top business stories, Volkswagen

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<v Speaker 1>has agreed to spend more than fifteen billion dollars to

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<v Speaker 1>get hundreds of thousands of emissions cheating diesel vehicles off

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<v Speaker 1>at US roads into playcate regulators. And now let's get

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<v Speaker 1>a look at some of the other stories were following.

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<v Speaker 1>I'm Bloomberg Radio. Thank you Catherine from the Bloomberg newsroom.

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<v Speaker 1>I'm Julie Hyman. British Prime Minister David Cameron met with

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<v Speaker 1>fellow European Union leaders today for the first time since

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<v Speaker 1>last week's vote to leave the EU. Cameron says the

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<v Speaker 1>UK may be breaking up with Europe, but he hopes

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<v Speaker 1>they'll continue to do good business. I very much hope

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<v Speaker 1>will seek the closest possible relationship in sums of trade

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<v Speaker 1>and cooperation and security, because that is good for US.

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<v Speaker 1>And that is good for them, and that's the spirit

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<v Speaker 1>to wish the discussions I think will be held today.

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<v Speaker 1>The British PM has indicated the UK could wait until

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<v Speaker 1>October to begin the process, but European lawmakers are calling

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<v Speaker 1>for an immediate exit as they try to call markets

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<v Speaker 1>and prevent other countries from following suit. Scottish EU member

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<v Speaker 1>Alan Smith says Scotland voted to remain in the EU

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<v Speaker 1>and wants to keep it that way. Scotland did not

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<v Speaker 1>let you down. Please, I thank you, chaper do not

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<v Speaker 1>let Scotland turned no. Well. Many greeted Smith's remarks with

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<v Speaker 1>a standing ovation. UK Independence Party leader Nigel Farage, who

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<v Speaker 1>had campaign for Brexit, remained seated. The winning is coach

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<v Speaker 1>in Division one college basketball history has died. Former Tennessee

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<v Speaker 1>coach Pat's Summit was sixty four years old. She had

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<v Speaker 1>been battling dementia sum at one eight national championships. The

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<v Speaker 1>city's rent Guidelines Board voted last night in favor of

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<v Speaker 1>a monthly increase for stabilized apartments. The board approved to

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<v Speaker 1>freeze for one year leases and a two percent increase

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<v Speaker 1>on two year leases. Neither side was happy. Tenants were

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<v Speaker 1>looking for a rent rollback, while landlords wanted increases on

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<v Speaker 1>both one and two year leases. Global News twenty four

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<v Speaker 1>hours a day, powered by more than twenty undred journalists

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<v Speaker 1>and analysts in more than one hundred and twenty countries

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<v Speaker 1>from the Bloomberg Newsroom. I'm Julie Hyman. This is Bloomberg, Catherine,

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<v Speaker 1>Thank you, And now let's get a quick check of

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<v Speaker 1>the equity markets. Down Industrial laverage of one hundred sixty

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<v Speaker 1>nine points at seventeen thousand, three hundred nine smp F

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<v Speaker 1>I founded up twenty three point at two thousand, twenty four.

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<v Speaker 1>NASDAC higher by seventy three trading at forty six sixty seven.

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<v Speaker 1>And that's a Bloomberg business flash. You're listening to taking

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<v Speaker 1>stock with pin Box at Kathleen As on Bloomberg Radio.

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<v Speaker 1>As Federal Reserve officials and investors who are bullish in

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<v Speaker 1>the stock market continue to keep their fingers crossed. Where

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<v Speaker 1>a consumer that were power the US economy to a

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<v Speaker 1>higher rate of growth in the second quarter, a higher

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<v Speaker 1>rate of growth in the second half. The focus is

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<v Speaker 1>on consumer confidence today, very closely watched number from the

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<v Speaker 1>conference board here in New York. It climbed to in

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<v Speaker 1>June from a revised nine two point four in May.

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<v Speaker 1>And there are some good signs within the report suggesting

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<v Speaker 1>the consumers are feeling pretty good about the future. Here

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<v Speaker 1>now to explain what's in the report, what it means

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<v Speaker 1>we're spending for the economy. And Moore is Lynn Franco.

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<v Speaker 1>She is Director of Economic Indicators at the Conference Board.

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<v Speaker 1>Thanks for coming into daily and you're quite welcome. So

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<v Speaker 1>there's two sub components. There's the present condition, what's going

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<v Speaker 1>on in the economy now, and what do you expect

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<v Speaker 1>for the future. How did those two indexes or indicase

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<v Speaker 1>should I say, shake out? Well, we had a rebound

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<v Speaker 1>in both, which is always good news in terms of

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<v Speaker 1>the present situation. What we saw really was not so

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<v Speaker 1>much sort of enhanced optimism as sort of a decline

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<v Speaker 1>into pessimism a little bit sort of. I guess I

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<v Speaker 1>would say we're consumers saying we're still cruising along more

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<v Speaker 1>or less at the same speed. In terms of their expectations,

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<v Speaker 1>they're cautiously more optimistic. We even had to bump up

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<v Speaker 1>an income and I think that will bolde well for

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<v Speaker 1>spending in the quarters to come. In fact, let's underscore

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<v Speaker 1>that consumer expectations gauge looking at the next six months. UH.

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<v Speaker 1>People are are are pushing that part to eighty four

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<v Speaker 1>point five from seventy eight point five, and many condoms

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<v Speaker 1>that I've spoken to say that if there is a

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<v Speaker 1>one part of this report that correlates well to spending

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<v Speaker 1>even more than present conditions, it's the expectations index. When

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<v Speaker 1>you get a bump like that, it supports those who

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<v Speaker 1>are saying, no, consumers, consumers doing a bit better now, right,

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<v Speaker 1>And I think, you know, we're all sort of anticipating

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<v Speaker 1>the second quarter consumer expenditure figures, which showed I think

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<v Speaker 1>a bump up and consumers ending, and I think the

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<v Speaker 1>fact that we see income expectations increasing now and it's

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<v Speaker 1>you know, back to back two months, I think, you know, consumers,

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<v Speaker 1>I mean, there's still gonna be a little cautious and

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<v Speaker 1>they're spending decisions, but I think we're going to continue

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<v Speaker 1>to see spending help boost GDP. Well, of course that's

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<v Speaker 1>very important, isn't Because you're alluding to we did get

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<v Speaker 1>the latest number on first one fact, to get the

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<v Speaker 1>final one in the first quarter GDP number, UH, it

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<v Speaker 1>was revised up to one point one percent from zero

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<v Speaker 1>point eight. However, the all important personal consumption expenditures basically people,

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<v Speaker 1>that's all the stuff you spend money on, was revised

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<v Speaker 1>down to one and a half percent from one point

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<v Speaker 1>nine percent. So all the more focused now on what's

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<v Speaker 1>going on in the second quarter. Of course, June is

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<v Speaker 1>the last month of the second quarter, right right, And

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<v Speaker 1>I think early estimates are that we've had a nice

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<v Speaker 1>bump up in the second quarter. Um. And so I

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<v Speaker 1>think our you know, income expectations is running parallel to

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<v Speaker 1>what we expect to see there. And you know, it

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<v Speaker 1>just remains to see what happened, if there's any fall

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<v Speaker 1>at with Brexit, if it calls any type of pullback

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<v Speaker 1>and expectations, even though it might be very temporary. We've

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<v Speaker 1>seen the market at least begin to bounce back today,

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<v Speaker 1>so that's good news. UM. So that might be sort

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<v Speaker 1>of a little headwind that confidence may face in the

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<v Speaker 1>next month or so. Labor market, the big the key

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<v Speaker 1>question is our jobs are more plentiful, are the same

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<v Speaker 1>or hard to get a little bit of mixed back

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<v Speaker 1>there too, Yes, And I think that's because we've seen

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<v Speaker 1>a slow down and employment growth and some of our

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<v Speaker 1>other indicators show that that's going to persist. I think

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<v Speaker 1>it's still be enough to support confidence levels. And we're

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<v Speaker 1>seeing you know, ways growth as well, so that will

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<v Speaker 1>help support confidence and consumption. As you oversee the Conference

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<v Speaker 1>boards US Consumer Confidence report, I know you're also watching

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<v Speaker 1>consumer confidence around the world. What does the Conference Board

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<v Speaker 1>expect to see in the UK when it comes to

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<v Speaker 1>consumer confidence when it comes to business confidence, one can

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<v Speaker 1>only imagine that once you do the surveys after the vote,

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<v Speaker 1>you could have some gigantic drops a lutely, and I

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<v Speaker 1>think any time that you have uncertainty, that impacts both

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<v Speaker 1>you know, consumer confidence and business confidence much more pronounced

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<v Speaker 1>obviously in Europe than it is right here in the

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<v Speaker 1>United States. So I think we're sort of okay for

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<v Speaker 1>the time being. We'll see, obviously confidence both consumer and

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<v Speaker 1>business take a hit, probably in in the euro Area

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<v Speaker 1>and in the UK as well as for the US

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<v Speaker 1>survey UM buying plans. What stands out to from that

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<v Speaker 1>part of the survey. I think we're sort of moving

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<v Speaker 1>a little bit sideways there. I mean, you know, we

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<v Speaker 1>do have sort of our month to month fluctuations. However,

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<v Speaker 1>I think we're a little bit stronger than we were

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<v Speaker 1>last year, and I think that's directly due to the

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<v Speaker 1>housing market. We continue to see improvements there, and obviously

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<v Speaker 1>if consumers buy a home, they have to furnish a home.

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<v Speaker 1>So I think the outlook for that particular area remains

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<v Speaker 1>quite positive. Know, the Federal Reserve watches this survey, this

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<v Speaker 1>report very closely. Uh what what do you think they'll

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<v Speaker 1>be taking away from this? No chance of rate hike

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<v Speaker 1>this year is now at the markets, and there's now

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<v Speaker 1>that people are on the fringes starting to talk about

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<v Speaker 1>a right cut. Right. I think what we're gonna see

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<v Speaker 1>is no rate increases this year. If anything, the earliest

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<v Speaker 1>would be December. But with all the all the uncertainty

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<v Speaker 1>that's evolved over the last week or so, I don't

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<v Speaker 1>think the Fed is going to raise anytime soon. Maybe

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<v Speaker 1>you should do a survey just of Fed officials, get

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<v Speaker 1>their get their confidence index. That would be quite interesting, Okay,

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<v Speaker 1>I think it would do well. Lynn Frankel, you work

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<v Speaker 1>on that, Okay. Well, she's director of Economic Indicators at

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<v Speaker 1>the Conference Board based here in New York City. June

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<v Speaker 1>consumer confidence sitting an eight month high and says it's

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<v Speaker 1>it's steadily moving along. No big move towards a higher

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<v Speaker 1>level of confidence, but high enough to ensure pretty much

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<v Speaker 1>or at least suggest that spending could hold up in

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<v Speaker 1>the second quarter and do better than the first quarter.

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<v Speaker 1>I'm Cathleen Hayes pim Fox on vacation this week, so

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<v Speaker 1>I'm taking stock today right here on Bloomberg Radio. The

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<v Speaker 1>presidential race. If Donald Trump wins, what does that mean

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<v Speaker 1>for the stock market? Off Hillary Clinton winds? What does

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<v Speaker 1>that mean? Ken Fisher had of Fisher investments? Coming up

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<v Speaker 1>now on Bloomberg Radio.