Global business news twenty four hours a day. If Bloomberg dot Com the Radio plus Global Act and on your radio. This is a Bloomberg Business Flash from Bloomberg World Headquarters. I'm Katherine Cowdery Will. The stock market is moving higher as traders feel less anxious about Britain's vote last week to leave the European Union. Mark Kearney signaled the Bank of England could cut interest rates within months as a central bank tries to shield an economy rattled by the
shock of Brexit. Now Standard in Pores has just reiterated its rating on the United States at double A plus. It affirmed its ratings the SMP five hundred on track for a third straight quarterly advanced. All ten industry groups in the s in the benchmark are gaining, with consumer staple shares up the most. We check the markets every fifteen minutes throughout the trading dawn. Bloomberg Radio doll Industrial average of one hundred eighty seven points one point one
percent at seventeen thousand, eight hundred eighty one. SMP five funded up twenty three points again at one point one percent trade at two thousand ninety three. Nazac hier By forty nine points, a gain of one percent, trading at eight less Texas Intermedia Crude oil down a dollar fifty three of barrel, three point one percent of forty eight thirty six s about gold down three dollars thirty cents
announced of thirty three sixty ten. Your treasury up eleven thirty seconds with the yield of one point for seven percent. And that's a Bloomberg business flash, Catherine Cawnerie, thank you so very much. Market volatility, the Brexit vote, so many things hanging over investors head. Is it time to look at an e t F? And if so, which kind? Now it's time for our et F report with Catherine Cowndry. It's a tale of two different kinds of e t F investors told by flows after the UK vote to
withdraw from the European Union. We saw a lot of the hot money. This is the big institutional money that moves very short term. Leave a lot of the risk on ETFs like s p Y and the cues. Bloomberg Intelligence analyst Eric Deltuna says. In contrast, retail investors seemed to shrug off the UK vote. If you look at the e t F they like to use Vanguarden, Schwab,
they all took in money just like normal. You know, there's a drip drip aspect to Vanguarden Schwab flows, and that drip kept coming right through Friday, right through Monday. No big deal about Tunis takes a closer look at those flows. Since the Brexit vote, Spider's et f s lost four billion, Vanguard took in a billion, Schwab a couple hundred million. That to me shows a difference in
terms of how scared investor. Mel Juna says. There is one e t F that's been popular with both institutional and retail investors this year, and that's the Spider Gold Chairs Taker d l D is taken in more than twelve billion dollars so far this see here. That's your Bloomberg ETF report. I'm Katherine Calderie. You're listening to Taking Stock with Kathleen Hays and Pim Box on Bloomberg Radio. The future more uncertainty than ever, it seems after the
Brexit Fox. We've been talking about that a lot on Bloomberg as you know. Now we want to talk about it with someone who has been watching in the markets for many years and travels around the world speaking to investors looking for companies to invest in. And that's Don Gimbel. He's portfolio manager at Geneva Investment Management, which is based in Chicago. Don joins us today from Helena, Montana. Don,
welcome back. It's some good good to have an opportunity to discuss what has been beaten to death for the last four days. Well, it's kind of hard not to beat to death, or isn't it, Because it's a pretty big deal. It is a huge deal, and I think what is most interesting is how little anybody knows about what the future holds, because this is a really monumental sort of shift, which is, uh, what what the British
did is only the tip of the iceberg. I mean, we we see people upset about the status quo all over the world, and uh, I mean the United States is not has not escaped that. Look at people we have running for the highest office in the land. These are people that the voters are saying, we want change, and well that's what happened in England. We want change.
We're not sure what we want, uh, and we're not sure what it means, but we don't like what the way it is as as economies change and develop and mature around the world, people who were used to the status quo somehow feel as though they're being excluded from what's going on, and it's a very uncomfortable situation and they're they are reacting, some would say irrationally. Uh to to what to the normal change in the way governments and countries work And this vote last week is simply
a manifestation of that. But we have to look more closely at at how to how it affects politics, how it affects government, how it affects markets, and then how does it affect individual companies? And I think that's what the latter is something that that hasn't we haven't spent
enough time disgusting. Well, let's do right now, how does it gonna and how so, how do you start that kind of gauging analysis, how it affects individual companies where they're based, the size the industry there, and tell us how how you're doing that done? Well, it's as well, I'm glad you asked, because that's what I wanted to talk about. Um. When when it comes to investing, and we're investors, were not speculators, we're not traders were investors.
So the first thing we look at is the quality of the management of the companies in which we are investing. And if you, if you are invested in companies that have great management, have a proven record of of knowing what's going on, or at least having a good idea, having a a good business plan that that can be modified, you, you're a long way down the lane, uh in in picking good investments. Now. Are there going to be huge changes in in the relationship between the UK in Europe
and the next five years? Well, definitely. Uh. Until Article fifty, though is brought to bear, nothing's going to change in the UK. And the Prime Minister is already on record is saying he doesn't want to do anything before before the fall, and people in Europe are saying that's not good enough. You've got to do it now if you're going to do it. So I think that there's a lot of of indecision going on in the UK as to what the time frame is, much less try to
address what the new relationships are going to be. But as an investor, I look at the companies in which I'm invested, and I know that the management of those companies because I talked to them on a regular basis, I know that they are Uh. They have already given a lot of thought. They didn't think this was going to happen, but it did. But they've been given it a lot of thought as to are they positioned to
to continue to do well. And my answer is, you know, in the industries that I particularly like are things like pollution abatement, uh, things things like transportation, things like food or these are basic industries. And if you've got companies in those fields, uh that that have experience and are well I have proven track records, these companies will do well regardless of whether they're manufacturing operation is in the UK or in France, or in the United States, or
in Brazil or in China. Uh. These are companies that anticipate and look at the alternative possibilities and when when something like this comes out of the blue or not quite out of the blue, but certainly surprises, there is
a plan. And I think that over what the stock market this week has said, as initially, oh my gosh, the world is ending, then the realization that it's not ending and we we need to uh sit down and decide what what companies are going to do well, not not just because of the industry they're in, but the companies that have the management that are smart enough to figure out where we're going. Okay, I want to turn to China. Because you invest in Chinese companies, you travel
to China. The yuan touched its lowest levels since January. Earlier today, there was a report that the PBOC, the People's Bank of China, is ready to let the uan its currency weekend. Now, it's not bad. For a while, traders were wondering if they really had shifted their stance. What do you make of this this speculation, what do
you make of what the PDOC may do done? Uh? Well, the first the first comment is that the PBOC is a very bright group of people, and they've they've been working on what the real value of the yuan is and what what its value should be against the US dollar as well as against the yen and the euro.
And uh, there is there is an economic change going on in the People's Republic, which a few years ago was almost completely dedicated uh to their the exports of of of goods from the People's Republic and the juan. The Hue government um AS has changed that and we're seeing lots of change in China, which over a long
period of time is going to be very beneficial. I would I would suggest that the yuan could weaken a little bit from here, but not very much, because it's it's not really in the in the in the interests of the pr of the People's Republic. They have two weak currency because they are now major importers of a lot of things goods and services, and uh, a much weaker you want would be a negative for the People's Republic. Just quick, very quick, final question. Uh the sp five hundred?
Uh are we is it gonna we't gonna stee this range two by the end of the year, Higher lord, Just quickly, what do you think done? I would say, we're in a trading range. It might if it breaks out, it will break out on the upside and out the downside, because I think two thousand seventeen is going to be a very good year for stock markets around the world. All Right, Don Gimble just creating the pathway to his next interview on taking stuff. We're gonna have to find
out why seventeen is going to be so good. Portfolio manager Geneva Investment Management of Chicago. Don joined us today from Helena, Montana. I'm Kathleen Hayes. My co host, Pim Fox is on vacation this week. And this is taking Stock, and this is Bloomberg.