Can todays sales smash records . Have a look at what is happening to european equities. Gmm is your function. Talking you through all the various asset classes. Those other currencies that are falling against the dollar. Sovereign bond yields are rising. That is the situation. So many things to tell you about. Lets start with a south african rand. The rand rallied, today amid relief from last weeks assessment by Credit Rating companies. A did not deliver the deathblow that some anticipated. This is dollar rand. Earlier today, the rand is rising. The dollar is declining. The fall has been unwound, today. The rand is rallying by 2 . A bit of a move. Moodysratings warned it may do the same, leading to a rewaiting reweighting. This is a chart that abigail showed earlier. It twice on bloomberg markets, because that coin is showing no signs of slowing down, blowing past 9,000, less than a week after shopping 8,000, quickly closing in that 10,000 figure. This does not show you the price, just the ounces of gold to buy a bitcoin were up to 7. 45. Some wonderful stats out there. Gratz novaah tz. Tz novagra he said that coin would in the year at 10,000. Do you think he changed that tune given their recent surge . 54 ines plunged by november. Share plunge has been on debt concerns, also sparking options in the market. Keep an eye on lt lte shares, down by 54 in november. 90 minutes into the trading session in the u. S. How is it looking . Abigail modestly bullish. Looking at small gains for the s p 500 and the nasdaq. The dow was leading, but the s p and the nasdaq also putting in alltime highs. This is pretty impressive, following fridays gains. Earlier today, these three major averages had been slightly lower, so it appears that the week is starting again. Lets top into the bloomberg and see what is happening. This is the imap function on the s p 500, a great way to did a great way to see what is happening, sector wide. At this time, we have eight of the 11 sectors trading higher. Not huge gains, of about 3 10 of 1 , helping to explain why it is not up in a huge way and also why the dow is up more than the other averages. I want to highlight energy, down 9 10 of 1 . You are going to see that oil is on pace for its first day since early october worst day since early october. Lots of anticipation around that opec meeting litter, this week and what it will mean. It is said that russia and opec have agreed to extend supply cuts, but we dont know that for sure. Uncertainty weighing on some of the names. Lots of stocks climbing higher. Meredith hitting at alltime high on the news that it is buying time. Eric to do trading higher. Higher. Cuda trading , down 1. 4 d wings despite the fact that worked capital is set to boost its even so, shares are down and well below the prices. Vonnie we shall see, thank you for that. Lets check in on the first word news, with courtney donohoe. Courtney President Trump is having lunch with members of the Senate Finance committee and this morning, he tweeted that the tax bill just needs a few changes. Senator rand paul says he will vote for the tax bill but would like to see a larger cut. The u. S. Supreme court has steered clear of the controversy over guns for now. Justices turned away appeals from two gun advocates. Refused to force florida to let pistols be carried open in public. German chancellor Angela Merkel is taking a pragmatic tone in talks with the social democrats about forming the government. She says she is going to compromise to get social democrats on board. There are a number of issues to facing germany. Wedding bells will be ringing for britains royal family next spring. Prince harry is engaged to actress meghan markle. Prince harry is also fifth in line for the british throne. News, 24 hour today day power by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Mark investors are waiting for clarity on a number of political issues. In europe, Angela Merkel has begun negotiating with the democrats. Meanwhile, the brexit time brexit clock is ticking. Joining us now is andrew balls, chief Investment Officer for Global Fixed Income at pimco. Thank you for joining us. Is it only a matter of time before a deal is struck in germany, to form the next government . Andrew it is pretty much 5050, whether we are going to get a grand coalition or a minority government versus having another election. No grand nown great enthusiasm for another coalition. Chancellor merkel would clearly like to have a grand coalition. I think it is unclear, but the good news is i dont think it matters all that much. Germany is stable and we know one way or the other, merkel will be the leader through a coalition or new election and it is pretty calm in europe at the moment. Vonnie are mark are you feeling is relaxed about brexit . Though theyooks as are moving in the right direction on both sides for the december meeting, to move to the next stage of negotiations on the ongoing trading relationship , following brexit. It looks like in terms of the divorce bill, there is enough agreement on both sides to move on. We have seen various headlines on the irish border issues, from our point of view, it seems likely they will be able to move forward in a more or less cooperative way. Not as relaxed as on germany. Mark what sort of boost does that give to the economy, to sentiment, u. K. Assets, if we manage to move on to trade negotiations in december . Would that be a massive relief . Andrew i think it will be avoiding a negative side. I dont expect any market reaction. View i express is the likelihood they move on december , that is what the mood music is. Confirmation of that, i would not see any great implication. Between december and the march summit in the june summit, over that time, when you get the impression this will be more cooperative or chaotic, i think then that will have Significant Impact for sterling, u. K. Asset prices on the bond important,cember is but what is going to be really important is the negotiations on the ongoing trading relationship and chaos versus cooperative. U. K. Fixed income versus eurozone fixed income. Discuss. Andrew neither of those are attractive. We have had a clear preference for u. S. Fixed income and that has worked quite well. I think in the case of the u. K. , deliver up the level of yields looks too low, even in the event of a more level brexit outcome, the level of yield less. I think over time, we should see , evener yield in the u. K. With modest regards to the brexit outcome. Yieldspe, the level of is low, but the negative deposit rate, you still get steepness of the curve. Stable in the eurozone, not terribly exciting, but you cant generate reasonable income on that curve. , im sure there are lots of arguments and debates, on what should be done about all of this. Where do you go for diversified preservation . Ital andrew capital preservation is always important, but particularly in the currency environment, we have seen risk assets perform very well this year. A little more cautious on credit, we think makes sense and then diversify into u. S. Housing related assets. Nonagency mortgages look attractive. Awayge of global assets from Corporate Credit where you can look to generate income at these kinds of levels, you should not be hoping for big capital gains, but look to generate income and we think it away frome to do this credit and you can still find opportunities within credit, just more in the case of the bottoms up for the instead of the generic cash credit. Vonnie the backdrop to all of that is the yield curve, beneath 58 basis points. At what point will that curve begin to concern you . We have seen curve flattening in the u. S. , this year. I dont think it is a big matter for concern. Over time, we would see some steeper curve in the u. S. , that is what we will position for and in terms of the federal reserve, that is moving along pretty smoothly and we expect the fed to go clearly in december, depending on the tax cut pitch tax cut picture. We think over time, that will be consistent with a steeper curve. Not great concern, but the european curve has steepened quite a bit and we could see something similar with the u. S. Chiefandrew balls, Investment Officer for Global Fixed Income at pimco. You will stick with us. This is bloomberg. Vonnie live from bloomberg World Headquarters in new york, i am vonnie quinn. Mark live from bloombergs new European Headquarters in london, i am mark barton. Counting down to the european close. Us,ew balls is still with chief Investment Officer for Global Fixed Income at pimco. What is going on . Andrew we are pretty stable for china, after a couple of years where from the global perspective, we had real excitement coming from china in terms of the currency again, it has been a year where on the currency side, growth has been good and you see pretty good Global Growth and china certainly played a part in that. The new president now following the Party Congress is superpowerful. Interesting questions when you look to next year and what the plan would be if you are ever going to focus more on the quality of growth and not just the quantity, and this would seem a time when that is possible. Clearly, leverage in the system in terms ofortant the good growth we have seen this year. Outlook ands of our overall, fairly balanced. That is something that can have mark how do we expose ourselves to china from a investment it investment perspective . Andrew we tend to do a lot with the currency, a very large credit markets are you could have exposure there. Clearly and equity space, it is an important and growing market. At pimco, we dont have a ton of china related positions. There is some work we will be doing in credit. Mark such as . To go i am not going into individual names, but you can find value there, you have to be able to do have to be willing to do the bottoms up work but clearly, china is growing. Vonnie wasnt you guys that called this a blowout of corporate spreads . Andrew not guilty. More generally, you see with global credit markets, you have seen some volatility the last and some weeks specific volatility that has spilled over into the highyield. Ndices some profit taking, there. We are still reasonably constructive, but we have gradually been paring back our global credit exposure, going a bit more liquid throughout this year. Vonnie you think it is such a little bit of posturing and you dont think it is anything more serious in china. Newsre anticipating this that south africa would downgrade but now it is out of the Bloomberg Barclays global index and still in the city index. What to do about Frontier Markets . Andrew it is very small in the index. I dont think that should be a big driver, over time. Has them onties watch, so that is something that will be important over time. There is a lot of political uncertainty. That is what happens with emerging markets. Overall, we are pretty neutral in terms of the credit. Mark a lot of things being said about synchronized growth. You have the abcs of caution. Optimistic but about this wonderful synchronize . Ecovery across the globe is there an element of complacency . Andrew on the growth side, it does look good. This could be as good as it gets, in terms of the cycle. We have Central Banks tightening as the expansion gets older. The risks grow every year. In the u. S. , this is quite an old expansion. We dont want to be too pessimistic. Is good,the backdrop but when you have valuations and credit spaces like those we had today, volatility at such low beels, we think it mixes to more cautious. Is behind us. D you have to be a lot more careful as the credit cycle turns over time, that is when you earn your corner as an active manager. Mark thank you for joining us, andrew balls, chief Investment Officer for Global Fixed Income at pimco. Still ahead, as we head toward the close on the monday session. The dax is just one piece of the puzzle, down by a third of 1 . Eight minutes left in the monday session. This is bloomberg. Live fromflow bloomberg World Headquarters in new york, i am vonnie quinn. Mark from bloombergs new European Headquarters in london, i am mark barton. Time for the business flash. Less than a week ago that bitcoin hit the 8,000 mark. Brokee cryptocurrency has past 9,000 and is showing no signs of slowing down. It has attracted more mainstream attention despite warnings of a bubble. It is up more than 40 in the last two weeks. It has gained more than 800 this year. A management shakeup at tether pharmaceuticals. Three Senior Executives will be leaving. Two operating units will be merging. The profit margin is being squeezed by competition. That is the latest Bloomberg Business flash. Have a look at where european equities are, right now. We are four minutes away from the end of the monday session. Stocks trading lower, today, down for the third day after falling for the first. I will leave you with the currency board. It is a macro light week in the u. K. The close is next. This is bloomberg. Retail. Under pressure like never before. And its connected technology thats moving companies forward fast. Ecommerce. Real time inventory. Virtual changing rooms. Thats why retailers rely on comcast business to deliver consistent Network Speed across multiple locations. Every corporate office, warehouse and store near or far covered. Leaving every competitor, threat and challenge outmaneuvered. Comcast business outmaneuver. Mark live from bloombergs European Headquarters in london, this is the european close. Industry groups higher on the grr function. Lower, ledothers are by resources, technology and pharmaceuticals. So much to chat about. Among the companies in the news is pearson. What it has done is it has agreed to shell it to sell its english Language Training system to bearing Equity Private asia. The price, roughly 300 million in gross cash and it is the latest asset sale by the chief executive. He is trying to shift the textbook called expert publisher to Digital Education and has promised to cut annual extensions annual expenses by 300 Million Pounds. Due to cost and the fact that 150 Million Pounds of cash will remain with the unit that it is selling. That is pearson as you can see. A call on the pound against the dollar. The big focus point is going to be on the u. K. , the eu, how those negotiations are going. Rally. G, a solid that is the red dotted line up there. Neil jones does say it could fall to that yellow dotted line, 128, if the news flow suggests that a december deal is not achievable. Sterling last week, up for a third week, the best run since september 15. One of the big movers across europe, buddha hermes is the name of this company. This is a oneday chart. A record 22 . It is a move to take control of this company, the worlds biggest trade credit insurer. It increased its stake through a simplified cash tender offer of 122 euros per share. Hermes euler hermes up. It is going to be an interesting week. The yen is strengthening, down below 111 1. 11 right now. The dollar is starting on a weaker note. Nothing to be too concerned about, but there was talk, Morgan Stanley postulating that the bank of japan might change its yield curve policy. On, i mentioned that the yield curve was just below 58 basis points, flirting with 57 basis points so more flattening as we see. Cyber monday offering from the treasury, two auctions today and he thinks they will be at a discount. I do want to point out global macro movers, the south african rand is reversing course. Stronger by 3 . Moodys kept the investment rating on the south african rand. You can see that the rand is coming back and i want to point out it beats off sort offshore trading at 6. 641. Expected to be resigning as chief executive of the swiss equity. Laurentus now, line a lyondell Laurent Lionel l aurent, bloomberg gadfly columnist. Fall but tell us a 6 they were not prepared for today . I think it is sell first, ask questions later. I think the communication from the company suggest that the resignation was abrupt and unexpected and i think what they have announced so far is a plan that is not pacifying investors. Mark the deputy chief executive will step into his shoes for the moment. Are they big shoes to fill . This is the man who took over when he was 34. He is at the lofty old age of 43. Are they big shoes to fill . Lionel they have been there, a decade. Yard he has a staff of loyal colleagues that might leave to where he has gone. He also knows where the bodies are buried, if there are bodies. There seems to be gaps in the executive bench. Some hires have not come on board yet. Mark why would he move . Just been there, done it . What do you think is behind the move . Is or nothing left to achieve at julius baer . Lionel the is quite dependable. He spends about a decade in a leadership role and then moves across. Mark they should have seen it coming. Lionel they could have. Maybe he was so divided with no time to engage it. There might not have been much space to negotiate. You get the feeling they could have. Vonnie is there somebody out there that could join julius baer . Clear. It is not there are plenty of people inside the organization. There is no reason why they could not have some key promotions inside the bank. I think the communication seems to be around having a deputy, having people who can lead in the interim, but we are not willing to say this is a longterm solution. Clearly the of and head they have been able to hire people down the ladder. They should be giving a more confident sound and they are just not doing it. Vonnie is there a need for a change of strategy . Is this the time that julius baer needs to tell investors that it is going to do Something Different . One of the investors, very unhappy with this. Lionel that is a good question. There is a question around the turn in the Economic Cycle is as Interest Rates get better, if inflation comes back, it should be good for this type of bank is allows them to profit from all the money they have been taking in, thanks to this Revenue Growth and new hires. It does mean some kind of disappointment from the inflation they have been promising, the return they have been promising might not come to pass. Mark talking about people who are about to leave or maybe are in the process. There is always a speculation. Always speculation. This is an industry that never settles. Lionel investment banks in europe are in a bad position. It is a very thankless task. As long as you can survive, that is seen as good enough. Mark 10 years is a lifetime as a ceo of big swiss money managers. Lionel he has had it lucky. They have grown volumes and resisted a lot of the bad parts that the rivals have not. Mark thank you for joining us, Lionel Laurent bloomberg journalist for gadfly. Relief for south africas currency trade, retaining its Investment Grade rating. It did issue a warning. That was enough for the market which lifted the rand. Lets bring in robert brand. He joins us from cape town. Hat a couple of days traders so relieved, today . Robert i think after the s p , it was the kneejerk the reason for that at is in order to be a constituent of the World Economic south africa needs investment rating on its local currency either from moodys or the s p. The concern was to lose both of those ratings so the moodys reprieve means they wont be forced to set of south african bonds and you will see massive outflows from the country. Vonnie is there anything about the succession race that might change that . Rand, ifthink for the the leadership election with the ruling party which is happening in middecember, think the market sees that as a contest between one candidate who is seen as a pro market candidate against one who is the candidate to leave the party. Ingles it will be seen as a continuation of the party. Up fromities open reformists in the party and the. Overnment that could be seen as rand positive. Vonnie how liquid are these markets . Who are the Major Players or how many Major Players are there . Priya one of the reasons robert one of the reasons why the rand is such a volatile currency is the emerging markets. Investors are willing to take on those risks because they know they can easily trade out of them. If south africa should be kicked out of the world bond mark world market bond index, it will be a problem for emergingmarket currencies. Trade goingculative. N in the rand, worldwide us, think you for joining robert brand from cape town. Vonnie lets check in on the first word news. Courtney President Trump will not campaign for Republican Alabama Senate candidate roy moore. He has been accused of sexual misconduct. The president has not explicitly endorsed him, but he has blasted the democratic candidate and said it would be a disaster if he were elected. 6 the special election is december 12. Overshots are being fired who is temporarily running the u. S. Consumer protection bureau. President trump has a net has micknted budget director mulvaney. English has taken the issue to federal court. A big surprise in the latest report on the u. S. Housing market. New home sales unexpectedly rose to their highest rate in a decade. Shows the south continues to recover from a pair of hurricanes. Pope francis is in myanmar where he immediately plunge into the crisis. The pope met briefly with the awerful military leader and military crackdown has forced more than 620,000 to flee to bangladesh. News 24 hours a day, powered by more than 2700 journalists and analysts, in more than 120 countries around the world. Vonnie coming up, the Holiday Shopping season is just a strong. New numbers just out from adobe. We will take stock of cyber monday, next. This is bloomberg. Mark live from bloomberg jerk a bloombergs new european World Headquarters in london, i am mark barton. Vonnie and from new york, i am vonnie quinn. It is time for our stock of the hour. Lets have a look at another retailer, this time, l brand. Abigail doolittle joins us. We just got adobe data would suggest that online spending is what higher than last year. Abigail they did discontinue their catalog business. L brand owns victorias secret and bath and body works. You have to believe that catalog business has gone online. Malls hearing reports of being the busiest they have been in a decade and many analysts say l brand is one of the biggest winners. Bloombergting with a Intelligence Analyst and she said when she was at the mall on black friday, victorias secret was actually roping a line into the pink stores. Millennials apparently like them. We can see, this is another retailer that they need to pull off some kind of a turnaround. Back in 2013. Es not very impressive for an apparel retailer, plunging down after victorias secret discontinued apparel, trying to get the mix right. Maybe they will go back into the positive if the Holiday Season does prove to be a stronger people want it to be. Vonnie just 10 , that is not nothing. Abigail you are right. Investors are just going after these retailers and devouring them and perhaps they are pulling off a turnaround, but i do love the technicals. This is a longerterm chart, a stronghart, same downtrend in effect. There are going to have to put up a few different quarters in a row of strong, not just a few strong shopping days is going to turn the stock around. Vonnie what are we hearing about cyber monday . Andrew we are hearing abigail we are hearing strong reports. The big winner is likely to be amazon. Theyre expecting a 50 clean up. We will have more details. I have not shopped yet, although i have never shopped on cyber monday. What about you . Vonnie i managed to miss black friday. Thank you for that, abigail. Mark lets have a quick peek at the Bloomberg Business flash. Pearson is selling off another of its units. This time, the textbook publisher is getting rid of its englishLanguage Training business to pay down debt. The chief executive has sold assets while shifting the companys focus the Digital Education. Cable companies have a new strategy when it comes to streaming Video Services such as hulu. If you cant beat them, join them. According to people familiar with the matter, comcast and charter are in talks to offer hulu through their settop boxes. Magazine publisher meredith the price, q point 2. 8 billion including debt. Titlesh has acquired such as time, Sports Illustrated and fortune. The car brothers is supporting othersl the cockrell the Koch Brothers are supporting the deal. Opening bid of 150 billion served around november 13. The firm owns arbys along with other fast food brands and chains such as carvel and cinnabon. Coming up, it is battle of the charts. Can bubbles in the s p take on the bubbly we will find out next. Mark time for our global battle of the charts were take a look at some of the most telling and compelling charts of the day. You can access these charts on the bloomberg are running the function features by running the function features. In our new building, our new European Headquarters, lets get this guy up, mr. Edward ludlow. I want to talk about the u. K. Consumer and a pint of beer in the pub. We talked about the squeeze on the u. K. Consumer in the wake of brexit. Sterling rising. What does that mean for the Consumer Behavior and a pint of beer at the pub goes a long way. Got three u. K. Company shares. Screen qingdao the bottom, mitchells and butlers in the middle and j. D. Webster in white. You can see mixed stocks. J. D. Webster has been targeting the budget conscious consumer. The one that wants more pints for their pound. 23. Es up 60 since june been showing consumers moving at a price consideration when going for lecture raise. That might look at how Consumer Behavior is looking, moving forward. To beoons is likely continued benefit for consumers. Of whether spoons is a prominent brexit backer. Vonnie, brexit, beer, that is a tough chart to beat. Vonnie i love that chart. Especially because nonopec meetings going this me cap this week, i thought he was going to pull a oil chart. I will quickly show you my chart because it is interesting to watch where the s p is going. This is the dotcom bubble all the way back in the day and then we had another bull market. This is where we are. We have well sir fat well surpassed the dotcom bubble. 2800 is where we are going to go for the s p 500. Is it going to beat oil and trouble . Toil in trouble . Vonnie the internet bubble. Passe. O Queen Victoria street, this is open to the public. Plenty to visit in the new you in the new building. Mark we have a tradition to always award it to the new entrant. I was thinking because we are in a new building, lets get rid of those rules. Lets be hard on the new entrant. The winner today is at ludlow ed ludlow. Up tomorrow, complete coverage of Jerome Powells confirmation hearing to head the fed. 10 00 in new york, 3 00 in london. This is bloomberg. Vonnie it is noon in new york city, 5 00 p. M. In london, and 1 00 a. M. In hong kong. I am vonnie quinn. Julie im julie hyman info shery ahn. Welcome to bloomberg markets. From bloomberg World Headquarters in new york, go to top stories in the bloomberg and around the world that we are following. Cyber monday is in full swing and stocks are admit securities as investors focus on the busy week ahead, particularly for fixed income. The Koch Brothers are back. Meredith corporation is all ofng time inc. And its brands for 1. 8 billion in cash. More details a little bit later. Past 9,000. Blows the cryptocurrency showing most no signs of slowing down. Is it just the beginning or the bubble about to burst . All that in the next 60 minutes. Abigail doolittle is with us
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