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To resign. Welcome to the program, this is bloomberg daybreak europe. Lets check in on the Market Action overnight. The msci asiapacific is trading higher after we saw that strong session and United States. In the past two sessions, the biggest twoday increase in 18 months. 43 . S up 0. Japanese markets big weighted down being weighed down. Are also pointing down, so we need to be aware of that as we go through this mornings session. Morgan stanley joining Goldman Sachs and jpmorgan and advising the dip. He dip buy the has been a substantial move, and one of the things in the mix seems to be the Prime Minister in japan speaking in parliament, talking about how they have a blank slate in choosing the governor of the bank of japan. Reports suggested that governor kuroda would be tapped for another term. That could still happen, of course, but theyre talking about a blank slates of people to choose from. The3 is where we trade dollar against the brand rand. Zuma refuses to step aside, but many are wondering if that will hold. Perhaps the writing is on the we will jacob zuma, but wait and get analysis from south africa later on. Manus the bond market is an absolute focus for us. Will we make 3 . Between the hedge funds, which i ,aid are fast and furious money and the Asset Managers who look for real yield, what we have got here is the 10 year Government Bond yields and this positioning. Speculators boosted their short bets to record, over 939,000 short positions. The Asset Managers positions the Asset Managers net long positions are the highest since 2015. Flipped on what he was saying in dallas davos. He says that bond markets are past their peak. Last weeks fairly violent to move, 14 basis point in the 10 year Government Bond yields, was not enough to frighten those hedge fund bond traders. They came back in and they have built up their short positions. Goldman sachs says that what you are going to get here in the bond market is 4 hikes from the Federal Reserve and youre going to see gilts go to yields go to 3. 5 . What does that do . Earlyrse, is it ever too jamison up of jameson . I always ask myself that. Anna well be joined by ale xandre ricard for an exclusive interview. Manus lets go across to Juliette Saly for the first word. To 5 00 it is closer p. M. Here. 3. 5 in yields will hit the next few months, according to Goldman Sachs Asset Management. Its easy yields increasing at the feds trims the holding of treasuries it purchased through quantitative easing. Io sayswdy oh ray dal the risk of a recession is rising. He says bonds are past their peak, but it is unclear how far the stock market is from its top. Slump was a minor correction, typical of late market behavior. Jacob zuma refused to resign voluntarily, according to people familiar with the matter. The African National congresss executive committee made this is the decision. Bank of england policymakers are uniting against the key message of last weeks inflation report, telling investors that rate hikes will come quicker than previously inspected. Athe u. K. Will need succession of rate rises in the next few years to stop the economy from running to hot. Policy makers are yet to dispute the view that the next move could come in may. A cyberattack has paralyzed Internet Networks in pyeongchang, and what has been appeared and what has appeared to be an attempt in what has appeared to be an session. O embarrass global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. You can find more stories on the bloomberg at top. We were expecting a comeback from japan after it was closed yesterday. We were singing rally earlier in the session, but the nikkei has closed down as we started to see some strength in the yen. We have seen the pboc today announced some more injection of funds into the. Australias market coming back and overall the mood has been quite strong here in asia. In terms of stocks that we are optical rising in hong kong. It is up by 5 in the late hong kong session. Capital land, which is southeast asias largest developer, came through with a Fourth Quarter profit. Fourth quarter profit rose for them. The market also impressed with a rise in their for your dividends fouryear dividends. Ana President Trump proposed 4. 4 trillion federal budget for 2019, which congress is expected to dismiss. The plan would slash entitlements and other domestic programs in favor of military spending and border enforcement. What are some of the Key Takeaways from President Trumps budget plan . How does this fit into the overall priorities . His budget director, mick mulvaney, called it a messaging document. That is just what it is. He has long derided some diplomatic and environmental programs, and in this budget we see some significant cuts in those areas. Drop to the Environmental Protection agency, he also would spend that money that he saved from those areas on things like a border wall with mexico, that he has talked a lot about. Also an increase in military spending, he wants a 11 increase in the spending for the pentagon budget. These are things that he has long talked about and he is showing them in these document in this document is been priorities. Manus how is this budget plan expected to hit the deficit . I suppose that is really what markets want to know. Extent they have agreed to a twoyear window, havent they . To what extent is this going to hit the deficit . You are right. Pureis a message document, and simple. Year because they just passed a twoyear budget, 300 billion over two years, it really is pretty irrelevant. The deficit is the real issue. This would almost double the deficit and it would hit the public debt in a serious way. It would not allow the balance the budget to bounce. That, plus the tax cuts enacted at the end of last year, will really hit the deficit. Some fiscally conservative republicans are really concerned , saying that it would be reckless, in terms of spending. Again, this particular budget is a message, but the twoyear budget agreement that congress has put in effect will actually increase the deficit. Some analysts are sent it will increase Interest Rates pretty soon. That is the anticipation. Manus thank you very much for breaking down the latest missive from the white house, in regards to the budget. James at the is from aberdeen they is fromes a Aberdeen Asset management. He joins us now. How does this fit into your world right now . James i think the lesson that we should have learned over the next 1218 months is to not necessarily make too many judgments this early in the process. This is a statement of intent as opposed to a policy document. Willo way, shape, or form, forebodingthe senate in its current form four in its for voting current form. It does not really tell me a huge amount more, i dont think, then we already knew. These are largely Campaign Promises that we knew about from trump in areas that he feels need focus. In order to fund some of that spending he is looking to cut back on domestic spending. Anna it is kind of like a financial manifesto, isnt it . James yes. Anna this is a measure of money market tensions and i bring this up because it taps into concerns about government borrowing in the u. S. Some say this is a gauge of where they see borrowing costs going in the next few months. How concerned are you about the extent of government borrowing . Word i would probably it differently. I dont think it is worry about Government Bonding. This is something we have been forecasting,and and positioning for, for a while now. Dollar Financial Markets are changing, have been changing, and will be changing. Treasury funding is just one aspect of that. Anna what is changing those liquidity conditions . James because of the way the Government Shutdown has been working, or the debt ceiling has been impinging on the treasuries ability to borrow, they have had to they have not been able to issue. What are starting to see the treasury come back and issue again, and were expecting them to do a lot of bills issuance to try to restock net balance that balance. The bill auction last night, demand was the weakest since 2009. Raises a big marker in the it is not failure, but the lack of interest in short term paper tells me something. Lets tight back to this chart t back toback tie i this chart. We had a couple of guests saying that they will buy that yield, theyre happy to do that. We see that kind of positioning for fast money, a moderate tie the 2rmance, together for me. I think these are red flags. James i tend to agree. Direct participation was low and indirect participation was low. This is one of those issues the Price Sensitivity of these people and the short, these investors in the shortterm, is definitely far higher. People who are still long treasuries at the moment still have a lot of leeway to hold in some negative price actions. Willnk these investors have been emboldened by what has happened over the last 10 days. We have had aggressive weakening of equity markets, and yet the bid for treasuries has been feeble. Hopeis something which i come in terms of trying to correct the miss valuation of a lot of assets together. Anna are we now in a bond market a bond bear market . There was a lot of conversation on the bloomberg about how you define that. It is not as simple as a percentage, is it . It should be about real returns and actually it is about purchasing power. Are we in a bond bear market . James i agree with that person. It seems to me that where we have come from was very much to me about financial repression. That was not using anything, expected returns should below, and it forced investors to go elsewhere. Admit the real return from prettyent bonds looked measly, but investors were not forced to choose between that investment and something pro cyclical. They could have both, and both were working. Anna james, and for joining us. He will stay with us on the program. Manus coming up, a blank slate. Kuroda make it again into the top slot . Moore bank of england policymakers say that hikes will come sooner than expected. This is bloomberg. Manus this is a live shot of the Emperors Palace in tokyo. Sign dollaryen be warning of a bumpy day ahead . We have a blank slate to choose the next bank of japan governor according to the Prime Minister. Have a look at the nikkei, they found hard to digest those comments over lunchtime. Us for asaly joins Bloomberg Business flash. Juliette amazon is cutting hundreds of jobs added seattle headquarters at its seattle headquarters. The move is seen as part of a broader reorganization at the company, what some see as a shift towards automating tasks once performed by humans. Amazon did not comment specifically on the use of automation. In a lawsuit filed in a new York Federal Court come on associate director at the firm accuses the president of using an inappropriate term in his office. Denies they 72legations point emphatically denies the allegations. Anna according to the Prime Minister, the bank of japan has a blank slate to choose the next central bank governor. James athey is still with us. Do we take these comments at face value . Or is market expectation that we still get corroded for a second kuroda for a second term . James there was nothing in that sentence, nothing specific. Seem that there is a newpside in selecting boj governor, so i would assume that kuroda will get the job. Manus have a look at this, this is the average of jgbs come in terms of their yield, versus the explosion that they have got in the six major regions. The peg has delivered. ,ou look at the Growth Numbers so nobody is really prepared to fight the bank of japan, but are we at the limit of the bank of japan . They have a Balance Sheet the size of the economy, so do you even fight the bank of japan at this moment . James no, absolutely not. They have managed to keep the 10 year yield locked down around zero. I would take a huge issue with the notion that market success has been caused by this. I think japans problems are structural and i think inflation is a structural issue and one that the boj cannot really fight. Japanthe boj has enabled to take advantage of that economy . James it has enabled the currency to stay largely week, but that has not always been the case, and it will not always be the case. People are looking further down , theyne, as investors do look at a central bank that starts to change the way they look at the world. If the boj is not able to make changes to its policy in a hawkish direction and this sort of environment, then we start asking ourselves the question, when exactly what they be able to tighten policy . If this sort of environment cannot allow them, then nothing can. Yes, the other aspect is inflation is still have to level that they promised even though this policy has been an active session and acted policy has been enacted. Anna lets talk about whats coming up. And and we diggs look zuma digs in. Were live in capetown for the next set of headlines regarding zuma. Anna this is bloomberg daybreak europe. 4 msci asiapacific up by 0 weighed down by the japanese stocks. Lets check in on the markets. Asian stocks on the rise today, again led by chinese and hong kong equities. Hong kong really being pushed up by property and technology companies. The market looks to be stabilizing in asia this morning. Quickly, japan not be able to catch up to its peers, as it is back from holiday. I want to look at what happened yesterday in the u. S. Trading session. This is of course were asian is taking its cue. Here in this chart you see the nasdaq as the green bar, positive for the year. The Dow Jones Industrial average off 0. 5 there, that is the white bar. 2is chart really shows those days. Finally, with the cpi data out of the u. K. , i want to show you pound volatility. A hawkish bank of england, along with questions surrounding brexit, whats going to happen with the future of the u. K. Mashed up against the bank of england, with that message that we are going to get more rate rises. Watch for u. K. Cpi today. Hawk yesterday saying that growth is holding up and inflation is above the target. Pound volatility is one to watch. Manus some breaking news coming through on gucci. It looks like gucci is making a comeback in the holiday sales. Profits fullyear topping estimates as holiday sales surge. Up, you just look at some of gotbrands there, youve gucci. Gucci had comparable sales at 43 . I dont have any of these in my wardrobe at home, i cant afford them. [laughter] anna maybe youve got some leisure footwear . You have to say in an american accent. Weve heard about this before, but they are going to spin off for 12 keringare shares. A proposed spinoff of 70 of its shares in the german sportswear round, puma to its own investors. Manus you have focus on a granite growth from the cfo on organic growth from the cfo. A little bit later today we will bring you an exclusive interview ceo so we cang put those questions to him and ask about the pricing of those handbags. Anna bank of england policymakers are uniting behind the key message of last weeks inflation report. They are telling investors that Interest Rate increases will come quicker than officials previously expected. Later this morning we will get u. K. Cpi data. Just a smidge lower. Aberdeeney is from Asset Management and he is with us this morning. This has changed, we got a lovely chart of how the inflation curve has changed since we got the last set of data from the bank of england. It is a much steeper curve. Where are we in the debate versus debate of inflation versus brexit in the boe . James most of the Committee Members seem to be on the side of the debate. The bank of england has come down on the side that it is more of a supply shock than it is a demand shock. That means the economy will generate inflation and a slower rate of growth. Manus at any level do you think that the rhetoric from mark carney is folly . Which is to focus on inflation rather than brexit . James putting aside brexit, i think targeting inflation is folly. I think it is a policy which has been a bit of an albatross around the neck of central bankers, at times. I truly dont think you can measure the state of an economy by one variable, and certainly not one that we struggle to measure come and we see globally has been bombarded with to measure, and we see globally has been bombarded with influences. Thats not something the Central Banks can affect or can or should try to affect. Mandate we had a dual at the bank of england, with a be doing Something Different this year would they be doing Something Different this year . James no. It revolves largely around the output gap. One of the things they would look at his unemployment. I dont think a dual mandate would help. I think they need something more holistic than that. Ive been calling for them to because asast year, i see it, you got unemployment at an alltime low and youve got growth that has been held up better than was forecast, and were still on open trading , there are not many pillars that you can fall back on. Anna what if the forecast includes a potentially dislocating event . James i think you have to get closer to that event before you judge how it will impact. The bank has still got more than 400 billion pounds of assets on its Balance Sheet. 5 anderence between 1 , we could all get tangled up in the shocking moves, but in terms of how the economy operates and how much extra or less stimulus that is providing, it is negligible. It is an arbitrary number. They are not that different from each other. Manus this is your 3d yield curve. Really what you have got, you see the steepening of the curve. You had this repricing, probably in the 56 days, along with the u. S. Is this steepening simply a mirror of the steepening that you had in the United States of america . Or is this about fundamentally repricing what is going on at the bank of england . Someone said to me that carney will hike, that he has to hike. James it is interesting. When we were looking at the fed 12 months ago, people talked about the notion of hiking so that you have room to cut. I think it is slightly strange that we think it is suddenly a in theea and the u. K. U. K. Beld curves globally tend to largely about the domestic economy. The farther you go out, it starts to be more internationally priced. I think the fact that u. S. 10 years have sold off aggressively has dragged other 10 years with it. Markets dont tend to work that way. 2. 9 is the that 2. 8 right price for u. S. Treasuries . No. Least 16 basisat points higher. Manus james, thank you very much. We mentioned south africa and the ruling African National congress. They told president jacob zuma to step down. He refused to resign voluntarily, according to people familiar with the matter. Anna the Anc Executive Committee made that decision during a 13 hour meeting. For more on the story, we are joined from cape town. How has the anc made a decision to recall some of zuma from office . It seems as though during 13 hour meeting meeting, the anc has decided that it will recall jacob zuma. Theas come to light that when thedent Deputy President deliver the news, president jacob zuma complied to refused to comply. They will be writing a formal letter to ask him to step down. Manus i love what they have written this morning. , the look at dollarrand market is saying that it is an overreaction. This is more of a dollar story perhaps this morning. Is there a key benchmark that the markets are looking at . I wouldnt necessarily think there is a key benchmark, but what is very clear is that the markets would have preferred a clean resignation from president jacob zuma. The fact that the meeting lasted up to 13 hours is somewhat of an indication that the party itself is still divided. President jacob zuma possibly still has some supporters in the National Executive committee. Markets are feeling jittery about the transition from resident jacob zuma president zuma and how smooth it will be. We will have to see how the markets react. Anna if there is a transition, what lies ahead . What does the future look like for jacob zuma and the country . It seems as though because president jacob zuma as the head of state is declined to resign, this could also possibly be taken to the National Assembly. The have called for dissolution of parliament, saying that they want early elections. Well have to see if the speaker of the National Assembly grants those requests. The matter may be taken to parliament. Manus thank you very much. If youre a bloomberg customer, you get tv. You can follow the charts, the functions, the influence, the conversation, you can join in, at the question ask a question. Anna Bloomberg Radio is also available if you have to switch off bloomberg television. Noel ohalloran will be speaking to us on radio. Bloomberg. Is early on a tuesday over in new york. Futures over in the United States pointing downward. The Asian Session is moving higher, but s p futures suggest a little more weakness to come. Lets get it Bloomberg Business flash with Juliette Saly. Juliette amazon is cutting hundreds of jobs at its seattle headquarters. In new areas of business like Cloud Computing. This is seen as a broader reorganization of the company, but some see as a shift of automating tasks once done by humans. Billionaire Steve Covance point72 Asset Management has been accused of sexism. 72 emphatically denies the allegations. Mercedesbenz has confirmed that it will skip the Detroit Auto Show next year. Carmakers are increasingly saving big announcements for technology conferences. That is your Bloomberg Business flash. Manus juliette, think you very you very much. The market is on course for restoring balance, given that robust demand and producer complaints. In the past two days we have seen global stocks rally and , it is nowebounded trading above 59 per barrel. Now from dubai. The president of opec, and the Energy Minister from the united arab estimates, it is basically a story of improving demand, able to offset any gains. Number in the key terms of u. S. Production, how fast it is going to grow beyond 10 Million Barrels per day. There was an acknowledgment that shale is going to be stronger in 2018 than it was in 2017. The reports from i88, in terms in terms of the Broader Energy outlook, that will be important. Ultimately they are still targeting the fiveyear average, so from a strategy perspective there is nowhere to shift. Manus lets talk about that secretarygeneral. We spoke to him as well. He is talking about the monthly Market Report come in terms of compliance. Who are the placards like compliance . Ards in latest compliance data is inwing a rate of 129 december and that increased in to 136 . 2 136 lage hasnt been really a gard here. And the other countries in the past that have not pulled their weight have actually pull their weight this time. In terms of the story around the price action itself, the relative strength index also indicating this might be a little oversold. Manus all of the technicians will be jumping on that. The very latest on the oil market. Anna lets bring james into the conversation. Ey from Aberdeen Asset management is still with us. Whether people asked the Global Demand picture and the strength of this synchronized Global Recovery is Strong Enough to keep those supply changes in check. Do you think that is the case . James i do not. I am bullish on global growth, but i dont know if it will be able to offset supply. I dont believe that opec is the marginal price setter anymore. I believe it is coming from u. S. Shale production. Once again after having seen the count go sideways, the most recent data, sing that jump quite considerably, and i think most interestingly we have seen rigs go up and some of the higher cost areas. Is the shale producers that we should look to come do get a sense of where they target the price . Do you think they are happy with where we are . James absolutely. The Global Production marginal cost is way below where we are now. Up here i think even some of the tighter producers are profitable. Well cheap money. Riod is ending. At the margin, do you think that opecnonopec might have over tightened the market in any way . They have been incredibly successful with complaints compliance. Weeks andthe last few months we have seen oil flirting towards 70 per barrel. I would argue that that is not necessarily sustainable. I dont think Global Demand, even in this global synchronized upswing, where not talking about global Growth Numbers that are outlandish relative to history. We are incredibly cut isnt of the fact that we are trying to become more Energy Efficient incredibly cognizant of the fact that we are to become more Energy Efficient globally. Over the next few years we would expect us bank less oil us being less oil intensive. I think there are some speculative longs in there. Those producers in the United States, how vulnerable are they if we get rates going up in the u. S . Colleaguessure my would be much more aware of individual companies at risk. Biould observe that the ss. James, thank you very much. Is the Senior Investment manager at Aberdeen Asset management. U. S. Futures are dipping. We speak to the swiss asset manager ceo later. This is bloomberg. Manus good morning from bloombergs new european headquarters. Anna these are todays top stories. Recovery. D to asian stocks rallied after the s p 500 closed back more than 3 in the past two sections sessions. Is goldilocks market really over . Anna President Trump proposes a 4. 4 trillion federal budget before next year slashing entitlements in favor of military spending in the next and border wall. The company is said to tell the president to quit nash south africas told to tell the president to quit after he refuses to resign. Manus welcome. re paying futures european futures geeking out small gains. American futures down slightly as yen rallies on the prospect of mage each of may be changing mr. Kuroda on the top. Repricing,ing this playing catchup with the backtoback gains of the United States. You cannot say the shock run is over but its still an open question. Hes a nobel laureate, i Pay Attention to him. One man says this market is too cheap and you want to get in there. Spain is going to the bill market. Thats going to play into the markets. Day, would you . Anna i leave it to you. Is will we see on Global Equity markets. We saw strong two days of gains in the United States. The biggest twoday gain in 18 months. Morgan stanley gaining joining insane by. The japanese market has been a laggards today. The we might have thought there has been some catchup of the strength in the win and the yen seems to be taking some edge off. We have the dollar on the move against the japanese currency. A blankbe talked about slate in choosing a new boj governor. How of reporting about governor kuroda is going to be tapped for a second term. Doing the market something to think about. Seeing if there are any other firm contenders. The market has been moving on this story. People ask about the future of Monetary Policy in japan. Over in south africa, it seems jacob zuma is reluctant to be removed from his presidency. We did see a little bit of dollar buying on the back of that. We will watch the longterm story there. Many voices in my year, anna. The bond market is where its at. It will be the most boring bear market in 30 years. Of thewords but those man from standard aberdeen. Are we really in a bear market . There is this debate about what a bear market really begins. The short betting on the u. S. Treasury market is at a record high. The specs are record short in the bonds. The managers net long positions are the highest since 2015. Goldman sachs says youll get for rate hikes and make it to 3. 5 . Aberdeen investments in asia says it will be a moderately tight bandwidth for the bond market. The spanish come with bills. Sterling is a little bit under pressure. Steepening. Ve his thats was going to carry through in the bond market . Early for aever too glass of jamison and this gentleman. Alexander he cart. Alexander ricart. Juliette saly has your first word news. Treasury yields will. It 3. 5 in the next six months thats according to Goldman Sachs Asset Management. They are defined the consensus for around the three. Managerire hedge fund ray dalia oh has seen the roots thes dalia has seen roots of a recession in the next 18 months. He says bonds are past their peak but its unclear how far the stock market is from the talk the top. Slump is a minor correction typical of late cycle behavior. South africas Ruling Party Told jacob zuma to quit after he refused a request to resign voluntarily. The executive committee may decision during a 13 hour meeting in pretoria. Bank of england policymakers are you 19 behind the key message of last weeks inflation report, telling investors rate hikes will come quicker than expected. Hawkish boeost officials said borrowing costs will rise to a greater extent than anticipated. U. K. Will need a succession of rate rises to stop the economy from running too hot. The next move could come in may. Lobal news 24 hours a day in more than 120 countries. You can find more stories on the bloomberg at top. The rebound generally continues here in asian markets led by what you have seen in hong kong and china. The market has bareback a little bit but closing higher by 1 . We saw australia rebound from the selloff. India closed for a public holiday. We did think there would be a rebound from japan that she saw that yen strength of the top of the show and the nikkei closed lower. Session lets look at some of these stocks. Lion corp. In tokyo up by eight points. A variety ofes household products and had earnings coming in above forecasts. Myer Holdings Closing another record low. Its unlikely to see a turnaround after was unable to give the market for your guidance. And saysand capital the underlying business remains solid. Anna thank you much. Juliette with the latest. Lets look at Asset Management. There was a better than expected increase in new money from clients in 2017. Inflows of almost 6 billion francs. Joined by the lunch of all ceo. Underbell ceo. Net new money there. Lets been dragging that . A strong, rich, oversized product that can navigate an environment where everyone is afraid of rising Interest Rates. We deliver recurring income, stable patterns, in a environment that becomes ever more choppy to navigate. Very good morning, its manus. This is been a tough 10 days. 20 days ago people were defending in your country. Global recovery. Castigating anyone with cash unemployed. How are the clients handling the past 10 days . Zeno they are putting things into perspective. Its what we have told to our the Extraordinary Events was not the last two weeks but the last two years. You see on average two or three downturns about the 5 in the normal environment. We didnt see any for the last two years. Most of our clients joining us in our perspective as a return to normality. Volatility is part of the basis of being invested. Volatility is back but so is opportunity. Volatility and opportunity, then. Do you have volatility products that made you feel uncomfortable over the last 10 days . You have to review the portfolio of products you have on offer . Zeno no, we didnt. You believe index trackers have become genuinely less popular . Blunt, i amvery biased that we are a High Conviction asset manager so i always felt a little bit risky route. I think its too early to tell a change in behavioral patterns or the demand structure. I think the last two weeks are strong reminder that at the end of the day, nothing beats global diversification and active decisionmaking. Anna talk to us about the Growth Strategy in terms of what you might do in the u. S. How do you grow more in the United States . Its one of our core markets. Around 18 of our global Asset Management. We grow in the u. S. Through our Asset Management division. We have just introduced a new product to the u. S. Market. Quality Growth Equity products in the u. S. Now we have Strategic Income funds from 24 in the u. S. Management side, we build up boots on the ground and people look after our clients so there is organic Growth Strategy. Thats the two main areas of growth. We push forward in the u. S. Market. Anna what kind of m a acquisition ambitions do you have . You said you have 6 billion francs to do acquisitions. Is that the right number . Zeno we have a highly leveraged Balance Sheet. We havent yet cracked into anything that is 81 or 82. We would love to do that at the current interestrate levels as we could deliver a lot of value to our core shareholders. We need the opportunity that makes sense. On the asset measured side, i would love to buy volume. That would be our key priority on the Wealth Management side. We would do a deal in bringrland as this would additional scale to are very scalable platform. Wealth measured businesses that we add through an acquisition. Anna we wish you well to get those boots on the ground and hope you dont have to pay to the early paid to dearly. S;rcsalexandreis ducad. Rd. 42 minutes to go until the start of equity trading. Cash open here in london. It looks as if we could see a little bit of downside later in the session. U. S. Futures pointing downward. Lets get a Bloomberg Business flash. Amazon is cutting hundreds of jobs added seattle headquarters, slimming down older departments while hiring new lines of business like Cloud Computing and alexa platforms. It seen as a broader reorganization at the company but others see it as a shift towards automating tasks once performed by huge and by humans. Asset management has been accused by a current employee of discriminating against women and promote a culture of sexism. In a lawsuit, associate director of the firm accused president doug hames of leaving an inappropriate comment on his whiteboard for weeks. That is your Bloomberg Business flash. Manus thank you very much. And spiritwine producer has raised its profit forecast, pushing shares higher after the Company Reported their earnings. That was last week. Anna the ceo is making his biggest reorganization to improve the brand and improve the position in china. Welcome to the program. Lets talk a little bit about china. You are doing something right in china. What has done so successfully . We reorganized in china a little bit more than a year ago. We have both a perceived unit and a Premium Brands in unit. Its investing behind the likes of jamison, absolut, and so on. You had the best organic growth in half a decade. This is even before Chinese New Year has come into your numbers. How strong is the upper end of the market in china for cognac and whiskey . Is that where the real resurgence comes worries of the middle . Alexandre the big change in the recent past in china is back to growth. The overall strong results are a direct result of diversifying our growth. China but also india, the United States, and all regions that are growing. Anna what youre looking for acquisitions in china . Are you interested in any particular purchases . Look at all the opportunities across regions and in china as well. The last acquisition in china was chinese wine. If we look manus through these numbers, and we , itsbout absolute vodka struggling in the u. S. A couple things made us look strangely at the notes was you got naked last week for absolute vodka. What is it due for the brand . I challenged our team in sweden, the Marketing Team to be audacious. It was the Marketing Team that i challenged and they challenged me back. I ended up having to walk the walk. Its a one community, Carbon Neutral distillery and there is so much to say about the heritage of the brand. They came out to explain that in what i would say is a very fun and engaging way. They just asked me to support them and walk the walk. It was difficult for me to refuse. Are your expectations for it in the United States . Alexandre its a headwind but the rest of the world is a tailwind. In the u. S. , the brand grew 9 . Its growing in china but all regions outside the u. S. Remainsside the u. S. Challenging but is very. Manus it looks like its down to me now to talk about cannabis. Views, but areal you having broad discussions about whether we should be in cannabis . What is your biggest fear . Is a brand rejection . Alexandre we saw that operation. Its a situation we are monitoring closely. Manus you have had a conversation. Alexandre i read the papers and we look at this closely. The entire industry is monitoring it quite closely in the u. S. And canada. I personally prefer whiskey. You have mentioned m a on a couple of fronts. The heineken ceo said borrowing costs are coming down. What do you see in terms of valuations in the brewing sector . What do you see in terms of opportunities for him and day . Xandre for him and a for m a . Alexandre we plan to keep doing what weve been doing which is bold acquisitions on one side and then disposing of brands that we dont feel fit the company in strategic speaking. We have recently acquired a West Virginia and american whiskey brand called smooth amber. Anna that was a while ago. No more plans . Alexandre we are still focusing. You cans you can expect to see more. Manus i know jamison is a favorite brand of yours. One is the challenge with absol ut vodka and the other is the success with jamison. You have to make hard decisions about where to put the marketing dollars. Where is the next jamison in your portfolio . The beauty of having a large portfolio of brands is you see our strategic and International Brands are growing on average at 5 . You see our local brands growing on average at 5 . You see our wines growing at 5 . Thats what i mean by diverse fixation of our growth. The u. S. , jamison is doing extremely well. But at the same time, we are investing behind tequila and behind our cognac brand. Its doing extremely well in the u. S. Anna how a protected are you from brexit . Alexandre as you know, we are one of the leading scotch distillers in scotland and we have arjun operations here in london. Our gin operations here in london. We will adapt to our environment and our consumers. Anna thank you very much. Some breaking news . Chairman atte lotte chairman has been sent this to 30 months in prison. This is the company, the shopping company. Corruptionis on charges according to the seoul district court. To monitor this story. Lets have a quick check on the futures. Manus we have this selloff, dollaryen is a rip whipping around. An open option of who we might appoint for the head of the bank of japan. Futures are a little bit lower. Rest of europe, you have london up by. 7 . Thats it for us. Coming up, nick woodman. 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. Welcome. Im guy johnson. Im alongside matt miller. Cash trade is less than 30 minutes away. Guy asian indigestion. Stocks fade. Dollaryen pushing lower. Europe is expected to open up, but just a little. Is the rebound running out of steam . President trump proposes a 4. 4 trillion budget

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