Market is expecting . President trump delays his latest tariff hike on china by two weeks, and bloomberg learns that asian could allow companies goods. Importing farm and come a ab inbev is said to be looking to raise 5 billion for its unit in hong kong. Less than half an hour to go until the start of a european trade. Good morning and welcome. Lets look at futures and where they are heading this morning. Riskon seems to be the scene this morning. No surprise when he see what is happening in asia when you coider the symbol losing from what we are seeing on trade right now between the u. S. And china. No surprise are seeing some moves higher indoeuropean features. The screen shows us the moves that are outside our normal trading standards. We the equity story on the left side. Looks a little mixed, but positive for the markets in the asian session. Chinese markets of the more than 1 . We have seen it in the two tariffs by the u. S. , our colleagues have also brought up a move that china could vaguely going easier on u. S. Agriculture, on about on about increasing the positive mood. A stimulus of what could be achieved in the forthcoming trade talks set to take place next month. Interesting to note, the Hong Kong Market in down a bit, because of the surprise offer in yesterdays session from the london stock exchange. Lets talk about the fx markets. The chinese currency is stronger money coming of the best out of the yen after further signs of the truce in trade tensions. The yen is weaker as a result of that. This is the upside for the emerging market and the new Zealand Dollar today in todays session. That is where we are in the markets as we write for the ecb as we wait for the ecb. U. S. Inflation data is also do today. Lets get to the markets of mark ardmore. As ite had this symbolism has been described from the u. S. And china around trade. Nobody knows whether this heralds something significant, but it seems to be the expectation. Mark yes, this is a bigger step in terms of goodwill gestures. They are both making offers, trump delayed the tariffs, china talking about buying more agricultural goods. These are important steps. I am not sure it is a big game changer yet. My one worry now about the exuberance is the pricing of more positive tone of trade talks for a couple of weeks. As soon as the october date was confirmed, we got excited, even though they were not officially abandoned and turn the. The october talks are many about providing a framework for other talks. So i still think an eventual grand deal removing the tariffs of the last year is far away. It also is important that we still have the tariffs in place, even the ones that in place at the start of this month, so there is continuing economic damage being done even despite the goodwill gestures. It is good headway so far, but i dont think we can run much further on this goodwill. We need a fish is removed. Francine yes, we love that talks about the talks. Anna lets talk about the ecb. We got the news on trade and it seemed like the big story in the markets today and remains of focus. The you expect an Interest Rate cut, announcement on quantitative easing, a small smorgasbord for the markets . Mark there are so many expectations. I dont have any insight on what the ecb will deliver today. The consensus is that they will cut the deposit rate around 10 basis points. And most people seem to believe. Hat they will deliver today my suspicion is that. It will be a disappointment for the hawkish people. One thing to watch from the ecb is the tearing rate. If they do not deliver that, a way to exempt the banks from the costs of negative rates, than that will be a problem for your. I think if the ecb delivers a tiering scheme today for banks and financial institutions, that will be something to watch for. Anna yes, our ecbwatching colleagues say that it is taking a while to deliver on tiering. Let me ask you about the market live question for the day, i know you have been debating this behind today. How long will performance of stocks last . Treasury market, it stands a bit aside from what we have been seeing from the ecb perhaps, the story around race is not the same. We have been talking about things moving in the different direction. We talked about treasuries, the outperformance of value. Is value going to last . Mark it is an important reference you made about the treasury markets come this rotation into value over momentum, that has been the big thing in equities over the last week or so and something we are seeing in the bond markets as well. One person commented on the fact that we are also seeing a rotation into chinese bonds which offer value over treasury in a major way. So this rotation into valley is new at the moment. I would argue that it is more about unwinding trade that have worked really well. People are taking chips off the table. Whether they believe there is a genuine term, longerterm narrative, or it is just time to consolidate, that is up for debate. I am of the camp that it is just a consolidation of the longerterm trend and not a turning point. I think it can on the last of of the a few weeks. Ultimately, value has kind of underperformed for many years. Maybe this is the start of something new, but it will not be a Straight Line trend between here and christmas. Anna i know that we talked about the ecb are ready, but i wanted to get your thoughts, if we see a turning point in trade tensions and that is not certain, but if we do see that that is perhaps a risk to the ecbs providing a lot of support to the Market Strategy here. Mark it is a valid point. It might look like they moved a little quick and were premature in acting. But i think it is crazy to draw the conclusion from a truly. Even if we get a ground deal between china and the u. S. , it may not come until october. October might just be providing the step toward the next talks, and there would be damage. The bigger problem is that the ecb does not know what they will be able to provide. Will extra stimulus to into the story around . It is important to emphasize that the chinese exemptions used yesterday accounted for a total of 1. 65 billion dollars worth of goods. Major tariffsthe tonight put on the u. S. So really, it was a very relevant gesture, it helps some companies, but they are not offering big exemptions this year. Chinau. S. Trade talks, i think, is getting far ahead of itself. Anna ok. Want to watch. Thank you very much, mark cudmore, Bloomberg Markets live managing editor. Remember, you can weigh in on the question of the day by reaching out to us and the ,s live team on tv that is the function to use on bloomberg. Up next. , signs of goodwill on trade. Could tensions be easing between the world powers . We discuss that from a markets perspective, and we get the latest on the news flow behind the markets optimism. Remember, Bloomberg Radio is live on your mobile device and on dab Digital Radio in the london area. They will be covering the church story. And the ecb in full this morning. Anna welcome back to the european open. London, 8 41 if you are in london or berlin, and 20 minutes to go before the start of Equities Trading in the u. K. Trade optimism between the u. S. And china showing baby steps toward some kind of truce perhaps. Lets get the bloomberg first word news update with the young governments in london. Thanks, anna. Bloomberg understand china may resume form imports as a show of goodwill ahead of upcoming trade talks. This comes as President Trump said he was postponing the imposition of a 5 china tariff hike by two weeks. U. S. Tariffs at 25 until october 15. The u. K. Government paper this morning talks of sweeping chaos with a disruption to trade and Financial Services from brexit and the possibility of public disorder. Ministers were thought to release the internal document to comply with the deadline set by parliament. Mps have passed a law intended to prevent Prime MinisterBoris Johnson forcing through in Nodeal Brexit, but he said he is ready to do it anyway. Sources in the white house say National Security adviser john bolton left after arguments with President Trump, over easing sanctions on iran. We are told the president mold in a meeting with iranian leaders later this month but bolton argued forcefully against such a step. The u. S. Government is promising to increase oversight on the ecigarette industry. President trump says vaping has become Public Health concer. The u. S. Have secretary says 5 d thisn kids have vape year, an increase from 2017 and 2018. Meanwhile, investigators are risking to identify a serious lung disease links to use of ecigarettes. Turnednd pickens, or men died. Ate raider has he was a vocal supporter for wind and natural gas power and have suffered several strokes. He achieved fame from takeover bid in the 1970s and 1980s, but arent most of his wealth betting on oil and gas. Global news, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. This is bloomberg. Anna thank you very much. Lets have another look at the markets. The symbolism from the u. S. And china moving markets higher in. 5 , also the msci asiapacific, the goodwill gestures from both sides, from the u. S. , a two week delay in the imposition of tariffs, a change in the mood ahead of that. We also understand in bloomberg that the chinese are considering going easier on u. S. Imports of agricultural products, and that all of that seems to be behind what we are seeing in the latest news flow around trade. Lets talk about the ecb. Central banks around the globe refrain from sounding dovish. The ecb is expected to cut rates further below zero today, but the rise in doubters over Mario Draghis radical measures have caused markets to eschew extreme easing. Here is more with bloomrgs berger. This is likely to chip away from the likelihood that we get a stimulus package. Policy makers are presenting half the euro area economy have expressed some opposition, that is in the dark think, in one of the telltale signs in the skepticism of france. The bank of france governor signaled that it cut in guidance might be enough. But really, it is not just europe we are talking about. The vision of an ecb cut followed by a half point cut from the fed next week is starting to look dicey. We have seen policy in sweden, canada and australia back away from adding more stimulus. Markets also taking to camp hawk in the past few days. We have seen government yields in both sides of the atlantic picking up from multiyear lows. It could be the start of a sweeping rea recalculation. There is plenty of ammunition for those heavily invested in a large easing measures from the central bank. 80 of the economists surveyed by bloomberg see the ecb restarting bond purchases. And most sensitive to media action, the corner of the market still sees a looser policy. C. F. T. C. Data shows speculate positioning across dollar at a record net long. Anna yes, the ecb having to make its decision amongst all this big moves in all the bond markets. That was dani berger with the latest. Washington and beijing are showing signs of goodwill on trade. President trump delaying an increase in tariffs, while china may allow companies to resume buying u. S. Farm imports. Joining us now is bloombergs Senior Editor in singapore, who has been watching the overnight developments on trade. Bring us up to speed with the latest. Yes, absolutely. President trump says he was going to back off the threat to have a tariff imposition 1, a for china, ther 70th anniversary of the founding of their modern country. To know, he had put that on by treat. It was really a lash out best bite to eat that she had put that out by tweet. It took a lot of people back. We have been saying for a while, you need to what concrete indicators, not just happy talk. This is a real concrete going to happen on the first of october, now it has been pushed back to october 15. On the other side, china has said, it put out yesterday a list of exclusions. Today maybe there will be some Movement Toward agriculture. We know how big farm issues are to this president , so there is a little bit of an easing but you can detect from both sides walking into ministerial level talks better supposed to happen in washington in the very first bit of october. Anna it is interesting how big a deal the tariff delay is because there is a substance and also the style. You suggested earlier that maybe it is just happy talk. But to hear happy talk in a relationship that has not been characterized by happy talk of late could be significant in itself. Derek yes, this is definitely style over substance. But the style on this is so big that the style it self has some substance, if that makes sense. That tariff escalation on the u. S. Side, youre talking about taking 25 up to 30 , a five percentage point escalation. That is not that huge considering a lot of the stuff was tariffed already. But if you are looking for positive signs when we have gone literally months since the last positive sign that the g20, you were really starting to see something here. You are seeing it reciprocated on the chinese hide. The peoples daily in china said it is a very positive sign. So it is clear that even though the threat is not gone, even though there is an october 15 threat, a further december 15 threat from the u. S. Side, a lot of the threats are still on the table, but this is a concrete, positive easing that means the u. S. Should not have h. R. Escalation between now and when those negotiators meet in washington. That is a big deal. Anna so is it style or substance . Maybe it is a substantial style change . Thank you very much, derek wallbank, bloombergs city editor in singapore. Minutes away from the open. Up next, we look at the stocks to watch at the start of trade, including ab inbev, who is said to be renewing lance to list its asia unit best its plans to list its asia unit. Anna x and a half minutes to go until the start of cash Equities Trading. Bloombergs Annmarie Hordern is looking at ab inbev and the asian listing. And also covering job losses at bat. Story. O the lsc emery, the latest on ab inbev. Annmarie the plan was scrapped a few months ago, but in there is a possibility that they are looking at listing their asian Business Unit on the Hong Kong Exchange to raise 5 billion. Right now they are gauging investor demand and it could launch that the lesson is next week. Anna tom, what is happening over at bat . Tom British American tobacco is cutting about 2300 jobs over the coming months to focus on new products such as vaping. However, those new products will be facing a challenge in america, where politicians are looking at cutting back consumption measures measures to cut back consumption of ecigarettes and vaping. Anna a couple of reasons to watch the stock, and the sector as a whole. Really an impact on share prices in hong kong is today. What is the latest on lsc . Accompanied company gained 6 yesterday on that bed. We have heard reports from the flow to equity saying that the takeover. Start a another report from the telegraph saying that the u. S. Might scrutinize the deal as well. To face thelse effects of gravity anna. Anna thank you very much to both of to the three of you. You can get the latest on the stories were covering by going to the bloomberg apps. Also check off her bac forget, in you type of the royal navy is commissioning, the next generation of warships. Keep an eye on that. And also the maker of the angry birds games, with could see a movement in the downside for that particular share price. Also, this French Company has told its 30 stake in else trump as they watch for movement. Open. Up, the market we expect to go higher on trading options. This is bloomberg. Devices are like doorways that could allow hackers into your home. And like all doors, theyre safer when locked. Thats why you need xfinity xfi. With the xfi gateway, devices connected to your homes wifi are protected. Which helps keep people outside from accessing your passwords, credit cards and cameras. And people inside from accidentally visiting sites that arent secure. And if someone trys well let you know. Xfi advanced security. If its connected, its protected. Call, click, or visit a store today. Anna a minute to go until the start of cash equity trading. We are stronger across the asian equity session. Not by an anonymous amount, but factoring in the happy talk, call it what you like, from the u. S. , and also from china going easy on farm u. S. Imports, that is adding to the happier mood around trade and lifting equities and futures as well. Oil prices under pressure, dropping of a bit. Overnight, the actual move had been a positive one, again, the trade story factoring here, in the abu dhabi meetings are very much in play. Ae u. S. Dos obviously 1. 09 handle as we approach the ecb. Will we get 10 points or 15 basis points of rate cuts from the ecb 13 billion euros of qe . That is what the markets are anticipating. Future suggesting that they will be picking up where asia is leading off and running with the trade. M around we heard from the Trump Administration that they are delaying the imposition of new tariffs by a couple of weeks. But we still have the old tariffs in the system. Perhaps things are improving a bit on the trade side of things. The ftse 100 is up by. 03 . U. S. Stocks up by. 08 . A little weakness coming through on the dollar. The pond is up. 1 the pond is up. 01 . We are approaching the crucial ecb meeting and we also see money going into the yuan, and coming out of the yen, also having to do with the riskon picture in the market. Euro stoxx up by. 03 . We will be looking for any reaction in trade sensitive stocks, the likes of autos and technology, the list is pretty substantial. Energy stocks also often in the mix on this occasion. This is what we have across the sectors right now. Basic materials moving lower, which is interesting as we factor in more riskon. It could have implications for global growth. Lets have a look at the individual movers to see how up. Are shipping to the upside, William Morrison up. This particular retailer released numbers earlier on this morning. Glencore is also higher, that basic materials moves higher in the sector lower in the sector suspected. I see anheuserbusch and ab inbev of higher this morning up on1. 9 as we get started thursdays trading session. Wehe downside, halston, reference to this are the on the and the trade. The French Company selling a third of its stake in the store. Group,ntinental hotels if you exdividends, ramy and a few others could appear on the list. 1. 6 inaccor down by the hotel space. So that is the story will be watching the next couple of days. Interesting, the latest brexit talk could have an impact also on some u. K. Exposed businesses. Let us talk about whether european markets are higher, generally this morning, based on good news from washington and beijing on trade. President trump and an increase on tariffs, china allowing companies to start agriculture imports, that is what we are bloomberg. M i am joined by the ceo of latitude investment management, freddie lait. Conversationwith a with a calligraphy on, this might be style, and not much substance but it could be a substantial style change, and maybe that is what we are seeing ahead of october 1. Freddie it is quite a substantial change but it is also a sign of goodwill, and President Trump put it in a tweet. My view is that the trade war is more likely to run more than not by the end of this year, but i think it is probably a step in the right direction certainly a positive,. Anna so we shouldnt run with ourselves on what this means, but if this heralds a change or ceasefire in trade tensions, no further escalation it would be progress, wouldnt it, from a market riskon perspective. What implications does it have for the fed . Freddie i think that is a balance in the markets. Dovish, bondn so yields have collapsed around the world. So a relative to the mission of equities is higher than we have seen the last five years, however, they are held down by policy uncertainty and trade tensions. If you saw an easing of the trade war or a solution to it, would see a sharper move higher in the markets. At that point, you have to start pricing in what will happen to the fed and the yield curve. With a move higher . Absent inflation it will higher. Move fire anna have the markets going ahead of itself of the too much. I was thinking of the end of last week when we heard certainly better mood music on trade, as the treasury market seemed to turn on that point. And we see banks following. I know you like u. S. Banks at this point. I have a chart here that shows the uptick we saw in u. S. Treasuries and also in the banking sectoshare ices. Have we jumped on this already . Freddie a tiny bit. You can see from the chart on the screen, it is a very small move back up, and banks will be aligned with bond yields moving higher. But in terms of getting ahead of ourselves, is that an enormous number of people are credit into low volatility stocks, highgrowth stocks, the compounds of the world, paying 30 times earnings and totally cyclical, anything oil and gas, mining and financials in particular have been completely written off, because people cannot think beyond the trade war. It is very uncertain, i admit that. But thinks like the banks, they have a huge amount of cyclicality in them, a lot of negative duration, which is what that chart shows, and also a great valuation and great capital cycle. You have lots of opportunities, you just have to suffer the nativity. Matt so if you like. Matt a bank, is that have to suffer the volatility. Anna so why do you like u. S. Banks . Freddie i think european banks are in a much harder place, but the u. S. Banking system i think has a really positive 510 year cycle. The cap ago that was b injected into the system was higher, the asset quality was higher than in the past, the assets are better, two or three times before the past crisis. Goldman sachs for example makes 11 and still trading book valley, so you get an 11 capital return for the shareholder. So i think i incredibly wellplaced. They have also positive transformation and tech investments. A solution to the trade war and slightly higher bond yields would be icing on the cake, but i like it for a lot of reasons. Anna freddie, thank you. Good to speak with you this morning. He will stay with us. Up next, this is equipment maker sellsunging after point cell its stake in the business. Opening down by 5. 4 . This is bloomberg. Anna welcome back to the european open. 10 minutes into trading, youre looking at live pictures from beijing, the ministry of Commerce Holding a regular briefing. One of the spokespeople for the speaking. We will look at for any headlines, anything they have to say on trade. And we will be closely watching, in particular because bloomberg has this story overnight that suggests china will go easier on tariffs on u. S. Agricultural products. Now lets get your movers this morning. 10 minutes into the trading day, Annmarie Hordern has picked a few for you. Annmarie a few. Of the biggest gainers is William Morrison. The supermarket is up 1. 3 . And it might come as a shock since Quarterly Sales faced a slump, but they announced they will be expanding on amazon now, really encouraging the link between the tech giant, as well as offering a better dividend. That is why we see shares higher. Ab inbev of up more than 2. 5 . Two months after scrapping the idea of an ipo for their asian unit. That is looking more likely according to people familiar with the matter. This would be the secondbiggest share sale this year just after uber in may. Also. , all some plunging this morning alstom,storm al after bouygues says they are selling is 13 stake in the company. They know have about 15 stake in alstom. Anna annemarie, thank you so much. Ecb officials are expected to cut Interest Rate when they meet later today. Expect drama as Mario Draghis penultimate i as president , he is likely to go big. But there have been protests from amongst his ranks that purchases are not needed. The german and dutch side, they have expressed skepticism over the need of bond purchases. They say would be disproportionate to market conditions. Maria tadeo is in frankfurt to preview what could be a tense ecb meeting. Well mario draghi deliver, maria . Maria that is the big question. Is mario draghi going to be of deliver on the expectation, or are we headed for disappointment . There is a lot of hype in the market when it comes to this meeting. This is the first time the governing Council Meets since july, when they sent a very clear signal that they would take measures to prop up inflation and prop up the european economy. When you look at what has been priced in already, is a rate cut, no question, the only debate is whether it will be 10 basis points or 20 basis points, or a record low for the deposit rates. The real debate is qe2. Mario draghi could make that announcement. Somehow said that there are doubts about whether it is needed. If you look at market expectations, if you look at investors, many will tell you that we are headed for around 30 billion euros to be announced today, the timing still to be concerned. Others will tell you that we will see a very modest qe of around 20 billion euros. So we could be headed for disappointment if mario draghi is unable to hit the mark. Anna the other big focus is whether, is on banks, and whether we will see the introduction of tiering, trying to cushion the banks from the worst effects of negative Interest Rates. Is that something we expect to see . Maria that is one of the tools mario draghi could also knows especially the decides to also change the guidance to signal that rates will stay very low for longer. He could also argue that we will go for a tiering system for banks that could provide some relief. We heard from many european banks ceos who said that it is difficult for profitability when you operate at such a low negative rate environment. The terms for this will be key, but if we get the relief banks, we could see shares jump, especially the Northern European banks. Much. Maria, thanks very our reporter on the ground in frankfurt, maria taddeo. Let us discuss the forthcoming meeting of the ecb with freddie lait, chief Investment Officer of latitude investment. , tells youence something a little different about what the ecb will. Do. What are you expecting . Freddie i think it is well broadcast the he will have to see through with a lot of it, but in anticipation of the meeting, i saw a resistance from the other members of the European Commission and the e. U. I was a bit more torn given that it is his second to last meeting, how bold he will be, but mario draghi has always proved he is willing to go more dovish or more aggressive, so i would not be surprised either way. Anna let me show you an interesting chart that underlines why, we are having this conversation at all, the growth trajectory. They have an inflation mandate, but this is the growth story for the eurozone. It has been weakening. Is this justification for doing something, for turning tail on the policies of less than a year ago, just nine months ago, when they signaled the ecb was done cutting rates. This is where we are having this conversation. At the same time, the driver for this is really tensions through in the u. S. And china on trade. So there is a danger here that mario draghi announces something drastic, just at a when things can get better on the front. Freddie i agree, but the danger is for equity markets that it drives, levels of inflation to return. But given what Central Banks around the world have thrown at our economy the last 10 years, and how low inflation is, in the cpi sense, asset Price Inflation is what happens when you go through qe, every review will continue to see strong Price Inflation, meaning equities in particular, but low levels of cpi, which is what they are benchmarked against. I think they will put too much stimulus at this stage, because there will be a soft and in the trade war in the next 12 months. Anna the u. S. Does seem to be inflation proof in a sense. You like u. S. Anks, you dont like european banks. Will tiering help fix your view on europe . Freddie i dont like european banks because i think they are undercapitalized, the asset quality is still bad, and in general, they havent invested anything as well as the u. S. Banks have. I believe he of for you are comparing banks like barclays to Goldman Sachs in america or j. P. Morgan, there is a stark difference in market position in the last few years, much more on a strategy and execution base that i dislike them. To your question, the point in lowering Interest Rates is to get people to spend and suck savings out of the system. For a huge portion of those people for whom the negative rate applies to, if it just stays at zero, it makes them impotent. Anna freddie lait stays with us. Attimulus showdown expected draghis second to last meeting as ecb president. Do not miss of a News Conference from 1 30 p. M. London time and live go on your terminal. Up next, the battle of the charts. Remember, bloomberg terminal users can see and interact with all the charts reuse. Gtv is the function to use. We will be back with plenty more charts, a battle which he we may ask freddie to weigh in on. This is bloomberg. Anna welcome back to the european open, the positive session for u. European equities equities, u. S. Futures also pointing higher. Positive lines from President Trump around trade. Delaying of tariffs, that is being well received by risk assets. Time now for the battle of the charts. Dani berger is going headtohead with annemarie. There is a brexit theme in the mix. Annemarie, whether you kick things off . Annmarie if you are looking for returns is a u. K. , look no further than the guilt index. It has returned. 6 since the brexit deadline in march, with the return of about 1 . The ftse 250 a little better at about. 5 . Ftse 250 is really exposed in the u. K. , the pound doing less against the dollar, but still, the best place to put your money in was gilts, and maybe there is still time to do that. Anna if you are looking for something cheap, what do you got . Dani value involved in the past few days, one of the ultimate value plays his the u. K. Stock market. Looking at the ftse 350 forward one year pe. Since its peak in 2006 it has declined 18 , the lowest in 13 years. A lot of the value plays would suggest it has to revert with the markets doing what they are doing, but considering we are closer to a Nodeal Brexit chaos, is it value or is it just a value trap . Anna good question. Thank you so much to both of you. Decision time, i will let freddie do the judging. Freddie it is interesting to see how gilts have performed, but i think the most compelling thing for an investor is a discount in the u. K. The ftse 100 argument is harder given the tactical position. Caps,ps, smaller milliondollar businesses in the u. K. Are trading at a huge discount for longterm investment. Anna thank you. Bloomberg terminal users can look at the gtv to look at the charts we are using. We had overnight at release of the Yellow Hammer documents, as they are ominously known, the governments frustrations behindthescenes preparations for the worstcase scenario around in Nodeal Brexit. It makes for some grim reading. Do they make you question any of your holdings . You have holdings in tesco, for example. Freddie not particularly. If we end up with in Nodeal Brexit, i anticipate there will be uncertainty and volatility around imports, and things like that. I am sure these thoughts will go through some sort of that. We have to the global busses and really, tesco is the only domestic u. K. Stock. The u. K. Stocks are really trading on their knees. I think a lot of that uncertainty is priced in, and it will not last for five years, it will probably last months to a year. I think the Yellow Hammer documents are obviously worstcase scenarios, not predictions. I am an optimist come as i believe great businesses like this can see themselves through. Anna what about other stocks . In particular, Imperial Brands come at which you have in your Equity Holdings as well, interesting to see President Trump taking some action against the growthn as maybe side of these businesses. Is that kind of regulatory doest over this company, it make you question your holding . Freddie in a funny way, it doesnt. One of the reasons why imperial has done worse than its peers is that it has not invested in next intermission products. Philip morris has it, juul has been bought partially by altria, number one in vaping, and they have a product called my blue but really, combustible businesses is what generating their growth. On the competitive and strategic side, this is and so negative for them at all. Anna to close out our conversation this morning, you think stocks are cheap generally. How much are you loading up on stocks at this point . Freddie we always have the same allocation for stocks, we take a lot of time to choose individual names. We havent added anything since the volatility in q4 last year. When volatility comes again, we will use that as an opportunity to add stocks. Stocks are very cheap compared to bonds. I dont believe we are entering a recession at the moment, so the growth aspect behind stocks will be positive. Anna i was looking at stock dividends versus 10 year treasuries, we have the sb dividend yield higher than 10 year treasuries, but the move treasuries is making it is it make you question that at all . Freddie that it could revert at some degree . Think bond yields could move higher you could get a valuation discount from bond yields. But they will probably move higher if you get more uncertainty or greater expectations. And those are both positives. Anna thank you so much, freddie lait, founder and cio of latitude investment. You can listen to our conversation with freddie by tuning into Bloomberg Radio 8 45 london time, 9 45 london or berlin. Back on after putting the deal ice, ab inbev is said to be preparing to list its asian unit this month. Well bring you more on that story and the ipo coming up next. This is bloomberg. Anna 30 minutes into the trading day, here are headlines. Mario draghis an ultimate ecb meeting could be dramatic, but will he provide the stimulus markets are expecting . President trump his latest tariff hike by two weeks. Beijing welcomes the move and is looking into prices of u. S. Agricultural products in response. And the ipo is back on. Is looking to raise 5 billion for its asian unit in hong kong. Welcome back to Bloomberg Markets. I am anna edwards in london. We see moves higher for european equities. 171stocks moving higher, to the downside. Higher, up byving 4 . And hauser bush is up by 4 . This is the brewing business we know well. Shelved but looks like they are coming back. The stock is up by. 4 . 3. 8 am morrison is up by on the back of their numbers. Surroundingnews that Yellow Hammer report overnight. There are pushed into producing that. Could that have implications for the retail sector. Was moved to the downside. Puig, until last night and held a sizable stake in this business. They are selling a stake and now the stock is down by 4. 5 . We see weakness in some of the banking names. Whitbread, a couple Hotel Operators moving lower. Or accor as well. Thats how the market looks right now. We are moving higher on trade optimism. Lets get a first word news update in london. Bloomberg understands that china may resume u. S. Farm imports in a show of goodwill ahead of upcoming trade talks. This come as President Trump is postponing a 5 tariff hike by two weeks. The delay forces levies on chinese imports at 25 until october 15. A u. K. Government paper is warning about sweeping tales from a no deal exit with disruption to trade and Financial Services. Ministers are focused to release the internal document of operation Yellow Hammer. And hes have passed a new law to prevent premature boris nson forcing through they are meeting with the iranian leader latest month at a you and general assembly. But bolton argued forcefully against such a step. The u. S. Government is promising to increase tariffs on the ecigarette industry. President trump is facing an urgent political concern. The Health Secretary says 5 million kids have a debate this year have vaped this year. Meanwhile, federal investigators are racing to identify a mystery lung disease that is linked with ecigarettes. Global news, 24 hours a day on air, on tictoc, and on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Anna . Anna thanks very much. The ipo of ab inbev of his back inventive inbev is back on. Lets get the latest from hong kong with our ipo. Good to speak you on this subject. What do we know about the deal so far . The company is looking to raise 5 billion u. S. Dollars instead of 10 billion. This move comes after the company sold its australian operations to a sake to a sahi. I would say it is a boost for the market in hong kong. The market has been subdued for a while after the u. S. Trade war put its impact on the market and ongoing protests against government. Investors and the market has been really excited about a deal coming through. Anna what has changed . This was a deal that was expected now seems to be coming off the shelf and back to the market. What has changed in the last few months . Actually, we have heard the sponsor on the deal and there might be some changes for the ipo. In terms of the general market in hong kong, the protests here have been toned down a bit after the withdrawal of the extradition law set by the government. After summer holidays, investors are looking at the market to revive a bit. Moreuld be a bit enthusiastic at the end of september after a bankers and investors are coming back to the market. Anna that has changed the picture of it. Thank you. Carol, joining us from hong kong with the latest on ab inbev. Lets get back to the briefing by the minister of commerce in china. We said in our headlines earlier that Chinese Companies have started inquiring about the prices of u. S. Agricultural goods. We also saw they welcomed the Goodwill Move on trade in reference to present comes announced he is holding back iny were to go into force october in october. We also hear that chinese companys are specifically inquiring about the prices of soybeans and pork. These are areas that have been targeted by china. Politically sensitive and very much at the forefront for President Trump as he heads towards 2020 and his reelection. That is a press conference taking place in beijing. Up next, we bring you some of the stock movers this morning including morrison. This is a Supermarket Chain and the u. K. That in the u. K. It sees Supermarket Chain in the u. K. It sees improvement. This is bloomberg. Anna welcome back to the european open. 40 minutes into the trading day and things are looking increasingly positive. Goodwill gestures overnight followed by goodwill gestures from the chinese. Tiny companies are inquiring about the prices of u. S. Soybean and pork. Does this pave the way for something more positive . No date for the talks yet. Lets get your stock movers. Annmarie we have to begin with rodeo rovio. This company is plunging, down 24 since cutting the 2019 outlook. Profit outlooks are coming in. British American Tobacco to the upside this morning, up more than 2. 5 . They announced they were cutting thousands of jobs in january that will affect one in five. This comes as they are seeing weakness in some a big markets. On top of that, donald trump is vowing to tighten restrictions on ecigarettes. 7 . Ab is to the upside this is as they win a defense contract to deliver the newest fleet of warships. So good news for the defense contractor. Anna Annmarie Hordern with your movers. Opec and its allies meet in abu dhabi, but there is growing concern about fuel demand is the Global Economy slows. Lets go live to manus cranny in abu dhabi. He has been following the twists and turns. What is the latest . It has become an awful lot more cordial. There is one metal detector the 500 journalists went through and then we did not get any access, so i think they have implemented a new regime. The question is, what will the new position be . The russian minister suggested that our goal here in oregon is not to suggest new cuts. Dhabi ised in abu not to suggest new cuts. They wanted iraq on board and to comply more. The russians have only complied for three months of this year. So it is unsure if they want this collegiate see that this compliance. Delivers, you got to that yourself. Where we are,at brent prices are around 61. Terms ofwe expect in the saudirussia oil alliance . Change . Xpect any certainly, the language they are using is steady as we go. It is all about compliance and unanimity. The ministers emphasized the need for continuity and compliance. Fascinatingg to be when we speak to Alexander Novak later on today is the discussion between russia and the colleagues about iran. If we do see a demonstrable shift from the United States of america and regrets to sanctions and the relationship and if that brings in the risk of about 700,000 barrels of oil. So could that mean a new level of supplies which would force them all to get on board maybe with deeper cuts by christmas . As you know, we are only ever one tweak away from a complete uturn prices and volatility. Anna manus, thanks very much. Volumes in the gold market have soared in recent months as investors flocked to traditional havens. Despite the pullback in price, citi is predicting the precious metal could top its record. This is the London Bullion Market Association marks the centenary of its fixing of the gold price lets speak to the ceo of the London Bullion Market Association. Good morning to you. The centenary, tell me about. What exactly are you celebrating . Thank you for having me. Today is a special day as we celebrate 100 years at the london gold price. One celebration is that it is a special moment in time and an homage to the pioneers wht it up in 1919. But more important is the next 100 years and making sure the work out there is transparent, open access, and most importantly, has independent governance. Anna you called it very carefully the gold price. 2015 marked a bit of a change. The process is a little bit different. Tell us how things have changed. In terms of the name, it has definitely changed. Partly because it was right popular in 1897 and you had lots of benchmarks. But you also have the london gold price option. Understanding how that tradable option determines the price for the day and it happens twice a day. Wasng that transparent important to get people to understand the robust process and that it is a tradable price. The name changed and you are clear about the transparency. Let me ask you about Capital Requirements for banks and your concern about how banks might be stifled in their ability to trade gold. Due to a lack of data, unfortunately, gold was not considered the highquality liquid asset that is. You see a flight the gold now because it is a reserve asset. Times of uncertainty, gold is a safe haven and that has been years. Or hundreds of the lack of data is challenging for regulars to understand that is something we corrected last year. In november, we had our first prices and thats how we know we had the biggest volume since records began. Are the anna regulators aware of the data behind the gold market . That there is more data now available, will they rethink the next Stable Funding ratio . They had reconsider the case for precious metals. That has been required by european parliament. But part of it is getting them the numbers. You can look at the numbers yourself. From our perspective, something we have been trying to educate lobbyists and regulators on for seven years now, now that they have the numbers, we are having much better engagement. There is still a lot of work to do. You always have the qualities of a highquality liquid asset. You just did not have that data to back it up. Anna what are the implications of this exemion . It is anonymous. Most have put it enormous. It is not something you can pass on to the client, it is a get out of the market move. You have seen some institutions take that on in recent years. Our goal is to have a number that is reflective of the liquid assets that gold is. We would love an exemption, but it should be nowhere near 85 . Anna this is at a time when many have been finding havens and gold prices. Thank you for bringing us the story. The London Bullion Market Association, celebrating the centenary. Up next, mario draghi faces one of the most contentious ecb meetings of his presidency. Will he ramp up the stimulus again . The hawks have been vocal of late. What will mario have to say . This is bloomberg. The trend, i think, in my , its inevitable that consolidation will continue. It really concerns a very small number of globally positioned exchanges of financial infrastructure companies. None of them today have the complete suite of global products. Lse that was the former ceo telling bloomberg there will be more consolidation amongst exchanges. That comes after lsu rejected a takeover lse rejected a takeover. They will be looking at this carefully, as well u. S. Regulators. Todays ecb meeting is said to be one of the most contentious of Mario Draghis presidency. He is ready to wrap up the stimulus despite skepticism. Joining us is richard jones, our markets live fx rate strategist and our head of the markets live team in europe. Richard, lets come to you first. Reading all of the previews we got on bloomberg, it all seemed kind of straightforward. The more i talked to people, the less it seems everyone is on the same page. Yeah. U. S. 10 different people what they think what you get 10 different answers. You ask 10 different people what they think, you get 10 different answers. The key thing is that the cheapening and bond prices has accelerated. In bond prices has accelerated. So the disappointment is already in the price. We could get a kneejerk shift higher if the ecb does not qe. Unce but draghis messaging will be dovish enough that the kneejerk spike will be shortlived. And because bond prices are already cheap, we probably have further upside and bond prices and downside on yields. Matt christine, your thoughts . Im interested in your idea about draghis messaging. Leaving, there is more value attached to what you do so what are you expecting . Absolutely, i think you make a good point. This really factors into what is going to happen today. Richard has pointed to a cheapening and bond prices and a bit of a backup higher in yields in the last couple of days. I think there will be more to that move once we see what the ecb does today and if they fail to meet the dovish expectations that are already out. Pressure been a lot of and bond markets and it has been a oneway bullish trend for so long. And what better way to let off steamf that state then then than failing to be as dovish as expected. Itt i have third anna have heard others expecting them taking their leave. I want to go to the other side of this stimulus argument. We talking about what the ecb will do. We are to hear from Christine Lagarde that both think european governments need to do more i have got a chart that shows the extent to which german gdp has fallen behind the u. S. Therefore outlining room for the germans to do more. Is this catching on in berlin . If we see pushback against qe from the german political establishment, perhaps they might be more tempted to do fiscal easing. Five vibe vibe . If you ask me months ago, i wouldve said it was a nonstarter. But we have seen a shift in that over the last few months. They are not keen to do it, that there is a bit of a move towards it in berlin. I dont think there is any enthusiasm hundred, but there is an acknowledgment that might be necessary. We will get that pressure and we have had it for years. We will get it increasingly from Christine Lagarde. So they will continue heading in that direction but there is not a lot of enthusiasm. Thank you both very much. Well be all over the ecb and the news flow. Dont miss our coverage of Mario Draghis penultimate ecb meeting. Type live go under terminal, it will take you to our coverage. Thats it for the market open. Upopean equity markets are. 2 and u. S. Features point higher. Pricing in a better mood music and a bit of optimism emerging around the trade story. This is bloomberg. At comcast, we didnt build the nations largest gigspeed network just to make businesses run faster. We built it to help them go beyond. Because beyond risk. Welcome to the neighborhood, guys. There is reward. Beyond work and life. Who else could he be . There is the moment. Beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. Take your business beyond. Francine mario draghi heads into his second to last ecb meeting. A rate cut looks certain, but how much stimulus is enough . Stocks gain as President Trump delays tariff increases. Beijing considers resuming farm imports. And a Boris Johnsons Government Faces the worst case raise outcome. Operation Yellow Hammer once of food and fuel shortages warns of food and fuel shortages. Welcome to bloomberg surveillance. There is quite a lot going on today. We focus on