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Is when Prime Minister netanyahu faces a challenge up to the leadership of the party after failing to form a government. Lets talk about trade and not the usual tensions between the u. S. And china. There is escalation cost true trade wars two trade wars. Move is cutting tariffs, a partly aimed at expanding imports. The news comes as beijing and washington work to finalize the signing of the first phase of the trade deal next month. Japan and south korea agree to negotiate on export controls. President moon jaein and Prime Minister shinzo abe will meet for bilateral talks i tuesday, tomorrow. Joining us to discuss in more detail, bloombergs executive editor for Greater China john liu. Why is china cutting tariffs now . Remind us the process involved. John some of the products include pork, which is important to china. There has been a shortage domestically and we are coming up on chinese new year, peak season for me demand. Getting imports will be very helpful for president xi jinping and how things look domestically and you mentioned trade. It will set the right mood music as we get closer to a deal. Anna i wanted to ask about the onk between china moving freeing up some of its being more willing to import more product in terms of pork and other imports. What does this tell us about the phase one trade deal, because this is an part of that. Maybe it is all about the mood music. John thats right. Have been cutat today are not directly related to the phase one trade deal that is coming close to for wishing, but you have to connect the two in the bigger scheme of things. President donald trump tweeted about these cuts moments after china announced to them, so on both sides of the pacific, each side is watching what the other is doing and trying to prepare for what looks like a deal to be signed in early january. John if beijing wants to paint a picture of a government that is more willing to accept products from overseas, this perhaps goes some way to doing that. What about the trade tension we have been talking about between japan and south korea . We know shinzo abe will be visiting china this week. What is important about this visit . John there is a trilateral between china, japan, and south korea tuesday. Ahead of that, Prime Minister abe and president moon of south korea will be in beijing meeting with xi jinping monday. And primemoon minister abe havent met in over a year because of the dispute over women who were used subjected to sex slavery during world war ii are being treated. That has caused additional uncertainty that nobody wants to see in east asia. Anna thanks for the update. Thanks to bloombergs executive editor for Greater China, john liu. Fidelity international ceo Anne Richards said removing Systemic Risk has brought a new danger, illiquidity. She started on the positive signs for globalization in 2020. 2020, talk move into once again about getting a deal between china and the u. S. , if that comes to the fore, that will be helpful because it will get the flow of capital moving around the world and trade moving around the world would be hopeful. If the u. K. , when the u. K. Leaves the eu at the end of moment, thethat u. K. Will be in a position of negotiating new trade deals and will have an certain imperative to do that. Maybe that will bring back the need to continue to think globally to the fore again. It may be after a more difficult period, it goes more positively up the agenda. Time will tell. Francine how difficult is it for markets to navigate geopolitical events . Anne the challenge is not the volatility per se or the frequency of it is the frequency of political events. Business forthis 27 years and every year, there has been geopolitical stuff. I dont remember the quiet year when things didnt happen. It has never been like that. What i do observe now is calls pools of capital are more narrowly circumscribed and they have been for a long time. This has been partly in response to banking regulation, which has been trying to take away Systemic Risk, so within a bank structure, capital is defined it is defined by country. It is defined by types of business within the country. Tois prescribed within banks each desk and how much capital it has. That has been done to remove Systemic Risk. The unintended consequence of that means that when something happens unexpectedly over here, it is not always that easy for capital to jump from one pool to another pool to mitigate the risk of that. I think, strangely and perhaps without intention, by trying to remove Systemic Risk from individual banks, weve created a different risk, which is the capital cant move around in response to an event and when you look at some of the spikes in the repo market, for example or contortions in the currency market from time to time, i think there is a sense that once in a while, we had a little warning signal that capital cant just move where it needs to to respond to something quite small, but nonetheless quite significant that has happened and that is giving regulators pause for thought at the moment. I think this sense of sure, we need a set of rules that manage the daytoday, runofthemill weditions we are in, but need to say, in an unexpected condition, are those same rules which normally safeguard, are they making situations worse and that is a conversation that needs more fleshing out. Anna interesting conversation ceo of fidelity international, speaking with francine lacqua. You can watch the full interview in the next episode of leaders with lacqua. Lets get a blue bloomberg first word news flash. Credit suisse is pointing the blame at its former operating officer. It says he mandated the observation of the companys former hr chief and it says there is no indication the ceo for other members of the board knew anything about it. This follows another sign of involving the swiss lender. Bank of america is watching the Leveraged Loan Market for signs of stress. Brian moynihan is telling us there is too much leverage through Certain Companies and they have trouble, it will impact the economy. It comes at a time when direct lenders are doing many of the big deals traditionally handled by big banks. You are working with these firms as partners and they may do financing, but typically, we are more focused on the shortterm and how we finance and they are focused. Plans to buy Wealth Management in a 100 Million Pound deal according to a source. The price wont include a significant premium to the close on friday. No, from either side, and that is your Bloomberg Business flash. Anna thank you very much leighanne gerran , in london with us. Next, Credit Suisse blames it spying case on the same person who took the fall after the first scandal. We will delve into this one next and remember, Bloomberg Radio is live on your mobile device or dab digital in the london area. This is bloomberg. Anna welcome back to the european open. 7 41 in london so 19 minutes until the start of trading. It will be a lowvolume week. We are expecting weakness at the start of the trading day but European Equity markets, global equity. Markets, close to alltime highs. New alltime highs in the u. S. Last week. Credit suisses latest probe into spying points the finger at the former coo once again. The report said there was no indication the ceo knew about his activities. The bank said he issued the mandate to have the former hr chief followed. Our europeano finance reporter nicholas comfort who joins us from frankfurt. Give us the context, some of the detail you have been delving into in the release from Credit Suisse. They would hope in the wake of the khan scandal, they would put this to bed but here we are on another scandal with the same fall guy who fell before. The key takeaway is at the scandal, theyan went out of their way to point this as a isolated incident. , this isthe chairman not part of our toolbox, this is not what we do. Then, a similar instance so soon afterwards is obviously not what they want to see. What they are seeing today is the people responsible for this actively lied when asked whether there was another related spying scandal. Maybe it would have been better at the time if they had gone and done it a more thorough investigation, saying the guys responsible made sure there was no trace on the system of this separate surveillance operation. Still, you have to ask the question, did they do enough in the first time around . Enoughey thorough looking into the allegations and what it meant for the wider Corporate Culture . Anna this seems to be a story that isnt going anywhere, so we will keep across it and bank will have more to say on this. Lets talk about the future of the Banking Industry toward the end of the 2019 and head toward 2020. Unicredits plan to eliminate it thousand jobs pushes the total cuts announced by banks this year to more than 75,000. Deutsche banks cutting 18,000 jobs and nearly five 5500 jobs to go at santander. Also hsbc, and barclays. For than 80 of those issues will go in europe where negative tw torates and aslahs slash costs. What is the background . I would say negative Interest Rates are the key driver here. The economy is slowing and International Trade disputes, but the medicine for the ecb has been to open up monetary taps and try to juice up the economy. That is good for companies, but bad for people lending. They are making less money from loans, so if you look at your loan book and realize we are not going to be as profitable as we had hoped to be so soon, you will have to counteract that and they easiest way for banks is to look at the cost they have and they have i. T. And people, and they really need the i. T. , so they have to look at which people they can let go. The fallout is, how do you cut back in a way that doesnt de motivates the rest of your staff and cost you revenues in one part because you no longer offer a particular product. That is something european banks had trouble with the past three or four years. Wille how they manage that be something to look at next year. Anna what about winners and losers . Clear the knows who lost their jobs feeling like the losers in this story, but were there winners and the Banking Sector this year in the Banking Sector this year . Look at the reaction from the overall plans. Deutsche bank in july presented the plan and showed their targets and the stock market doesnt buy it. The stock market falls todays after the announcement two days after the announcement. Contrast that with unicredit, with targets the promised a higher payout in dividends, share repurchases, and people to buy it, even though on a down day they were up. I say between banks, i would Say Deutsche Bank has had trouble convincing people they can pull off their plans whereas other banks have more goodwill from investors at this stage. Anna what does 2020 hold for the sector in europe . I was speaking with gareth mccartney, who was talking about the need for consolidation. Domesticsettle for consolidation if crossborder stuff seemed to challenging. Bank mergers are pretty tough, even in individual markets. Look at the example of Deutsche Bank and commerzbank this year. That is an incountry merger. I still needers, convincing to see that will happen anytime soon. Asking people, they will blame different things. The bank blames the regulation, regulators blamed the bankers. Re seems to be resistance carrying the burden, people are still nervous about the idea of big banks getting bigger. Anna nicholas, thank you for joining us. European finance reporter nicholas comfort with latest from frankfurt. Keeping an eye on the sector, news out of Credit Suisse. Program, stocks might fly higher into yearend but one many manager warns there may be correction. We discussed the morning call next. This is bloomberg. Anna welcome back to the European Market open this monday morning on bloomberg tv. 10 minutes until the start of the session and it looks weaker per European Equity markets at this stage of the trading day. It is a week that will be dominated by lower volumes and closed markets in some developed markets. U. S. Futures, fairly flat. Markets may be getting ahead of themselves according to vanguard, who had a warning heading into the new year. More with this mornings call is bloombergs dani burger. Dani stocks have a 5050 shot of entering a correction next year according to vanguards chief economist joseph davis. Simply put, the market has gone too far in optimism on the reflation trade. 10 ory, the odds fall more, around 30 so 50 , certainly heightened concern. He says the volatility is such a low base, it is likely to put up. Investors should be conservative at the end of the year. He says next year is the time to put the dry powder to use when there are sufficient dips to buy. Anna dani burger with that caution from vanguard. Lets get a first word news update with leighanne gerrans. European equity markets, a touch weaker is what we are expecting to see in eight minutes when European Equity markets open for the week. Lets get to leighanne gerrans. Leighanne china is cutting tariffs for a range of goods including frozen pork, pharmaceuticals, and hightech components. And is notanuary 1 related to ongoing discussions with the u. S. , but is part of beijings effort to support the claim it is opening up its economy. And saudi arabia could reach an agreement to restore oil output in the neutral zone. Fields have been shuttered for years because of tensions. They could produce as much as 500,000 barrels a day. In the u. S. , new documents show President Trump asked ukraine about ukraine 80 before his call with the countrys president. That is a conversation that went on to trigger the impeachment investigation, the heavily redacted emails from the center for public integrity. They show the administration ordered a hold on aid about an hour after the phone call. Bush fires are burning out of control in new south wales. They are devastating property and farmland and at least nine people have been killed and hundreds of buildings barged down. The fires are being stoked by record temperatures in the region. Carlyle plans to buy hardwood Wealth Management in a 100 Million Pound deal according to sky news. It is a takeover will be announced today, adding the price wont include a significant premium to harwoods close on friday friday. No comment from either side yet. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. This is bloomberg. Anna thank you, leighanne gerrans, here in london with your first word update. Lets look at stocks on the move this morning. The u. K. Grocery, busy time of year for this type of business. Very much in focus with people stocking up for the holiday festivities, but not the news flow we want to see. Tesco, suspending a chinese card maker, its contract on forced labor allegations. To suspend its supply of christmas cards from this particular factory, says it is investigating a news report. All cards have been withdrawn for sale according to a followingfrom tesco, allegations in the sunday times newspaper. Not market moving in itself, but something a backstory tesco will not want to be the focus of things. The drug sector, keep an eye on astrazeneca for better news. Regulators giving policy news flow around breast cancer. Fda givingline, the something of a setback to the ambitions in the hiv space. A couple of things to be watching for. Youve heard from the u. K. Government over the weekend they are okaying the acquisition of a business by private equity and Credit Suisse remains a big story. The results of an internal investigation by this giant. They have concluded the ceo had no knowledge of the spine that took place against the exhr chief. This, coming close after the khan scandal and the same coo being blamed. Will be around. European equity markets expected to open to the downside at the start of mondays trading session. The open is next. This is bloomberg. Anna a minute to go until the start of the cash equity trading, here are your headlines. Credit suisse blames a second candle on the coo a scandal on the coo. Yet another case is emerging. China cuts more tariffs, from smartphones to frozen pork. Products. Slash on global stocks have are near highs after wall street capss its best week this quarter. Whether positivity followthrough into europe . 25 seconds to go until the start of the trading day. Its going to be a week dominated by volumes. Doesnt mean well see voluntary volatility we will remember. Lets ignore that. We were expecting to see weakness coming through at the start of the trading day this morning. Suggesting we would be weaker, but not by much, flat expectations. European markets opening up and we see movement in fx markets on waits for some of these markets to populate, the pound stronger, over 130 once again. A terrible week once again yesterday on the back of a stronger performance the week before. And the election, we know that story well. The dollar weaker. The ftse 100 moving to the downside. The euro stoxx 50 flat. The dutch market down to 10 7 . We are seeing weakness coming through on these European Equity markets. A little bit of mood music around trade notes, firm news around the trade tensions. The chinese rolling back tariffs on port is not related exactly to the trade deal, but helps at the margin. Lets look at a sector perspective as we had towards the end of the year, nearly the end of 2019, but not quite. We ask ourselves where we go in 2020. Incredible returns, ending the decade with the best returns in a decade for a number of assets. Where are we on the sector picture . A slight downward bias, it would seem. Weakness. In area of if we do see positivity, its coming through in staples and health care. Fairly defensive picture painted by the sectors this morning. I a look at the mov screen, get a sense of the even split, up versus down. Little,side dominates a 300 or so stocks to the downside, but 380 go higher. We seem confused on which direction to go. Just a few days until the end of 2019. Lets get the individual movers to the upside. Nestle the biggest gain or. Beasley also higher, next he also higher. Down up 1. 8 . Ofwent up 1. 2 , a range diverse movers to the upside. Lets go to the downside, the Construction Business down over 2 , baker violence also weaker, a mixed bag of losers. Flatoor picture is the one. European markets starting slightly lower as turner says its cutting import tariffs january 1, a move it says is aimed at expanding imports. Joining us is the Senior Investment manager. Good morning. Good morning. Anna we sit with this news around trade. We do see the chinese rolling back tariffs on pork. This is because of domestic need, but also paints a positive picture of willingness to trade. Does this help at the margin with the u. S. Tensions . Guest im really not sure. Thats essentially the name of the game. Even when theres not news, which seemed affectionate into good news seem to fashion it into good news. Weve had headlines saying from the president himself, weve made a big leap forward. Were ready to sign. We assumed we were already there. It is difficult to signal a noise here, to your point, that producing tariffs is essentially seen as positive for the trading environment, the economic environment. Whether it justifies any additional rally, whether it starts today, i take issue with that. Anna talking about that rally, which has wrongfooted many, ive got a chart that talks about relative strength indicators. Its showing in overbought territory, and makes a point that its not always fatal for a stock rally. How much confidence do you have in stocks going into 2020 . James i dont have much confidence in my own call, but the justification of it being appear, its something you need to seek, a Material Change to justify stocks moving higher, even staying where they are. Anna why is that, then . Profit margins come under pressure . James Profit Margins are under pressure and already have been under pressure. Theyve been declining for more than five years, and yet equities have been rallying throughout that period. There are subtle distinctions, depending on where you take the data from and what extent you take the data at face value or extrapolate a complete kitted situation. We see the economy weakening. We see the state of the economy in a place where its difficult to get new gains from where we are, given the tightness of the labor market. And in a forwardlooking sense, that means it should be reflected in the were prices. Anna you seem to be feeling gloomy. James im poised to be gloomy. Anna as got a chart that shows the yield curve steepening. James amazing, isnt it . Anna thats not gloomy, is it . James yes. You get the curve when the thease policy, to deal with policy built up during the expansions cycle. If i were to look at the curve, i would say this is classic yield curve behavior. Anna you think this takes us into a period where the fed cuts rates . James i think so. It could be march where they will be back and forced to ease policy either because the economy continues to weaken because inflation drops more precipitously. There are reasons it will be under pressure again or because wed see disruption in Financial Markets and the fed has a job to convince the world of what its up to and how its going to play out. Anna this isnt showing in the jobs data. Lacking james it is a lacking indicator and it matters the most. Is not a good realtime icator, the 57 of cities what they are telling you is yes, in aggregate, its too bad. Were starting to see early signs, its not quite as healthy as we look at headline levels. If we look at the base, more than 12 months, 18 months, Even Companies that feel good and want to invest are struggling to find workers available with the necessary skills. Once that happened, its difficult to create jobs growth. That could mean negativity in the retail sector. You see jobs being shed. Anna excellent. Gloomy, but excellent. James ill try to be less gloomy. Anna gloom is allowed. James stays with us. Up next, we talk about the u. K. Boris rakes through the blockade blockage. He wins. More on that next. This is bloomberg. Anna welcome back to the european open, 10 minutes past 8 00 in london, weakness across European Equity markets. Not that much. A week start to the trading day, coming of alltime highs for u. S. Equities. Features flat this stage of the middle of the night in new york. Lets talk about u. K. Politics. Boris johnsons predicate deal trackxit deal, the fast to leave the european union. Johnsons majority allowed him to break to the gridlock that had dominated what is politics the last few years. Senior investment manager is still with us. Lets talk about u. K. Assets. Weve been on an incredible roller coaster, running into the election, we saw a lot of strength for the pound. And that continued when we got the pound, the election result, but last week quickly unwound. Whose logic to you by around the pound . The rally that took us higher or the caution we saw last week . James the rally that took us higher. I was extended at the reaction of markets. It was a shock to some as opposed to others, and less surprising to some again, but to me, it seemed hopeful or selfserving that market predicaments were analyzing participants markets were analyzing ports johnsons majority to shoot himself in the foot and rush to try and find a transition. Essentially, youve given away the opposition. If you admitted you are worried about what would happen in the negotiation, thats not a strength to negotiate. I dont think that was ever going to happen. And as soon as he announced he would legislate to prevent the extension in the market, it affected it negatively. Anna the logic would have been he would have to protect communities from the effect of brexit and away he didnt have to before. James yeha, and im not necessarily sure thats true. I think the car industry has been used as an example of that dynamic, but realistically, if you do the analysis in the labor supporting reasons that voted in favor of the tories and possibly come up possibly in favor of leaving the european union, i think youre talking about a much rotter swathe of industry and things that are not necessarily going to be catastrophically affected if you are elected in the union. Itsnk against the dollar, a much tougher call, versus the euro that sterling is still structurally underpriced. Anna against the dollar, tougher. This is the pound, short positions in the pound, following the lowest in seven months. This is the line you take, suggesting there more reasons to buy sterling now. James i think the longterm, shortterm investors have been positioned in a different way. U. K. Investors have been short the pound a long time and the money has been in and out and there was a position that built up going into the election and thats what we see and get lost out. That, when you look at versus the dollar, you need to salve in your Federal Reserve ane, your economic call, and a heck of a lot of capital fall call. There is more going on there. Youre a rates guy. Talk to us about gilts. You would be a buyer of gilts . James i would be a buyer of bond markets in general. Weve seen a selloff, the curve steepening. These things have made rate markets more attractive. I think gilts are the least attractive on valuation of the markets if you look purely at 10 years versus cash trade. Cash rates. Marketts are another that i would struggle to short on an outright basis. I have recently been short on gilt markets, but because of positioning going into the election, thats something i look to trim down because investors got sure. I dont think the nbc is going to be in a position to hike. I dont think we will see a wise investment. Anna thanks very much. He stays with us. Quarter past 8 00 in london. Lets get a business flash for you. Thanks. Tencent aims to boost investment in europe to more than 10 billion a year. Thats according to the giant european cloud chief in an interview with handles flat. Tencent says germany has the most prominent cloud market. Thats beyond china. It aims to create 20003000 jobs in europe the next three years. Traders may be among those who access a highspeed audio feed from the bank of england. Thats according to the financial times. It says Investment Bankers are trying to establish whether traders use the feet. It is subject to a probe by financial regulators, hsbc and jp morgan are declining to comment. And that your Bloomberg Business flash. Anna . Gerrans. Nk, leighann Credit Suisse shares flip after a scandal, even as the bank denies having any knowledge of the matter. It is so dominated, the talk of the town in zurich and beyond during 2019. More on that next. This is bloomberg. Anna welcome back, 19 minutes into your trading day, a weak performance and equity moments, down by a little bit. I just want to bring you a line on softbank, 3 billiondollar we work financing talk stalling with japanese banks, according to these talks from rotors, coming through this morning story weve been covering for a long time, the plight of we work and have softbanks going to shore up its investments in that Property Management business. Lets talk about the business sector. Credit suisse has a second scandal on the coo, absolving of the matter. Lets get the dani burger who has more. Dani they released this report an hour ago. Now that we have the market open, we are seeing Credit Suisse falling more than 1 , basically what we had expected from the report. According to people familiar, it would follow the same playbook as we saw last time around the scandal that surrounded the former of Wealth Management. This time, its around the x head of hr, and its blamed the former coo in the matter. This is the biggest drop for critics in about three weeks, down 8 10 of 1 . Even so, the stock is still headed for 814 gain on the air, the best year since 2017. This is dragging the shares down a bit lower, but its not hurting as much as you might expect, as much as the reputational damage might do. What might hurt more is previously, when Credit Suisse cut profit outlook. Thats going to concern investors more. But this is definitely an unwelcome distraction for the person in the end of a painful three year turnaround. Anna thanks very much, dani burger with the latest. Sticking with the Banking Sector, bank of america tops the table for the leverage loan issuance. They have dominated the market for a decade but warns potential carnage from stress reverberating through the economy. Bobby moynihan spoke to david westin about signs of stress. The actual exposure on your books is relatively small, especially given the size of if you go way back, we have balanced the company, commercial Consumer Lending on the consumer side is a bigger than that commercial lending book. Thats how you manage risk, when you go back to the question of what could go wrong. Wrong. Anything can go you manage risk by having diversification, thinking about it and clients election. Weve always been good to business. Its not necessarily on the books, but the cabeza tend to have problems when the world slows down. Thats economics 101, or credit writing 101. We have done a right in with amount of terms and you hear is get concerned when the market moves away from the traditional levels that major Financial Institutions find entire levels through providers. We get concerned because it reverberates back at some point. The real concern is theres too much leverage in Certain Companies, and if they have trouble, the impact of the economy, thats the question you hear people talk about. Value,ds in the asset the fund will go down in value. That happens all the time. Is it enough of a market share to impact the economy . Thats the concern you hear more about. Moynihan, was brian the bank of america ceo speaking to david westin, speaking about the risks in 2020. James is still with us here in london. Let me ask you about risks. What looms large on your radar . James i think mr. Moynahan has touched on a couple points there, which we would share those concerns, which is to say, are we in the very last lockings of the Economic Cycle . If we are, what has become an leveraged system copes with that . Those are the questions to be answered. Debt is not necessarily a problem, provided money has been borrowed for productive means. That is generating their returns and ordered to pay off that debt. Thats not such a problem. For debt is being issued financial engineering, nonproductive means, suddenly it becomes a concern because we are probably more debt onto the economy and the ability to paid off is going down. Anna does it remain a concern that we dont have to get too worried about . Depends on the macroeconomy. Had to see debt to gdp across the household sector, but across the corporate sector, rise. Its taking more and more debt to produce the same rate of growth. What happens when growth is zero or negative, thats when it becomes a problem. Anna ive got a chart that talks about hedge funds positioning on dollars. Sincecond lowest level june, 2018, enters of dull the long petitioning. I think its a tough one. Differentials, if we go into a weaker period, and the rate has take cut differentials, it would put pressure on the dollar. If we see economic weakness and market disruption, theres a bid for the dollar. The market has been desperate for the dollar to be weaker the last three or four years. Its essentially seeing what it wants to see. At side the economic channel, you have the financial channel, and the world is a dollar borrower. In the world is gorged on dollar debt, specifically world markets. Strengthens,ar thats a huge tightening of conditions for the world and that can lead to fallout. The market doesnt want to see that. Its a long risk and its try to push this weaker dollar story and its not gone any traction. For emergingf take markets. Speaking of the yield curve, one he says whose to read, investors have been switching out of investing markets and into emerging market areas where they see may be trade tensions are abating and that looks positive. Is that dangerous positioning . James i think thats usually dangerous hugely dangerous. Its been a perfect market free emerging markets. Developing markets are under huge pressure with what we saw in 2006, 2007, and 2008. They are sensitive to china, able to benefit from chinas infrastructure. Policy,easing monetary and china, the rising tide was raising the boat. While the sun was shining, most emerging markets have not only not fixed the roof, but shot a few extra holes in the roof. I struggle to see how you get to the end of the cycle and start to think the cyclical economies are an attractive investment. You need some yield. Anna its all about brent at the end of that cycle. James. Up next, a tale of two trade wars. It will rollback tariffs on u. S. Goods. We talk about that and other trade tensions. This is bloomberg. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone wifi up there . Uhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your local xfinity store today. Anna welcome back to the european open, 30 minutes into the trading day. And session for equity markets, but not down all that much, just 10 weaker. The ftse 100 down to tens of 1 . The dax keeping its head above water. Lets have a look at a sector perspective, Health Care Leads the gainer. That tells you a lot about the risk off attitude we have in markets today. Nmc leading the pack, in terms of health care. They plan an independent review after the muddy waters allegation that led their share price down from over 25 pounds to over 14 pounds. Thats the health care side. Banks at the bottom, but not just Credit Suisse, weaker by 9 10 of 1 . Others lose more. 1 c and bmp down more than in todays equity session. Lets get a bloomberg first word news update with leighann gerrans in london. In hong kong, protests are easing, but if i was a tense weekend in which a Police Officer drew and pointed his revolver at protesters. No shots were fired. The interlink came after a reported attack on police during the demonstration. Kuwait and saudi arabia could reach an agreement to restore our will oil outputs in the neutral zone. The area has been shattered due to tensions between the two sides. They can produce as much as 500,000 barrels a day. Fires are burning out of control in south wales, devastating property in farmland. At least nine people have been killed and hundreds of buildings burned down. The fires are stoked by record tech matures in the region temperatures in the region. Percent trump asked about ukraine eight before his call with the president. Want tohe call that trigger the investigation. The heavily redacted emails were obtained by the center of public integrity. They ordered a hold on eight after an hour after the phone call. Global news, 24 hours a day on air and on quicktake by bloomberg, powered by more than 2,700 journalists and analysts in more than 120 countries. Anna leighann gerrans with your first news update. The move is partly aimed at expanding imports. It included frozen pork as a key item due to the outbreak of african swine fever. Beijing andes as washington looked to finalize the signing of the first phase of the trade deal early next week. 20 is from singapore is the asia economics correspondent. Good to speak to you. How do you interpret development in the context of the broader tensions between the u. S. And china. This announcement is not directly linked to the margins, perhaps. Guest thats right. This one is interesting because cuts across semi parts of the chinese story and as you mentioned, not directly related to the trade talks. Were still awaiting the deal expected to be signed in january. You look at it from two perspectives. One, the domestic side. They are trying to spur the domestic side thats been lackluster, the giant super economy that it is. Particularly in respect to the pork prices, thats a big thing right now in china. The lowering of the import tariffs will help, hopefully, spur the domestic demand. From an external perspective, china can be billing this as another development where theyre trying to show the world theyre a Global Player. Theyre drawn in sharp contrast with u. S. Strategy. Thats the goal there. One other thing i would flight thats good news for the rest of the region in asia is that the semiconductors and smartphone parts that were on that list. Just earlier today, we sell south korea a mixed picture on their trade data, and questions remain about the electronics rebound theyre hoping for in this region. This might be good news, bringing down those import prices. Perhaps there will be more demand that will help export engines in the region. Anna maybe that will help around proving they want to be that Global Player and reduce barriers to trade. As you point out, maybe that has impact on the trade talks. Whatever other developments are tracking in china . Has strongly or weakly do we close out in china . Michelle i mean, is changing all the time. Were getting all these announcements. Many are unconfirmed. One i would flight. Yesterday, a government one i would flag, yesterday, a government talking about talking about more access to capital. Been tough amid market softness in china. Any sort of commitment you see from the Chinese Government to open up and ease regulations can be seen from the regulation of efforts to be more of a Global Player. If it is a concrete commitment, something that is firmed up in the days and weeks and months ahead, something that would certainly help their private players in the economy, and some foreign entities, as well. Thats one development. On sunday, adjusting cutting across a different part of trade war tensions. Japan, south korea, and china commerce and trade ministers meeting, reiterating the fight against unilateralism, fight against trade protectionism. We have japan and south korea, who have been sparring quite heavily over this year in their own trade war. Just to see those entities push forward with that message to wrap up the year,well see if that optimism goes into 2020. Anna thanks for joining us. Michelle jamrisko with the latest from singapore on the latest entrees tensions. Remember, terminal users can see an indirect with the charts we been using with the chart. Tv is what you can use. Save them for future reference. A couple Hedge Fund Positioning charts to use, the yield curve in focus, as well as overboard stocks. All of that part of the conversation. This is bloomberg. Anna welcome back to the european open, 39 minutes into the trading day, a little bit of downside. We do have one or two markets keeping their heads above water, actually in positive territory. U. S. Futures improving a touch, nothing dramatic. Flat to positive. Let me bring you a red deadline. jd. Coms Logistics Unit is considering eight to 10 billiondollar ipo, this according to reuters this morning. This is the ecommerce business, direct Sales Company based in china. It does have a listing in the united states. This is the logistics part were talking about here. Theyre also talking about how it might take place in the second half of 2020, may happen in hong kong or new york. That one is still up for grabs. We talked earlier about how the ipo market has been one to start with promise, the likes of we work expected to come to market rent study or emco. Some of that. Saudi aramco some of that excitement did not live up to expectations. We keep an eye on jd. Com and where they decide to list. Lets stick with the oil story, holding its biggest decline in three weeks. Kuwait signals a deal to renew oil output in the neutral zone along their border. That could come by the end of the year. Hedge funds boosted bets on rising u. S. Crude prices to the highest level in more than seven months. Lets bring in dennis after two join us. How likely is it this will end, and what impact will it have on oil markets . This has been something theres been no production for four years . Give us some background. Its been over four years and there have been back and forth talks between saudi arabia and kuwait for quite a while. Almost a year ago, we saw the crown prince of saudi arabia go for talks in kuwait to resolve this dispute. This dispute started over four years ago, when the kuwaitis said saudi arabia renewed the concession for several on chevron without consulting kuwaiti partners. That led to the shuttering of those two fields in the neutral zone. But now it seems from local media, what were hearing is the saudi minister is going to trave l to kuwait on tuesday to basically formalize this and sign an agreement on resuming production in the neutral zone. Anna that sense more positive in bringing back production. What about the overall picture for 2020 on oil markets . The minister is minting inchoate, aesthetic upbeat. What do we expect into 2020 . Certainly, they were very upbeat and optimistic. Basically the main thing is they expect a trade deal, hopefully, between the u. S. And china. That should boost demand and consumption on oil prices. That will help other countries who have so far resorted to propping up the oil price, mostly through production cuts. As you remember, earlier this month, we saw opec do the surprise production cuts, basically 500,000 barrels a day, which was not expected by the market. Thats basically coincided with the aramco ipo. It give a signal to the market that opec plus, which includes russia, are serious about trying to prop up the price and keep it above 60. Anna thank you very much. Lets get a Bloomberg Business flash. We stay here in london with leighann gerrans. Credit suisse is pointing to the blame that is former chief operating officer mandated the observation of the companys former hr chief. It says there is no indication the coo and other members of the board knew anything about it. This follows another spying probe earlier this year involving this was lender. Softbank has hit a roadblock in its attempt to kill to rescue we were. Reuters is reporting softbank was in top for 3 billion with japanese lenders. Those discussions have stalled because the banks hit internal lending limits. They also expressed concerns about the risks in rescuing we work. No comment from softbank or banks. Bank of america is watching the loan market for signs of stress. Brian moynihan is telling us there is too much language in leverage in chinese companies, and it will impact the economy. It comes at a time direct lenders are doing many big deals traditionally handled by the big banks. Youre working with these firms as partners, and on a given deal, they may do the financing we have done, but typically they do a different trench. And we are more focused on the shortterm evolvers. That your Bloomberg Business flash. Anna . Anna leighann gerrans in london. Was talk about globalization and whether the phenomenon is over. Its a total of a new book by jeremy green. In a year dominated by the trade war, brexit, and a climate theis, it has risen over fate of an interconnected world. Lets discuss with jeremy green, who joins us on set. Really good to speak to you about your new book. I will start at the end, around Climate Change because one of the check things that you the things you bring up is whether globalization has partly to do with a monitor of globalization that works for the claimant. Hallenges that we face wellk jeremy Climate Change is one of the main things we focus on globalization. We have to have a sustainable environment. The ramifications of Climate Change for globalization are actually important. In the shortterm, it may enable a boost to growth. With big about the enormous requirement for Green Infrastructure investment to do carbon eyes our economies. And if we were to loosen fiscal policies to achieve this, that could be a big boost to global growth. In the longer term, Climate Change raises important questions and doubts about the prospects of growth. Unless were able to decouple growth from intensified economic environment a pressures, then there may be the question of whether or not we can sustain growth going into the future or whether growth itself is something we might need to aspire to less as a goal. Anna does it help to look back to inform that future, the future decisionmaking you describe . In your book, you look back to other areas of globalization, where the phenomenon came from, the winners and losers, and how globalization changed over time. Does it help us to look back to tell us where this my head . Jeremy setting globalization and Historical Context is helpful for identifying what is specific to the current crisis, and which aspect of this crisis bears previous periods of disruption in the global economy. It can be useful to position where we are at in terms of trade politics, the situation around global investments, rising nationalism. But i think Climate Change is a singular problem. I think what is setting this globalization crisis in context reveals starkly have unique that problem is. History is not really any guide to dealing with Climate Change. Were going to have to rethink and be imaginative about how we rethink politics to meet the challenges. Anna your book talks about the legacy of the financial crisis. As much as we want to look forward to claimant challenges, its evident how much were still dealing with past. Do you expect that globalization survives the challenge of the great financial crisis . That still might be an open question. Jeremy were living through a period shaped through the Global Financial crisis. It undermines confidence in the globalization progress. It led to stagnating growth, declining wages, and the rise of populist nationalism in many countries. I dont think it spells the end for globalization. Globalization is much deeper and more resilient than it has been. I think that buys some time to reset globalization on stable footing. If we dont deal with climate question, globalization features is the leak bleak does look bleak. Anna where the west has here and how the west coexists again, arising china, the bigger global footprint. Is there room for two models of globalization, one linked to democracy and the like, and the chinese model . Is there room for the two to exist to each other . Jeremy the rice to china provoked anxiety in the west. States like the u. S. And britain were the primary architects for the globalization practice projects at the end of the road were. The rise of china, more of a rule maker than it will take her, has shaken western confidence the west should be primary beneficiaries of globalization. Were seeing the globalization of capitalism, and if we look at the trade dispute, thats very much about american capitalism against chinas state led capitalism. A lot of the discontent from the u. S. About chinas trade performance is the state led model of capitalism gives china unfair advantages in the global economy. Worseand are we better or at sheltering the partners from globalization . Thats one of the unanswered questions. Globalization might be good for an economy, but it doesnt benefit every Community Within that and making sure people arent overly damaged and leading to increase demand for populist narrative. Our different models of globalization able to address that differently . Jeremy states have flexibility to put in place different economic models that can help mediate pressures of globalization. That depends on how powerful the country is, the u. S. And china both actually powerful. They can shape the rules of globalization and use their financial muscle to achieve certain policy goals. One of the problems of colorization is globalization as it did not allow enough flexibility to bend globalization to the interest of citizens and economic wellbeing. Anna those two may have been in the driving seat, but plenty say they may have missed out. Jeremy absolutely. Both of these economies experienced rapid growth under globalization, china more so in recent years. But 13 expect other spectacular increases in quality. Theyve lifted millions out of poverty. Theyve also seen spectacular increases in quality. The same applies to the united states. The politics in the u. S. Is more prominent post occupy wall street. Anna thank you for joining us. Jeremy green at cambridge university. Also, the book. Up next, Credit Suisse bases its spying case on the person who took the fall in the first scandal. Hes no longer with the business. Well discuss that next. This is bloomberg. The swiss regular finland is looking into this and i dare say they are asking similar questions. Will we do to avoid these kind of thing of than . What will you do to avoid these kinds of things again . Anna thank you very much. Reporterfinance reporting there. We had a few technical issues, but everything back on track. I we markets down. Equity measures down. The worst of the measures. Ground, downttle just a fraction of a percent. U. S. Futures plant flat to positive. U. S. Stocks were up at a record during fridays session, the s p hitting a record, asian near record highs during the asian equity sessions, where we were entirely flat on asian equities. We are expecting low volumes this week, Christmas Day on wednesday means many markets, developed markets will be closed for those holidays. Expect to see low volumes as a result. Perfect steepening curb steepening. No doubt picking up on that. Next, bloomberg surveillance. This is bloomberg. What will 2020 bring . Amid brexitlide uncertainty. Boeing brings it star liner in for a soft landing in new mexico. Good morning. I am guy johnson

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