The 10 year yield at 1. 56 . The dollar index continues to strengthen, and crude oil is above 53. Guy we are seeing Dollar Strength beginning to ease a little bit right now, but you still got the dollar up against the turkish lira. The Turkish Central Bank cutting rates again. Still, the pressure is building on the lira. Eurodollar flat to negative right now. We are still below 1. 08. How low does the single currency go . European stocks not at session highs, but fairly close to them. Oday vonnie we begin with the latest on the coronavirus as china makes moves to stimulate the economy. Possible bailouts for hardhit Industries Even as the death toll continues to rise. Bloomberg also reporting that china plans to take over the indebted conglomerate hna group. For more, lets get to bloombergs Sophie Kamaruddin in hong kong. Continuings and illnesses. What is the latest. Mr. Prystaiko with the report sophie with the report on hna group, bloomberg has learned conglomerate is in talks with the government for a took over as the firms ability to meet its financial obligations has been hampered by the out. An announcement on this may come as soon as tomorrow. Hna Airline Assets may be sold off to local players as part of this deal. Seemingly, the pivot for the group back in november to focus more on tourism and travel related business is certainly taking a hit, given the impact on china travel. As for the broader airline industry, china is reportedly considering measures to support the aviation sector such as direct cash infusion and perhaps mergers. When it comes to the wider saying that itc is calling for a rational view when it comes to the Economic Impacts from the outbreak, saying it will be shortlived and limited in terms of time and scope, and the central bank is planning to roll out more measures to promote consumption and investment. Uy we are just showing , suffering for demand out of china. How long is it going to take for chinese consumers to get back into stores . We see macau opening, or reopening. What is the story on the streets in some of those key retail areas . Sophie there may be some hesitation on the part of chinese residents to go back out and flock to stores, even as we are seeing some big names. Eopen, the likes of apple, drop inosted an 85 business on the mainland given the number of stores it has had to shudder. Uma also suffering, although saying it doesnt see an impact beyond this quarter perhaps. To your point about whether or not we will see a pickup in besumer activity, that will as we have noted in recent days, several cities have ratcheted up restrictions on residential compounds, and more quarantine efforts have been put in place as well. Vonnie Sophie Kamaruddin in hong kong, thank you for that update. Guy lets get some insight into the state of the markets and their reaction to what is happening with coronavirus. We are joined by Derek Halpenny, european head of Global Markets research at mufg. Are you surprised at the sanguine approach risk assets are taking to the coronavirus story . You would have thought on the face that this is a very market negative event. It doesnt appear to be perceived that way by those investors that are putting large amounts of money in here. Derek i think for sure, there is this huge assumption, hope in the markets that this plays out, however bad the data gets. That ultimately, you will have Central Banks and governments who stepped in very aggressively. On the central bank side, that has already been happening. But certainly in terms of china specifically, that there is more stimulus to come, both fiscal and monetary, and that ultimately we will get this kind of transitory impact and ultimately a large rebound. Guy i am trying to get my head around what transitory is. Transitory seems to mean q1. Is that transitory . If it goes into q2, this becomes a different story. Derek my sense from the markets is that, yes, everyone is focused on real gdp growth in china getting hit by potentially 2 , but then ultimately getting a rebound in q2, so for sure. You were talking about the question to your colleague about predicting wendy stores start to open predicting wendy stores start to open pretty thing when do stores start to open. It is very difficult to predict. That assumption i mentioned a moment ago, certainly as each day ticks by, at some point the current risk rally could reverse quite sharply, as does a reassessment of that vshaped rebound activity in q2. Vonnie what are you looking for the dollar to do . Euro ises well, the obviously front in focus. Three big figures in the month of february to where we are is a pretty big move. Of course, we have to also incorporate where we were before coronavirus became the issue in january. In that context, i think the fx market has been playing out the very surprising weakness that is now come to the fore in terms of fourthquarter gdp. We had the contraction in gdp in japan, which was way worse than what the markets were expecting. Not only do we have the coronavirus to deal with, we have the running to that in the Fourth Quarter of last year, where markets are now seeing that being far worse than expected. It is playing through in the fx market. Eurocale of the move in is significant. Now you are back to the cyclical lows, and this entire cycle lower in eurodollar, so below 1. 05, below the levels we have reached before. Those are very credible targets for the market to be looking at. Vonnie the parody calls we had the parity calls that we have had, are they slightly beyond what you would anticipate . Derek in my view, they are. I still think the window we are talking about for Dollar Strength is playing out in the backdrop of what we have at the moment, but the u. S. Economy in our view, while it is relatively better than elsewhere because of what is happening in relation to coronavirus, it has its own issues as well. In own view at mufg is that the second half of this year, we are going to see more pronounced evidence of slowdown in the u. S. Economy. The physical support that has been there is now evaporating the fiscal support that has been there is now evaporating. We are going back to trend growth after a sugar high from the trump stimulus. 1. 8 ,nk Something Like 1. 9 this year. We are seeing a slowing economy in the u. S. As well this year. We think theres a good chance the fed may have to cut rates later on this year, so it is a positive story for the dollar at the moment, but we are not assuming that continues. Guy lets talk about today. Dollaryen, walk me through what is going on. It is a massive move. Derek it is, and the risk backdrop today is reasonably favorable. But i think also, if you look at the two risk off episodes we have had this year, the middle east escalation and then coronavirus escalation, on both of those occasions, dollaryen dropped sharply. Occasions, if you look at the weekly flow data from japan, what that triggered was very substantial purchases of foreign bonds. Some of that, perhaps a good chunk, is hedged, but there is certainly a portion that is likely unhedged. I think that is certainly a supportive factor. Japanese investors are seen as being there to the downside, and on the two occasions when we have tested the downside, we have reversed very sharply. Today, we have broken the january highs. Of 1. 10. Re north you talked about the one dollar five cents on eurodollar be incredible. Is 1. 10 a credible target . Derek in that window we assume is open, for sure. Absolutely. It is interesting what is happening in japan. Just in the last couple of weeks, we have seen a massive drop in five year fiveyear inflation expectations. Guy they were pretty low before. Derek and it has turned negative in the recent data. Historically, that type of development which boosts real haves in japan, when you circumstances of these huge currentaccount surfaces, it becomes more and more difficult withe yen depreciation, real yields rising and having substantial currentaccount surpluses. While i can understand what happened today, i am skepticals of levels beyond the shortterm given that development. Higher real yields in japan historically is very supportive for the japanese yen. Guy talk about declining real yields in turkey. We will do that just a minute. Stay with us. Vonnie. Vonnie lets get a check on Global Markets now more broadly. Here is kailey leinz. Kailey taking a look at green all across the screen when it comes to Global Equities today. The prospect of more stimulus coming from china giving a boost to risk sentiment in the face of the coronavirus. In the u. S. , all three major averages right around the highs of the session. The dow not yet at an alltime high, but the s p 500 and the nasdaq are, as is the stock 600 and europe with a gain of about 0. 8 . One heard the phrase tough market tossed around lunch. We just keep persisting phrase teflon market tossed around a bunch. We just keep persisting. It does suggest that the rally could still have room to run. , over 70,k at the rsi indicates that we are in overbought territory. It could indicate more gains could come. The gains just keep coming for semiconductors as well. The sox index up about 2 today at a fresh record high. Of course, china stimulus really heating these names. Some of the top performers are analog devices. Nvidia up more than 4 after reporting earnings this morning. They did have to revise down the revenue for the Second Quarter a bit because of the virus, still reinforcing the idea of the company turnaround. Nvidia up nearly 5 on analyst recommendation over at bernstein. Upcoming catalysts for the stock now at another record high. I want to point out the gains we are seeing in oil today. Again, a risk asset. Growth a big player for this commodity. Maybe demand is going to be a bit better with the china stimulus. That has wti up about 2 , giving a nice lift to oil and shale stocks. Vonnie thank you for that. Do remember the function gtv allows you to browse all of the recent charts featured on bloomberg tv. Save your favorites for future reference. More with Derek Halpenny in a moment. This is bloomberg. Vonnie live from new york, im vonnie quinn. Guy from london, im guy johnson. This is the european close on bloomberg markets, lets check in on the bloomberg first word news. Here with the details, riddick ago. The details, ritika gupta. Ritika democratic candidate going toloomberg will debate state for the first time. Bernie sanders leads the way at 31 . A bloomberg is the founder and majority owner of bloomberg lp, the Parent Company of bloomberg news. U. S. Attorney general william barr told associates he may quit. Barr is frustrated over president trumps tweets and comments about Justice Department investigations. He issued a rare rebuke of the president last week. Another sign of a strong Housing Market in the u. S. Housing starts pulled back from a 13 year high, but remained at over 36 million units, the second fastest pace of the expansion. The British Government wants to end the immigration of unskilled workers. A new pointsbased immigration system will take effect next january. Skilled workers must prove they can speak english. They also must have an offer for a job paying at least 33,000. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Im ritika gupta. This is bloomberg. Vonnie thank you. Halpenny,k with derek head of Global Markets research at mufg. What looks attractive to you right now across Asset Classes . Gold is doing well. Perspective, i would throw in speculation around the Monetary Policy framework reviews, and particular from the fed, on what that might mean in terms of longterm applications of the monetary stance in the United States. Impetusnk theres added to gold in terms of expectations of Monetary Policy being looser for longer. Whenever weve had these kind of risk off moments and we seem gold spike, but then risk , gold haseturns reversed, so there is this fundament a backdrop of support, and i think it is that Monetary Policy framework expectation and expectations of lower for longer. Vonnie does that mean that Monetary Policy in the United States is exhausted . Derek relative to elsewhere it is not, but of course, one of the reasons why we are having this on a terry policy framework review from the fed is exactly those concerns of being at the lower bound and what exactly can be done in order to implement stimulus into the real economy. Definitely we are reaching a point of policy being exhausted, but when you look at the fed Balance Sheet relative to gdp or relative to market size, when you look at interest rates, when you compare that to the boj or the ecb, there is certainly plenty more scope for the fed then there is in the other major Central Banks. Guy do you think this is a more important focus for the minutes coming out later than the focus that everyone seems to be talking about, when do we get the paper of the bill purchases and how they are going to work . Do you think we should be focusing more on the structure of the inflation targets and how the fed is going to reach that rather than worrying about the shortterm implications of paper . Derek we are going to start getting more and more information on the framework review, and dont forget, a small but important week to the statement in january, the removal of the reference of conditions being conducive to getting inflation near target, the removal of that and having target,nflation to the returning to the target, small change, but potentially important change. The message being the fed no inflationepts getting near 2 , and therefore, 1. 8 , 1. 7 , it is near, but it is not good enough. In the context of the fed having missed its inflation target to the downside in 95 of the last 10 years is telling you that the fed needs to address this downward, asymmetric bias to its inflation targeting. Change ine a the statement to indicate they are trying to send a message to market. Guy they have done pretty well on that. Lets talk about turkey. I just went to get your take on this. Turkey cutting rates again today. Not as much, but we are pushing further and further into this negative yield story. How much more can the turkish authorities cut before we start to get a blowup in the turkish lira . The pressure has got to be building. Derek definitely vulnerable, and the statement made reference to monitoring external conditions and inflation. In other words, that kind of dynamic of inflation undermining real yields and what is required in order to finance, its got a surplus on current accounts at the moment, but that is going to be temporary. We will go back into deficits as the year unfolds. And ultimately for the central now about real yields 150 basis points, we are historically invulnerable territory in terms of depreciation. Is 6. 40. Berg figure our view is 6. 60. The camp of greater depreciation, and there is probably more cuts to come. , but erdogance is clear in what he wants, and the central bank will deliver what he wants. More cautious from here, but we should expect further easing going forward, enough to put downward pressure on the turkish lira. Vonnie we have to leave it there, but our thanks to you for joining us in our london studio. Ofek halpenny, global head mark its research at mufg. This is bloomberg. Vonnie it is time now for a Bloomberg Business flash. The meale pioneer of kit by mail thad. Now by mail fad. Now blue apron is looking at ways to increase its business. Blue apron reported a Fourth Quarter loss that was worse than expected. Palladiums recordbreaking rally wont stop. It rose about 28 an ounce for a while today, already up 40 this year. The reason, expectations that Environmental Standards will get tougher. That means cars would need more palladium, and theres already a shortage. That is your latest Bloomberg Business flash. At wheres take a look european markets are right now. We are near session highs. Every single sector in europe is in positive territory. We are led higher by the tech sector, bouncing back from a big move to the downside yesterday. But then we get into some of the more defensive names come of the household goods, miners bouncing back. But like i say, everything is in positive territory. The european close is coming up. This is bloomberg. Guy 30 seconds until the end of trading in europe. A positive day. Every single sector in positive territory. Bright green great we are on session highs as you can see. Remember when we crossed the 400 mark . That was a big deal. Everyone was saying the market would, under pressure. Today we are up. 8 . Lets look at the individual markets around europe to give you an idea of the kind of story we are focusing on when it comes to individual components. Ftse, cac 40, dax good the cac of these markets up. 8 . Helped by00 is being the fact that hsbc is bouncing back today. As we saw yesterday, is a huge waiting on the ftse 100. Lets look at the sector stories. Every single sector is in positive territory. Tech leading. Then the minors, then the financial services. Telecoms trading strongly. Utilities are up, oil and gas is up. It is a reasonably eclectic mix. There is no clear rotation happening, which is worth paying attention to. The bond proxies are middle of the pack today. The bottom end of the market, the chemical sectors underperforming. Banks underperforming despite what we are seeing with hsbc coming back a low bid. A big drop yesterday. In terms of the sector breakdown story, i am not sure theres a clear message you can take away. Lets look at some of the individual names. This is where the story is most interesting in europe. 12 . Up this is a company that came out and said we are being pummeled in china. The footfall through our stores has cratered. We are suffering. Lookedket has basically at the china numbers before coronavirus, said we think this will be a temporary phenomenon, and extrapolated the before into the after, and as a result there is an expectation we will get a strong bounce back. Tradingult puma strongly. Another stop helping out another stock in germany is dt. Remember we have the sprint transaction as a factor worth bearing in mind. Some of the european markets coming back quite strongly. The market liked what it heard from dt. It did not like what it heard from campari. A disappointing number from the drink maker. At this point in the market, you are being punished. Campari down 3. 4 . That is the european close. Vonnie . Vonnie we are taking our cue from europe. That is the only place to look to see if risk is being a knowledge. Gold futures at 1607. Everywhere else, the stock market looks to be quite healthy. We are not seeing huge move in yield. Crude oil up 2. 3 onnews. Lets dip into the s p 500. It is interesting to see what companies are moving at higher. Garmin is the best performer on earnings. The sox is up 2. 4 . The nasdaq is up more than the s p 500. The chip stops doing well, all higher in the sox index. Resources in competition with other energy users to see who can up its dividend more and that is sending that stop a pirate that stock up higher. Losses ine downside, the real estate sector, particularly in storage. Experts say storage is the worst performer, but some of the other storage comforters companies lower by multiple percentage points. Guy lets turn to the tech sector and try to get detail on what is happening in brussels. The European Commission unveiling its white paper on regulating big data and artificial intelligence. The commissioner says she favors one single eu digital tax for technology giants. She spoke to bloombergs maria tadeo in brussels. Theres a difference between a shift in tone and a shift in behavior. Everyone appreciates we can have another debate by now about the responsibility of giant platforms, but i think the important thing is to see real change on the ground. Are still considering if not regulation is needed to make sure all of the things we have decided in the real world are in our digital reality. Know the eu has been pressing hard for tax reform on Digital Services. Do you think this year will be the year we see the move . That is what we are pushing for. We would want to sell many businesses that pay their taxes at the many people who work in businesses who pay their taxes that they are not faced with unfair competition from Digital Businesses who have been able to escape because corporate taxation does not understand digital value creation. We will do our best within the framework to create a global consensus. Maria i know youre meeting with a lot of executives going back to mark zuckerberg. Do they get a sense you are serious about this and they have to pay more tax in europe . I think so, yes. They find it is tricky if each member state makes their own system because than they have to deal with one set of rules in one country and another set of rules in another country and maybe it is easier to say this is how it is done in europe. Here you go. These are the taxes you have to pay. Maria tadeo joins us from brussels. This is the eu taking on china and the United States. She sounds pretty confident. This is a big fight, isnt it . A big fight and this has been a big week for technology where we have seen the European Union trying to get a hold of rules when it comes to social media, when it comes to hate speech. Now today artificial intelligence, which many see as the next frontier in digital. When you look at facial recognition, when you look at self driving cars, the mention is clear. Europeans are saying we have a huge market where you can make a lot of money, but if you want to do business in europe you have to do with the european way, a way that plays by our own rulebook. There is a sense this is what you get behind the scenes when you speak to officials, that the eu does feel american tech owes too much to the market, that they have become too dominant, and the eu was too timid and had a laissezfaire attitude that resulted in american tech owning every single space of the Digital Space in europe. They want to change that. They feel like the best way to do that is not just regulation, today they unveiled measures to help European Companies in the tech space. They do feel it is regulation that will be the key going forward. France and the u. S. It into a bit of a spat about this at the World Economic forum. It seems like it has been delayed. At the european level, what can be decided . Maria that is the big topic and is the big conversation. Are we going to see real tax reform when it comes to Digital Services . We know the french government has approved a digital tax. We know italy and spain are considering doing that. What is the highlight from the interview is you have a commissioner saying i believe 2020 will be the year where we will finally get to an agreement at an oecd level. This is a tax for everyone. Also that u. S. Executives like the idea that her than they did a year ago because they feel the eu does need to be moving that way. It is better to get one big tax for everyone rather than having to deal with individual Member States that would have to do this differently and having to pay different tax rates according to different regulations. It is better we have to get a global solution. That is a shift in town, and when it comes to digital reform, it is probably the highlight. Doesnt mean we are moving closer . It depends on who you ask. There is hope we will see the reform done by the end of the year. We have been here before and we did not get anything. Guy how is this good for innovation . How will this help us move forward with some of these technologies . Maria we dont know. The reality is the eu is competing with china and the u. S. We have not seen real innovation. That is what you hear from american tech. This is only the result of the lack of innovation in europe. The europeans have often said this is not the case but they do not recognize they have to invest and put more money to work. The question is who will pay for them. Tomorrow we have eu leaders to talk about the eu budget. They disagree on how much money they should put on the table. Much. Hank you very maria tadeo joining us out of brussels on the eu digital white paper. Now lets turn to a bloomberg exclusive. China is apparently planning on taking over the indebted conglomerate hna group. It is the latest example of how the government is trying to contain the economic fallout from the coronavirus outbreak. Head of ours the u. S. Deals team. What we know about how this transaction will work . How will the authorities take control and how the spinoff take place . A lot of these details are unclear because we are still a day or so away from an announcement. This is an inevitable chapter for age in a. They struggle for hna. They struggled to keep from going into default and they need solutions. They sold off many of their assets and all that is left is aviation and tourism which took quite a hit over the coronavirus. How much does this have to do with the coronavirus and how much is the coronavirus providing cover . Why now iso not know the time the government is trying to do this. Hna group has been in trouble for some time. They have huge bills to pay and they need solutions. There could be other conglomerates in china struggling with their debt load that could see china, in in light of the see china come in in efforts to stabilize the economy. Guy who could be a buyer for these assets . Liana the Chinese Government would be a good place to look because they have said they are looking to stabilize the economy. That is definitely a place to look. Are probably not a place to look for logical buyers. Vonnie how politically palatable will it be . Will it, as a relief to many in china this happened . Will beijing pull the plug . Liana it is not surprising many of the companies are close to the Chinese Government. Some of these assets are private, some are public. Chinese airlines is publicly listed. Maybe there is some movement in that stock. Otherwise this is a private conglomerate so we are not sure who will benefit here. Pressure is the Airline Sector in china. Cathay has cut back considerably on hong kong into the mainland, but what does the rest of the sector look like . How troubled we know is the sector . Howmuch we of liana much we have seen cut back, it cannot look good. Have all of the specifics. The Parent Company for hna group would be part of this. We will see if this is the solution. If things improve, maybe we will see a comeback in the sector. Vonnie is not just the Airline Sector, obviously there other sectors. Could we see china getting into the Banking Industry . Liana hna group still owns a stake in deutsche bank, so im curious what happens there. Other companies in china are looking to sell iron to pay down debt. We know another company has been devasting a lot. It is not just the tourism industry. Vonnie wonderful stuff. , u. S. Dealsa baker team leader. Guy lets check in on bloomberg first word news with ritika gupta. Faces Michael Bloomberg his rivals in person for the first time tonight. In las vegas, he will take part in his first debate. The latest National Poll has bloomberg in second place with 19 . Bernie sanders leads the way and 31 . Bloomberg is the founder and majority owner of bloomberg lp, the Parent Company of bloomberg news. Inflationary pressures may be building in the u. S. Core Producer Prices rose more than forecast last month, up 1. 7 from a year earlier. ,hat includes food and energy almost all of the increase was due to a jump in the positive services. The imf is predicting a rebound in Global Growth despite the coronavirus outbreak. The fund says the Global Economy appears to be bottoming out. Still it says the risks dominate the outlook. Those include virus and trade tensions. For its efforts to enforce the u. N. Arms embargo around libya. Says eut erdogan nations who agree to a maritime operation in the region are interfering in a dispute where they have no authority. Libya has been in turmoil since 2011 when the civil war toppled a dictator qaddafi. Betweentry is now split governments. 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. Am ritika gupta this is bloomberg. Guy thank you very much. We are through the settlement process in europe. Lets look at final numbers for the European Equity market. It is a positive day, finishing close to session highs when it comes to the main market. Not much action. A dip lower in the final few minutes. In terms of the weight on the , puma, nest light, lvmh had a solid day today. Despite the coronavirus having a meaningful impact on demand. It was interesting to see the tech sector bounce back. Deutsche telekom with good numbers. Hsbc adding weight to the upside. It was not a big gain edited to include but did contribute to the upside. Nestle up 1. 5 . The biggest gainer for the stoxx ing was the biggest stop from a points point of view. The biggest stock from a points point of view. We will tell you what is happening on bloomberg radio. Jonathan ferro be on the new york side of things. I will be joining him in london for the cable on dab digital radio. This is bloomberg. Vonnie live from new york, i am vonnie quinn. Guy from london, im guy johnson. This is european close on bloomberg markets. Vonnie time for our stock of the hour. Here is viviana hurtado. Viviana our stock of the hour is gorman after the company beat the street on fourthquarter profits. 2020 guidance above estimates. Banner 2020. A if you were to look at the Fourth Quarter reported revenue, 1. 1 billion is up 18 from a year ago. Revenue will top 4 billion, that is 4 above wall street consensus. 20 20 eps projection higher than the street and the board approved raising of the dividend. The fitnessing is segment, think of wearables like garmin watches. The growth there is 34 . If we were to look at sales by category, it is not just fitness. In particular we will focus on aviation and marines. Also leading the growth, 22 for the Fourth Quarter. Analysts are saying this strategy, garmins specifically a shift into highmargin areas like gps and smart pricing. Wearables, we talked about how carmen watches how garmin watches was leading the growth, but think about earwear, things like ipods. If you were to compare units in 2023, you can see it will only represent a significant increase going forward. That is your stock of the hour. Vonnie . Vonnie that is viviana hurtado. Thank you. Guy time for the Bloomberg Business flash. Some of the biggest business stories in the news. Lets kick things off with camper airways increasing their stake in british airways. The airline now owns more than 25 of iag. That will give qatar leverage at a time of transition. The iag ceo will leave next month. Iag also owns iberia and aer lingus amongst other airline brands. Staying in the aviation sector, boeing has another problem with the 737 max. Ragsctors have discovered and tools left in the fuel tanks of newly built planes. The boeing is now looking at more than 400 of the jets. They have since been stored since the max was grounded almost a year ago. Will give Northrop Grumman up to 13 billion and richard spending through 2025. This is part of a trillion dollar effort to modernize the landsea, air, and Nuclear Weapons triad. And that is your Bloomberg Business flash. Vonnie coming up, it is our global battle of the charts. This is bloomberg. Everyone uses their phone differently. Thats why Xfinity Mobile lets you design your own data. You can share 1, 3, or 10 gigs of data between lines, mix in lines of unlimited, and switch it up at any time. All with millions of secure wifi hotspots and the best lte everywhere else. Its a different kind of wireless network, designed to save you money. Switch and save up to 400 a year on your wireless bill. And save even more when you say bring my own phone into your voice remote. Thats simple, easy, awesome. Click, call or visit a store today. Guy time for our global battle the charts. You can find them on your bloomberg. Kicking things off is eric balchunas. Eric esg is all anyone is talking about. It is taking over the headlines. Get people to understand what esg is, esg funds tend to be overweight tech and underweight energy. Most of them have 2 or 3 on either side. Heres a chart showing the tech etf and the energy etf. Clearly this has been a great trade. Esg is benefiting. You will see good return records on esg. However, be aware that if there is a supply shop in oil or a high beta selloff, it could spell bad news for esg funds. You are making an active back. Esg is growing inside the mouth of an alligator. You have to be aware that if the jaws close, it could be bad for your esg fund. If you go in knowing that, it is fine. You need to be aware. That chart even looks like the mouth of alligator. Vonnie kind of creepy but also interesting. Mine is simpler. The kbwe spread between banking index and the s p 500 index ratio. For the Smaller Banks, there are many of them, for the Smaller Banks in this index, the thread between their index and the s p 500 is at the narrowest since the year 2000. This is an interesting one because how many will survive as Standalone Companies . Will we see a wave of consolidation . How long will it take . Batman. E will tell, guy i will go with the alligator. Vonnie i probably would, too. Guy it is a lesson that you have to look inside and unpack these etfs. It is almost inactive that you are making. Thank you for the fantastic charts. Eric balchunas is the winner. Watch etf iq for more smart analysis. Americas 1 00 new york and 6 00 in london. What is coming up in United States . Balance of power with david westin. He will have a preview of the big democratic debate tonight. This is bloomberg. David from bloomberg World Headquarters in new york to our tv and radio audiences worldwide, i am david westin. Welcome to balance of power, where the world of politics meets the world of business. The brief today, Wendy Benjamin senate in washington, d. C. On the ninth democratic debate tonight in nevada. Sophie kamaruddin and hong kong on the latest of elements on the coronavirus, and maria tadeo on the push for a European Commission to regulate digital taxes. Bring us up to speed on the polls. What are they telling us . Wendy there are a lot of pauls. There seems to be one every few minutes from our perspective. It is showing one very clear thing. Bernie sanders is the undisputed front runner for the democratic nomination. He is leading by double digits as the chart shows, well outside the margin of error in just about every National Poll and poll of key states like california, which votes on march 3, super tuesday. The next f