Japans ruling party says the coronavirus will hit harder than the financial crisis. The global stocks rallied after the u. S. Opened the fiscal taps to the tune of a billion dollars. Thats on rate cuts for major Central Banks surge. St. Louis fed president tells bloomberg, dont assume that will be another cut in two weeks. Rate to thee policy right place for now. Given the information that we have now. We took out some insurance against the possibility that this will cause a growth slowdown in the u. S. Matt division in vienna. Agreement over output cuts proves elusive for opec plus delegates as they look to counter the impact of the coronavirus. We are live on the ground for a crucial meeting there. Lets take a look at futures, getting across europe right now. More than 0. 5 . Up 0. 75 . S are futures. In u. S. We finished up more than 1 yesterday across european forces. There was a major surge in u. S. Stocks as a result. You are seeing futures down for the west stocks. Risk on for europe. Have a look at what we are seeing in terms of breaking news coming through. 7 00 here in london. We get u. K. Corporate to reporting. Aviva, the operating profit for the full year is in line with expectation. The fullyear eps, just ahead of estimates. So far, so good. Thats a little backward looking for this market. Significant uncertainty so far in 2020 on covid19. Echoing what we have heard from other businesses. Its difficult to predict right now. We will see if other headlines come through from that. Thats the latest from aviva. Lets talk about where we are on the markets. The strong gains we saw in the United States rippling through into the asian session. Up by 4 on the s p yesterday. It was not all to do with the big fiscal package from the u. S. It is setting a new tone globally for fiscal support with a total of a billion dollars in the United States, passed by the house. Joe biden with a relative victory in the democratic race. That is something that is also supporting market statement. California declaring a state of emergency. U. S. Futures point downward. We are up for the moment in asia. We will see how long that lasts. Stocks boosted overnight as the u. S. House passed an emergency spending bill. Around the world as europe scrambles to contain the outbreak. A nationwide School Closure in italy is a to last until march 15. Heres what policymakers and ceos have to say about the impact so far. The coronavirus could be more severe than what we were previously thinking. We have moved to a more adverse scenario with the coronavirus spreading now in 75 countries. We have to think about the demand side, meaning what will happen with consumers. How are buying habits going to change . What will happen to companies . The most immediate impacts our travel businesses. Nobody wants to ride on airplanes or go on vacations. We have seen air traffic come down materially in asia pac region. Theheres uncertainty about longevity of the outbreak. This in all likelihood will be temporary. It is temporarily. Well get through this. House of your willoughby and how long will it last . Some of the responses we have seen in the past 24 hours, some of the comments around coronavirus. Lets get to the markets with mark cudmore. He is with me on set in london. Great to see you. The fiscal response from the u. S. Seems to be something that has once again purported sentiment and markets. How longlasting is that support going to be . The kind of surge at the moment the government response and the clear message that governments are willing to do monetary stimulus and fiscal stimulus. We will debate how effective it will be an how much fiscal stimulus will be delivered and clickable happen. Everyone is cynical on the monetary side. It does not cure a virus because you get cheaper liquidity. I think thats one of the issues. Overall, i think this is something that doesnt last too long. I think the odds of the u. S. Going to recession this year have massively increased. We have not seen the supply chain disruption. Thats because of the lack from china. That will come through in midmarch. Anna companies are still working through stockpiles. The china impact, the breakdown of the supply chain will affect you with companies in midmarch. As we are getting the escalation of the run supply chain domestically, this problem is going to get a lot worse. Matt its hard for me to read headline like, worse than lehman, and then talk about a 7. 8 billion fiscal stimulus. It seems like a drop in the bucket compared to the 700 billion bailout that we got 12 years ago. Do you expect more stimulus needed in the u. S. . I do. I have a lot of sympathy with your perspective. They come in different avenues, direct spending or a bailout which was eventually repaid. Very difficult situation. I think its important to emphasize that lehman is a financial crisis. There was a real risk of the whole Financial System breaking down. There was a Snowball Effect because of that. This is a very much realworld problem. The health risk and really economy risk, business is getting disrupted from lower demand on the Services Side and the supply chain getting blue disrupted. Anna summit he remembers the demise of lehman pretty well. Let me ask you about oil prices. I know you been asking this question on the mliv blog today. How far can oil rally on deeper opec plus cuts . Thats the supply side of things. Previously, the market was based on how Weak Oil Prices get because of weaker demand for seen. This has been a supply driven market overall for the past five years, ever since the collapse of oil in 2014. We realized that the shale story is so big. Overall, it is a supply driven market. When we get that spike in prices, we get increase production in the u. S. The u. S. Is producing at record levels. Brazil and norway are increasing their supply. Even if opec plus delivers a strong statement, the extra package of cuts, we might only get a bounce in brent crude around the 55 level. If somehow they deliver shock think all, i aew, i think theres a chance. There are shorts that are exposed. You could see a massive overshoot into the early 60s in brent crude. I dont think it is sustainable at all. Matt speaking of a shortterm rally, we are looking at a csi 300 index that has jumped 2 to close at a twoyear high. Being thechina epicenter of the coronavirus, pushing all of these economies around the globe towards a recession, you have a twoyear high in stocks. Does that make any sense . It does make some sense. One of the things ive been writing about come if i think china stocks will continue to outperform all year. Whether thats outperforming in a Global Equity bear market or because the coronavirus threat dies down and stimulus works, i think it be outperforming in a global bear market. I dont know whether the Chinese Market will continue to make franchise. They will outperform. The chinese equities have never traded off the domestic economy in china. They have always traded off of stimulus and liquidity. This massive package is directly supporting the company economy. They support the market very directly and easily. But more important than the Economic Impact you are seeing in china. Anna thanks for joining us this morning. Debate, get the involved in todays question of the day. How far can oil rally on deeper opec plus cuts . Tv is the function to use on your bloomberg. Up next, a look at some of the stocks we are watching this morning including the german version. The company sees solid organic growth in 2020, net sales theming a scenario in which coronavirus has a 1 . We will dig into that. What can other businesses learn from that . Bloomberg radio is a viable and your mobile device. This is bloomberg. Matt welcome back to Bloomberg Markets. This is the european open. Right now, we are over 45 minutes away from the cash trade. Futures are gaining in europe. They are falling in the u. S. Because of a big rally at the end of the u. S. Session. We have a little bit of catching up to do. German broadcaster proceeding reported 2019 sales and operating profit that was below analyst estimates. They struggle to compete with streaming platforms and tackling challenging television at at market. Tos check in with the ceo see if it has become more challenging among the seat coronavirus. How has the coronavirus affected your business . Our people staying in and watching more tv . Good morning. Usk, its very difficult for to tell how the Coronavirus Impacted our business. So far, we are seeing very little impact. We have had a confident year and to 2020. Particularly as we diversify to a more to best digital portfolio a more digital portfolio. Our businesses are growing strongly. We have quite a confident outlook into the future. Anna good morning to you, max. I was interested to see a u. K. Broadcaster saying that they expect a 10 drop in Advertising Sales in april because travel companies are postponing their advertising. Is that something you are seeing coming through in your numbers . We have very little visibility in the german market. We can barely see the bookings through march. So far, it looks fine. Of course, its difficult for us to assess are how coronavirus will impact the spending and advertising. I have a very simple philosophy. We need to stay focused and do what we do, which is invest in digitizing the company. Last year, we launched a viewing platform. By december, 7 million monthly active users. Is the widest offering in the german market. We are investing heavily behind that. Matt in terms of eyeballs on the screen, we know how difficult it is to measure ratings, what are you seeing . Our people staying a fixed to their televisions . Are they still doing other things, looking at other screens . I think its a bit of both. The thing that is really interesting for us is that we think about her entertainment brand and how People Consumer entertainment. Ill give you an example. We have latenight berlin that is quite an iconic format in germany. We now have more people watching latenight berlin digitally than through linear television. At the same point in time, the market share and viewership in television is great increasing as well. , if you good example have exciting offerings and entertainment and infotainment, my view is that it doesnt matter whether people watch it on a big screen or a small screen or whether they watch two things on the same time. Its all about building exciting entertainment brands. Your you recently debuted streaming service. What is the uptake like for that product . Yes. Last summer, we launched join as a free offering, 60 challenge. Best channels. Its the most convenient way in germany on any screen to consume tv. We launched plus in november. We are not publishing subscriber numbers, it is very early days. Were seeing really good uptake. We are doing 12 original productions this year. Whats working particularly well for us is very german, local programming, quite comedic, quite quirky. People of this. We have a very deep library with pieces of movies and series. Matt what about the meat group . You bought this company, the meat group. The description says it operates as a social Media Technology company. That is jargon for, it could do anything in the world. What does this company do and why did you buy it . First of all, its a tender offer. We havent bought it yet. We have reached an agreement together with general atlantic, our Investment Partner here, to. Ake an offer for meat group we think it is very attractive for shareholder. The intent is for us to combine the meat group, which is active in Online Dating and social and to combine that with our Passion Group which is the number one serious matchmaking player in germany and also 18 months ago, we acquired the hominy eharmony which invented the category in the u. S. We have an opportunity to create a top three global leading matchmaking group with a portfolio that is very synergistic in the bandwidth from wars more social, Online Dating to more serious matchmaking. We have an ambition for this to billion business and we get into it. Matt thats a big business. Man, it is anied omnipresent brand you see all over the place here in germany. Thanks so much for joining us. Now lets get your stocks to watch from around the newsroom. Annmarie hordern is looking at hugo boss. Tom lavelle is covering airbus for us. Thedict, sell is focused on german mark. What if you got . A warning on the coronavirus and what it will mean for asian sales. Saying that this could mean profit comes in less than what analysts were expecting. Hugo boss has been on a turnaround plan. They thought they would have a 10 higher in sales in asia. The coronavirus will throw cold water on the turnaround plan. Luxury has had a really bad couple months. First it was the practice in hong kong. On top of that, the coronavirus hit at a time when the asian buyers really come out and spent because of the chinese new year. Likely, stock is not going to be doing well today. Over the past month, they were down 12 . Really fascinating story behind airbus at the moment. The 737 max groundings. They have been thinking about ramping up production. Now with coronavirus, things look very different. Indeed. Shares will be under pressure ,cross the board after airbus it looks like airbus might be cutting back on production of widebody 330 neil after the biggest customer for that plane decided to defer delivery. The cons that comes on top of airbus also pressuring its on thers to cut cost narrow body which is a new and unprofitable model they are producing. We are talking pressure ons rollsroyce roys a into senior plc. Matt wide reaching story indeed. Thanks very much for that. Lets get to mark. What is the story . Anna pretty upbeat pretty upbeat. Driven by a cancer drug that is doing very well. That is helping them mitigate the decline in multiple sclerosis drug. Is the outlook that is giving the company a bit of the left. They are reasonably optimistic that the coronavirus will plateau in the First Quarter and then start sliding in terms of the impact on the market. They say this is only days, it may become worse. But the resumption right now. That means that in terms of revenue, they will only take a 1 hit for this year, based on the coronavirus. Reasonably optimistic. Out rosy very outlook from this company. Anna thanks very much. You can get all the latest stock stories from our team. First go is the function to use on bloomberg. Coming up, oil prices. Opec plus ministers have a crucial meeting as they class clash how to cope. The latest on the ground. This is bloomberg. Anna welcome back to the european open. 35 minutes to go until the start of the equity trading stay. U. S. Futures tell a slightly different story. Plus ministers are in vienna for crucial talks on oil output and the wider market price. Saudi arabia and russia split over the prospect of deeper Production Cuts as the coronavirus weakens global demand. Manus cranny us now with the latest from opec. Hes outside the hotel where a rons delegation is staying. Give us some of the background on this meeting. The data you. Good to see you. We have the iranians in there. Along with the nigerians. They are all around the breakfast table this morning. Saudis are the swing king producers and cutters in this organization. As the prince left the headquarters last night, he said, we will keep you in suspense. Theres a wonderful proposition on the table. That wonderful proposition needs to be credible. The market is already resuming 8 Million Barrels per day cuts. There is approximately 1. 2 Million Barrels. What to the russians want from the saudis to really get on board . Thats the question for the markets today. Theres a sense that we dont want to return to the contango hell of the end of 2014. That was a heckuva surplus that took years to get rid of. Thats the risk. Of dataabout a lack response fiscally. Hopefully opec plus are listening. Matt 30 seconds here. Well could bring russia and the saudis together . I think that they want to show cohesion. Its really about how much silence have the saudis are do to bring this across the line. A promised extra cuts if everybody complied. Will they sell that story again or something with the low bit more prosperous . Its in both their interest to do a deal. Do they want to throw the baby out with the bathwater today . Unlikely. Anna thank you very much. Up next, we talk to the ceo of hugo box about coronavirus and beyond. This is bloomberg. Welcome back. This is the european open. 30 minutes away from the start of cash equity trading. We are looking at features that are rising here. And that a bit of catchup to do after 80 big u. S. Rally yesterday. Europe was only up 1 . Here areee futures showing some big gains. We are also getting a lot of breaking earnings this morning. This outlook is disappointing the market. For Company Makes tires cars which have not been selling well lately. Certainly not in china, where we saw february sales drop 80 . Anna hugo boss says sales will fall in 2020. But could normalize in the middle of the year. Great to have you with us again. The impact you are talking about in asia and china, is this all about demand or is there is supplyside act as well . We too impact on both sides. But more clearly on the demand side. Theuary was difficult for automotive industry. 60 of stores in china were closed. In the beginning of march we see the first normalization. 20 of all stores are now closed. That visitors returning to our stores is not at normalize levels. Normalizationct before the middle of this year. Most of our suppliers are back in operation. We are monitoring the situation closely. Fashion industry is highly globally integrated. So far, we have seen no disruption. That is exactly what i was going to ask. Also if you consider changing your supply chain. Altering it at all. Do you have contingency plans or did it function well enough that you do not need to do that kind of planning . This is not the first Health Crisis to hit us. Is Good Housekeeping to prepare for such a situation. We do have fallback options. We also have significant Production Capacity in europe. Turkey has a very sizable plant. We do have contingency plans for these cases. I am very happy with the plan that our team has developed. Those are now being put to the test. On the supply side, we have seen very minor disruptions. What is your best scenario looking like for europe . We have to monitor the situation. We have seen an increase in cases in europe. Italy is the country where we are seeing the most clear impact. This is an important but significantly smaller part of our business. This is one impact we see. What we do to mitigate that is be smart and prudent in terms of our inventory allocation. We see a very Robust Development in north america. We are working on our comeback in this market. We can redirect merchandise to these locations. Matt you mentioned rising prices as one of the results of the supply issues. Do you think we will see any inflation that you pass on to consumers because of the coronavirus . Some industry players will be sitting on overstock. We do not like that. The other hand, we might see some industry players with disruption. That would limit product availability. We do not expect to see Significant Impact. Anna thank you very much. A really interesting conversation they around inflation. We were talking about that recently. Will talk more about that in the 8 00 hour. To what extent could inflation be a risk or is that a complete red herring . Business a bloomberg flash for you now. Has startedirlines administration after the failure of lastditch talks. This comes after pressure from the coronavirus outbreak. Britains biggest domestic carrier is left with very little choice. It is no longer able to fly or take any bookings. Considering more production. Biggest customer has been installing deliveries due to the coronavirus outbreak. General electric is standing by its forecast. The 2020 forecasted not include virus impacts beyond the fourth quarter. We have 18,000 people in china. With the exception of a handful of facilities in wuhan, we are open for business. That does not mean we are at full capacity. On average, our facilities are at 75 to 80 depending on the day. That is your Bloomberg Business flash. Anna thank you very much. Coming up, we will speak to the ceo of merck. More conversations about how coronavirus is affecting supply chains and demand. We will get into that conversation next. This is bloomberg. Matt welcome back. This is the european open. We are currently about 20 minutes away from the start of cash trading. Futures are higher. As Central Banks capital with the impact of the coronavirus, President Trump is calling for more rate cuts. But the st. Louis fed president says policy is in the right place. Policy editor. He did a great job in his press conference of elucidating the details around us. That thisare rising coronavirus could be more severe than what we were previously thinking. The sentiment was being that we would have to move at the march meeting anyway. This was the basic thinking. I think we got the policy rate to the right place for now. Given the information that we have yeah now. You say it is at the right level for now. President trump is the person calling for more rate cuts. That does not something test sound like something you are on board with. I dont think you should prejudge that meeting at this point. We just had a meeting. It is a very fluid situation. Have hung around Monetary Policy for a long time. It is unlikely we will have that much different information when we get to the march meeting. Depending on how rapidly this is going to move. We can keep our options open. Im not sure you should put a lot of weight on the march meeting right now. I would not want to put a tremendous about of focus on this march meeting. Anna that was the st. Louis fed president. Merck says the coronavirus will probably subside in the second quarter. Can we start our with your expectations . You said it is hard to get the Economic Conditions right. Expect the difficult conditions to subside. Why do you have confidence that we will see that subsiding so soon . We have developed several scenarios, just like anyone else. The situation is evolving very fast. That is the scenario we have included. Mean we think this is the most probable scenario. This is what we can quantify at this stage. Anna the forecast you have given today, do they include much impact on europe and the u. S. From coronavirus . Or is it just about what you are seeing in china . No, it doesnt. We are looking into different scenarios. Not included a global recession into our forecast. Thehis happens, it shows impact of such events. Our health care system, historical models show that there may be some impact, especially on products that are more close to the customer. Pharmaceuticals is generally not as radically affected. We dont expect a major impact. Historically, the Electronics Market has been less affected by situations. There may be more of an impact shortterm. That is a very active market in china. No one has a crystal ball. I given the information you have now, and we have heard from bmw and hugo boss that the supply chain is back online. They are producing their products. Are you seeing supply and demand issues alleviated already and china . Is it getting back to work and back to shopping . China is getting back to work. In our company, we have a policy like any other company. We have employees coming back to work. We have more than 4000 employees in china. We kept about 400 of these 4000 who were absolutely businesscritical at work. As of this week, people are returning. Are in daily contact. What i hear from the team is encouraging. I ask you about the liquid crystal sign of the service. You were seeing slowing sales in china before coronavirus because of the competition. What is the competition like in china on that front . Washe chinese situation that we had better growth in china than in other asian countries. We have no information about how our competitors are. Marketrence to a display was more about consumer reaction. That is much more sensitive to Consumer Sentiment than other businesses. About the semiconductor business. In november, you cautioned investors that that business would face a tough first half. Clearly, you can confirm that. Does it look worse now and will that business also see a vshaped recovery . We have seen a vshaped type of recovery in previous crises. Without any impact, we have seen early signs of a resurgent. We have seen new capacity. We see a flattening off so far. On theno complete impact coronavirus of the Electronics Market. Anna thank you very much for your time. Coming up, jeffries is giving up on the energy sector. We tell you why on our morning call. This is bloomberg. Matt welcome back. Just about seven minutes to go until the start of cash trading. Jeffries is giving up on the energy sector. They have lost 40 here today. Not just saying they are giving up. They are saying just when it does not get worse for energy, it does. The 1962 mats were known as one of the worst baseball teams in history. They lost 120 games. I take great pleasure in saying this as a yankees fan. The data matches up. Look at the stocks. Energy shares makeup just under 5 . Now and a sector is bear market. Anna thank you. That analogy was well explained. Lets take a look at some of the other stocks on our watchlist today. They are talking about a 10 drop in advertising revenues. Delays of advertising spending. That is having a big impact. Not have the visibility to tell us where that is going. Is the beijing metro. They are seeing a hit there. As a result, they are reviewing their pricing. You have been looking at insurance. Matt im looking at at the the aviva. The u. K. Insurer posted full year profits in line with what was expected. Citi says it looks like a slight beat. Will see a little bit of a gain in those shares, especially considering the fact that futures are higher as well. We could see a little bit of a risk on open this morning. 1 inan stocks were up change the other day. It is up to 4 . Looks like europe has some catching up to do. Anna i am really interested to hear some of these conversations we are having. Talking about returning to work in china. To get thosesting measures of normality and terms of the chinese economy right now. This is bloomberg. Anna good morning, everybody. Japans ruling party says the coronavirus will hit harder than the financial crisis, but global stocks rally after the u. S. Opens the fiscal tap. Rate cuts surge but James Bullard tells bloomberg to not assume another cut in two weeks. Cuts in raymond over opec as they look to counteract the effect of the coronavirus. We are live on the ground a crucial meeting. Matt yesterday, we saw equity indexes close higher. The dow jones was up 1173 points. Europe has catching up to do. The blue chips in europe right now are up. 8 . Out, wemarkets get expect green arrows on the screen. That fiscal stimulus has lifted markets in europe does have some catching up to do. Last is thel it perennial question. We see u. S. Futures weaker at this stage. Some of them coming from California Clearing a state of emergency. We will keep an eye on those futures and how they move as we go through the early part of todays session here. For the moment, the dutch markets are to the upside. The french markets are also up by. 4 . We are seeing weakness coming through in the europe, but the pound is fairly flat. Its interesting given the renewed expectation around Interest Rate cuts. Perspective, its a day when we see a lot of buying of assets, but not across the board. Red to diveea of into. We have some sectors looking mixed, but its generally a day for risk on, that we have seen a number of sessions with investors prepared to buy into these rallies and treasuries to keep options open. Matt we see a lot of these days. Yesterday was fairly even, but ,f you look at the move we see most stocks are gaining. Only 64 are down. If you take a look at the winners, you will see some defensive stocks. Nestle is adding the most index points today. Nordisk,artis, novo and British American tobacco are leading the pack here. Take a look at the losers. You see a rio tinto as well as bhp down. Stocks are down once again today. Continental is down after an outlook that disappointed the arket, but you had to expect drop like that in this market. Areeneral, european markets up higher this morning. Now as is up. 5 right an emergency u. S. Spending bill to combat the impact of the virus added to signs of support from around the world. , europe scrambled to contain the outbreak. Are athe measures nationwide School Closure in italy. Europe is hoping to shut things down whereas the u. S. Is just passing out the cash and cutting rates. Joining us now is maria tadeo. Cases are climbing in italy. What are the economic implications . School,kids cant go to you might not be able to go to work. Ironically, this is going to hurt. Italy, we see the government taking more measures to try and prevent the threat of the virus. This could impact Consumer Sentiment. Att is clear is we are not peak virus. Speculationeady that they will put into place measures to stop people from getting together. This is going to hurt people. They are already warning italy could fall into a technical recession. We are going to see tourism numbers fall at the start of the year and this is a crucial industry for italy. Virus, the impact of the is mostly in the north of the country. But just to give you an idea, we are looking at over 30 of gdp. Economically, this is doing a lot of damage. Yesterday which took cases to 3000 really point to the fact that this virus is still not under control. Anna what about european corporates . Today, we have had a number of Companies Across industries. Theyf them are warning expect to see a hit from the coronavirus. , hugo boss said we will see a decline in sales and we expect another hit in the ad business. Expect people to go out on holiday and travel so much when the coronavirus is affecting somebody countries across the world. When you look at the normal operations for countries, all of them are telling staff this is not business as usual. If this is nonessential, you should not be going on trips. Overall, you are seeing a hit on the supply chain, of course. You could see supplies being hit and the fact that the consumer could be afraid of the repercussions of the virus. , theyou look at italy messages that you are better off staying at home. Anna thanks very much, maria. Cio at st. Is the james place wealth management. They see advertising businesses and add space being bought by travel companies. Maersk is talking about going back to work, hugo boss is talking about stores reopening. There is a sense we are getting through this. Sense,re getting that particularly in the east coast of china. But as ever, the data will lag in terms of what we are seeing, so it is difficult to get a clear picture. While the pmis out of china were truly horrific, one could expect a recovery into next week. As maria was saying, it is hard to see what the implications are for europe. We are still in the early stages with respect to reporting arid reporting. Matt what do you do in terms of investing . Risk assets bumped up to alltime highs. Try to lock in the gains and by insurance . Tricky, because the correction was sharper. Predicteally hard to markets. As we have seen, markets continue to be volatile. If one was to try to put in a hedging strategy when markets were correcting, that could have looked a bit foolish with the s p climbing. Seeing, and comes back to the point i was just lookingng, is they are for really interesting opportunities that have been fundamentally mispriced where you have a good quality business where the share price has been slammed in and indiscriminate manner. They are saying this is a good company. Im going to add that to my portfolio. Doa what kind of support you expect from Central Banks . We are looking here at expectations of action. These reflect the market is pricing in a larger than conventional cut. Are you expecting more support to be forthcoming . Surprisedadmit i was we had such an early shock. It made me feel we will probably be ok. To what we have gotten used is almost an addiction. Whenever there is a problem, Central Banks around the world provide stimulus, so there is almost a necessity, whether it is the canadians cutting, or the ecb or bank of england. Delivered,ts are not there may be another in a couple weeks time. There is this expectation Central Banks will provide that liquidity. If they dont, markets will be disappointed. Matt chris, you will stick with us this morning. Chris ralph is the cio at st. James place. Coming up, we speak with Robert Kaplan, the dallas fed president at 10 30 p. M. London time. Its one you dont want to miss. Its kind of late. Set your tivo or whatever. Dvr. Is automatic . Is it automatic . You can watch it on bloomberg. Anna welcome back to the european open. Are seeing a bounce across European Equity markets. In europe, we are up a little bit stronger. U. S. Futures still points down on the major markets. The imf is providing an aid package to help combat the coronavirus. It says 1 5 will be interestfree. The managing director spoke to david west. A very serious commitment to take actions in a coordinated manner. Mnuchin from secretary in a strong emphasis on action. That has resonated across from everyone. What was particularly important is that for Central Bank Governors and finance ministers, they have shifted their attention to what can be done. Collectivelyitized lifeng systems to protect and the wellbeing of people. Second, measures that are well targeted the ease the pain on affected businesses and households. Third, a great deal of attention on liquidity so that we do not end up with a credit crunch. Also, confidence that the Financial System, having been built after the financial crisis, is actually strong. Call is that,he in china, the governor of the peoples bank of china gave us some good news of production in 60 andepping up to expectations in the next week to go further with the objective of full recovery. The imf managing director laying it all out for us. Chris ralph is still with us. Think about the countermeasures we have seen thus far . The fed rate reduction, the u. S. Spending. Italian School Closures. Does any of it seem coordinated and like it works well . It would be an overreach to say it was coordinated. There seems to be a lot of activity going on and fiscal spending out of the u. S. And on the ground action throughout europe. What i think will be interesting to see in the u. S. Is whether the cdc ramps up testing of people. It will be interesting to watch over the next few days. One thing that is fascinating is the imf is saying we needed to understand that this is a global problem arid what we dont want is to nearly eradicate. Eradicate the virus and then for the problem to escalate out of developing countries. Anna we heard about the possibility of a credit crunch. I remember reading recently about concerns of junk bonds or hedge funds on the wrong side of this. Are we going to hear some big fallout or are we prepared for a market player that is gotten themselves on the wrong side of this . Chris its possible. I was talking to a colleague about highyield etfs which have seen substantial outflows. That will putnue, further pressure on highyield spreads and create problems for Companies Looking to refinance its difficult to say because they are trying to keep problems under the carpet and resolve them without going to the public. Anna chris, thank you very much. We will bring you stocks on the move. Including this advertising business stock moving down as the company sees revenue dropping on the coronavirus. Andt to do with traffic transport numbers in china. This is bloomberg. Anna welcome back to the european open. 21 minutes into your trading day. Equity markets are looking more mixed now. Stocks are still up but the ftse ibex are all on the back foot. Annmarie hordern has your movers this morning. Day ofe another Companies Across sectors talking about the impact of the coronavirus. I want to start with the german auto parts maker. They are exploring further cost cuts to make up for this impact. Time whent a critical the company is going through this restructuring program. This network expects Advertising Sales to drop. Companies are just not going to be spending on Advertising Campaigns finally. Jcdecaux is adjusting numbers for advertising. They say passengers have dropped from 14 million to 1. 5 million. Matt thanks very much. I will cover it something that she is usually all over, opec. Vienna,ing today in opec plus ministers are about to add into a second day of talks. The saudis are trying to justify deeper cuts. How closely are you watching oil . If we look at the end of last year, brent was spreading and we are down around 50. Drop and hasantial a Significant Impact on the economy of the middle east, which was more comfortable with oil at higher levels. That wenot surprise me are seeing the saudis talk about these cuts. In ising i am interested whether iran is going to be forced to cut because its economy is under the duress of the coronavirus and may not be able to get his workers to the refineries. Its workers to the refineries. Say, i have sympathy for the russian view that we need more evidence before we can say what type of cuts are needed. Anna what about the longerterm perspective . We were talking about yesterday haveg you havent been giving thoughts to what oil majors will look like. Do you see them as investments you can take with you . I think its quite tricky. Esg has absently not gone away. Some are saying it as a result of poor Global Corporate management, but if you are an or a company in the shale industry, realistically, are those the type of industries that are going to prosper . Believe thatd to there is going to be a Movement Towards these industries. They are toxic and we need to be moving into greener production. If we were to look at a 10 year , would i be investing in a Small Oil Company . Absolutely not. Matt the question is how far can we rally on deeper cuts. Those. Ot do think it would make a huge difference do you think it would make a huge difference . Bounce,ould temporarily but it comes back to whether we see more coronavirus problems in europe beyond the countries currently being affected. Emergency thatf has already been announced sit and makes it harder to produce and activity declines, oil could easily decline further. Anna chris ralph, thank you. Chris will continue the conversation on bloomberg radio. Ready tothe u. S. Gets join the easing cycle. We talk physical versus monetary in mitigating the coronavirus. We heard about a spending bill to the total of 8 billion. We talk about what europe could do on that front. This is bloomberg. Anna welcome back to the european open. Day. Nutes into a trading i am anna edwards in london alongside matt miller in berlin. Lets take a look at the story for stocks. Volatility has started out positive and we are, on many indexes, down. The stoxx 600 still looking at , but these indexes are all falling right now. In terms of the equity groups we see, financial services, food and beverage and Health Care Consumer staples are rising. Lots of defensive stocks as well as financial services. Basic resources are down but it was pointed out to me that the Biggest Companies there have gone ex dividend. Auto parts with this tire maker coming out with a disappointing outlook weighing on that sector and banks are down. Really a mixed trade today. To first word news with leighann gerrans. Over 3000 have died in china from the coronavirus and 52,000 have recovered or been released from hospital globally about the number of confirmed cases has reached 95,000 and the growth in inflections infections and south korea in south korea is slowing. Darkened andk has the imf says uncertainty will remain high. The lender is making 50 billion available to help countries hit by the virus. Countries to allow tap into Financial Resources immediately on emergency ground. For poorer countries, zero Interest Rates. The leaders of turkey and russia are meeting to smooth out relations. It comes amidst increased violence in russia. The countries have much greater economic ties they on in the past. In the u. S. , allies of Elizabeth Warren and Bernie Sanders are discovering joining forces. After a poor showing on super tuesday for the massachusetts senator yesterday. Michael bloomberg has pulled out the race, endorsing joe biden. Global news, 24 hours a day on air, on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Anna, matt . Anna thank you very much. About what the coronavirus is doing in terms of putting pressure on those who can act. Ecb president is under pressure to provide some form of relief, but researchers from the Central Bank Says the eu needs to adapt fiscal rules to a world where growth and Interest Rates are already low. Said they haveas come to an agreement to coordinate the responses and take appropriate fiscal action. Joining us is a chief fiscal economist. We have got a couple of things to talk about. Lets linger on the subject of fiscal stimulus. Some coordinated stimulus out of europe . We have seen the news from europe that the coordinated responses. They fell short of actual responses and they are on a wait and see mode. This side is one that could have more of an impact. Monetary policy is already quite low on ammunition there is pressure to act. Matt do you expect anything to come of that . Immediately after the fed call and then the next day. In europe, we still got a lot of wait and see from everybody in germany for sure. The fed action has certainly increased pressure on the ecb to act. We have to remember its slower decisionmaking. You have a lot of competing interests across the euro area. Effectiveness, there is a risk to engage in a titfortat with the fed. You have to remember the fed has more room to act. They cut again, the ecb cannot follow anymore. Justified lower Interest Rates if they do not follow. There is huge market pressure on it to do so. Rates are already low and we are already talking about being close to the reversal rate. It is about what targeted measures we can have. Terms of a targeted response, is it the big numbers that will make a difference or is it the detail in policy that we need to see . Example, having banks not foreclose on those who own money , cutting people from flats over things that are due over six months from now. Things where macro credentials can make a difference . Is about the type of measures you see. If you have tax cuts, thats not going to incentivize spending. You need are targeted measures to support liquidity to delay tax payments to the government and Government Spending could be very effective. Move in and fill the gap from private spending and aggregate demand. That could be very justified in these times when Interest Rates are already very low. Matt do you expect more coordination . Is that happening behind the scenes . Level, thereopean is definitely a lot of coordination junta the scenes. The ecb issue suggestions and policy advice. You have coordination from the National CentralBank Governor and we have seen the g7 finance ministers note as well. So it is a global issue and we see that coordination. As the last time we see banks moving in the same direction. Anna that me ask you about the annual index that has produced this gender balance. It sounds quite nice but is very highprofile. Trend . The general a lot of hearing progress in terms of women and the finance and economic sector. But in central banking, they are still a rarity. In most cases, it is small Central Banks that perform well in gender balance. Women in central banking are still very few. Withe asking Central Banks they do to support womens progression and why the sector is so bad. Anna but spain is doing well . Spain is the best performance and gets a score of 92 when 100 means perfect balance. It gets less than 100 because it has more women than men, one of only 12 in the worlds to have women. Towards with anna nice to see the index being applied on both sides. Coming up, we speak to Robert Kaplan at 10 30 p. M. It might require it might be a little late for some. You can watch it online. This is bloomberg. Matt welcome back to Bloomberg Markets europe. Session, wento the are seeing red arrows across the board. Live to the opec conference in vienna. Only a matter of toermination of this issue discuss and find a way to help the markets. Excuse me. Are you surprised by the amount of demand instruction . Its enormous. Is it serious . Ok. As you can see, that was one of those little moments here at opec that we get one of those magic moments, with very difficult to understand where we are with these negotiations. Iran is trying to destabilize the market. Some of these propositions to my guest, who has been very patient. Researchhe director of over at rapid and. Your first time on bloomberg and you get in the scrum. Societies are flooding 1. 5 Million Barrels of cuts and russians seem to be pushing back what does it take to stabilize . Opec really needs to cut 1. 5 Million Barrels to put a floor under prices. O balance floor under prices to balance. It may need to be more than that. Tell me what you think is going to happen to demand. We already thought Economic Growth was weaker than consensus expected. We expected to Million Barrels a day in the quarter. Olivia would be fully on but now they are off. It goes to show that the supply surplus is already happening before demand destruction. What is most disconcerting is we are still basing at 50. What does a 1. 2 million barrel cut of opec do to prices . It just gives us a floor. Until sentiment turns around and there is a clear peak, the onkets will be laser focused the latest news stories of how the coronavirus is impacting travel. All of this is negative for oil demand. Give me your numbers for global gdp. Were 7 trillion of gdp wrapped out wiped out. On 2 ofmand is based global gdp growth this year. Oecd has updated earlier this week. Its much lower than the 3. 1 expected at the beginning of this year. We have been warned that the to q1 and q4,urn which took them years to undo. Is that the biggest risk to this market . Driven by the surplus from opec. This time, we are focused on demand, and hopefully, it will be temporary and we will be able to return. I am always grateful for google. , kabuki opec plus. What is that . It is a type of japanese theater that is very overstated and exaggerated. To have thet russians are playing right now. What they want . What do they want . They want to be part of opec plus at have these positive relations. Theyre saying they only wants to extend the cuts as they are without cutting deeper. But ultimately, they will go along with it. Matt lets get the numbers out of the way. Saudis to have to cut . They will have to take the majority. Its probably closer to an additional 400,000 barrels a day, if not more. Do nigeria and iraq really have to step up to the plate . They do. Whether or not they completely followthrough is yet to be seen, but this could change sentiment and put a floor under prices. Well done. You see, you come to get interviewed by bloomberg, you end up in a scrum, then theres a fight at opec plus. I dont know how many more bum fights i can do about really. Matt its great to get some time there with the wildcat. I caution you to think about gloves and the mask when you go into that scrum. Hopefully, you all stay safe and healthy. Manus cranny is joining us live from vienna. One of the few conferences not to get canceled. Its interesting they went ahead with that. Up next, we bring you stock movers this morning, including the german burke. They are moving higher after they said the coronavirus fears would probably abate quarter. Next quarter. This is bloomberg. Matt welcome back to the european open. We are looking at drops across the board after gains at the open. The volatile session and mixed a trade as well. You have got interesting winners and losers. Lets get back over to annmarie hordern. Annmarie i want to start with hello fresh. Its a company in germany. They are replacing the midcap index. Upgraded to neutral by j. P. Morgan, thats pushing the stock higher. Merck up. Ave they said Coronavirus Impact will probably subside and they see strong organic growth pushing up shares of merck. To do with the new james bond movie being pushed back to november due to the coronavirus. That is really hitting sinema operators because it was going to be a big draw. Matt, anna . Anna does big events can make a difference. Londons bankers are preparing to flee the city amid the coronavirus outbreak. Goldman sachs is actively. Esting operations joining us now is our finance reporter, who has been tracking the story. I suppose lots of banks have these locations in case of Power Outages are all kinds of unforeseen circumstances what is the backstory here . They have these locations in place for stuff like hurricanes and cyberattacks this is something altogether different. Its threatening to be a pandemic at the banks are now pretty anxious about highspeed trading in global markets. They are considering a glamorous places in the city. Less glamorous places in the city. Matt is it going to be more difficult for these firms to get the trades that they want . Good question. London is obviously a major Global Financial center. It is home to 6. 6 trillion per day fx market. These are complicated im a fast markets. Goldman has said it is actively testing its systems as a potential move to shift trade. Anna what are regulators saying . Trading is a very closely regulated business. Calls are recorded and things you do are recorded and theres a lot of control about who can do what. Are regulators on board with all of this . Saidfinancial watchdog yesterday that they want them to carry on as they would. It does not mean they can slack up with compliance. They want systems to be recorded. Its times like this you may discover some kind of misconduct, potentially. Thanks for bringing us this developing story. Thats it for the european open. Stay with bloomberg tv. Matt, these European Equity markets are a bit of a conundrum. We are flat negative on docs, but u. S. Futures point downward. Matt you can encourage people to stay with television. I am going to encourage people to switch over to radio. Join me on london dab digital radio. This is bloomberg. Tv just keeps getting better. How you watch it does too. This is xfinity x1. Featuring the Emmy Awardwinning voice remote. Streaming Services Without changing passwords and input. Live sports with realtime stats and scores. Access to the most 4k content. And your movies and shows to go. The best tv experience is the best tv value. Xfinity x1. Simple. Easy. Awesome. Xfinity. The future of awesome. Anna the imf makes 50 billion available to fight the coronavirus. Disagreements in vienna prove elusive for opec plus delegates. Ministers look to counter the impacts of the virus. And airbus considers a Production Cut and United AirlinesTrims International flights by up to 20 . A warm