Because gold is rallying. Strengthen,inues to and treasuries continue to see their yields drop. The 10 year at 93 basis points right now. Guy we are moving pretty strongly here in europe. What a week it has been. Today we are definitely down when it comes to european equities. Seeings of what we are on the bond market, we see a bit attached to bonds. Not as aggressive as in the united states, which is worth bearing in mind. At the moment, the u. S. 10 year is down by two basis points. Nevertheless, we are 68. There seems to be some feeling that the russians wont sign up. Weve got a u. S. 10 year yielding 93 basis points. Things are moving pretty fast around here, and the words of ferris buehler. Economic activity is definitely slowing, so what comes next . Peter kinsella joins us now onsite in london. What do you make of these markets . Peter what is interesting is that youve got a combination of Global Demand shock, Global Supply shock, central Bank Reaction functions, and risky assets plummeting around the world. Safe haven assets doing very well. I think that is set to continue. It is definitely the longawaited increase in volatility that is finally here. Space, staythe fx long the yen, stay long swiss franc. You can benefit from further gold upside. From what we have seen from the fed to come of this is pretty much the end of the dollar bull market. Vonnie wait a second, that is a big thing to say. Are you suggesting the dollar weakens from here . We are seeing so much demand for treasuries. Peter weve got to think about what the likely reaction functions are. Weve seen the fed cut by 50 basis points. If you look at what futures are pricing in, looking like another 50 basis points of cuts by june or by the end of the summer. The one reason we had to buy the dollar and the last number of of the greatause advantage, and that is clearly evaporating. There is the possibility of a dollar funding squeeze. Theres an awful lot of short dollar positions out there. If the fed stops where it is doing rate cuts and doesnt increase swap lines and or asset purchases, that could lead to a dollar funding squeeze, but absent that, it is pretty clear that the one advantage the dollar has is now crumbling, and consequently, i think we are going to see consistent dollar weakness from here on in. Guy for those watching in the united states, a little bit earlier on, they may have seen the fact that italy is coming out with a stimulus package. What is the picture going to be like here . The fed is taking the lead at the moment, trying to cut rates. The ecb has less ammunition. Does fiscal policy finally kick in here in europe . What are the locations in your world for that . Peter the states does benefit havingis combination of very quick and effective decisionmaking. That is clearly not the case in the euro zone. What we are leslie to see from the ecb, and my view, i dont necessarily think another deposit rate cut will be stimulus. It just kills bank profitability. Butight see another tltro, do the banks really need it . I would say no. Theyve run out of policy route. We need europeans on the fiscal side to do more, but saying that and doing that are different things. Guy how does europe keep the euro lower . Peter they cant. Its bad news, and it is precisely what they dont need. ,rom the ecb perspective appreciation of the euro leads to a tightening in financial conditions. That is precisely what they dont want. But if the dollar weakens materially as i suspect, theres not an awful lot the ecb can do about it. Vonnie i am still on this dollar weakening thing, though. Andhe fed continues to cut, for every example we have of emergency cuts in the last 25 years or so, the following meeting saw another cut, so it is at least a little bit likely we will see another cut. If the fed cuts, Central Banks around the world are cutting, and the u. S. Consumer is still strong, i still dont see why the dollar should we can should weaken. Peter what we know is the likes of the boj, the ecb, even the bank to an extent have run out of policy road. If we look at the dollar and the fed come of the fed is the only centralbank which can still weaken policy, still reduce rates from current levels down to even 0. 25 if necessary. Ofwe see continued loosening auditory policy, the corroboration of that is a stronger dollar. Given the fact that other Central Banks cant loosen policy at all, it does stand to reason that the dollar can we can from here. Bear in mind, the dollar does traded very elevated levels in valuation terms. So what would it take for the dollar to appreciate from current levels . It is a totally different story. For me, the only reason the dollar would appreciate in an aggressive manner is if we see an incredibly large increase in risk aversion akin to what we saw in 2008. Vonnie u. S. Equities are lower. They have been lower for six straight sessions. We are seeing 2 down, to percent up. Is this the sump is this something the market gets over . Four soon as we have proper diagnostics . Peter i would say that the bull run is definitely on ice. It is pretty clear we are going to get at best flat Earnings Growth this year, if not even negative Earnings Growth. So theres no reason for an equity bull run, which is already extensively priced to resume. On that basis, it is very early days, and premature to say we should see a kind of getting back to normal. The second point regards the data outlook. Periodgoing to be in a for at least the next four to six weeks where data and asia and the euro zone is going to be awful. It is going to be very hard to see how one contains a constructive picture. For me, it is very defensively advise my, as i would clients to be defensively positioned from here. It would be hard to see good news for the next four to six weeks. Guy we spoke to the former ecb president a little earlier on. Lets take a quick listen to what he had to say. Each central bank has its own responsibility, its own law on legislation, so there is no general rule to apply to everybody. That is one of the problems of governance in europe, as well as in the world. Recommendations are not the same for all. Coordinated do you think any action is going to ultimately end up being . At the moment, it feels very uncoordinated. Whate still waiting to see the ecb does. The bank of england, who knows . A governor coming in, a budget coming up as well. It is coordinated if it is coordinated, will it be more effective . Peter the first point, the answer is no. They are all going to same direction, but they are not doing so at the same time. It is the same destination from different starting points. If it is a demand shot, yes. If it is a supply shock, no. Some had money to spend, and others dont. What you find in the euro zone is the governments who have money dont want to spend it, and the governments that dont have money do want to spend it. We continue with this paradigm of euros in fiscal policy. It is basically nonexistent. Advise so what did you clients to do in this environment . Moment, we have taken a pretty defensive stance coming into this risk aversion. We are certainly advising clients to maintain long gold positions. We are positioned well on equities, and that saved us from some of the significant down moves. At the moment from here, we are still buying some tail Risk Protection. If we see upside in gold, we would like to have some tail Risk Protection there. On the equities side, it is a question of scaling into equity loss, but we can only really do picture ande data valuations picture becomes a bit clear. , it is moment maintaining a broadly defensive posture. We think that has served us quite well in the last two or three weeks, and will continue to do so. Guy stick around, peter. We will get more conversations in a few minutes. Either kinsella joining us from union bank rivera. Vonnie lets get a check on the markets with kailey leinz. Kailey wild swings in the equity market are continuing today to the downside as investors have renewed fears about the coronavirus, seemingly putting the bears in charge. We switched directions every single day so far this week. The scene in europe is not as bad as in the u. S. 1. 4 , while the dow and s p 500 are down by roughly 2 . Of course, it is hard to be fazed by 2 moves at this point. The s p 500 has moved plus or minus 2 or more in six of the past nine sessions. It is showing that volatility is back in a big way. If you take a look at gtv and look at the average volatility for the past 10 days, it has spiked to the highest level we have seen since all the way back in 2011, surpassing what we saw in 2018, the most since back when the s p cut its Credit Rating on the u. S. For where we are seeing big moves within the ethically market today within the equity market today, one of the groups down the most is airlines. United and jetblue trimming their flights because of the demand impact of the coronavirus. Those stocks are down by roughly 8 each. Of course, you have Southwest Airlines cutting its revenue forecast. That stuck down by nearly 4 . An analyst at bernstein cutting his price target on a number of u. S. Carriers, again because of the virus. American airlines was one of them, down by nearly 9 now. Also downgraded at bank of america. Plus, you have the association for Global Airlines saying they face a 113 billion hit potentially because a passenger slow down. We also have to Pay Attention to the bond market because we are seeing very dramatic moves there as well. The u. S. 10 year yield down by another 12 basis points today. If you take market, youe bond are seeing the twostens curve steepen, signaling investors are expecting some more coming from the fed. Vonnie thank you. A programming reminder, later today we are speaking with della said president robert kaplan. That is at 5 30 eastern time. Meanwhile, stay tuned to Bloomberg Markets. We will have the hp ceo to talk this iraqs deal leader this hour to talk of the xerox deal later this hour. 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, ritika gupta. Massachusetts senator Elizabeth Warren is dropping out of the president ial race, according to several media reports. Her past to the nomination has been narrowing since the first round of voting in iowa, where she placed third. In subsequent contests in New Hampshire and nevada, she dropped down to force. In south carolina, she came in a distant fifth. On super tuesday, she failed to win any states. Rates for 30 year u. S. Mortgages tumbled to the lowest on record, according to freddie mac. The average rate is a little under 3. 3 , down from more than 3. 5 last week. Investors have been rushing to treasuries because of concern about the impact of the coronavirus. The Trump Administration wont beat its timeline to roll out coronavirus tests, according to centers briefed by health officials. By the end of the week, the government hoped to have a million tests ready. Opec is taking a big gamble on russia. Oil ministers from the cartel have agreed that production should be cut by 1. 5 Million Barrels a day to offset the huge demand hit from the coronavirus outbreak. Opec bets it can overcome opposition from russia that would block the move. Moscow prefers to maintain current production levels. 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 for that. Still with us is peter kinsella, ubp global head of fx strategy. If your to the emerging markets, obviously there is smart money looking to the emerging markets for opportunity now. What does that mean for stability in their currencies, both pegged and unpaid, Going Forward and unpegged, Going Forward . Peter typically speaking, once we saw the fed cutting rates and indicating that more will come, this is traditionally seen as being a great opportunity to buy likes oft long em, the the russian ruble, mexican peso, turkish lira. However, that was before. During a period of much higher volatility, it is not really a good idea to get into long carry trades. I would not be inclined to get into systematic carry trades at this point. I still think the likes of the russian ruble and the peso will do well. I like the real yield profile. I liked the current accounts in good shape. I like that the domestic politics arent crazy. Apart from that, i certainly dislike brazil quite a lot. It doesnt look good to me on it only metric i look at, so wont do particularly well. Interestingly, i think the timing is looking a bit more. Nteresting for chinese yuan it does seem as though the government, what the government mothers have undertaken, they certainly seem to be successful in containing the spread of the virus government measures have undertaken, they certainly seem to be successful in containing the spread of the virus. The u. S. Treasury gilding roughly 0. 9 , a bit of a nobrainer to sell dollarcnh. That is one trait i think will be reasonably well over the coming weeks and months. But they are very selective trades. The aggregate buying is not going to work. Youve got to be very selective. Cnh is at 6. 93 and change. What about the oil trade . If russia agrees to this 1. 5 million barrel cut, are you putting on any positions to try to take advantage of that . Do correlations between commodities, currencies, and oil stay closely aligned, or does this centralbank action make that a moot point . Peter i think theres basically three moving parts to the trade. The first is what the dollar is doing. If we see the dollar depreciate anymore material manner, that is normally good news for commodities and commodity currencies. On that basis, looking at what the fed has done and what they are likely to do, that is good news for the ruble. The second point comes to the production cut. If russia agrees to the proposal of nearly 1. 5 Million Barrels per day, we would think that is a reasonably constructive environment for oil, and indeed for broader ruble appreciation. The one thing to note is that the central bank of russia has indicated his is going to cut rates again, and with a lower oil price, that does risk lower inflation dynamics in russia and elsewhere. The committee possibility of further rate cuts from russia later in the year if the central bank deems it necessary. Me, we are not really at levels which are very compelling for ruble positions. Ruble at 70,ar i would be very interested. We are getting close to levels that look interesting. We are just not quite there yet. Guy foreignexchange, low volatility was there for a long time. We are getting a bounce. Do you think we go back to the low volatility era once weve dealt with the coronavirus . Peter no. The euro was considered a dog of the currencies the last year and a half or so. There has been a slide in eurodollar flipping a position in higher carry in the states, and also this low vol. That carry is no longer there, and we have seen an increase in vol. But we are likely to find going that corporates now have a much lower cost of hedging. Consequently, they can look at hedging revenues a bit back toward zero or other currencies more, and lead to an increase in activity and possibly in vol. Guy whats the funding currency in that environment . Peter it would gradually shift towards the dollar. If you think of what the fed does, it will cut rates again, possibly go for qe, and we saw what happened the last time the fed did qe. Guy we will leave it there. Peter, always nice to see you. Peter kinsella joining us from heon bancaire privee, where is the global head of foreignexchange. This is bloomberg. Guy live from london, im guy johnson. Vonnie from new york, im vonnie quinn. This is the rp and close on Bloomberg Markets the european close on Bloomberg Markets. The nasdaq performing the best today, but still down 1. 3 . This is the sixth down by 2 day , so we will see how we progress throughout the coming hours. The vix is up around 35, the 97, and the around yield is down to 0. 9376 . No let up on those lower yields. Guy in terms of the picture 600 aere, the stoxx little bit more on the story here in europe. Nevertheless, we are off session lows. We are down by 1. 6 , 1. 5 for the dax, cac 40 down by 1. 8 . In terms of some of the biggest losses, you are seeing city world you are seeing cineworld down, responding to the bond movie and suspicions we could see further movies being postponed as well as a result of people not thing to go to the cinema right now. European close is next. This is bloomberg. Guy 30 seconds until the end of regular trading in europe. European equities are back to bright red. We are down 1. 5 . Terms of the way the market is set up, it is even more defensive than the 30,000 view looks like. Way zoloft from the getgo we sold off from the get go. The s p asian was looking back. We moved lower. To be honest we had our lows about an hour and a half ago. We are a little bit off the lows. On the stoxx 600 down 1. 3 . You have a five to one ratio of losers versus gainers. Lets talk about the individual markets. 1. 5, the tax a little less , the cac 40 is the big loser. This is the interesting bit. I want to break it down from the sector point of view. This is where you can tell what is happening. What you are seeing is the defensives, the bond proxies having a better day. You are seeing a better day. Food and beverages, these are the nestle of this world, the higher rated bond proxy names. Food and beverage down 1. 5 , the Health Care Sector down. 5 , telecom, utilities, real estate, the defensive or bond proxy low volatility kind of stocks doing better today, between 1 and. 5 off. The bottom end of the market is negative. Lets take a look at what is happening. 4. 2 , the travel and leisure sector, the airlines, the cruise operators, the hotel company, they are down 2. 7 . Down 2. 7 . Anks will be talking about the banks in a moment. Down by 20 . Ading that is the bear market. For that story on the sectors, lets show you individual names. There are gruesome ones. At one point today we were down to levels we have not seen on this stock since 1988. It has cut a load of targets the marketasically is signaling that will life will get tougher from here and probably more to come. The stock is down 37 . Cineworld. They postponed the bond movie yesterday. There is suspicion more movies will get postponed. Right now you do not want to sit next so somebody in a cinema. Orld down 12. 64 . And continental down 14. 38 . Chain storyg supply out of germany. Trading at 84. 35. Top stories today in this market. More broadly, defensives, bond proxies having a better day. Those kinds of companies exposed to the public economy having a much worse day. That is the european close. Vonnie we have a new bond villain, but maybe not the one we were preparing for. Statescheck in United Senate shows the s p 500 with a volatile mornings behind us. We are now down 1. 8 . Still plenty of churn across the indices. There is no into see higher today. The 10 year yield. We are down at 94 or thereabouts and staying around there. Got into it just in the overnight session alone. An analyst pointing out there have been flows around various points. Once we went through 1 , it was at 98 basis points, 96 basis points. It seems like we might have another one forming today. Below 1. 07 and gold is higher, holding onto its gains. One of the less volatile Asset Classes today. Lets move into the s p 500 and see what is moving there. Imagine those are higher , including clorox and kroger, including all the stayathome stocks, including netflix. Humana, you can also see higher with the coronavirus and the possibility of a not Bernie Sanders candidacy. Lets look at the lower side of things and see what is down. Royal caribbean losing another 13 . Marathon petroleum is an idiosyncratic story related to coronavirus. Not as interested and pulling out of the deal to buy the Marathon Petroleum stations in the united states, partly because of coronavirus. It is everywhere. Guy it certainly seems to be. Bank stocks back in the bear market. The sector being hit by a range of factors, certainly the recent Economic Activity slowing due to the virus. Could there be more bad news to come . The ecb looking to take action. Could that mean cutting rates further into negative territory . Do they need more tltros as well . Joining us is bloombergs marcus ashworth. We are in a bear market. Marcus we are. We were always in a bear market, we had a bear market rally which has ended. ,e saw Deutsche Bank recover almost getting close to double figures, but no, as far as a share price. In that sense, what is the upside for european banks . They are looking in the face of recession, almost certainly in italy, germany, and quite likely france. Spain has lost its mojo. It is not their own fault this time, but the reality is that loan growth, which was falling tltro, so how can a which the ecb can offer have terms to take free money and then going to about two a lovely corporate client. The corporates do not want to borrow and the banks do not want to lend, particularly not looking forward to the next six months to nine months. Trading and overall commercial activity and their Investment Banking operations, everything all at once if youre looking straight down. They have been hit with the ugly stick very hard. Vonnie i want to say as soon as the coronavirus thing is behind us, who knows when that will be, but once we get back to the old concerns we had, we do not know whether Central Banks are in time to raise or lower. The bank of england has said that. It is not necessarily judgment day yet for the european bank. The European Central bank comes up with Something Else . Marcus judgment day . Im afraid judgment day has been coming for a while. Slightly emotive with the headline, looking into the abyss , the reality is that what can the ecb do . This is not a central banking magic wand it can waive because they cut interest rates, it makes it worse for banks. It might help a few stocks but it will not help banking stocks. They can do tearing, which is a rate hike. They can offer cheaper terms if they want people to fill their loan Balance Sheet, but as i mentioned before, why would people do that and wheres the demand . Banks. N help finance the reality is you can help buy equity, but that is so far away from what the central bank wants to do. The point here is reaction mechanism. They cannot react quickly enough. They should be proactive. They will do anything to keep the swiss franc where they want it. Has itsity is europe own box it has put itself in. Guy we will leave it there. Thank you for stopping by. Bloomberg opinions marcus ashworth. Vonnie lets turn to vienna. Opec has agreed to a huge cut, members agreeing to slash production by 1. 5 Million Barrels a day to offset the demand hit from the coronavirus. From goldmancurrie sachs told us opec should have acted sooner. I would argue that regardless of the size it is too little, too late. The forward curve is already pricing in that inventory built. To buildey mitigate inventories toward the end of this year. I think the Downside Risk is still there. With the rentable basis. Vonnie joining us from vienna is manus cranley. Can opec force russia to comply . Is a higha word, it risk road. They put the 1. 5 Million Barrels on the table. There are negotiations going on right now. There are negotiations going on around this time. You can be sure there is for societies on with other intermediaries going on. What if the russians do not come on board with the size and the scale we think. , which ifn for opec we apply the traditional methodology, one portion of the additional half a Million Barrels is pressure prepared to additional half a Million Barrels is pressure prepared to do . The iranian minister who is staying here along with the nigerian minister, along with the uae minister in the venezuelan minister, it is popular, but it is not in budget for me. They are all in there. The russians arrive tomorrow. This means the pressure that has been exerted by opec is high risk. What is it Vladimir Putin is prepared to do to help the saudis and themselves . This is a high risk player. I think tomorrow it will be short stock or it will be a long day. Vonnie . You let me just quickly ask , saudi aramco has delayed pricing. We have not seen this for a long time. We will probably not get it until the weekend. Is the oil market incomplete confusion . Saudis are not pricing crude in the way they normally do. Manus this is a new paradigm. The aramco last year was a private company. Here we are in the public domain. A very different set of issues. If i have said to you before christmas there would be 3. 6 Million Barrels of oil, 3. 6 Million Barrels of oil off the market by now, we would have a very different reaction function. I think the market is in a bit of a tailspin. The headlines have piled up about europe and italy and jersey at the moment. I do not think anybody really has a clue in regards to coronavirus. Vonnie thank you so much. Manus cranny in vienna. We will be back with him tomorrow and following every opec move between now and then. For more on the markets, lets bring in bloombergs dave wilson. It is important to have a look at what has really been going on all week. We have a huge amount of volatility that continues today. It is important to not get complacent. Where our markets and what is the consensus view . Dave you have a market that has come off its lows, but you talk about volatility. This weeks percentage moves in the s p 500 on a daily basis. Take out the down so it is not an absolute level. Youve not seen volatility like we have seen this week since december 2008, the middle of a bear market. It just goes to show you how difficult it is for people to try to figure out what the appropriate prices are for stocks as the coronavirus spreads, as the democratic president ial primary process works its way out, people exit and you get endorsements. There are a lot of moving parts. It is really showing up in the daytoday fluctuations. Is this annie sensible. We are seeing kroger and netflix being the panicked stops in this market going higher . Is that sensible . David the direction is sensible. The magnitude is always the question. The airlines, the cruise lines, the hotel chains, the Online Booking companies, that makes perfect sense. People are not traveling the way they were even a few weeks ago. Does that mean the stops deserve to fall as much as they have . That is the sort of thing investors have to work through. You can say that with a lot of other stocks. Does kroger deserve to be up 7 . There you go. Vonnie bloombergs dave wilson with some context. Guy lets look at where european stocks have settled. The cac 40 down 1. 5 . Of earlier lows but certainly another negative session in europe. In terms of where we have seen the damage done, it has been in the mining sector. We continue to focus on that sector. We have also seen the auto sector continue to come down. Ver on the cac 40, down 1. 9 the selling continuing. Yesterday feels like an anomaly, political driven anomaly. We will carry on the coverage at the top of the hour and we will do so on bloomberg radio, on dab Digital Radio in the london area, and around the world and all of your bloomberg devices. Jonathan ferro will be new york, i will be joining him in london for the cable show. This is bloomberg. Guy from london, im guy johnson. Vonnie from new york, i am vonnie quinn. This is the european close on Bloomberg Markets. Hp has rejected at takeover offer from xerox, saying it undervalues hp. Bloombergs ed hammond is with us now with the ceo. i am joined by the hp ceo. As bonnie said, youve just rejected another offer from xerox. It feels like this is a recurring theme. What will it take to get hp to reject an offer . Rejected the offer because it undervalues the company and creates a risky Balance Sheet, and third because very high synergies that are unrealistic to validate the deal. Goodve rejected the offer because we do not see a key value for our shareholders. Ed one of your complaints about xeroxs there a company that is in potential and potentially even terminal decline in terms of their own business. How can you be confident of that without having conducted Due Diligence . Can see the evolution of the company and see a clear negative trend. The best way to do that is to understand the total contract values. This will be a key piece of information. Ed one might see that number and put the offer on the table. We need to address the Value Exchange of the companies is right. We need to do whatever the combination is, the capital structure needs to make sense for the business that this company is driving, and third it needs to be realistic. This is a conversation we need discussion of any a combination will happen. In terms of the pure logic of a combination, the printing business is a part of hp. Do you see longterm it would make more sense to combine with xerox so you have an expanded platform . Enrique i have said we see logic in driving consultation in the premarket. We bought the samsung printing business. There is an opportunity there. It will of been the First Company driving we took a company losing money, and it also helped us to grow into spaces. We have seen consolidation mix in and we are open to explore that opportunity. Ed you came into the ceo here in november. Youve been it hp most of your career. 30 years. Immediately you find yourself in a hostile situation. You have xerox and carlisle on one side, you and your company on the other. What have you learned from this . Enrique the key thing is the importance of being focused. The key thing we have been driving in the company. I need to make sure we continue driving the business forward. We need to keep our connection to our customers making progress , and the returns we have had in q1 show the abilities we have had to stay focused and continue to make progress. Ed that is an interesting thing because we are so focused on the potential deal that a lot of the times we lose sight of the fact that you are running significant companies, many employees around the world. That switch onto what is going on. The coronavirus is a huge story for all businesses. How is it affecting hp . Enrique hp is a big company and we have many parts of the company that are not affected. We have said the coronavirus is having an impact on our overall business, only on the manufacturing side. Years, thee new manufacturing in china was lower. We are recovering. We said this would have a temporary impact in q2, but we expect a recovery in q3. Ed apple came out yesterday and warned some of the products used for their equipment will be slower, will be harder to achieve Going Forward because of the virus. As that summing hp is also experiencing . Enrique we said last week it will have an impact with our ability to manufacture products. What we have seen is making the plan we have had an going factory by factory and what will be the ability to manufacture products. Also we need to accept the situation is fluid and every day we get new news about what is going on. Ed beyond the fight with xerox, youve been in this job not very long and have a vision for where you want to take the company, where you want to see hp going . Enrique i am very confident on the future of this company. We presented our plan a week ago when we showed the ability we have had to create value for our customers. It is driven by three things. First, the ability we have to reduce our cost structure to be more efficient. The value we will get from our business and continue to grow our value and create new businesses and also by using our Balance Sheet to create value for our shareholders. We have great focus of growth in the company led by innovation, like gaming, like a into services that we see will position the company and a much stronger way three years from now. Ed topped me about the Balance Sheet. Youre returning a lot of money to shareholders. Could you not use that money more effectively in m a . Enrique what we have set as we have a plan to return to our shareholders 16 billion, which is 50 of our market cap. We see that this makes sense to do because we think the hp shares is undervalued, and when your share is undervalued, it is a great way to cut value for your shareholders. Lauret, ae fascinating tale. We turn it back to you. Guy ed hammond, thank you were much indeed. Lets turn to the Global Airlines industry, which is being hit hard the coronavirus. U. S. Ceos working with washington, trying to help counter the outbreak. Kevin cirilli spoke with a key official in the u. S. State department. We will continue to have to keep the pressure on the chinese. The white house has indicated, especially the cdc and the people on the ground have indicated they are working closely with them. We certainly were explicit that the chinese were not as transparent as the international compute community had hoped for. The cooperation has been better in recent days. What the president said, i will get on a plane tonight. I will take a few days off. I am more than happy to do so. One of the thing your viewers should Pay Attention to his we are closely monitoring any countries overseas. We have raised the travel advisory warning if we think there is a threat to americans as it relates to prone a or anything else. We have issued warnings on italy or south korea and japan. If americans are concerned about traveling abroad, they can go to state. Gov and get detailed information about that. That was u. S. State Department Spokesperson morgan ortagus. Lets get to kailey leinz for a market check. Kailey it is hard to be phased by the news. This is the seventh of nine sessions we have seen the s p move plus or 2 or more. Sing investors struggle for direction amid fears of the coronavirus. We are seeing the most pressure in the travels, transports and the airlines lower, as well as cruise lines like carnival. That is weighing on loyal caribbean as well. You also see moves in the bond market. The u. S. 10 year down between 12 and 13 basis points. Just 93 basis points on the yield. In 2020. Ly 100 points vonnie i assume youll be working hard for the rest of the day as you have been for the rest of the week. Coming up, we have balance of power with david westin on Bloomberg Television and radio. He will be looking at the dropping out of Elizabeth Warren from the democratic nominee race. 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. On the brief today, Kevin Cirilli in washington on Elizabeth Warren dropping out of the president ial race. Neil armstrong in new york on the spread of the crown of virus and the rollout, and annmarie cutern on opecs gamble to russian support. An important of Elizabeth Warren out of the race. Unclear who she will endorse and where her supporters will go. With her out of the race it becomes a race between Bernie Sanders and joe biden. The map looks increasingly like it would be more of a positive for joe biden as we head into the next round of states that are going to vote in more than a week. That being