Executive later. Another busy day. A lot of people were talking about in the virtual newsroom that we have created around the world that we cant quite remember whether it is tuesday, wednesday, or thursday. A lot of the focus is on what your markets are doing. This is your data, euro area, april services pmi coming up at 12. The preliminary figure was a touch below that. That Services Data coming in at 12 instead of the preliminary 11. 7. That is a little bit better than expected. I am looking forward to the ofexecutive of com campari. Look at renminbi. President trump continuing to push the reopening of the economy and oil pretty much stalling. Treasury yields edging higher. We will have plenty more on that shortly. We will be speaking to the campari chief executive. Trump isent donald pushing to get the u. S. Economy to reopen. He says americans should begin returning to their everyday lives but he is also acknowledging it could lead to more suffering, including more deaths. Pres. Trump the people are going to accept it, they wont accept it, and they shouldnt accept it. This is the United States of america. Will some people be affected . Yes. Will some people be affected badly . Yes. But we have to get our country open. German factory orders for demand collapsed in march as measures to contain the coronavirus brought the economy to a standstill, as europes manufacturing powerhouse, germany has been particularly affected by factory closures. Support for the industry has been postponed until june. They European Central bank is defiant in the face of the German Court Ruling criticizing its bond buying program. It is pledging to continue to do everything necessary to revive inflation. In a statement, the ecb also noted that europes top Court Previously set its qe program is legal. The grim milestone adds pressure on the government, which is facing criticism for its pandemic. F the the british chambers of commerce says most businesses could reopen within days after the lockdown. Global news 24 hours a day, onair and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Francine . Francine thank you so much. Lets get to drinks maker cama pri, who has reported campari. Behindlian company also the very fashion aldrich fashionable drink. We are delighted to be joined by bob kunzeconcewitz, the chief executive of campari. Always great to catch up and have a conversation with you. When we look at the world economy, where we are, how much more pressure will mean for margins for campari and how much more in marketing we have to spend will you have to spend . Please hang up. Francine i think we have just lost bob, the chief executive of campari. We will get to him in a minute. A lot of the focus is on what we saw in shanghai. The stoxx in shanghai rose this morning. Chinese traders went back to work, came back online. Australian shares are falling. I dont know if we have data boards up. If we do, i will give you some of the market movements. Innas yuan also rising offshore trading. This is what you can do on the bloomberg terminal, is actually keep up to date with all the market action, even if you are working from home. The coronavirus pandemic has also forced of the European Union to take a hard look at the regions reliance on Global Supply chains. Yesterday, we had an exclusive conversation with phil hogan. Here he is. In the beginning, there was a a lot of Crisis Management and the temptation is to put up barriers and restrictions. We have to remove all those restrictions and return to an open, rulesbased approach. At the same time, im sure every country will be looking at the vulnerabilities in the context of this pandemic and look out they are vulnerable at this particular time in terms of medicine, pharmaceuticals, medical supplies. They will want to reshore some of this material and do local production. This is why we need, you know, some rethink in terms of what we should do in terms of working together. I have been reaching out to the United States, i have been reaching out to the wto members in the last few weeks to see how we Work Together to have more speedier recovery than perhaps if we were working individually. You have been talking to ambassador lighthizer and United States. One of your key jobs before the arrival of covid19 was to try to put the 2018 truce that Jeanclaude Juncker initiated back on track. What is the tone of the conversation you are having with washington right now . Is it amiable to making that happen . To putting the eu and u. S. Back on a level Playing Field or more even Playing Field . What kind of feedback are you getting back from washington . Over the last few weeks, people have been concentrating on trying to deal with saving peoples lives, both in the European Union and United States. We are expecting in the next few weeks to get back on track. The mandate that we have in the European Union is to negotiate with the American Administration based on the 2018 mandate. That still exists. We have been making some progress the early part of 20 20 and i am looking forward to reengage in with ambassador lighthizer and his team to make more progress in the coming weeks. You have visited d. C. Several times, commissioner hogan, during that time. The Sticking Point at that time was agriculture. Wanted agriculture on the table. Is it on the table potentially . We continue with the mandate of july 18. We have made some progress. Technology and Energy Issues are on the table, standards and conformity assessment in respect of Industrial Products in the future with the commerce secretary. There is a big agenda. Openmindede is an spirit to try to make some agreement here. I hope that the positive attitude of the European Union will continue to find good engagement in the diocese. I am very in the United States. I am very happy with the constructive conversations we have had in the early part of this year. And i are lighthizer certainly having a constructive conversation at the moment. You talked about vulnerabilities in supply chains, countries potentially looking inwards. How can you do both . How can you have a less globalized Global Economy and at the same time, cooperate with the United States and with the berries European Countries to have a with the various European Countries . Rulesbasedn open, approach, fair competition and fair rules that can be implemented by the reformed wto. We are doing a lot of deals around the world in free trade agreements. We have partners and 75 countries and we want to do more of them. At the same time, there are vulnerable sectors we have seen exposed during this pandemic, particularly in the health area. Equally, the production of medical supplies that are important and essential to citizens. I think both the European Union and United States see this issue now, that you cannot just depend on one geographic location in the world and we have to diversify. That does not mean we cannot do both. We can deal with the vulnerable sectors that are dependent in the context of a pandemic, but equally, we have to have an open, rulesbased approach for the entire economy. There, thehil hogan eu trade commissioner. Coming up, and great conversation with the campari chief executive. That is coming up next. This is bloomberg. Francine this is bloomberg surveillance. We were talking earlier about campari. Lets get straight to the chief executive of campari, bob kunzeconcewitz, to talk about the market and their latest acquisition. Congratulations on purchasing the champagne bread. Overall, brand. Overall, how do you see it playing out . Does it mean you will have to spend a lot more on marketing some of your products for consumption at home . Are you just weighing it out with pressure on margins . Well, we started the year very strong and then the lockdown happened in italy. In the last month so we did not have much of an opportunity to take our forward. Thing isencouraging strong consumer interest in demand for our products. We are seeing that. If you look at those markets, we are outperforming significantly. All of our brands actually outperformed in double digits. In large markets, where if you weeks, the first six market was up 38 . Atple digit growth rate campari. We quickly is shifted our marketing plan and everything shut down from offline, online. The results are paying off. We are seeing increased interest in our brand. We are doing a lot of on that. We have to spin around in a short amount of time and we have been able to do that. It does not mean we need to spend more. Activations in the arm permits and the offline have been canceled. Hand, where following developments on a weekly basis and we will decide on a weekly basis how and where francine bob, how much more will you be impacted in the second to Third Quarter given there is a little bit of lag . And when does it get better . How will this virus change the way you look at all of your brands . Is it the entrylevel brands that will see more pressure Going Forward . No, bob no, actually all of our brands are performing [ indiscernible] in markets like jamaica, italy, which are very skewed. On the other hand, in other , the strong is more than compensating for the weakness. Digital,ed it all to very different from engaging with consumers. The results are speaking for themselves. Francine i know you mentioned that, given, i guess the pressure at the moment in some of your rivals, this could be a moment for bigger deals. What kind of bigger deals would you like to do and acquire . I think there will be much more pressure with the markdowns and issues of the virus on small and mediumsized companies. I dont see much happening in the top tier of the industry. We will have to wait and see. Weve got access to 1. 9 billion euros of cash. If an opportunity should arise, [indiscernible] you can be sure that will not be the only deal we will do this year. Francine what happens in the next couple of years . Is it consolidation . Last time i spoke to you, we were talking about the trade war because of the u. S. And china. This could be back at the forefront. How do you see your supply chains being impacted . Weve had the virus, your first the first trade war. Are you much more noble now dealing with these shocks and disruptions nimble now dealing with these shocks and disruptions . Bob we are seeing consumers return to establishments. With rick established brands. With regards to trade tensions, etc. , we will take the case of , as you know, there is extra duties on italian imports in the u. S. We reflect that in pricing but our brands are still growing triple digits. If you have strong brands, you are able to patch over price increases. Going back to diversification, so you bought lallier, premium portfolio. Will there be more growth in the Premium Brands or will there be more of a mix . Overallare seeing Premium Brands doing quite well. It is the middle which is not doing that well. Since we are mostly skewed to clearly and upwards, people in these moments when they tend to go out and go to restaurants, they are treating themselves. Francine all right, bob, thank you so much as always. Bob is a delight to speak to, the chief executive of campari. Coming up, we will have plenty more on your markets, the possibility that m a is back at the end of 2020. We will also speak to novo nordisk, the chief executive, after they reported some pretty good figures. Diabetes segment impacted by covid19. That interview coming up shortly. This is bloomberg. Good morning, everyone. This is bloomberg surveillance. Im Francine Lacqua working from home. This is what the markets are doing. A lot of mocha its focused on marketing a lot of markets focused on the market movements. We had some figures in terms of pmi. This is what we are seeing overall. German factories not great, demand also in german factories fallen by the most since records began. This is, of course, for the month of march. Meanwhile, the ecb has also responded to that german constitutional court. Lets get straight to ludovic subran, chief economist at allianz. I have like a million questions and three minutes to ask those questions. What worries you the most . To the see an end lockdown with a pickup in the economy . Or are you worried this is it, that the european economy will be the most hit in the world . Ludovic i believe countries are affected in a similar way and europe has made good policy choices, especially when it comes to shortterm Employment Opportunities and the policy the ecb has done. I think other regions of the world are actually also at risk, thecially because containment wasnt strict enough. Some of the policy measures taken were not as good as it looks. Francine how damaging we will get to the u. S. And a second, but how damaging would be a second lockdown for the european economy . Ludovic i think pretty damaging because the relief measures we have seen have been pretty costly. It is preparing to transition into where we have set [audio drop] francine i think weve lost him. We will get back to him. We seem to be having technical difficult this difficulties this morning. This is what the markets are doing. Lets get straight to the markets. Eurodollar was the one we were watching out for yesterday on the back of the german concentration of courts. We heard from President Trump pivoting to phase two he was saying he wants to save the economy despite the risk of more deaths. Lets get back to your markets. And then we will get back to ludovic subran. Stocks in europe drifting. We had mixed corporate earnings, dismal economic data. Dollar pretty much steady, treasury yields edging higher. One thing we need to keep a bit of time on or look at a bit more in depth is china yuan. This is renminbi and offshore trading. It was rising. Yen reaching its strongest since midmarch. Look at anything to do with asia. West Texas Oil Prices also snapping five days of gains while emerging stocks rose for a second date. Coming up, we have a quick conversation with novo nordisk. We will ask about demand for diabetes drugs and what he sees and then a conversation with the chairman of rbs, sir howard davies. That is also coming up later. This is bloomberg. 49. 50 daddy, i found you good job. Now im gonna stay here and you go hide. Watch your favorites from anywhere in the house with the Xfinity Stream app. Free with your xfinity service. Now any room can be a tv room. Stream live tv, on demand shows and movies, even your dvr recordings. Download the Xfinity Stream app today to stream the entertainment you love. Francine this is bloomberg surveillance. In a moment we will get back to our guest. Lets get to new york city with first word news. Ritika disney has taken a 1. 4 billion hit from coronavirus and the worst may be at the co. , earnings plunged by more than half in the quarter. Giant parks are being pummeled particularly hard. A doubleeing hit with itw with the company said will not give guidance for the Second Quarter given the uncertainty caused by the pandemic. I tv is also canceling his 2019 dividend to conserve cash. One good sign, online viewing jumped 75 in the First Quarter. Bearing the brunt of airline cutbacks in the u. K. , Virgin Airlines is the latest carrier to back away from the u. K. s second busiest airport. It will shut our operations there temporarily. Gatwicks thirdlargest tenant, no region air shuttle, is fighting for a bailout, to relieve some of its heavy debt pile. Global news 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in i amthan 120 countries, ritika gupta. This is bloomberg. Francine . Francine we are getting data out of the u. K. , april construction pmi, actually, ugly number coming in at 8. 2 instead of 21. 7. That pma falling to 8. 2, single digit, and the forecast was 21. 7. I dont know whether it is having an impact on pound. It probably is. The focus on the bank of england tomorrow, a little bit different because the release will be at 7 00 a. M. Tomorrow, that we , alsofrom the chancellor about putting an end to furlough because he is worried that households will get addicted. Lets go back to our guest from allianz. Briefly on the u. K. , we heard from the chancellor that he is looking at possibly minimizing furlough time. Is this going to be a concern across the western world, that people will get addicted to this free money without working, or is it what is needed to make sure that the economy does not collapse, leading to a decade of misery . Move toss we as we the second phase of fighting the virus, a chronic or retracted crisis mode, most of the relief measures in place by government will have to be more conditioned and much more targeted. I think with u. K. s doing is being proactive, trying to make morend muchey targeted. U. K. s being proactive, trying to make sure that they go with to reopeningort especially restaurants, hotels, some of the transport sectors, and is the only way otherwise francine some are saying that this is very risky because it and theory ofer the ecb at a critical moment. How do you see this panning out . the ecb is a political instrument as much as the other policy measures. A sense we do in not know much. I personally believe that it is not going to be a big roadblock or for the ecb to continue to implement the new instrument, and the way the ecb buys government bond, i believe we cannot really see from the judgment that it seems to be an impediment. I think it is an issue for the National Bank of germany, but i dont believe this will be markets have not been fazed by the news. Area not going as they used to before crisis level. In a sense you have to do this because it is the only way we will protect the euro. We started the conversation come you said you were worried about some of the policies in the u. S. What specifically, and has that changed . Ludovic in the u. S. , the numbers look big, especially the headline numbers. Also when you look at what the fed has been announcing. In a sense you dont see these numbers in the pipes. S arest of the businesse fighting for banks are filing for bankruptcy already. Of what you see are better than the current gdp numbers. The fed has been buying mostly treasuries, bonds, corporate bonds, so they do have firepower, but in a sense i am worried that the Second Quarter will be much worse than the First Quarter data. So in essence the u. S. , even havemild confinement, we been impacted by the. Last two orom the three quarters, so i dont believe that number total days your nement the only worse off than the u. S. , worse off than another economy. I think there the efficacy of the policy will matter a lot and that could create uncertainty for the second half of 2020. Francine overall when you look at the composition of the economy, is there anything economists are underestimating . Is it the job losses the echo is it right to think about the number of job losses and when we can go back to the job creation that we saw only a year ago, or will the Global Economy just . Ludovic i guess for me, the jobs are an issue because trade is an issue for asia. The covid19 trade loss is equivalent to a return of the 1994 level of global trade, and these are jobs that will be very hard to recover and countries. In europe i think the shortterm unemployed schemes are protecting the relationship with employees, but the risk is that businesses go belly up because they cannot go much further once the relief measures have been wiped out. In the u. S. It is different, the choice to protect the ecb at every cost the question is, how much can you reenter. When i look at 2010, it is possible that the u. S. Can really curb unemployment. Of course we have these selections right in the middle. About jobs in the beginning of 2021. We can wait for the u. S. To recover fully. Will a change globalization . There is a possible second wave of trade war brewing between the u. S. And china. This could only be electoral rhetoric, but could it actually change the composition once again of how things are made with a more domestic focus, and but with that due to inflation . I guess what it can do is a massive devaluation. My concern is in the grand scheme of things, the effective global trade is contracting by as much as 25 with losses of 2. 5 trillion. We have not seen help to repair supply chains yet. The only thing that china will it is responding to with verycrisis, aggressive policies, remaining competitive when it comes to exports, so it will be a gain reducing. S. , dependence on china. In the first instance of this crisis, it is going to be very hard to make sure that we have enough goods for import if we do the manufacturing capacity that is already reopened in the southeast of asia. Francine do you worry more about sudden surges of inflation, or do you worry more about the debt that countries are creating . Mentionedou know, you. T could create inflation the other channel is of course the debt monetization. That creates my terry inflation that creates monetary inflation. Havethe unemployment, you increasing wage inflation. When you look at the numbers, these three channels of inflation are capped somehow by some of the entering through market, but also some of the measures Central Banks could debte to cap or to access 2022. Lation in 21 2021 the trade one, i am less worried about inflation. I think we could have a somerary overshoot, but people that compare the or 1918 ofith 1914 the last century, i dont think we will have hyperinflation we can see, what the mechanics of inflation and the drivers of inflation somehow you seeued because inflation asset prices, you see inflation in food. I am not worried, and i think we are all going to be great. That willamine make the job of Central Banks to exit accommodative Monetary Policy very hard. It is going to be a very what we sawget with in 2012 in europe. It is not much like the fantasized version of what inflation looks like. But it is a very difficult situation when it comes to debt, and i am less worried than average i would say. Francine thank you so much, ludovic subran. Ing up, the worlds august we will be talking with the chief executive of novo nordisk. That is coming up shortly, and this is bloomberg. Francine this is bloomberg surveillance. Lets get to the Bloomberg Business flash with ritika gupta in new york. Ritika hi, francine. Unicredit has posted a 2. 7 billion two point 7 billion euros loss. Business remained resilient in the First Quarter. It was the first big european back to bank to quantify coronavirus impact. Theriley is apologizing for companys past wrongdoings. In the story that brought down south koreas president. He has been entangled in allegations for years including a stint in jail. Latest hurdle for chief executive elon musk to collect the first chunk of a big reward to give musk access to stop doctors two stock to give musk access to stop auctions. That is the Bloomberg Business flash. Francine . Much,ne thank you so ritika gupta, with your business flash. They wonts biggest maker of insulin has reported sales growth of 16 in the First Quarter. Nordisk benefited as customers stocked up on medicine ahead of coronavirus lockdowns. Welcome larsto fruergaard jorgensen. What exactly is the impact that covid19 is having on the operation globally . We recorded 16 growth in sales, and the underlying growth is 7 before take out the covid19 related inventories. It is a 7 impact and 7 growth of our business which comes from across the businesses. As a Strong Performance in the First Quarter. That is a Strong Performance in the First Quarter. Francine has the company been forced to stop Clinical Trials or delay them . Tos no, we have been able do Clinical Trials. Programs are revving up, unimpacted. Longer lasting trials that are harder to recruit patients, so there will probably be a delay, and then we decided not to start any new Clinical Trials, so we are not stressing the Health Care Sector more than it is already. Francine can you give us a little bit of an update on how the virus is impacting patients thatdiabetes and obesity use your drugs . Lars we know from some of the data that comes out with the countries that have the heaviest impact from covid19, that particularly Patients Living with diabetes and obesity are at higher risk, though if you have a cardiovascular system that is under pressure, you have probably inflammation ongoing already, and when you are on top situation, covid19 it stresses the whole system. If we have to live in a world with more frequent virus pandemics, they will be focused on preventing diabetes and obesity in making sure that patients are wellcontrolled because these individuals are at higher risk than anyone else during outbreaks what we see today. , forine does it mean that example, diabetes has to be treated earlier, that we need to find it earlier, or that they need to use more drugs . Are ofe know that if you type one diabetes, that cannot be prevented. But type two diabetes is a lifestyle related to disease. It is possible to prevent some of these cases by changing lifestyle. We have worked around the world in a program, looking at the leading causes of type two diabetes and obesity and how we can reverse that. Obviously treating obesity is also a way to prevent type two diabetes because obesity is a leading cause of type two diabetes. And besides lifestyle changes, our medical interventions that can help prevent developing diabetes, type two diabetes because of obesity. Actually, we have this year a Large Program on obesity reading out. Francine sorry, finisher thought. Lars so this year we have a large phase three program where we are testing out a molecule that is being developed for obesity treatment, and we can see that when people get on these products they lose weight and thereby you also prevent cases of type two diabetes. How is novo nordisk contribute into the fight to end this pandemic . Not as a company, we are active in vaccines, so people should not expect a vaccine coming from novo nordisk. But we are trying to make sure that People Living with diabetes and relying on insulin have access to it. In the u. S. We have launched a program where if you lose your job come if you lose your health insurance, you can get access to free access to insulin for 90 days. We collaborate with a number of humanitarian organizations. We have also donated free insulin and transportation of that because transportation is becoming quite expensive. Across the world we have different initiatives in countries like denmark, where we are using our laboratories to test for covid19, so we are testing up to 6000 people every day for covid19 symptoms. So we have a broad and important responsibility to focus on in these difficult times. Can you also update me on m a . We have been trying to figure out whether this is an industry where we could see m a flurry in 2020 because of valuation and things like that, or do you think everything will be on hold for a while . See thathink you will it is becoming recently difficult for smaller biotechs matters, so test there might be a larger interest from some companies partnering larger companies, and we have a strong balance sheet. We have cash to transact. Good programs are still expensive because there are more Companies Looking for getting highquality. Nothing comes cheap, but there might be a higher interest in doing deals right now. Our strategy is unchanged, but we probably will see a higher willingness to discuss changes. Chances. Francine Lars Fruergaard jorgensen is the ceo of novo nordisk. We look at what most of the big hedge funds in london and elsewhere have to do with covid19. We discussed some of the biggest rebounds after a pretty tough First Quarter. That is coming up shortly, and this is bloomberg. Francine this is bloomberg surveillance. After a pretty dismal First Quarter, hedge funds returns have sprung back to life. Managers have gained on average 2. 8 in april. With a full round up of the story, less go to dani burger. The when we look at entirety of the Hedge Fund Universe last month, anyone who did well was long stocks, not surprising considering what the u. S. Stock markets and Global Stock Markets did back in april. That means funds like bill ackman, pershing square, took their daily total to 17 . Some Equity Managers still did not beat out the 13 gains we saw in u. S. Stocks, including ultraglobal as well as fund which was up about 9 in the month. Francine, the best since 2009. Strategy,ross multi citadel returning 4 , but for most strategy investors who invested across assets, it is more difficult of a prospect considering the fact that they also had to contend with negative oil prices out one point, weaker. That is why those returns do not look as strong. It is another market upheaval that these managers are having to deal with, though not necessarily the same upheaval as the First Quarter, slumping into a bear market, francine. Francine thank you so much, danny merke dani burger lookinge hedge funds. Up next, we talk with hedge fund chair howard davies. We will talk about banks and what we are seeing out of there. Spent a little of time looking at renminbi. This what i am seeing overall for renminbi. There has been a little bit of an upswing or volatility there. Tomorrow we have the bank of england, so we could see a movement in sterling, and tomorrow we also have the latest projections on when the lockdown in the u. K. Could end. This is bloomberg. Francine phase 2 President Trump intensifies his push to reopen the country, saying americans should begin returning to their everyday lives, even if it leads to more sickness and death. The ecb stands by its inflation mandate after a German Court Ruling on its qe program. Bond investors express concern about the Central Banks stimulus. And sales surge at novo nordisk as patients snap up diabetes medication ahead of the lockdowns. The chief executive tells us about stockpiling. Well, good morning, good afternoon, good evening, everyone. This is bloomberg surveillance. As always, tom and francine, as always, working from home. There has been movement offshore , having to do with trade tensions between the u. S. And china. Still trying to figure out exactly means for the ecb, whether it is positive because they can adjust in or make something out of it, or whether it is the beginning of trouble some things ahead when it comes to possibly the pep program as well. Tomorrow we look at the bank of england