Global infections exceed 30 million. Saudi oil minister says, make my day, and a warning, he says whoever gambles in this market will be ouching like hell. Good morning. 6 00 a. M. In london. We have breaking news, caution to buy bankia. They see a completion of the merger in the First Quarter of 2021. A number of headlines are breaking, and they will do that, we will have an update on that. Sentiment to the downside, relatively flat across asian equities. Msci asiapacific up 0. 3 . Tencent down 1. 5 , under pressure from the Trump Administration, looking into Data Security concerns. They have large stakes in these gaining companies. Lets see what is going on across assets. Brent crude up 0. 7 . Barrel, getting a boost from the Saudi Oil Minister. It was a public dressing down of cheaters, and a blunt message to the market to not bet against the cartel. Nothing really happening in the bond market. More confidentng in its alliance with oracle. Beijing has asserted its right to block the sale of critical technologies, it is likely to greenlight this deal if it does not include the transfer of the app, algorithms. What would it take for this deal to go through . Getette we are starting to all the pieces of the puzzle, but the key piece is whether or not President Trump will approve this. They are getting confident that chinese regulators will give the green light to the deal. It is dependent on those factors you mentioned, as long as it does not involve Artificial Intelligence algorithms that drive tiktoks service. Oracle has agreed to Steve Mnuchins new terms that address these security concerns. We need the backing of President Trump. We have heard from mike pompeo who said he is close to backing the deal, which is an indication the president will give a goahead. What is also interesting is that oracle ceo, larry ellison, is a known trump supporter. He held a fundraiser for the president in february. Donated 130,000 to trumps reelection bid. Piece on the bloomberg saying this is how business is done in russia, not the United States. He writes that he can scarcely imagine a situation that is in greater violation of american capitalism. Annmarie tencent is also in focus. Protocols security involving tencent, the one that caught my eye, tencent owns a stake in epic, which has fortnight which a lot of people are obsessed with. What is the latest in this gaming saga . Asking forhey are movement on how these gaining companies are dealing with the privacy of american data. Owns the Los Angelesbased games, riot, which is the maker of fortnight. Says theyintelligence value the assets around 22 profit. 6 7 of that is why you are seeing a move downward in tencent in hong kong. They are down about 1. 5 in late trade, dragging on the hang seng tencentsrimming gains. It is another move as President Trump looks to crackdown on chinese tech. Juliette saly in singapore, thank you for your time. Emmanuel cau, head of European Equity strategy, Barclays Bank joins us this morning. Thank you for your time. Is there a risk we will see retaliation from beijing on u. S. Tech or u. S. Companies in general . It is not just huawei, wechat, it is now into gaming. Where else can we see this, and at what point do the chinese retaliate . Emmanuel good morning. Seen this strategic law between the china and the u. S. , and with the election we see a lot of noise. Not sure anyone has a strong , inrest to escalate particular from the u. S. I suspect there will be some status quo for the time being. , it will bece volatile in the coming months. 40 plus dayshave until the election. Will the biden strategy be different . Will we see a different approach to china and Tech Companies under joe biden . The democrats have a strong stance against china, so there is not much different between the democrats and republicans to contain china as much as they can. Cooperative more with europe. I think the u. S. Will try to create more consensus around the way to contain china, and rebalance trade away from them. This will be a central theme to the u. S. Election. Some part of the market already exposed to tech will be volatile. Annmarie do you think through bet prism, is it safer to on technology outside of the United States . A guest yesterday was bullish on tech all around, but said in emerging markets she likes tech because they are not against regulatory hurdles we could see in the United States as well as the backandforth between beijing and washington. Emmanuel absolutely. And there are signs of euphoria in tech driven by investment in in this using options part of the market. [indiscernible] as we have seen the last few days, we have some of the high profile stocks falling sharply. [indiscernible] we do like semiconductors in they arertly because less likely to be in this between the u. S. And china. Annmarie more broadly, there is a piece in Bloomberg Opinion that talks about the effect of fed support and how it may be fading. You think stocks are losing liquidity momentum . The strong liquid driven market, the bull market [indiscernible] tech is part of that. We seem to be seeing liquidity now where Central Banks are approaching the limit of their policies. The fed announced news this week, the market was somewhat disappointed, including the bond market. Annmarie you can never please some people. Im glad you brought up Central Banks. Stay with us to talk about that next. Lets get to the first word news. Laura the eus climate chief says green bonds create an opportunity for the bloc. They plan on selling as much as 225 billion euros of the debt. Soldhe Green Securities are likely to make the eu the largest issuer. You see blackrock making an enormous change into the green economy. If they wait for us to come out with green bonds to be part of that, i believe this is the moment to do this. Ura global Coronavirus Infections have topped 30 million. The u. S. And brazil with the highest number of cases. The World Health Organization is warning of a resurgence in europe, calling the recent rise a wakeup call. France reported the most new daily cases since the lockdown in may. Contracts based on californias water supply, the First Security of its kind in the u. S. Water supplies have been tight in recent years, and parts of asia and africa have potential problems. Two thirds of the world could face water shortage by 2025. 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. This is bloomberg. Annmarie i want to recap breaking news at the top of the hour. Bank they see this merger during the First Quarter of 2021. Approving this combination creates spains biggest lender as mergers accelerate among financial institutions. It is the biggest deal in spains Financial Sector in two decades. It adds more concerns the banking consolidation in europe. And will we start to see more of it . Saysg up next, britain there has been progress on eu freetrade deals. This is bloomberg. Annmarie good morning. This is bloomberg daybreak european open. Im hammer reporter and in london. Im Annmarie Hordern in london. Significant gaps remain on issues including fishing and state subsidies and European Commission president added to some optimism, saying she is convinced a deal is still possible. Emmanuel cau from barclays is still with us. The you think a deal is possible, and the ftse 100 is down 20 year to date and has not been able to wipe out the pandemic losses. Is it a buying opportunity on the ftse . Emmanuel i think it is possible. [indiscernible] we had the drama last year which ended well. This is the time for the eu and u. K. To agree on some things. It could pressure the currency and somewhat help the u. K. Onket because the ftse 100 the direction of the currency, and if we have a deal, which ,ould strengthen the currency that could somewhat help the u. K. Market. Within that we see domestic is a deal is done. For the time being, we see a volatile currency could help the ftse 100 to perform. If we get the deal in the end, that might reverse. Annmarie what is your outlook . Do they get a trade deal after all of this wrangling and back and forth between brussels and london . Isanuel i think a minideal the most likely. The government can reduce the economic shock, but on services you cannot kick the can down the road were not get something agreed on. , andght be a small deal there will be much more negotiation for many months or years to come. Yesterdaywe heard from the bank of england, the idea of negative Interest Rates is on the table. It was in the toolbox, now it looks like they will investigate it. The first port of call for their next move, or will he go for qe first . It depends on how quickly the deal we need to provide support to the u. K. Economy. It could open the door for the Central Banks. The option is on the table. Might be easier for the boe to justify. There will be more work to be done. U. K. Can prevent a messy shock from brexit, qe might be moreoft option for now than negative Interest Rates. Annmarie how much longer will it take before the u. S. Dollar curve rices in negative Interest Rates from the fed . Prices in negative Interest Rates from the fed . Arenuel im not sure they in the same situation. The fed needs to stay put because the u. S. Faces the upcoming election. If the economy were to suffer or take a hit from a messy try ton, the fed would keep the market and the economy afloat. Im not sure there is much for the fed to go into negative Interest Rates. Im not sure negative rates is what they will go for in the u. S. Remain. Dollar will under pressure because the fed. Ill keep providing liquidity , stayie emmanuel cau with us. Coming up, we will talk about concentration risks. Tech stocks are under pressure following a two days selloff. We discuss that next. This is bloomberg. Rates will remain accommodative until the economy as far along in its recovery. Inflation is expected to be contained over the medium term. Remaining globe remaining below close to the midpoint. With inflation running persistently below 2 , we will aim to achieve inflation moderately above 2 for some time so that inflation averages 2 over time, and longerterm Inflation Expectations remain anchored at 2 . Japans economy has started to pick up with Economic Activity resuming gradually. It has remained in a severe situation due to the impact of the coronavirus at home and abroad. We believe the policy guidance we are providing will serve the economy well by promoting our goals to the many possible paths the recovery may take. Morning, that was fed chair jay powell along with other central bankers around the world speaking over the past few days. A big week for Central Banks. In the markets, nasdaq futures are attempted to find their footing after the index started to climb in the past two sessions. Volatility highlights how vulnerable the market has become to wobbles in these megacap stocks. Digesting all this is dani burger. How severe is the concentration in the Technology Space . Dani it is very severe. It feels like we are having this conversation for the past two years. The concentration in the biggest stocks, the mega cap tech stocks is unprecedented. In global indexes, as of the 500, essentially all of the upside this year is due to the top 10 stocks. Without them, gains for the main indexes will be significantly less, same goes for europe. In can see the index does better than it would without the big 10 stocks. That blue bar on those charts is the big 10 contribution. It is big for all these indexes. When you look at the average performance, all of these have done well year to date, but the average is actually negative because of this concentration risk. People are waking up to this and realizing indexes are dominated by the mega cap stocks, we need to diversify beyond the indexes. We have seen equal weighted s p do better this month than the main index. Annmarie every morning we talk about what is the latest in the Financial Community and whether or not they will go back to the Kitchen Table or the office, and the latest seems to be there are step backs for some lenders. Walk us through who is going back to the office and who is being sent home. , ai Goldman Sachs this week trader contract the coronavirus, so they sent some of them home who may be exposed. Goldman was one of the most Aggressive Companies getting their workforce back. We saw barclays sending some traders home here in london. That is all well and good, people might want their bankers back, but it does not always work out. Annmarie it is something we will keep track of as we enter the winter. Many Health Officials are warning of a second wave. Thank you, dani burger. Coming up, warning shots from the kingdom. Saudi arabia is out at opecplus and shortsellers in a bid to protect the oil market. It was a blunt press conference. This morning, brent crude is up 33. 59. This is bloomberg. Look here, its your very own allinone Entertainment Experience xfinity x1. Its the easiest way to watch live tv and all your favorite streaming apps. Plus, x1 also includes peacock premium at no extra cost. This baby is the total package. It streams exclusive originals, the full peacock movie library, complete collections of iconic tv shows, and more. Yup, the best really did get better. Magnificent. Xfinity x1 just got even better, with peacock premium included at no additional cost. No strings attached. Annmarie good morning from bloombergs European Headquarters in london. Im Annmarie Hordern. This is bloomberg daybreak european open. The Trump Administration asks skinning cubbies to provide information about their Data Security involving china giant, tencent. Is this the next catalyst for a tech selloff . Goldman sachs is the latest bank to send some traders home after an employee tested positive in the manhattan hq. Global covid infections exceed 30 million cases. The Saudi Oil Minister says, make my day, and a warning. He says whoever gambles on the market will be ouching like he ll. Good morning. It is friday, september 18. Flatarkets are relatively this morning. Msci asiapacific is up 0. 4 . It would be set for the first weekly gain. Tencent down after pressure from the Trump Administration looking into Data Security concerns. Euro stocks 50 flat. Brent getting a boost from the Saudi Oil Minister. Coming off of a low of initial drop when the boe talked about taking Interest Rates below zero. Lets get back to the oil market, oil climbing after saudi arabia expressed determination to stop opecplus members from exceeding their output quotas. Sent a warning to shortsellers. Take a listen, this was his answer to my question yesterday evening. We have decided to be proactive and preemptive. For those who would like to result,the market, as a make my day. Joining us now is will kennedy, bloombergs Senior Editor for commodities. It was an interesting opecplus press conference they gave, a bit lastminute. The prince was blunt and direct to the market, do not test us. This has risks, doesnt it . Will it does. The prints had a nice day the prince had a nice day and a market was impressed by his resolve to defend the price and his scolding of opec noncompliant is. Things will come into sharp focus and there are big challenges ahead. They have a meeting in december. Large cuts that they agreed to, putting two Million Barrels a day back into the market. It is not clear the market is ready to take those two Million Barrels. Demand has stagnated in several key markets. He is saying to the market, do not test me, but the key question in december is if he needs to keep more oil off the market, is russia going to stay with him . Other countries running financially, will they stay with him . He has a diplomatic challenge. At that last empress we sawlus meeting theatrics yesterday, and this is when the uae Oil Ministers flew to riyadh during a pandemic to sit with their saudi counterparts. This is because he has been cheating, but he is such an ally to the prince. The prince is doubling down on the cheaters, isnt he . Will it was the diplomatic equivalent of a public scolding. He did not mention the uae by name, but the minister was sitting next to him. Is usually their closest ally and opec and beyond. Are veryrown princes close. It is discomfort to saudi arabia that the uae was producing as much as it was. Level the prince made clear his anger, and you can understand why. If theiraudis, closest allies will not make cuts, what hope do they have for other countries like iraq . Annmarie well look forward to that december meeting. Will kennedy, thank you for joining me this morning. Still with us is emmanuel cau, head of European Equity strategy, Barclays Bank. There is a piece out this morning asking if there is a contrarian buying opportunity to the energy space which has been unloved this year. Emmanuel this is something we can agree with. Weeks ago we closed and did not see a lot of challenges with esg. Lows. Ices up 40 from the [indiscernible] commitmentre is more from opec to contain or limit supply and rebalance the market. Trade, this rotation some part of the market has been strong. We think there is a cheaper option to get the claim on this energy. We think we could see some support in the shortterm. Annmarie is there any specific names you could tell us on who you think would do well in the energy space . There is a divergence between European Oil Companies and american oil companies. European oil companies, we saw with bp, they are taking to the Energy Transition much more quickly than in the states. Emmanuel that is why europe has a chance moving fast to change greener. Ess, to be that is something that could , but in thee sector case of europe, more investors are excluding the oil sector, which is trying to make efforts to be compliant. There was another component affecting the sector, which is dividends. We have seen Energy Companies reducing their dividends. Annmarie the sacrosanct dividends, beal the reason investors want to hold these companies. Emmanuel cau, thank you for joining us. He is head of European Equity strategy, Barclays Bank. Demand for green bonds creates an opportunity for the bloc, he spoke to maria tadeo after the Commission Proposed a 55 cut in Carbon Emissions by 2030. We did the analysis, very thorough analysis, and it shows clearly 55 is something we can do. If we go the on 55 , the marginal costs are too heavy, the burden is too heavy. It would take away the pressure from other parts of the world to do similar steps. Thepe, we are only 9 of emissions, we can lead the way, but we cannot do it on her own. We have to convince International Partners to do the same. Needs to be approved by the parliament. Investor, what does that implementation look like . We will come up with a concrete proposal in the different sectors by june of next year. That is when industries and society will see what this means for the sector. At the same time, there is a huge push from industry telling us, do this. You need to give us some predict ability, longterm security, no zigzagging, stay the course. This is extremely encouraging. There is more drive in the private sector than in politics to make this happen. The private sector has to have the longterm view on what is happening with investments. AreFinancial Sector worried to create standard assets and the old economy. They want some regulatory clarity and longterm security so they can invest in the right direction. Maria for the Financial Community investors, they are interested in the est space. Is that something you get feedback from the Investment Community are interested in . Absolutely, we get questions but support from the Financial Sector. You see organizations like blackrock making an enormous change into the green economy. If you see them waiting for us to come out with green bonds because they want to be part of that, i believe this is the moment to do this. We get one shot at this. Able toa moment we were mobilize, solidarity on the european scale that probably cannot be repeated anytime soon. We have this opportunity now. If we squander it, i do not know if i can look at my kids in the eye again. Of 225the announcement billion euros in green bonds is huge. Is that something were you think the European Union will lead the way when it comes to regulation and the benchmark . Is that were you think we can be the biggest player . I think so, i think europe can lead the way. But there is huge interest across the world. If we can show that we can handle this and go on the markets and markets will respond to what we are doing, this could lead to successful investment and take off. Maria you are saying the Financial Committee is with us, but what about the rest of corporate europe . Aviation, the carmakers, what feedback you get from them . Difficulte in a situation because they need to make this transition. At the same time, they need to go through profound restructuring because of the covid crisis and that resulting economics of that. They have to keep people in jobs and reskill people. We need a partnership between the private sector and the Public Sector to make sure they can do this in a sustainable way. They cannot do this on their own, and we all need to take our responsibility to help them get their. To help them get there. Annmarie the European Commissioner speaking exclusively to bloombergs maria tadeo. Catch the bloomberg green festival, a weeklong Virtual Event that focuses on the core issues of climate action. Today is the last day, and you do not want to miss it. Now for the first word news. Ytedance and oracle are edging closer to a tiktok deal. They agreed to new terms of the treasury department. Bytedance is confident they will beijing,pproval of assuming it happens, and ipo in about a year. Hurdles remain for a brexit deal. The Financial Times was told they are convinced it is possible. Latest round of informal talks were are useful and some limited progress was made. They aim to reach a deal by midoctober to have a ratified by the end of the year. Tencent is under the microscope in the u. S. The government has asked Gaming Companies to provide information about their Data Security, that includes epic games, the maker of fortnight. No comments from the companies or the treasury department. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in this isn 120 countries. Bloomberg. Annmarie thank you so much. Jay powell says inequality issues should be dealt with by politicians and not the fed. Americas income inequality, and how the pandemic has widened the gap. A very important story. Stick with us. This is bloomberg. , inequality, i would point to it is a multifaceted thing, but i would point to stagflation for people at the lower end of the income spectrum and lower mobility. Those hold back our economy. We do not have the tools to address those. But we lower the federal funds rate, that supports the economy across a broad range of people and activities, but we do not have the ability to target particular groups. Notwithstanding that, we talk about it because these are important features of our economy, and those distributional issues are issues that are for elected officials. That was fed chair Jerome Powell saying any quality and the economy needs to be addressed by politicians and not the fed. We are looking at income inequality in the United States. Worsenedhe pandemic any quality . We see a lot of data, but how exactly has this gap widened . We are six months into the pandemic, and really seeing how it has exacerbated any quality not just along racial lines but the economic, social, and gender lines. A bloomberg colleague spoke with there is equity on one side, and staff privilege on the other. Height ofing at the the pandemic, the stimulus checks went out, the extra 600 a week jobless benefits helped a lot of americans facing unemployment and declining incomes, also helped keep Consumer Spending steady. Eagle were at Home Shopping online. People were at Home Shopping online. When that ran out, the hardest hit throughout the pandemic really became less optimistic and cut back on spendingnding, anything at all because they could not afford it. At the same time, the wealthiest americans who have been able to work from home have only become wealthier. A recent report from a progressive think tank found in that time when 50 million americans lost their jobs, the wealthiest americans gained 845 billion. We hear lawmakers proposing wealth tax puzzles. It comes down to policy, and we are at a stalemate weeks for the election on a stimulus. Annmarie some are saying we may not get to a release build. When you break it down by race. These numbers are more troubling . Yes, not only are black and brown people much more at risk for serious the ill from covid19, they are also taking a disproportionate financial hit. A recent study highlighted the most reported burdens they are facing, which includes trouble making rent or paying mortgages, credit card payments, affording care, food. There is a poverty divide we are seeing with 18. 8 of black americans living in poverty compared with 7. 3 of Nonhispanic White people. President trump likes to tout his policies benefiting african this week he did so in his town hall, but the gains made by africanamericans have. Een wiped out in the pandemic this will be a central issue for morelectorate because they and more are falling into these categories. Dont forget, you can catch her weekly show your world every sunday. That is at 6 00 p. M. London time. Join us for the bloomberg inequality summit on september 23. Butill be uncomfortable have much needed conversations. It will address systemic racism. Among thewill be featured speakers. This is bloomberg. Annmarie good morning. A key ally of Angela Merkel says, we are unlikely to see any abrupt shift in policy partyless of who wins the race. This will be a transition. We will of course bring changes to the party. People shape parties, but thanks to the Angela Merkel the cdu is rooted in the middle, that i have no doubt that when Angela Merkel is no longer holding this responsibility that the cdu will still be on this course. Correct that the course is reaffirmed, it is in in the strongest position. 36 is certainly not nothing. This is a particularly good result in a local election where this mentoring of parties is greater on various levels. This is an absolute affirmation of this political direction. I think we should not doubt the centrist line. This is a confirmation of this political line, and signals where he stands. This is not just a onetoone continuation. He is much clearer than is the case under Angela Merkel. It political positioning, where he would like to lead the cdu is the person who stands must clearly for the political center. Cduarie that was politician daniel gunther. Angela merkel has dominated german politics are such a long time. What effect will have when she leaves the political stage next year . Good morning. Said, thereenther are young cdu politicians who will succeed her, but the question is if any of them will fill the hole she believes. I assume it will take some months maybe years for germany to find its new role. Thank you so much for bringing us this exclusive interview. We will have more of the interview with Daniel Guenther throughout european programming this morning. That is it for bloomberg daybreak european open. The edwards will bring you european open this morning. Mostly down across the board. A little higher for the nasdaq 100 slightly in the green. Euro stocks flat. Ftse futures flat. A lot of catalysts, what will the next one be . Stay with us this friday morning. This is bloomberg. Good morning. Welcome to bloomberg markets. I am anna edwards. The cash trade less than an hour away. Here are your top headlines. Trump administration asks Gaming Companies to provide information about tencent