Environment. Businesses, the private and Corporate Bank are fighting through the Interest Rate headwinds, but doing well on executing strategies and offsetting that had went. Thee are uncertainties in Macro Economic environment and that is something we factor in as we manage our businesses, our risks, but we remain quite confident in our outlook and the way we are managing through this pandemic. It is supporting clients, the economy as we all navigate an unexpected environment. Risks, howaging the hard would Deutsche Bank be hit if there would be another wave of lockdowns across europe and elsewhere . James weve built in some conservativism into our numbers, weve taken an overlay, adjustment more conservative in provisions and that prepares us for uncertainties that lie ahead. We are not seeing a deterioration in portfolio beyond what we expected in this environment and while we are all subject to the direction of the economy and potential impact of more distancing and Protection Measures in the economy, we think the Second Quarter experience had showed us the households and corporates are relatively resilient and governments are in a position to support the economy through this period of uncertainty. Throughout the year, you continue to say you expect pretax profit in the full year, which most analysts for a long time didnt believe at the bank. At 846 million in the first nine months in pretax profit. The question now is how big is the pretax profit going to be . Will it exceed one billion . James we are continuing to work through restructuring. This quarter, we had almost 500 million pretax profits, burdened by restructuring and severance charges, as well as a burden from the cru wind down. We expect that to continue in the Fourth Quarter. As we execute with discipline on this transformation of the company, but 850 million in pretax profit over the first nine months with this in a position to deliver on being profitable in the pretax line this year. Risen by 47 in the third quarter. This momentum continued in the Fourth Quarter . James we are continuing to see Client Engagement as the environment normalizes a little bit, but there is still uncertainty in the outlook, still a vence ahead of us, whether the u. S. Election or brexit, events ahead of us, whether the u. S. Election or brexit. We have done well, 47 year on year and that has been consistent over the last four quarters. The high double digits, we doubled rates revenues for four quarters in a row. So for us, the sustainability of these revenues is a key factor and we think a significant amount of it will stick. Jonathan the Deutsche Bank cfo james von moltke, stock doing nicely up around 3 . The market open in 55 minutes. The price action, not good this wednesday morning. Following two days of losses in europe, we add to that. Equity futures are lower. The story out of europe, chancellor merkel proposing to shut bars and restaurants for up to a month. Emmanuel macron speaks later this morning this evening. Hes exploring reportedly a onemonth lockdown. Joining us now is maria tadeo in brussels. This is accelerating quickly. Us through what is being proposed, considered, and decided . Maria it is moving very fast and you could argue it is a reaction to the number yesterday in terms of cases and deaths, which were high in france. When you look at Emmanuel Macron speaking at 8 00 p. M. , there has been speculation as to what measures we could see tonight. These are measures that are being speculated. I want to stress it is not official and we will have to idea,or tonight, but the the french government would be inclined to go for a fourwe clocked down that would start friday to detain spread. To go for thated option, a complete shift, a real uturn on what we heard. It was all about tracing, but that is changing. According to reports, not official yet, a manual macron would be inclined to take a draconian measure carried chancellor merkel favors shutting down hospitality for four weeks, but i want to stress this has not been agreed with the german regions. Merkel has become concerned about the rate of infection over the past few days. The idea we are reaching numbers that were only modeled to happen later on in the winter, so she is inclined to take on draconian measures to avoid more infections heading into the flu season. Switzerland yesterday saying a National Lockdown has to be back on the table. Their intensive care units are struggling over the next few days. How receptive are europeans around the continent to these new measures . Maria well, to me, this is the question. The measures in march only worked because people respected them and there was a good reason for it. No one was ready, it was completely unexpected but the social context has changed. Four weeks, governments repeated this was about testing. Europe was ready for the second wave. Hospitals were in good shape. Clearly, the picture is different. In countries like italy, we have seen three days in protests. We havent seen this at any point in the pandemic. The measures only work if people respect them. You need them on your side. When you whiplash them every week, that translates into anger and you have to factor this is having an impact on unemployment numbers. We are seeing that on a monthly basis and it is having an impact on your personal finances so that anger is boiling and those measures are not helping. Jonathan we want to touch the market action. We roll over once again, cac 40 futures off 1. 7 following a tough session yesterday. The dax, hammered monday. Rolling over on tuesday. To 10. Ay, down 210. A couple of weeks ago, the happy talk around europe was palpable. A fiscal agreement. Whatever happened to that package in europe . Why hasnt it been ratified . Its late and becoming problematic and you do hear from the European Commission that europe could beheaded into a doubledip recession. That is a real risk and the Recovery Fund needs to be ready by 2021 but it is not clearly will get that. There is pressure building on governments and European Parliament to get to a deal but i would stress this is problematic. Countries like spain and italy are clinging to something that might not be operational by the start of 2021. I would point to the fact that the forecast we have seen from the european officials and European Commissioner probably dont mean a lot now. If you head into a locked down, restrictive measures, this could be headed into a bigger recession than we have dentist appended and the money is not ready to be distributed at this point. This is something i would keep in mind coming forward. Maria tadeo on brussels. We will have more through the morning. Lets get the first word news with laura wright. Laura chinas economic recovery is showing mixed signals. While remaining broadly steady in october, Small Businesses are becoming more cautious, with the Property Market weakening. The Worlds Largest exporter is exposed to a worsening outlook in the rest of the world. The domestic economy remains robust with car sales soaring. The u. S. Has seen a surge in early voting with nearly a week left to go until election day. Over 70 million votes have already been cast, over half the total number from the 2016 election. States have been expending mailin ballots or absentee voting in response to the pandemic. Young and minority workers are more likely to lose their jobs after being furloughed according to a survey by ugov. Have 1 5 of young people been laid off and a similar percentage of black, asian, and minority ethnic workers compared to 9 overall. Global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. This is bloomberg. Aldajon. Jonathan good morning to you all. Waking up in europe, staying up in the United States, futures one. 9 ongative euro stoxx 50 futures. Futureses out, equity to the United States, down. 7 . Eurodollar, 1. 1774 and the treasury market, that bid sticks. Your yield on a 10 year, 0. 76 . Proposing torkel, close german bars and restaurants for up to one month. The reports circulating europe is that macron of france is considering a onemonth lockdown. We will hear from the man this evening. There is a way to this tape. And focus ons, earnings as Deutsche Banks Asset Management arm posts a big beat and will speak to the cfo of the bank of ireland next. From the city of london, good morning. This is bloomberg. Minutes from the opening bell in europe and equities are rolling over. The ftse, off 1. 2 . 1. 85 . Wn the story across europe, not pretty but latest news out of germany is chancellor merkel is proposing to shut down bars and restaurants for up to a month. In france, reports say macron will put in a one month lockdown starting possibly this week. Frances move would follow irelands second lockdown, moving to the second highest level of coronavirus restrictions. We are joined by francesca. Cdonagh of bank of ireland never mind q3, can we sit on the first month of q4 . What are you seeing with the business with the challenges europe has been facing and ireland has been facing . Francesca it is a mixed bag. There are good signs and a lot of uncertainty and negativity. Ireland is two weeks into a sixweek increase in restrictions. Retail is closed and people are saying staying home, but schools are open, construction and manufacturing are open. Consumer optimism be because theme low uncertainty both of increased restrictions in ireland, but also the uncertainty of brexit. On the other hand, weve seen gdp data come out stronger than many were expecting and that reflects the International Nature of the irish economy, and also we are seeing house prices and the Housing Market being surprisingly resilient. We have relationships with 40 of households and that gives us insight. There was optimism out of summer, now there is uncertainty but the economy is showing a high level of resilience. Jonathan what weve seen in the standards, we heard from the ecb they are seeing a similar theme across the continent. Are you tightening lending standards at the bank of ireland . Francesca we want to lend and we would have been prudent and conservative in our lending practices before covid. We will be supporting a government 2 billion scheme looking to support businesses and mortgages. You are seeing a significant increase in london lending. There isnt a significant tightening of standards. Weve made emergency liquidity available during payment rates across europe. We were a key player and contributor toward that but we continue to want to lend support to customers, household or businesses, through every stage of the pandemic. Annmarie what are you seeing in terms of bankruptcies as economies are shutting down . The United States, some of these are set to surpass 2009 during the depths of the crisis . Francesca we are writing a Trading Update as part of our order results. We are not seeing a Material Change in our stage three. In our resultst about the outlook and we continue to see behavior in line with expectations. A lot of customers on payment breaks are coming off payment breaks and resuming their interest repayments. We are saying to customers, contact us. Weve been contacting customers. The sectors that rely on social and contact, hospitality are bearing the brunt of the crisis and are being impacted. Other parts of the economy, though, the indigenous sector in ireland, retail manufacturing is adapting much better to this level of restrictions that may be at the beginning when it caught everyone by surprise. In ireland, you have 10 out of 10 of the Largest Pharmaceutical Companies in the world based here, nine out of 10 of fintechs and eight out of 10 of the biggest banks in the world having a base. It isave bank helping with the resilience of the irish economy. Annmarie i want to ask about cost cuts. You 1 had an thousand 400 cost cuts in terms of layoffs. It is a very grim morning for europe. Ireland has very strict lockdowns. Do you expect more cost cuts . Francesca we are reporting implementation of a successful voluntary scheme. Reduce 40 ost will over the next couple of years and that is a fair proposition to our colleague, but of value to our shareholders to pay back shareholders. The payback on that Redundancy Program has been good. Because of automation in the way customers choose to engage banks. Covid has augmented that, but this is a covid related redundancy so they have been voluntary. We have been in a multiyear project to increase efficiency. We stay focused on that objective independently of covid. Jonathan thank you for your time this morning. We appreciate it. Francesca mcdonagh, the ceo of bank of ireland. We want to reiterate the breaking news. 40 minutes from the opening bell in london, we rollover. Zero stoxx 50 futures, down. 2 . 2 . S p 500 s p 500 futures, down. 8 . Chancellor merkel proposing to shut down bars and restaurants for up to a month. Reports that macron of france is exploring a onemonth lockdown. We will hear from him this evening, that is weighing on this market, pushing a little risk aversion worldwide. In the bond market, 10 year yields unchanged 0. 70 6 , almost down a base and point basis point. Dollar 1. 17. Here is the business flash with laura wright. Laura lvmh and tiffany are in discussions to cut the price of their contested takeover deal. Sources tell Bloomberg Tiffany is looking for 100 32 a share, down from the original price of 135. Tiffany will likely want to again. Ee lvmh back out the luxury giant pulled out from the deal in september due to a request from the french government. Aston martin is forging closer ties with dialer to survive the downturn in the auto industry. Help thehe spends will carmaker bring hybrid and electric vehicles to the market. It will become a major shareholder without spending cash. Aston martin is raising a total of 1. 3 billion pounds through bond and stock offerings. Credit suisse is starting a new Advisory Group to focus on mega deals. According to a memo seen by bloomberg, the asset will focus on highpriority banking clients to grow revenue and market share. Plans to transfer some internally. That is your bloomberg bigss flash. Business flash. Jonathan we will wrap up earnings from this morning including Deutsche Bank beating estimates. With equity futures lower, good morning. You are watching the tv. Jonathan stocks rollover a little more, down 2 on euro stock futures. S p 500 futures down one Percentage Points. Yields lower by 10 basis points, comfortably below 80 basis points. Concern, itr of the is not about u. S. Politics and stimulus. It is about restrictions and potential lockdowns across europe. The euro, 1. 1770 two, eurodollar down. 2 . With your movers, with about 35 minutes until the opening bell, here is dani burger. Dani the earnings continue unrelated in europe. Deutsche bank, the headline is then absolutely demolishing expectations when it comes to debt trading. Revenue jumped 47 in the segment. If you want to find a wall Street Lender who had something even close to that, the only bank that beat them was goldman sachs. Otherwise, almost double of what trading. S saw in debt that helped beat expectations all around, posting a profit of 182 million euros. Analysts had expected a loss. We spoke with Deutsche Bank are cfo james von moltke. He was upbeat on the state of the economy. James we think the Second Quarter experience had showed us the households and corporates are resilient and governments are in a position to support the economy through this period of uncertainty. Optimisticave outlook, earnings numbers which were strong, so the question remains after the biggest restructuring in two decades for Deutsche Bank, are they taking back market share or was this a oneoff . Rakinge what about dws, in fresh client cash . Dani good news on all fronts. Client cash coming in about 10. 6 billion euros 10. 5, rather. The estimate was for 3. 3 2 billion euros. W close at this point last year. Really, it is about passive strategies for dws. About 60 of flows were due to index tracking strategies. That sets dws up as the secondbiggest etf platform in all of europe. Somee going to dive into of those numbers and what it means for the greater etf market later on etf iq. Jonathan thank you. Dani burger. Coming up, 30 minutes away from the opening bell, futures lower. This is bloomberg. Jonathan 30 minutes from the cash open in london and equities not looking good this morning. We are down 2 on euro stoxx 50 futures. Down 34, 1 off the s p 500. Foreign exchange, eurodollar down. 2 . A break at 1. 18. Chancellor merkel proposing to close down bars and restaurants month. The reports out of france, suggesting macron is considering a onemonth lockdown. We will hear from him this evening. That is where the weight is coming from on the tape this morning. The earnings picture is not all bad news. Deutsche banks Asset Management arm raked in more cash in the claire peel, and the cfo, joins us. Some read good news on a wednesday morning when europe is suffering. Your numbers look good and i wonder where the growth is coming from next in this type environment . Tough environment . Claire we are pleased with our results today. It has been a difficult year but we have demonstrated we can respond in this kind of environment. We have 10. 5 billion in inflows in the quarter and that delivers 7 billion inflows yeartodate. Businessdiversified model and Offering Solutions to clients across Asset Classes has been important for us to deliver results we have today. Jonathan where has the money they going and has it continued to come in through the first month of q4 . In new york a month ago and then talk about allocating to europe, passive money coming through. What do you see . Weve seen inflows coming across all of our regions come across europe, the u. S. , asia pacific. Thats been, including and excluding cash. Cash is a strong feature of inflows this year. Please seen that this quarter, last quarter, and into q4. Aside from that, excluding cash, we still have them close across the passive space, etfs, fixed income in the third quarter. The liquid strategies and alternatives continue to be a strong feature in our inflow story. Really, across the board, there is a mixed result, but across the diversified Asset Classes, we are able to offer solutions to clients and esg is a strong schematic. One third of inflows yeartodate have been coming strategies in etfs in the passive space, but across Asset Classes, as well. Good point. G, a you have been ahead for years on investors, it is no longer nice to have, it is a need to have. How will you distinguish yourself in the space Going Forward . Thats right and what we g isseeing this year is es an all weather solution and weve seen demand accentuated this year. As you say, weve been responding to that megatrend for a long time, not just this year and that is demonstrated in productinnovations, new launches weve been bringing to market across Asset Classes this year and before, and if i look purely at the new product launches we offer, esg equivalents, one third of those inflows from product launches are coming from esg fanatics. Thematics. Weve putting a Sustainability Office and officer. Beoss dws, that office will responding to client needs and making sure our platform can be agile in responding to what esg needs to bring to all of our stakeholders now and in the future. Annmarie you also mentioned your etf platform. You are the second biggest in europe. There is a lot of space between you and blackrock. Could you ever start to compete with them for biggest in europe . Can you do that organically or will you have to buy another company for that . Number two in the etf space in europe in terms of our size of aum, but importantly, in inflows this year. Fromcting new money inflows in the etf space in europe, we are second, as well. That demonstrates the organic ability to grow to some degree. We have 13 billion inflows across two quarters in the etf space. Thats global, but i think having a Broad Product suite, being able to respond to Product Trends enables you to grow organically to some degree. There is a big space. We are comfortable with the way we are developing an etf space in europe. Jonathan are you actively looking for a dance partner when there is serious consolidation in your industry . Claire we always have an eye to what is going on, scanning the environment on the m a space and what could be the right partner. Distribution channels, product channels, platform channels, but as we demonstrated this year, we had to make sure we are fit and healthy, meeting our nearterm targets and we are meeting those targets a year ahead of schedule and we are efficient and resilient. Thats been our focus this year, but we are keeping a very close nic options inorga could look like in the future and we will be turning our right to growth in the next stage of evolution at dws. Jonathan i imagine Public Relations is happy with that answer. Are Deutsche Bank supportive of you finding a dance partner . Have you had the conversation with them . Claire our Majority Shareholder has been vocal in say they are finding thef dws best way to develop shareholder value, the best way to grow. I think theyve been quite vocal in that regard, as well, but we wont move into the mandate for m a for them a sake of m a. We will look at partnerships that can develop our shareholder value, that dont cause disruption, but can help us on that journey forward. Talksan i didnt expect to be announced on this program anyway. We appreciate your time. The cfo of dws, thank you. 23 minutes from the opening bell. Europes virusas outbreak intensifies. Germanys chancellor merkel proposing closing restaurants and bars for months. In france, Emmanuel Macron announcing new lockdown measures perhaps as soon as this evening. Mark cudmore joins us now. Your take on things in europe, and why this isnt bleeding more heavily through the rest of the world . Mark i think it will bleed into other markets pretty soon. What is happening in europe is the epicenter of the next wave of the virus but the global numbers are rising. The 7,show we are seeing 21 day trend in global numbers are rising rapidly. We expect half a million a day later this week and it is creating a problem in more countries. Seven countries set record fatalities overnight. Why is this not affecting acetal to europe as much . I think part of the reason is because we have election uncertainty next week. It is a bad time to take aggressive moves in either direction so people are sitting on their hands. Theyve prepared for the election and dont want to change direction on the coronavirus news until they know what the new administration is going to be in the u. S. Annmarie does the idea of a blue wave start to lose its mojo in these markets, given the fresh19 resurgence of restrictions is coming to the forefront and potentially more of this in the United States . Mark there are two aspects people are focused on this morning. People are noticing the narrowing polls. There has been confusion between the fact we are narrowing the polls in the senate race to mean either could win. It still looks biden has a clear advantage on the president ial front. Clear. Ate is less will a republican run Senate Approved an aggressive stimulus package at the start of a biden presidency . The other team coming into focus is people are suddenly questioning, what does a Biden Administration mean for a virus response . We talked about what it means for stimulus, what it means for tax policy, but is he going to start pushing lockdowns . Change Consumer Behavior in the u. S. And is that something we need to consider, given three months from now before he takes power even if he wins. Jonathan i want to turn to the fx market. Eurodollar is fascinating to me, particularly the last month. The euro has had a break at 1. 18, but on the month, positive by one percentage point. It is clear what is playing out in europe right now. Walkingr to be sleep into more lockdowns across the continent and the euro has been pretty resilient. Mark there are two dynamics to think about. The backdrop is quite positive euro versus dollar. A lot of the younger term drivers, longerterm current accounts, exploding debt in the u. S. , percentage of euro and u. S. Dollar assets cloned in global asset reserves, there is a tailwind structure in the next couple of years for the euro versus dollar. In the shortterm, i am more worried about the downsizing of the dollar because i think people have gotten over positioned along longterm dynamics and they are not going to change in the space of a month so any shock makes it more likely we see a sharp move to the downside rather than the upside eurodollar. To reiterate, longerterm picture for eurodollar is much higher over the next year. The shortterm is more to the downside. Jonathan appreciate you getting on the phone this morning. Mark cudmore, of bloomberg. But get first word news with laura wright. Laura coronavirus is showing no signs of slowing down across europe. The u. K. And france have reported the most deaths since the first wave of the pandemic and italy and greece have seen record numbers of cases. Emmanuel is readying new measures to control the spread of the disease. He plans to hold an address this evening. In germany, chancellor merkel is proposing tougher restrictions on movement and contact. That includes closing bars, restaurants, and Leisure Facilities until the end of november. Citizens to avoid nonessential travel. According to local media, shell make the proposal today at a meeting with state premiers. Italys government has approved a new relief package to help the sectors hit hardest by restrictions. The measures are worth 5 billion euros including tax relief and targeted aid. The news comes amid growing protests and unrest across the country. Hundreds gathered in rome last night after violence in milan. Global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. This is bloomberg. Under 18 minutes away from the market open. Dani burger with your morning calls, looking a big names in the hedge fund managers. Einhorn says there is an enormous bubble in tech stocks. Mania,ts to the ipo volumes and more speculative instruments and high valuations. In terms of where we are in the bubble, he says he thinks september 2 2020 was the top and the bubble has popped. He says if so, Investor Sentiment is in the process of shifting from greed to complacency. What is he going to do about this . Hes going to add more shorts to his tech call. He is short big names like netflix and amazon, but hes adding more secondtier names. Jonathan it makes you wonder, if we go through a rough patch in this economy, a second dip in europe and elsewhere, whether vulnerabilities in the secondary market, is it in growth or more cyclical parts of the market . Dani when you look at the overvalued names, this is the easiest where the sentiment hit comes in. There is so much froth in tech names with a lot of the more retail robinhood type crowd chasing after these names, but the death of value has been talked about for a long time. There are investors waiting on the sideline to get any cyclical bump, be it in stimulus, and perhaps a blue wave and hopes for the stimulus. In the shortterm, you could see more cyclical names start outperform. With the coronavirus pandemic continuing to rage, the economy coming under pressure, it is difficult to see how the more growth stories and safe names cant continue to lead the next leg of the rally higher. We will catch up with you in a moment. Equity futures, 16 minutes away from the opening bell. We break down big time this week in europe. Monday, tuesday, wednesday, down 62 on euro stoxx 50 futures. 1 United States, down 35, and the bid into the bond market, lower and other basis point on the 10 year yield to 0. 7543 . Next, six days to go. President trump. Joe biden tries to expand the democrats map. We get the next from the city of london. On jonathan ferro. This is bloomberg. Is goinggain, michigan to answer the call of history and show the world sleepy joe dark money donors and corrupt special interests and by the way, theres never been anything like this. So much pain, so much suffering, so much loss in america. Americans225,000 dead because of covid19. 7800 right here in georgia. On november 4, youll here we are doing extremely well. Youll see. They used to say europe, look at europe, look at europe. First of all, they count their cases totally differently but look at europe. They have a big spike and it is going to go down, and we had a spike in miami, we had a spike in texas, arizona. It is down to low numbers. Everybody knows who donald trump is. Lets show him who we are. We choose hope over fear, unity over division, science over fiction, and yes, truth overlies over lies. Jonathan making their final pitch to voters. Six days to go, 70 million americans have voted. By this time next week, we might know who the next president could be. The difference in approach over covid19 between these two potential president s is absolutely radical. Europe, down aggressively because we are starting to understand the next moves on the continent. To get your hands around the next move in the United States, weve got to find out in a week. That is certainly right. If you were to see a Biden Administration, youll see more force about mask wearing, which we havent necessarily seen from President Trump and jonathan, the president and first lady had actually contracted covid19. One thing im looking at is wisconsin. There was admission from the president talking about cases ticking higher in the midwest region, which is crucial for both campaigns. Jonathan our Senior Editor joins us now. Fantastic to get you with us on the program. As we look at the market open 11 minutes away with futures down aggressively, in europe we are experiencing the next stage of restrictions around the economy. What is your extent understanding of what comes next from either president . I think you both nailed it on the head in the intro. There could not be more of a difference. You can see it and how they approach the campaign right now. Assident trump is out in many large rallies as he can, Vice President biden taking a approachd, or distant here in these final days. We were hearing reports trump is going to go on a barnstorming tour of 11 sites in 10 states in 48 hours in the final throes of the campaign. In terms of where they are going to be, if biden wins, biden wouldnt necessarily take over until the end of january, but if he does, he has sounded a little more open to things like asking people to wear masks, even though i would point out people who are thinking you might be looking at europeanstyle situations happening in america, he might not because a lot of what the president can do in the United States because of the way it is set up is more advisory than telling people they have to do it and going and enforcing it. That state structure does put a little distance between the white house and on the ground mandates. How critical will covid play to the midwest states seeing rising infections and are in the process of voting . Derek i think it is going to play a role. How couldnt it . For covid, if youve been sick, someone you know has been sick or god for bid, if someone has passed away, thats going to be a thing people are going to take into account, but also the drag on the economy is going to be a thing people are going to take into account. Look, the polls show a split, where biden leads in terms of the Covid Response and how will people think he can do that. Trump leads in terms of the so i thinksponse, depending on how much voters feel that covid is weighing on the economy to the extent they feel it is, that is going to be better for biden. Jonathan great to catch up, sir. Derek wallbank, Senior Editor on this election. Six days until that. In europe, more restrictions potentially in germany, maybe more so in france. The open, eight minutes away. This is bloomberg. Jonathan six minutes until the opening bell in london. Equities down 2 on euro stocks future 50 futures. Ahead of the market, stocks to watch with dani burger. Ill hire up 3 to 5 , beating on earnings with the help of online sales and restrictions lifting, starting again in europe but for the last quarter, this helped next boost their forecast the third time this year, massies 365 Million Pounds for the year. Estimates had been 300 million. Heineken doing better than expected. 1. 9 , butes fell down the estimate had been a slump of 6. 6 . They are seeing a lot of volatility due to the pandemic means it is going to be impossible to forecast from here on out. Andarie thank you so much we should know in the next hour, hearing more about delivery hero from the cfo. That interview, shortly after 8 00 a. M. U. K. Time. Markets come a brutal morning waking up in europe. Jonathan a tough week. Futures lower by 1. 9 on the euro stocks 50. The dax, monday ugly, the dax tuesday not much better, the dax wednesday, down two Percentage Points. The cash open is next. From london, this is bloomberg. One minute away from the opening bell in europe, your headlines this morning. The leader speaking this morning. Futures added to this week, losses, just six days to go until americas contentious election and six days away from the opening bell. Not pretty. I have been saying it repeatedly this morning. As the sessions grow, equities grow larger. Ftse futures down by 1. 3 . Dax futures where the pain is. Down a little more than two Percentage Points. About more concern restrictions, not just in germany. But also in france this morning. Annmarie yeah, you can france reported their highest covid death toll. It is front and center, europe going in reverse. Jonathan you know the story here. I can tell you, it is not a secret when it opens up, it is not looking good. Ftse in negative territory. Then we keep rolling over. Look at the bond market this morning. A bid to the front end of the bund curve. That ecb News Conference this thursday just gets bigger and bigger. We do not expect anything from Christine Lagarde, but, wow, is the pressure building. Yields heading north, up three basis points of the front end in italy. Over in switzerland, they have got their own problems, annemarie talking about that earlier in the week, and the front end there, that is a bid, too. 5 , the by one point cac 40 down by two, and the story out of france is that isron is macron considering another lockdown. I do not want to speculate. That is not my job. The reports are out there. You can read them for yourselves. The proposal to shut down restaurants for up to a month. So equity, bleeding red in europe, commodity rolling over. The brent crude just about hanging in there. Annmarie we had the stockpile data in the United States, but this demand story is not going well for brent or wti, wti down more than 3 , and as europe goes backwards, that demand picture can get very difficult. We are still waiting for the dax to open, as jonathan was saying, that proposal from merkel could be key, and of course we are waiting to see what Emmanuel Macron has to say. I think there could be nuances. If you close for a month, do school stay open . What kind of work can you do . s maria bloomberg tadeo standing by. A busy morning for you, maria. What have you learned so far . Go into the hard view of what you have been doing. Maria lets not speculate. Nothing is official until Emmanuel Macron says it is official. That is the way he operates. We have to wait until 2 00 p. M. European time. There are multiple resources suggesting the french government has decided to take that decision to go for a onemonth lockdown. A lot of this has to do with the figures we have been seeing this week. They have become concerned with the number of pressure on officials and have decided to go for a draconian measure shut down everything for four weeks. The tension in the story as there seems to be a debate in the french government as to who will be allowed to continue to operate, which industries are going to be given the green light to continue to operate over the next four weeks, and what to do with high schools, because this is also a point that is key for many parents who are now going to be told, you now have to go home and work from home, it is very difficult to do that two things at the same time. It is difficult to have an economy operate on a normal basis or something that looks like normality when you have to juggle the two of them. Again, a lot of this will depend on Emmanuel Macron. The debate has shifted, down from no lockdown to a lockdown now needed to protect hospitals and also save christmas, something we hear time and time again, perhaps going for that sentimental value to soften the blow. We are seeing the anger in the streets, pushed back in europe, citizens asking themselves, how did this get so wrong . Annmarie right, we saw those protests in rome, garbage pails on fire. The dax is open now, down. 9 . That is the story you outline so well in france. What has been going on in berlin . What is merkel looking at . Maria again, this is just an idea that Angela Merkel is floating, but we know she carries power on the german region. Germany is a very decentralized country, however, Angela Merkel is putting up this idea that for the next four weeks, starting november 4, all hospitalitys, bars, restaurants should be shot in germany. Angela merkel has been all bars,alities, restaurants, should be shut in germany. We are already seeing those numbers in late october, and she has decided to go for that position again, but it will have to be agreed with the region. Nonetheless, it is the biggest economy in europe. This is going to hurt, and, again, it will probably really change sentiment in europe, because we see restrictions that are becoming more structural and also longer in time. This is not a situation of one or two days but a few weeks or potentially longer. Jonathan maria, great work, as always. Much more to come out of europe with maria tadeo. Five minutes into the session, that is the sector story. Here is the index. By 1. 2 . Off monday, tuesday, the dax down by 1. 9 . If you lift the lid on the stoxx 600 and get back to that sector story, the pain in the dax, we were down 1. 4 on the bank index on monday. On tuesday, round about 1. 7 , and on wednesday, down by more than 2 . It is a great story, it is a bid into the bond market again, and it is about the inability of the ecb to hike Interest Rates anytime soon with an economy that is really facing a double dip now. Toning us now, i am pleased say, john roe, Legal General investment head of multiasset funds. John, your read please of the news coming out this morning. John yes, the lockdown should be expected. We are going to get increasing caseloads until we are not going to get increased caseloads until action is taken. The reluctance of government to take measures that are known to reduce the virus that have limited, direct economic impact, so in particular, there has been a huge spike in caseloads between 11yearolds and 29yearolds, which has been heavily linked to the return of education through september and october, and it would seem like secondary schools and universities would be an obvious place to start, bringing down with limited economic impact, but they are real reluctant to do so, because of the concerns over the social and development angle for those age groups. Jonathan so, john, tell me what you are doing this morning industrials, financials, energy, bottom of the pile. More restrictions coming, potentially. Have you been derisking around cyclical names . John not really around cyclical names. Some of those are already beaten up. Travel and leisure, it has been one of the bestperforming sectors, because around 80 of it is still closed in one form or another, so for that perspective, the ability or the potential for it to be harder hit is more limited, so actually come arguably, for that sector, it is more about the vaccine timing than it is about the time between now and the vaccine timing. We have been aiming for those sectors that are particularly low, so travel and leisure is a good example, European Telecom is another, where investors have so much negativity toward the sector, that that provides a helpful tailwind for is Going Forwards. Ofities theres a lot uncertainty, but when you look at the pricing and options, for example, it is not that much negativity until later today, so actually, it was more uncertainty than investors being concerned in one direction or and or the other. Which may make a deal with equity more difficult. What we are doing instead is looking at the positions where we can be negative but give us more asymmetry in the payoff, so we get a large payoff if things get worse, while a limited payoff if things get better. That would be things like european and u. S. Investment grade credit, also in the u. K. s case, higher than at the start of the year. Annmarie john, quite contrary and how long you are on travel and leisure. We have had a terrible year, down to print set down 2 on the year. Europe is going in reverse. Do you think at some point you might want to say actually, we have to leave it on the table, because the vaccine front is just overblown . We do not have an exact vaccine just yet. At what point do you think, potentially, that long is just not going to work . John yeah, so we only for the long on in the third quarter, so we missed out on the period of the worstperforming sector. Us, you said in advance, the market down 2 . What do you think happened to travel and leisure . I think in secretly camesa before percent or 5 , so almost the fact that it is broadly in line in the market, i would surpriseshould investors. That is one sector where the timing of the vaccine is arguably more important than the shorterterm path. I think where we do need to be careful, if we do get this escalation, than it might be the more preferred sectors that start to really get hit, as people start to lose space, and those crowded areas get more. Health care is kind of the more popular sector. It is kind of easy to go virus health care is great, but it is downsides as well, such as elective surgeries being down and generally reduced hospitalizations as people are told to sit home. Jonathan hey, john, thank you. John roe of Legal General investment management. We are about 10 minutes and. You can see the pain of the sector lever and the index level. The ftse down 1. 5 , the dax up by a. 3 . By 2. 3 . The dax off , yields lower, negative three basis points. I want you to take a look at italy this morning, because i think this is a really Important Development in the last six months. The italian bond market has been really resilient, and what we face this morning is potentially some really chalky times ahead for the european economy. What we are not talking about a significant, though. We are not talking about economic risk and breakup risk. A little bit of softness may be relative to bund but not the selloff that you might have seen 6, 7, eight months ago, and it is a Silver Lining to a very dark cloud in europe this morning for ecb president Christine Lagarde, it is that factor right there. Coming up on this program, we are talking u. S. Assets, with just six days to go into the u. S. Election. Alongside annmarie hordern, i am jonathan ferro. This is bloomberg. Oomberg. Jonathan 14 minutes into the session. Good morning to you. The stoxx 600 down by two percentage wise, the dax off by 2. 7. It is the third ugly day for the equity market in europe. Lets talk about the bond market briefly, i want to return to that seen. In the bond market, a bit into boones bid into bunds. This is the story in italy if we had this situation six months ago, you have seen something more brutal. John roe still with us, legal and general investment management, head of multiasset funds. I am not disregarding the weakness we have seen it is there on the screen, but relative to six month ago, how closely are you watching ahead of the ecb meeting this upcoming thursday, john . It has john it has bee john it has been a huge change. The next time we get a real downturn, do we get the fragmentation and the infighting in the euro zone, or do we get them to come together and come up with a response that really helps those countries most needed . The Recovery Fund was a together, coming particularly if you allow for the rebates other countries see, while country is in italy are receiving quite high payoffs, showing that necessary solidarity and increases the belief that actually crises could bring the European Union closer together rather than causing it to fragment and furthers aou say, discussion around the breakup of the euro. The ecb by an clearly really helps. We have seen extremely Strong Performance in italy generally, so even if italy were to give something back, that would be ok. I dont feel like this is a position where the ecb needs to act quickly, because italy has done so well in the last few months that actually it has been a real outperform her, bid outperformer, bid spreads tightening. So that is a fun has a dynamic, and it gives a real tailwind, but it makes investors really reticent to go short italy in the way that they might have done historically. Annmarie you have moved from neutral to your longview and the peripheral. What do you like in terms of sovereign debt in the region . Particular,like, in in the region, we particularly like croatia, and the reason we like croatia is actually to do with european convergence again. Croatia is on the way to joining the euro zone, and if it means those milestones, we would expect croatia to be at the short end of the time period can takes to join the euro, so around two years. As a gets closer to that, we should see more convergence with euro zone countries. So, for example, euro denominated croatian still trades around 150 basis points over bunds, whereas in slovenia, which has already joint, trades more like 50 basis points over bunds. We see that as a real mediumterm convergence play. Stillthan that, we have some sympathy, relatives but ining to come there, peripherals generally, we have not exited to that side. Italy in particular has been so extreme this year. Jonathan i have no idea if this continues, let but certainly at the moment, im sure Christine Lagarde is happy with what she sees. John, we are about 18 minutes into this session paid i am aware that early people, early risers in new york will be waking up to europe locking down potentially a little bit more, Emmanuel Macron speaking later, could be locking down for a month. Out of germany, a proposal to shut down restaurants. And in equity market that is lower, down three Percentage Points on the dax, the cac 40 up by little more than 3 . John, two months ago, if i offered people this market, where it is right now, they would have jumped all the way in, two hands full, up to their next in european equities, because they thought we would have more physical integration. That has gone wrong big time in the last couple of weeks. Are you a buyer of this move that we see on this screen this wednesday morning . John not yet, and the reason for that being the inability of these European Countries to keep atelow one, so when you look measures that are needed, there are some left that have relatively limited economic impact, so in particular, reduction in interactions in secondary and universities. Those are areas that have seen the biggest spike in case rates, and they are very clearly part of the population that could be targeted to bring this under control. But it is the surprise investors and we include ourselves in this we have not been long equities, but we have been concerned the volatility in either direction could be high is that governments have been so reluctant to control education. They have seen the social agenda as more important than investors had anticipated, and that made universities and schools going back and then a real reluctance to close them again. John all right, John Jonathan all right, john, great to catch up, john roe of Legal General investment management. We are negative big time of the s p 500, futures rolling over, but nothing compared to the losses in the equity market in europe, down about three Percentage Points on the dax. Annmarie, bottom of the pile, energy down another 3 on the stoxx 600. Withrie well, jon, europe going back into lockdown s might begerman calling at lockdown light, that means less people on the road, less travel, and that does not bode well for an already precarious oil market, which really only asia, jonathan, is the one picking up and demand. Jonathan and for good reason, because of china real thing. Annmarie, thank you. 10year Government Bond yields, the lowest since march. Up next, sales double as the covid19 pandemic drives demand, the best performing stock of the year, and we speak to the cfo of delivery hero on bloomberg. Continentit is a facing difficulties, an equity market breaking down, off by 3 on the dax. A bit into the bone market, lowest since spring, a bit into , a rare dollar, 1. 1754 break spot on the dax this morning, bright spot on the dax this morning, annmarie. Annmarie delivery hero se only spot on the dax, up 1. 5 . Sales doubled as the pandemic release drove demand for food delivery service, and right now we are joined by the cfo, emmanuel thomassin, of delivery hero. Good morning to you. In germany this morning, Angela Merkel is looking at a proposal, potentially a month, is closing restaurants, closing bars. How are you looking at that potential demand . Emmanuel in general, we managed covid19 pretty well. Consistent to make sure that we are having supplies and riders. The first six month have been ofcial for us, the losses diners, but so far, delivery hearing delivery hero has been able to be consistent. So the lockdown is not good news, but we are able to manage the situation and help the restaurants. Annmarie how have demand trends changed, given the is lockdowns in europe . Emmanuel well, we have seen a new commerce, people who have not tried our services in general may be coming faster than they had seen in the future, so they were trying our service for the first time. This is the case for the food business, and this is also the case for the grocery business. I think the online delivery business, not only food, is anving a boost across europe lockdown. Annmarie the dax is down, covid front and center of europe. You recently joined the dax. Has that changed your strategy at all with the company, or even psychologically, the culture of the company . Emmanuel well, the dax listing has more of an impact on the strategy. Growthcompany is on a path. We have a Clear Strategy for us. The investors know this, the shareholders, and also the supporters. But indeed, entering the dax changed a bit the culture, the mentality. Higher. Ny, it is by far we do have more scrutiny, so we have to be more focused, and that is kind of the Culture Shift that we have inside of the company. Jonathan emmanuel, we appreciate your time this morning. Emmanuel thomassin, cfo of delivery hero. Good morning, alongside annmarie hordern, i am jonathan ferro. It is an equity market that breaks down. The stock market speaks, the leadership speaks next. What do restrictions look like across the market . Chancellor merkel making her proposal, to shut down restaurants for a month. Mr. Macron, we will hear from him this evening on potentially a lockdown in france. From london, equities lower. This is bloomberg. Francine welcome to bloomberg etf iq europe. Over the next 30 minutes, we will be your guided market to exchange written funds. Everything you need to know about the funds and the flows. We ask if a lowcost solution is and when china set up a new export. The country takes a new step with the etf market. What it means for investors. Lets talk about which countries and sectors are attracting with dani burger. Dani one