Were going to have to be patient until the hard work of tallying boats is finished. Manus biden on the brink, michigan and wisconsin edging closer to the 270 electoral votes. Trumps campaign sued pennsylvania to stop counting votes. Treasuries are bid on policy uncertainty in the fed is set to focus on the pandemic, while the boe is expected to boost qe. The results may continue to flood in. Majors welcome to the show, and marie. Good to see you. What a difference 24 hours make. My guess in the past two hours have been saying you possibly have the genesis of chaos and hyperbolic language. Why . Because were going to begin to understand what the faceless Electoral College dissenters might do to spoil the road to the white house. Good morning. It is still risk on in these markets, but the question is the validity and veracity of a challenge to joe biden, if he gets the numbers. Annmarie we are still counting those boot those votes in america. Nevada, pennsylvania, georgia, were still waiting and they are still county because so many mailin ballots due to the pandemic. The markets are contending with the fact that we could see a biden presidency, but a split congress, how is it going to push through all those plans you spoke about . We are seeing Global Equities push higher, the Msci Asia Pacific having one of its best since march of 2018. Yesterday the nasdaq closed up nearly 4 . We are seeing weakness on the dollar, and what is going on in the bond market . When i walked in the building yesterday, we were at 90 basis points. We now trade at 73 basis points. Sinceggest oneday slide march. This of course is about that divided government. Thats delivering the prospects of the blow of the super mega stimulus deal and that is playing out in the bond market. Joe biden is on the brink of victory after flipping both michigan and wisconsin, two key skates in what democrats call the blue wall. Hes just six electoral votes shy of the 270 needed. Ed, you were in arizona yesterday. Arizona has been called the ap and by fox news. Were getting Fresh Results potentially in the next couple of minutes or hours from maricopa county. Walk us through the latest on the electoral map. Arizona,it comes to there are around 400,000 votes still to be counted. Posters onely both sides of told me they still expect those to skew toward joe biden and the democrats. The hope was that would see a big surge of republican voters, but what im hearing, that didnt quite happen. Biden has her razor thin lead in nevada with 75 of the votes counted according to the Associated Press, and it should could be some time before we get a result there. Ballots butreceive november 12 to count them. The gap has been narrowing, there were around 90,000 votes still to count in georgia as of a couple of hours ago. We know they are probably skewed toward democrats, so its a tight race but the most direct path for biden is nevada. Theres a chance in georgia as well. Even though the race has been called in arizona by the Associated Press and by fox news, what happens there as the gap narrows between the two candidates. Manus we been seeing Trump Supporters arriving at the maricopa,tations in weve seen some supporters arrived there. What is the strategy of trump, is it to stop voting in certain counties and to threaten the Supreme Court . Talk us through the strategy as we understand it right now. Ed its both, its a contradictory strategy, where the president wants to stops stop votes where he is ahead and have them continue in states where hes behind. Pennsylvania, according to joe biden, is still up for grabs, even though he is behind, because in urban areas like philadelphia, for example, those votes are very much skewed toward democrats. As you said the president and his campaign have instituted Legal Proceedings in that state and others to basically halt votes in the states where he is ahead or have them continue. Also basically where ballots have come in late, in wisconsin which former Vice President biden climbed earlier today, he wants a recount. Biden has a margin of around 20,000 votes there, which comes as no stranger to recounts. Difficult to see how her recount in wisconsin would work in the president s favor. How a recount would help in his favor. Manus weve got our work cut a raft of, weve got corporate earnings to get to. Reductionk seeing a in provisions, theyre talking cutting revenue 2. 3 billion. The estimate was for 306. All these banks, the loan loss provision, we still see the loan loss provision that commerzbank is being 1. 31. 5 for the year. Lets have a quick snapshot of unicredit. The 202021 profit target for the year. 731 in the third quarter, and that is below the estimate of 1. 37. So we are just seeing that come in their on the unicredit side. So net income also beats. You can hop on and grab those numbers a little bit later on. Well come back to socgen because that is the other major story. Well catch up with frederick a little later on. This is all about Loan Loss Provisions improving at the bank and also the equity side of the business doing better as well. They had that right in the first half on the equity. Cominge and net income in at 860 2 million euros. That is almost double the estimate so they pretty much beat on all of these fronts. From the first lost in 12 quarters. Will speak to the softy and ceo coming up around 6 30 a. M. London time. You dont want to miss it. Lets get a recap of the news this morning. It even before the results are known, the online bookmaker the a similar call in 2019, coronavirus pandemic is accelerated new records and infections. It continues to rage in wisconsin where hospitals are at or nearing capacity. Issuek had an outbreak in population that triggered a mutation. Italy is ready to improve new stimulus measures this week. The Prime Minister said the nation will sell bonds to raise funds as needed. The government is clamping down on northern cities with new restrictions and introducing a new threetier system dividing the country into different risk levels. Englands new lockdown starts today, closing pubs, gyms, and nonessential shops. Boris johnson said the nhs would be in extraordinary trouble without urgent action to cut the spread of the virus. Yesterday the u. K. Reported 492 more deaths. 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. 6 10 in the city of london. Coming up, it is fed and boe decision day after highly contentious election in the United States, and the u. K. Going into lockdown. We discussed the Economic Impact and Monetary Policy on all this next. This is bloomberg. The overall theme is that things are going to be incomplete and we just have to wait. Voices across our networks discussing the implications of the slowly developing election picture. A quick snapshot in atlanta and georgia. The counting is still alive, we are waiting on these final votes to come through. No democrat has carried georgia since 1992. So the voting continues. We will take you through those as they come. England, it is decision day. A highly contentious election day. The fed is likely to stress the urgency of the need for first further fiscal support. On this side of the atlantic, the u. K. Back in lockdown. The bank of england set to announce a new round of stimulus there. Morning, host this yesterday the market faced a , but there isrio no blue way. Today we seem to be embracing, where literally hugging divided government. Does that add up for you . Is it correct to be pro risk in a divided government scenario . Right, u. S. Yields are dropping and the weaker dollar makes sense. You are right around the stocks. The market is saying are probably not going to get weve seen tech outperforming financialse underperforming if you look at the s p. Annmarie i have a question on bond yields. I came in yesterday and we were at 90 basis points on the 10 year. Today we are at 73 basis points, and absolute wild swing on the tenure paper, something we havent seen since the pandemic hit in march. Where do you see bond prices going from here, given the divided potential government . If you have this divided government, it seems like the most likely scenario. Ithink what is combined with expectations that fard temper initially how it goes to the upside. I think yields will head lower. 6570 would still be the way we are thinking about it. 30us you could say that year paper is fixed yet he yesterday he said he was going to the Supreme Court. The fed will make the noise they want to have a fiscal deal. People are saying to me the republicans offered 500 billion before the election. You could look at something very skinny and that fiscal void and fiscal narrative is a bigger risk that we are not discounting enough. Say mitchan mcconnell is 500. Maybeould put a number, 1. 3. Clearly more than the 500 billion. Bad, buthink its that its going to be smaller, and that is what the fed doesnt like. Annmarie talk about in your in theat if trump wins senate is republican, stocks though higher. If it is trump its going to be growth and if its biden is going to be value. Are you rotating . Thomas its a good point, good question. It goes higher, no matter what. Wins, if he had had a blue suite, you would have some pressure, think thats fair. On the other hand, you would have the value stocks. You would banks performing better. Now you are somewhere in the middle. I think in this scenario the the value is not theg to be supported from higher yields. Your back to the same tradeoff with financials and cyclicals during relatively poorly compared to a blue suite. Back and forth between the vaccine and the virus and stocks are going to head higher again. Manus vaccine, virus, and victory. Yesterday the fed so theyre not going out further on the curve in terms of issuance. What more could or should the fed do in a fiscal vacuum or void that we might go into . Whated my last guest dexterity does the fed have on the Balance Sheet . Thomas i think they have a lot. I dont really see the constraints on the Balance Sheet. Yesterday you saw huge drop in inflation, and that is what the fed can do something about because they have this idea that theyre feeding into future inflation. I think they should step up qe eventually, but it would end on how much fiscal stimulus youre getting. If you get quite a lot, they will probably wait because they want to see the major benefits of it. But if you dont, they will step up qe. Up,arie stocks are going no matter who gets into the white house, according to him. Coming up, ing disappoints, net income missing estimates. Were talking with the cfo. Stay with us. This is bloomberg. Annmarie good morning, this is bloomberg daybreak europe. Lets look at where we are on the electoral map. We still have votes being counted in america. In the next halfhour we should get results from erakovic county. The ap and fox news have projected arizona to widen. 64 on the lead to 214 we will get those final tallies coming in. We are waiting on ivana, pennsylvania, and georgia. Nevada. Ae dutch bank will introduce new distribution policy of a 50 payout ratio. Thanks for joining us. I want to stop start with the loanloss revisions. The estimates were for above 800 million. Much better. Do you expect this to be maintained, given the fact that europe is going into lockdown 2. 0 . Nice to be on your show. The first thing i wanted to say is that what we see is that the third quarter, the economic recovery has been better than we saw in q2, and we see that in for example the payment activities, returning to more normal levels. Havemmercial activities we acquired an additional 200,000 new primary customers, so things are normalizing in cutesy in q3. Nonperforming loans have not really gone up during the course of the quarter. Thats why the loanloss q2 toion has dropped from about 470 million as you mentioned during the course of q3. About theimistic ability to handle what is coming with the second lockdown, giving guidance in the previous quarter that we do not expect risky spence is in the second half of the year would be higher than the first. Clear that indicates that from what we see from q3, that seems to be the case. You say the distribution, dividend policy and 50 payout ratio is resilient. What we want to know is when will the ecb that you pay the dividend for this year, and is the 2020 dividend on schedule . Tanate what we have done today is announced two things. Weve given a new capital target at 13. 5 . We have lowered the level of capital that we believe we need to run the bank over the longterm to 12. 5, so thats the first announcement we make. We will take our time to get to that 12. 5 metoo make sure we see an exit view from the current corona crisis. The second thing we have two announces the change in our dividend policy, going from a progressive dividend policy to 50 of resilient profit. Thats the second plan that we have. Have reserved our profit for that dividend payment. As you mentioned, this is guided also by the recommendation of the ecb on Dividend Payments and we expect that before the end of this year we will get further guidance or further recommendations from the ecb about whether they will relax the dividend band that is currently there for a number of european banks. Annmarie if they dont relax the dividend band, if that does not happen, what is your message to investors . Well, what i think we need to do is that, clearly the ecb is being responsible to make sure that they see a clear line ofsight for corona in light what we discussed about the second lockdown. Having said that, our message to our shareholders and investors is the fact that today we sit at 15. 3 for tier one, significantly above our minimum requirement of 10. 5 , and we do reserve dividend for payment so whenever that happens, we have reserved those dividends, allowing us to continue our business while at the same time providing the right returns to our shareholders. Manus what kind of lending is the bank doing at the moment . We saw sharp declines in the Second Quarter. We just came off that aggressive lockdown. What does it mean for the three proof 3 4 lending . Growth target that you have . Are you going to make that number, and if not, where does it settle in that . Tanate if you look at our lending numbers, we still have that ambition target of 3 4 . As you would amend as you would imagine, given the lockdown we went through during the course of q2, that was not possible. What we do see now is resuming activities particularly in our asian franchise and a little bit in the u. S. The european long demand remains for the time being. As we get out of this rather deep economic recession in q2, we expect demand growth to start to rise in subsequent quarters. Wehave to keep in mind that may go into a second lockdown during the course of this quarter. So its a mixed picture about what will happen but were confident about resuming Economic Activity all the time. Manus thank you so much. Lets see what this second lockdown brings across the economies. The cfo of ing. Us. Ng up, socgen joins they have rebounded from the worst losses in 12 years. Third thirdquarter profit almost dusting almost doubled, beating estimates. We will talk to the ceo, he joins us in just a moment. Map . You got your election annmarie lets pull it up and show our viewers where we stand right now as america continues ,o count related biden 264 President Trump 214. We are waiting on pennsylvania, georgia, and nevada. Three key ones we want to hear from. Stay with us. This is bloomberg. Annmarie good morning from london. This is bloomberg daybreak europe. We continue our election coverage. Here are todays top stories. Millions and millions of people voted for us tonight, and a very sad group of people is trying to disenfranchise that group of people, and we wont stand for it. We are going to have to be patient until the hard work of tallying votes is finished. Brink,e biden on the michigan and wisconsin edging votes. To 270 electoral stocks push higher and treasuries the fed is set to poke us on the pandemic focus on the pandemic. Commerzbank with the full year net negative result. We speak with the group cfo in the next hour. You dont want to miss that conversation. Gone 6 30 a. M. In the city of london. We are waiting on the results coming from the United States. Our map does show that arizona was given to joe biden, the former Vice President. Arizona, in the next few minutes, we may get more votes coming. They are still tallying some of these votes even though the ap and fox news have projected it to joe biden. Arizona is a deep republican state, so this is one of the states that joe biden was able to flip from the 2016 map. This is the state of john mccain and barry goldwater. Republicann some protests around these election counting centers. Tally the electoral , where on thena kospi of nevada, pennsylvania, georgia, these are all the votes that need to come in and could swing. They are ground zero any political challenge or legal challenge could cause pennsylvania, thats where a lot of people are inferring could be the basis of a legal challenge. Its a whole other discussion. Sure,ing thats for everybody wants a little bit of america in terms of stocks tax,se less Capital Gains dansk bank wants to be long on everything. The overall index, volatility is imploding, but the ground zero, i would say of repricing comes in the bond market. 30 year bond yields imploding yesterday. This is about the lack of belief in stimulus coming at a size and scale the market believed it would come through before. Inflation is have been decried. Our guest host in the last 30 minutes had said tenure paper take it down 2. 65 . Thats the state of play on the markets. Lets get the rest of the news from the u. K. , england going into lockdown. The central bank set to announce a new round of stimulus. We will also hear from the chancellor addressing parliament. Good morning. Good morning, manus. Thats right, this is the first day of lockdown and the boe is expected to ramp up their Asset Purchase Program by about 10 billion pounds. That estimate set perhaps prior to the second lockdown announcement, so now estimates have moved higher for how much qe table and into the system. Reporting yesterday could be as much as 200 billion pounds. Really supporting them as well. The other thing to look out for in todays announcement is an update on the forecast. The prior forecasted assume a second lockdown. However, it was somewhat of an optimistic outlook for the gdp, so we could see a downgrade there as well as an extension on the length of time it will take the u. K. Economy to recover from the lockdown. Thank you so much, dani burger there with the latest on the agenda for the bank of england. Society general rebounding from its worst loss in 12 years. That thirdquarter profit thats almost double analyst estimates. In, we did see everything in front of it. Its about the sustainability of the loan losses, have we passed into lockdowne go 2 . Can the momentum continue . Frederic good morning, risk, werehe conserving our guidance for the full year around 70 basis points. I must say that when i see the weity of the absolute remain consistent with our previous view. 0 basis points for this year annmarie good morning, covid is one of the major stories, the other of course is the election. Do you think volatility will continue, or now that we are nearing closer to a potential result in the United States, that volatility will start to come down . See, certainlyll what we are doing is going beyond the shortterm evolution of volatility. We are adjusting our Risk Appetite on Investment Solutions and considering will see the results of that policy with market activity reflected in the fourth quarter. Manus the whole world is focused on whether we go into a period of chaos in the United States, of legal challenges to the presidency. Are you taking any reduction, are you reducing any of your trading, reducing . . Any of your exposure are you making any moves to shore yourself up for perhaps a chaotic 23 months . Were taking into account the shortterm potential risk. As i said, beyond that, and we announce that to the markets at the beginning of august, we are adjusting our Risk Appetite for our structured equity and credit product. Having designed a range of products where if we had to face a similar crisis as the one we had with the first lockdown, we would have an impact that would be more than divided by two. We are moving forward with the risk adjustment, and again im confident that we will the kind of event weve had in the Second Quarter we will put it behind. Annmarie right now where things stand in the United States, biden has 264 electoral votes and President Trump has 214. Biden being able to win wisconsin and michigan puts him on the path to that 270. How is banking regulation comparing the United States from a trump to a Biden Administration . Frederic i think u. S. Bankers would be much more debt in a better position than myself to comment on the difference. Bidenms that maybe mr. Would be a little more demanding, but im not sure at the end of the day. We see the overall outlook of the election that there would be so much change. I guess that in most regions, governments will also be very keen to see their banks able to finance the economy, finance the recovery, finance the growth plans put in place by the government. So i dont expect so much change in the very near term. Companies you say quarter behind, but the stock is still down 50 . Exposed to atially takeover . How do you look at your position in this potential consolidation story in europe . Do you feel exposed or vulnerable . Your stock is down 50 . Frederic the european Banking Sector is also down significantly. I heard the people commenting on this from the industry, we had this big issue on the capacity to pay the dividend, which is certainly a major factor, which explains why the european Banking Sector is down this year. I think the valuation which makes sense compared with a longterm potential of the banks. So i dont think so at all, and the priority theres a lot we can do to better reflect the value of our assets. You mention yourself that are net profit is more than twice higher than the markets expectations. That shows that we can do much better than certain people think, and its really the priority to implement all our different projects and ensure resilience in this crisis and beyond taking into account evolutions,rends, the crisis is accelerating. As well as the energy transition. These movements will be longterm ones to deal with. To be the market is going focused on everything you say about dividends. What can we expect in 2021 . Are we going to get a regular dividend from you, an extraordinary one to replace this years count cast in terms of what is reasonably expected from you. Frederic first we will wait for the decision of the supervisor, which is very important. Stands at 13. 2 at the end of the third quarter. It gives us a 420 basis point buffer above the regulatory requirement we have. Which means that we have definitely a lot of flexibility and we will manage our capital in order to raise the rate at some point, depending on our investors. Annmarie thank you so much for joining us this morning. Brink of victory. Joe biden sounds confident as he wins michigan and wisconsin, but its not over yet. 214, that is where we stand. This is bloomberg. Manus election 2020, its bloomberg daybreak europe. Higher. Are flying ands look at the s p 500 nasdaq, all trading higher this morning. He gives you the justifiable the reason why just broken electoral system in america is not bad for stocks. Annmarie you do see a weaker dollar. One note saying it doesnt matter whos in the white house, what matters is the fed. We will hear from the fed today. What can they do as we wait for the Election Results . The u. S. Is still dealing with a pandemic. Joe biden is on the brink of victory. He flipped michigan and just six and is now electoral votes shy of the 270 needed to win the presidency. Is ang us from washington close advisor to Vice President joe biden. He knows the ins and outs of what this administration could potentially look like. Thank you for staying up late for us. Vice President Joe Biden seems to be on the brink of this. Youre still counting votes, though. What stands out to me is the fact that this wasnt the blue wave, when you look at the senate, that the democrats were hoping for. What does it say about the future of the Democratic Party . You for having me. Its a pleasure for me to stay up late and join you. At the end of the day, Vice President biden his team never thought this was going to be a kind ofe or some tsunami of democrats across the country. The goal is to win, and it looks like hes going to win. Well have to wait a few more hours to be able to certify that, maybe another day, but all the arrows are pointing in that direction. Even in a place like georgia, where donald trump had a 350 thousand vote advantage a few 23,000,o, is now nearly and most of the votes remaining are going to be coming from democratic districts. So the Senate Looks Like it may be in control of republicans. Remember we have two georgia seats that will go to a runoff, which means we have another six weeks or so of election. That could decide the fate of the senate. So i dont know if we know the fate of the senate quite yet, so we will have to wait a little bit longer. The Democratic Party will be very strong. Youll have the executive branch and control of democrats and i think theres enough senators, even on the republican side, who realize we are going bankrupt, and we have to have a stimulus. I would not be surprised to see tax hikes or adjustments, republicans or democrats are in control of the senate. Try and get through some of the big issues. Day one, joefrom biden will rejoin the Paris Agreement and undo some of the tariffs. What is top of agenda for executive order if it is a a Biden Victory . Amos i agree on day one there will be a rejoining of the Paris Agreement. Youll see in the first several inks some of the regulations the Energy Sector that would put in place by the Obama Administration that were withdrawn by the Trump Administration will be put back into play. They will announce new goals for the United States on energy. They will look to use the executive Branch Powers to implement new rules and regulations while in parallel working with congress for something that is more concrete and more permanent than trading executive orders every time there is a new administration. Annmarie what do you think his relationship will be like with Mitch Mcconnell, and at the same time trying to appease the most aggressive part of the Democratic Party . Amos i think the base of the Democratic Party remains the middle class in the United States. You said earlier in the program, states like michigan and minnesota and wisconsin and potentially pennsylvania, places like georgia, thats the base of the Democratic Party. Remember, joe biden was a senator for many years. He knows Mitch Mcconnell well. He has deep relationships in the senate and i think it would be a mistake to just assume the relationship between the executive and the senate that existed under the Obama Administration will be replicated. I think it will be different and i think there will be a lot more of striving to find places of agreement where they can, while still disagreeing in other places. Know veryething you well, the rn policy, how quickly would biden as president get a and a to the jcpoa substantial deal moving . Amos as you know, Vice President biden has repeatedly said that he intends on returning to the jcpoa, but lets rumor there are two sides to this. The iranians have to want to come back to this deal as well. That ive an election believe will be influenced by the the outcome will be influenced by what happens here in the United States, so i believe a president bynum will immediately reach out to the iranians to see what we can do to reach a deal. It will probably mean we have to have some adjustments, perhaps the sunset provisions, meaning the expiration of parts of the agreement, but i would expect, barring any major surprises, that within a few months we will have a return to either the minas, meaninga freezing some of the sanctions in return for reducing activity by the iranians. If you are reappointed, you know who you have to come and talk to first of all. Lets first when this thing. The former special envoy and formert obama, advisor to Vice President biden. Thanks for joining us this morning. 264214, boats in america still being counted as we try to see whether its going to be President Biden or another President Trump. Biden is inching closer to that victory. And of course we are moments away from the boe decision. Manus we also have the fed as well, but the bank of england is up first. It will probably show a level of commitment to do whatever it as were going into a lockdown in the united kingdom. Edwards will take you through the decision. Will it be additional qe for all my friends . This is bloomberg. Are you frustrated with your weight and health . Its time for aerotrainer, a more effective total body fitness solution. announcer aerotrainers ergodynamic design and four patented air chambers create maximum muscle activation for better results in less time, all while maintaining safe, correct form and allows for over 20 exercises. Do the aerotrainer super crunch. The prestretch works your abs even harder, engaging the entire core. Then its the back extension, super rock, and lower back traction stretch to take the pressure off your spine and stretch muscles. Planks are the ultimate total body exercise. Build your upper body with pushups. Work your lower body with the aerosquat. The aerotrainer is tested to support over 500 pounds. It inflates and deflates in less than 30 seconds using the electric pump. Head to aerotrainer. Com now. Now its your turn to lose weight, look great, and be healthy. Get off the floor and get on the aerotrainer. Go to aerotrainer. Com, thats aerotrainer. Com. Anna good morning. Welcome to Bloomberg Markets european open. Than an trade is less hour away. Here are your top headlines. Joe biden is on the brink of election victory in america. Edge himand wisconsin closer to 270 electoral votes. Trump supporters chant, count the vote in arizona. The Trump Campaign sues pennsylvania to stop counting votes. Stocks post theiresev