Strengthening as asiapacific nations signed the Worlds Largest regional freetrade deal. President trump plains fresh hardline moves against china. M a at the double. Pnc financial agrees to buy a usa unit for 11. 6 billion and creating a european giant. Very good morning to you. Market,to bloomberg the european open go lets get the european open. Revenues coming in at 21. 4 3 billion euros, just a touch ahead in line with the estimate, reaffirming their cash flow guidance for the full year 2021, something perhaps to have that kind of visibility at this point. They say they are on track to ipo. This has been a talking point, what kind of money were they going to raise . There has been talk of perhaps a 4 billion euro ipo coming next year. , it hasthe same unit been valued by some at 20 billion euros. That would make it the largest listing in europe in more than three years. We will be keeping an eye on that. Vodafone said they are on track with that plan. Marketst to the broader and look at where we are on European Equity markets. This is what futures showed. A clear picture. If we cast our minds back to friday, stocks in the u. S. Pretty strong. Europe flat. Futures on both sides of the Atlantic Point to the upside. Expecting to see movement in both places. Touching an alltime high. In asia, a really strong session coming through. Asian stocks looking perhaps to hit a record at the close. , an adviser to joe suggesting there will not be a nationwide lockdown in the United States. That has captured the markets imagination despite noise coming from the current resident of the white house. We will talk more about that. Expect perhaps some of that commentary from joe biden on markets, risk on in terms of the Asian Session, in terms of emergingmarket currencies, copper making decent gains on the back of that data from china and also the big trade deal signed in the name of one third of the global population. Let us get to the markets conversation with mark cudmore, who joins us from singapore. Very good morning to you. Lots of people focus on what joe bidens advisor had to say. Hearinger in europe similar things before we got lockdown mark two, which is not the same as lockdown mark one in europe. On vaccinesfocus last week. Where is your focus this week . Mark many people are citing the biden news. I find this surprising given biden will not take control, assuming he does take control, for at least two months. U. S. S never expected coronavirus policy would be nationally led. The states have more control over lockdown. By the positivity today. It is followthrough from the close on the s p 500 friday. Also the fact there is good china data and liquidity operations. As for the vaccine, look. Seeing casest globally leveling off, but in the u. S. It appears to accelerate. Overwhelmed,system that will become the biggest fema, how many Hospital Systems are getting overwhelmed. Watching that in europe and beyond. The markets live blog you have been asking a question pricehow far bonds will vaccine optimism. It does seem in a world where we are still concerned in the Northern Hemisphere about what happens to the pandemic, how difficult is it in that context for bonds to sustainably go above 1 . What are you hearing . Mark there is consensus that Central Banks are going to keep Interest Rates low and do more Monetary Policy easing of various measures which will keep front end rates anchored. I think actually the majority of people, we are going to see steepening still, partially because we will get stimulus from the new administration, but also because of vaccines. Markets will start pricing that outcome of normalizing whenever it happens. That will lead to a steepening curve. Ineans we get yields the majority the minority of the camp. There is too much concern out there over the Economic Growth and Central Banks are going to remain committed to such extraordinary measures. I think they will keep the curves flat where they can and they will keep 10 year yields suppressed. 1 o not believe a move above yields is sustainable. I was reading about the Regional Comprehensive Economic Partnership signed by asiapacific countries, new zealand and australia in there as well. What interests me is the size of the thing, the fact it covers a third of the Global Economy, but also that it includes nations that have fallen out on other fronts. A nice reminder of the way countries can come together to do deals on trade. It seems a long time since we have been reminded of that. Mark absolutely. It emphasizes the long known pivot toward asia. It now has the Worlds Largest freetrade region. When we look back at this decade , 20 years time, when we look at the path china took toward global supremacy and economics, we might look at the moment trump blew up the tpp. One of the reasons it seems to it is certainly an impressive agreement is the more fractious divisions over the agreement. It is a longrunning story. This has been building for many years. It is just another confirmation of a good news story. Wereis where growth is, we where we are seeing the most growth, where the pandemic is controlled, and were stimulus measures have been directly targeted to tackle the economy in the wake of the pandemic. Nejra anna mark cudmore joining us with his thoughts. Bonds rice vaccine optimism . Reach out to us and the markets live team. Eight minutes past 7 00 in london. Over 11s. Virus cases million and germany may be headed for stricter measures. More vaccine data is expected this week. We continue to track the commentary from president elect bidens team. Pres. Trump and National Lockdown costs 50 billion a day and hundreds of thousands of jobs every single day. Ideally we will not go to a lockdown i will not go. This administration will not be going to a lockdown. Hopefully whatever happens in the future, i guess time will tell, but i can tell you this administration will not go to a lockdown. That was President Trump speaking at the white house rose garden where he said his administration would not lockdown the country again, but another president could. President elect bidens advisor said they oppose a nationwide lockdown as fresh are expected as early as this week. Awaitedtes are eagerly at the pandemic continues to accelerate. Cases in the United States have topped 11 million after adding more than one million in the last week. Joining us is blackrocks head of India Investment strategy. Withd we start expectations around lockdown measures and what that does to economies in the Northern Hemisphere . Around europe and the United States, what are your expectations . Week we had more excitement about a vaccine breakthrough. Investors jumped at any news. We are heading into winter. We are heading into rising new cases that we are heading to ofing numbers as well deaths. In the near term, which is why when we hear the news overnight about president elect not likely to implement and national it would appear some lookinglockdown was inevitable. In terms of how our Investment Strategy has been evolving in dynamics, itirus is really important to note that we do think it is a time to cover your cyclical underweight. A lot of our clients are significantly under only european equities and then we see light at the end of the tunnel. Expectations for some sort of normalization by the end of next year is now looking a lot more likely compared to before. Inkets tend to price normalization before normalization actually happens. We think it is time to close some of the underweight. It seems as if you are willing to look through volatility attached to the virus and still look ahead to a vaccine related trade. Someplace toward the cyclical. Plays toward the cyclical. When will you say we need to go fully into this new rotation away from work from home stocks into value . The current winners here technology,h care, they should continue to do quite well. The likes of Growth Stocks and quality stocks. The reason we say that is in this low rate, low growth environment, which is what we have been in and where we are are stillnvestors likely to pay more for above average growth, above average income, above average quality. This should benefit the current winners, the likes of health care and technology. For a rotation to fully take for significant underperformers of value to fallsound after many many down including this year, we will have to see significant curve steepening, especially long and coming back up, and expectations for growth to come back in a way that is more than what is currently priced in. The breakthrough brought some of those expectations forward. You see the rate hike expectation was brought forward 2023. U. S. From 2024 to we are still talking about a prolonged period of no action and this is what we are expecting. We were talking about when value was going to pick up again, nothing to do with the pandemic. We still run into old headwinds. Let me ask you where you put the money. You quite like emerging markets. You see this transpacific, part of asiapacific trade partnership. Intoare you looking to buy in emerging markets . Broadly, emergingmarket equities is our biggest overweight at this juncture. The reason for that is threefold. Number one, a biden presidency is likely to be dollar negative. Not significantly, but modestly. That supports emerging markets in general. Theer two if you look at virus data, but we are looking at, china being ahead of the curve, countries within the sphere of influence around china also doing better in terms of shoulding virus, that kind of support sentiment toward this part of the emergingmarket and also when we talk about cyclical growth upswing, which is what we are heading toward going into 2021, emerging markets having a higher gearing to benefit as well. This is why we are broadly emergingmarket equities and continue to have a preference for asia and countries around the sphere of influence around china. Announced, we have two spheres of influence, u. S. And china. You have to have both to have a diversified portfolio. Investors already have only u. S. The big doubt is china. Us, thank you, stay with wei li with more thoughts shortly. Doing prettyific nicely, up by 1. 4 . A new alltime high there. U. S. Futures point to the upside. The dollar is weaker as you might expect. Bloomberg first word news update. U. K. Saying brexit talks should be extended. The chief negotiator is heading back to brussels for more talks. He has seen, quote, some progress, but says britain will not be changing his position. The december 31 deadline is fast approaching. Austria is locking down for three weeks as measures failed to slow the pandemic. It will close schools and shops. It comes just two weeks after a lockdown was imposed leaving large parts of the economy open. The chancellors has he hopes these new restrictions can end on december 6. Spacex has launched four astronauts into orbit on its first regular nasa mission to the International Space station. The dragon capsule is set to arrive at 4 a. M. Tuesday morning london time after blasting off from cape canaveral. It is a milestone in the development of commercial spaceflight. That is your first word news update. Coming up, writing the retail wave. Investors have a new target on sigh sites in their ts. Anna welcome back to the European Market open. European equity market futures, u. S. Futures point to the upside. The Asian Session looks strong as well despite the latest virus headlines. The robinhood generation of traders has famously driven some of the sharpest stock moves from high science like tesla to beatendown stocks like hertz. Now the retail army is propelling growth in another sector. Etf built around Climate Change or gaming. They are on pace for their best year of inflows ever approaching 20 million so far. , are you seeing Retail Investors into listed in interested in megatrends etf . Year ins year a record the same way it has been a record year for sustainable etfs. A year were investors are looking to put cash to work, etfs have always been a very strong choice. What we have seen so far this year is that covid and pandemic and change in behavior have been exhilarating structural trends accelerating structural trends that have been years in the making. I would also say it is not just Retail Investors that have been investing in etf. We have seen institutional structurallyng etf to adjust their portfolio for the new normal. It is very much in focus because of the structural trends accelerated by covid and we also see investors want that diversification to their to golio that allows them beyond the ebbs and the flows of economic data. To themesthem to play that could be decades in the making. Additional dimension to their portfolio. Digital security, health care innovation, clean energy, and so forth. Anna where can europe play in this . From a european perspective, where are the opportunities . Maybe in clean energy. Of the have seen a lot etf landscape into sustainables. Europe is actually leading on investors in terms of asking for Sustainable Solutions and the portfolios regulatory tailwind is pushing this trend ahead. What we have seen so far this sell outestors need to of their exposures. When they do come back and they do come back quickly, they go into sustainable equivalent exposures. Market volatilities have been accelerators in terms of investors making that sustainable transition. We expect this to continue alongside the thumb attic thematicsomatic adoption. Toa thank to him wei li wei li for joining us. Officials described the coming days as pivotal. We will discuss the barrier to a brexit trade deal next. Businesses today are looking to tomorrow. Adapting. Innovating. Setting the course. But new ways of working demand a new type of network. One thats more than just fast. You need flexibility to work from anywhere. And manage from everywhere. Advanced technology. With serious security. And reliable coverage, nationwide. Forwardthinking enterprises, deserve forwardthinking solutions. And thats what we deliver. So bounce forward, with comcast business. Anna welcome back to the European Market open. European equity markets point to the upside by 0. 8 . With brexit negotiations down to the wire, british businesses are racing for extra Storage Space. The risk the country leaves without a trade deal threatens their supply chains. Joining us now to discuss, dani burger who has been looking at the details. What are these businesses hoping to achieve . It is all about mitigating uncertainty as we get closer to the end of the year. Options these businesses can pursue. We have seen Companies LikeMarks Spencer apply for bonded warehouse space. You import the goods now and then when you sell the goods, that is when you pay that customs fee. Another option would be to not pay tariffs at all. That can happen if you import car parts, you assemble a full car, you exported that way. That can avoid customs fees. The issue here is that we do approach the end of the year, we get into next year, there is no trade deal, these companies can face more tariffs on the goods they bring in or more paper work and at the end of the day, what that means for these companies is a hold up, more delays, more costs. Is why we watched this story really closely. There will be changes for business. We just do not know what. Why are businesses only now trying to secure Storage Space . We have been talking about this for seven years. The vote was four years ago. New. This story is not companies have done this over the past couple years. Wet is new is this mad dash are starting to see. As the chairman of the bond Warehouse Association told bloomberg, a lot of firms thought by this point we would end with a trade deal that would have a seamless transition and they could keep things under the status quo. Closer to the end it is clear that might not be the case. These licenses to get warehouse spaces from hmrc, they take eight weeks to be completed. We are just six weeks until the end of the year. If companies have not gotten this done yet, it might be too late. Thanks very much. Dani burger with the latest on the warehousing story around brexit. Lets get a Bloomberg Business flash. Plenty of m a to talk about. Second acquisition in as many months. A wave of consolidation in the payments industry. The firm sealed the deal generating 100 70 Million Euros of synergy per year. Tsp financial has agreed to buy u. S. Smaller lenders are looking to scale up. J. P. Morgan and bank of america move into new space. Chinas recovery is continuing. Industrial production picking up. Many shoppers delayed spending. Recoveryshows chinas is on track. That is your Bloomberg Business flash. Lets get to the german fight against coronavirus. Germany may be set to introduce new restrictions on gatherings today. Angela merkel is set to meet with state premieres to discuss the National Coronavirus situation. This could come with tougher restrictions after two weeks of renewed lockdown measures slowed but have not stop the spread of the virus. Joining us is ings chief economist for germany. Happy monday morning. Lets talk about your expectation for how locked down germany must remain and for how long through the winter. Good morning. We will either decide today or next week. I think what we saw in austria, schools are going to be closed. Drugstores are close again. It is foreboding for the German Economy. We will see a continuation of lockdown going into december, trying to keep things open again the onember, but i think and off lockdown measures will continue at least throughout the first order. The First Quarter only in the Second Quarter we will see a lifting of lockdown measures and a pickup of the economy. Anna when you talk about the pickup, when you look at what the shape of the economy will be the next couple of quarters, how will any contraction, if thats what we are going to see how will the shape of that compare to the spring of 2020 . Businessesbility of to make themselves more covid secure certainly in manufacturing spaces, even if Services Remain very much under pressure . It really depends how strict the lockdown is. Not be as severe as springtime. Disruptionsy chain coming out of the lockdown measures in asia. That is not the case currently. We also had people being forced to stay at home because factories were slowed down and schools were closed. This was a supplyside effect which will not happen in the same magnitude this time around. What we will see in germany is services started to soften at the end of the third quarter. An enormous hit in the fourth quarter. Manufacturing has held up well. I think on the back of Strong Demand from china and other asian countries. It will be a small contraction in the fourth quarter. Going into the fourth quarter, maybe a slight pickup of growth. Will take really until the Second Quarter of next year before we see new momentum. Anna the level of debt germany should go to, how much debt germany should or should not take on, what would you say are the limiting factors . There are no limiting factors. This is going to be the biggest game changer of this crisis. No and currency toward what the German Government can do. Company is being hit by the walk the lockdown will seeexpect we more stimulus. The government will have to decide whether it will allow for debt forgiveness. Up privatee taking sector debt on the public or government Balance Sheet will be the next big issue. There is no return to the debt rate neither in 2021, maybe after the election when we Start Talking about 2022. Is such an open economy. We focus on the relationship with china, looking much better or looking solid, taking that recovery we know well now. What about the rest of europe . Threat is aa slowdown in those economies . It is clearly the threat. You look at german exports, one third of global german exports goes to eurozone peers. In lockdownia again, france, belgium, ireland. There are so many countries in lockdowns. Exportsrd to see that can save the German Economy for a long while. We still have the china factor but it will not be enough. It will not be enough to avoid the stagnation going to the First Quarter. ,e look at the Global Economy it is shifting anyway away from manufacturing goods toward more services. Really germany will continue to be under pressure and german exports will take a long while before they will return to the strength of the levels we saw prior to the crisis. Thanks very much for joining us. Really good to get perspective there. Decisions could be made around further lockdown measures. China and 14 asiapacific nations sign an historic trade deal that will form the Worlds Largest free trading partnership. We will get details. Anna welcome back to the European Market open. 18 minutes until the start of cash equity trading in europe. Msci asiapacific to the upside. The trade deal we are going to talk about shortly is part of the story. Ofo the commentary president elect bidens team on lockdown. Supportivea has been of risk assets over the weekend. The dollar retreats. Lets turn our attention to asia. Beijing has completed the Worlds Largest free trade deal. Has taken almost a decade and it covers nearly a third of the worlds population and gdp. For more, dan risko in singapore. It has been in danger of falling off. How significant is this new trade agreement . Quite significant. We have been waiting the past few years. It is like a joke in the trade circles. Each year we think we are going to have the signing. This year they had extra momentum to do it. Really 15 nations involved here, nations asean nations. One thing we are looking at is the tariff elimination. Varied by to be country. For singapore, 92 of treated goods will be exempt from tariffs. Provisions tonger simplify customs procedures, intellectual property rights, and tries to tackle things like toommerce, giving a lift small and mediumsize enterprises. As you know, all of these are big topics in the covid era. Long in the making. Negotiations have been hardfought. Been terms have really sticky for many countries and ultimately have left countries like india out of the deal for now. A big thing to celebrate. Asean countries and three nonmembers to ratify it, but we are on the way. Could still rejoin, i understand. Interesting to see the details. The u. S. Pulled out of arrival trade deal the tpp. The fact we have President Trump still in the white house, angry about china, how are u. S. China relations expected to play out . Course does not immediately take effect. It provides a symbolic backdrop for the u. S. China negotiations. All the questions people have about how a Biden Administration would deal with u. S. China trade, we but also have been waiting for some time. Not been team has enthusiastic about joining the tpp. Ofre has not been any talk joining this deal. Wilbur ross once called it a very lowgrade treaty. We know how the Trump Administration has dealt with these relations. We are waiting to see how the biden team might approach it. Something to answer for when you have 15 nations making up almost a third of the global gdp, pushing forward on this trade, addressing next generation issues, global trade agreements will have to address them throughout the world for years to come. The cosmetics giant revivalsees a makeup after the pandemic. The ceo told bloomberg even though ecommerce has gained traction during the crisis, the market will not completely move away from brexit talks. We are alreadyn back to growth in third quarter. The market is still negative. Should recover. There is a very strong appetite everywhere as well for beauty products. Year isis we have this not really is a man crisis. Demand crisis. It is more of a supply crisis. You have europe back to lockdown. Now ecommerce is gaining traction. When the virus is gone, i think we will be back to a very good consumption. The appetite for beauty is absolutely still there more than ever. Your chief digital officer talked about ecommerce and the fact that it is your biggest market now. Fueled by the pandemic. Will it ever be 100 as we see a phase out of brick and stores . I do not think so. Consumers. Tion for consumers are switching every year more from brickandmortar to ecommerce. Of course it was accelerated this year. It was already going very fast before. Ecommerce sales were growing. Even faster. Course when stores were closed there was acceleration. Of all sales. It is going to keep growing. Opportunityant the to see products in stores. Im a big believer as the offline versus online as a combination of options. France is in lockdown, the u. K. Is in lockdown. How has that affected your business . It does not help. Im really sorry for our , department stores. It is difficult for them. Weing the first lockdown froze payments of all our small we accelerated payments we are doing the same. Accelerated payments to suppliers. We are doing the same. Consumers now are more aware of other options. It does not help. It should not last too long. That was the loreal ceo speaking to my colleague Annmarie Hordern on the makeup industrys prospects for revival. Minutes away from the open, we will talk about m a. We will focus on stocks to watch including nexi. About that and spanish banking m a. Anna welcome back to the European Market open. Inutes to go lets get stocks to watch. For that we go to dani burger. Vodafone in focus. The listing of their towers unit part of the story. What are we seeing this morning . Their ipo might be one of the biggest ones to hit the european suite. Earnings,mes to their they beat expectations. Organicrvices revenue revenue falling less than estimated. Analysts have seen a 2. 3 drop. Up their also nudged outlook for the second half of their fiscal year. It shows they have more confidence for the entirety of the year expecting sales to recover. What about bbva . There is a lot of talk about m a. This is to do with their presence in the United States. What is driving this . Pnc is buying that u. S. Unit. Up more thang bbva 12 this morning. One of the largest local lenders. The price tag is 11. 6 billion. This had taken a big hit because of the pandemic. Impairment charge in the First Quarter. Some enthusiasm that bbva is giving up this unit that was a drag on them. We will look out for that and other m a in Financial Services. Services, theial payment space, nexi very acquisitive recently. This shopping spree takes them to denmark. This has been their strategy for some time now. To take on more acquisitions. Ts they aret is ne purchasing. 9. 2 billion. What this does is helps to expand their reach across europe. Something they have been trying to do for some time. The industry has had a lot of consolidation. Anna thanks very much. The stocks we are watching this morning. Minutes to go until the start of the European Equity session. Anna the minute to go until the start of cash equity trading. Your headlines. Rebalancing risk. To suggest aming National Lockdown is not on the agenda. 11 million cases in the u. S. While global stocks push higher. The Worlds Largest free trade plansut President Trump hardline moves against china. M a. Pnc financial agrees to purchase bbva. And italys nexi agrees to purchase nets creating a european payment giant. A lot of m a to focus on this morning and in general, the markets caught between the toativity and the ability look through that and focus since dead on more optimistic times or better times in the spring and summer in the Northern Hemisphere of next year. That is where the market is right now. The market is focused on the coronavirus story but also on the vaccine and the lack of a need for a lockdown from the joe biden team. The ftse 100. We have been talking about m a unitbva selling its u. S. And that was expected to be something that would push that stock up strongly as well as talk about other m a in the spanish Banking Sector. Bbvat have a price on just yet. I do see that nexi is up by 3 on the back of the deal they have made. And vodafone also treating to the upside. A market conversation European Markets opening higher with the ibex leading gains. The bbva has made that announcement that it is selling part of its business, to a u. S. Player. Dhare joined by shamik from bank of new york, melon. Mellon. When you look at the equity market going strongly, it seems they are focused on better data out of china and the vaccine rather than focusing on the challenge that still remains dealing with the coronavirus. Where is your thinking . I think you summarized it quite nicely. And markets look forward and through. We tend to focus on the here and now. There is a lot of bad news around at the moment. Markets are focused on what next year might look like. Of the vaccine coming through quickly and then the prospects for a recovery remaining pretty good. And then they look at parts of asia and china as an example of what can happen. See theere do you european economy . Going through this winter . Are you part of the contingent that would suggest a w shaped move for the economy . What kind of imagery would you give us in terms of europe charting the course through winter . Shamik ive been trying to get away from the output that soup if you will. I think the arithmetic is pretty straightforward. Months worth of lockdown which is what we are talking about in a lot of European Countries last time we were locked down, a number of european economies lost about a fifth of their economy. This time around, i think it will not be as damaging. 3 of european gdp this quarter and that is my starting point. What happens after that depends hugely on whether we have to extend lockdowns, etc. , etc. Of prospects for some kind relatively strong recovery remain good so far as long as good news regarding the vaccine continues to come through. You might see q1 but more likely relativelying strong. With i am looking at m a interest. We have had some deals and the Banking Sector and the payment space. We have a european deal to talk about. Im looking at the m a function on the bloomberg. We are down by around 15 globally. You would expect to see some hesitancy or nervousness about doing big deals i would assume given what 2020 has thrown at everybody. That said, we have seen a wave of deals coming through. What would you expect to see on m a . Shamik i think that is right. It is not surprising given the scale of the economic hit we took in the first half and going into the second half of the year that investors were more cautious and more nervous about doing big deals. Given the scale of the Market Recovery since and what that implies about the future confidence regarding economic prospects but also the Interest Rate environment and also the potential for some really quite interesting deals out there, encouragings up to a number to get back into the market and the m a space. I expect that to pick up next year and alongside fixed investment but all contingent on there being some kind of progress with the vaccine. Number of investors are talking about the lack of confidence in investments. What do you make of china at this point . How much of a comfort is the data we see coming out of china at this stage given the weaknesses more developed countries are dealing with . And today, we see the signing of this big, regional trade deal, rcep. Of china fortory you at this point . Some degree, it has been underestimated by economists. You hear a lot of bad news stories. Underplay theo butousness of the situation i would say that china demonstrates that if you can get on top of this, the potential for upside is still quite large. Principle, it is relatively easy to open it up again once you have gotten over the initial problem. A key issue is getting over the shop. A lot of economists are taking a much more pessimistic view that permanentd up with damage to the economy and mass unemployment. Ive long been skeptical of that. Im not saying that is not possible and we do have manage things carefully but the best news about china is economically it demonstrates to the rest of the world that it is possible to recover quite sharply and quite dramatically from what has been enormous shock. Dhar will stay with us. Anotheralks enter critical week as Boris Johnson is in isolation once again at downing street after the departure of his top advisor. This is bloomberg. Anna welcome back to the European Market open. 11 minutes into the trading day that has European Markets up 0. 8 . Up, now up opening. The ibex as a whole up by 2. 4 . Bbva but the all fallout of the story. Bbva telling selling to pnc. There is a lot of speculation about what they will do with the money that they have raised. Could they do further m a within the spanish Banking Sector . Brexit talks are entering another critical week. Officials say the coming days will be pivotal as they seek to reach a deal that can be ratified and implemented before the december 31 deadline. Frost says he will not be changing his position. Good morning to you. Week by bothove sides and yet it seems neither side wants to move. David im getting very cautious any dayubbing and th especially at crunch time. Timetable is getting incredibly tight. Will they get a deal in time for december 31. Both sides still digging in their heels. Saying the other has to shift their position. And still nobody is blinking. We have had some reports behind the scenes that maybe the europeans are prepared to shift their position on fish in exchange for access to Energy Markets but we still do not have the details on that. In theirs digging heels say in time is running out and yet no one willing to make the big move to get a deal done. , the in terms of timing only deadline that really matters, the 31st of december. Impactinghat has been these conversations in the past. David and really starting to a bit. His may drag on i could be wrong but it seems that talks could go on until new years eve. Weve seen a lot of negotiations and crunch summits to know that a deal only gets done when the isl, hard deadline approaching and people have a gun to their heads. End up with a deal to avoid any of the big economic disruptions that the leaders on both sides of the channel want to avoid . But still not get that big deal in time . Drag on for amay few more weeks. The one big thing that has changed is the departure of Dominic Cummings from downing street. Does that change things . He is now gone. Does that mean that johnson is preparing to shift around a bit and move into a slightly softer zone . Weve not had any sign of that. That could be a development in the coming days. Our senior merrick, executive editor. Lets get back to shamik dhar. You are so wellplaced to give us your thoughts on the u. K. Story. It has been some years but you have worked at the bank of england and the Commonwealth Office as well. What is the urgency or lack of of these talks from an economists perspective . Shamik these are issues of substance as opposed to posturing holding the sides apart. I think it remains clear that the u. K. Negotiating position is unlikely to change despite some of the events within number 10 in the past few days. Having worked with david frost in the past, you take his tweets seriously. I sense is that he probably there if have stayed he thought he had to make a lastminute, dramatic turnaround. U. K. Ess is that the position is unlikely to change. The concern is that these Political Developments proved to be a distraction detracting from these political negotiations this week especially if they heels to digopean and more deeply. Onngs are likely to drag longer. Anna this could go to the wire. What . About how the bank of england response what about how the bank of england responds . What are you penciling in . Bank ofu see the england going in that direction if there is no deal on brexit . Could that be the dealbreaker . Shamik it is possible. Significantse some economic disruption. In the short run, it could be the catalyst for the bank to do something. My sense is that a are my sense is that there is a lot of lively debate going on. Clearly, i think it still remains a last resort for the bank of england. They will look to more traditional methods with a little bit of room to cut Interest Rates from here. And there is qe to consider first. My guess is that were there to it would follow that route first. Have to use the alphabet soup to describe the economy, but what are your expectations . You are a bit more to the optimistic side than some other economists. Everything i say about the World Economy or the u. K. Economy depends largely on what happens to the disease. I think what we have learned is that if you do get on top of the disease, the potential to bounce back is a lot stronger than a generalconomists commentary would have you think. You would only need another quarter like that to get us back to precrisis level of activity. I remain relatively optimistic that if we do get on top of the disease and the vaccine comes through, then at some point, middle of the year, we will get back to Something Like precrisis levels. Everything depends on the course of the disease. Anna thank yous much for your time. Shamik dhar, chief economist at bank of new york, mellon corporation. We will have the pleasure to speak to him again. Coming up, bbva sells its u. S. Unit two Pnc Financial creating americas largest regional bank. The bbva share price reaction quite stunning, up by just shy of 50 . We will talk about m a next. This is bloomberg. Have beenuntries growing. The second wave passing through will trim some of that but travel is challenged. Case, we are going digital. Contactlesssing cards. That was the mastercard ceo talking about payments going digital. Let us stick with that theme and bring in an m a story. Nexi has agreed to purchase nets. The move will create one of europes biggest payment provider. Good to speak to you this morning. What are the details of this nexinets deal . It is an interesting story and has been well documented on our network and in the press. And in the italian press. Provider andments is strong in the nordic and german regions. It is probably one of the last remaining payment assets in europe up for sale. And then there is next see on the other hand that just a few years ago was a small italian payment provider and has been growing through m a. Done,this acquisition is it will be the biggest Payment Company in europe in terms of volume. M a is a global theme and nexi is probably one of the winners of that trend. It was already a blockbuster deal. 10 millionwas worth and has been growing exclusively almost exclusively through m a. Platform and have more transactions and you grow. That is the story. Certainly is effective watching the m a. Thank you so much for giving us your thoughts on nexi. Lets get on to the spanish Banking Sector, bbva in focus. Itt do we know about what wants to do with the money it is getting . That is a great question. I think it could be a precursor for more m a, no doubt. It could use the cash proceeds deal. Ts blackrock covid is putting a lot of pressure on banks and the u. S. Is back in the negative or at least zero rate territory. Consolidationic in spain is a big theme. If you think about how they could use this money, they could do something locally. Been discussion around santander. Think it will put more pressure on other european banks s. Cks anna thank you so much for joining us. Good to speak to you. You can see that people are thinking about m a in the broader Banking Sector. Up next, sweden introduces a curfew for establishments selling alcohol. We will talk about where the swedish economy goes next. This is bloomberg. Businesses today are looking to tomorrow. Adapting. Innovating. Setting the course. But new ways of working demand a new type of network. One thats more than just fast. You need flexibility to work from anywhere. And manage from everywhere. Advanced technology. With serious security. And reliable coverage, nationwide. Forwardthinking enterprises, deserve forwardthinking solutions. And thats what we deliver. So bounce forward, with comcast business. Anna welcome back to the European Market open. European equity markets off to a flying start. Talks in europe as well as a trade deal signed in china offering support for the asian equity session and the European Equity session even as we look at gloomy headlines around coronavirus. Story very banking much at the heart of things. And therep the ibex are only five stocks in the negative territory. Such is the enthusiasm for banking m a in this morning session. Bbva goes up by 16. 5 . What will they do with that money . Sabadell is also up. 3. 9 . Der up we are seeing some excitement around m a we would seem in the Banking Sector in spain. Here are the top stories we are covering. President trump is reportedly planning a new crackdown on china in his final weeks in the white house. He may announce new sanctions or restrictions against Chinese Companies or officials. The move would be to prevent joe biden from changing course on china. Boris johnson is self isolating after coming into contact with an mp tested positive for covid19. Has no symptoms and will continue to work remotely. In april, he was in intensive care. Lockinglooking down for three weeks as softer measures failed to slow the pandemic. Just two weeks after a partial lockdown was imposed leaving large parts of the economy open. The chancellor says he he hopes these new restrictions can and december 6. December 6. 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. Sweden is introducing a 10 30 p. M. Curfew from friday so all businesses for all businesses serving alcohol. The first on this country is in forcing this kind of lockdown. Daily cases are hitting a record. Joining us now is johan torgeby. Yourto speak to you to get feedback on sweden passing through these measures. Back on most of 2020, what impact has the pandemic had on your bank . Johan we have to divide between the Health Concerns on the Global Economy and its performance. We can trace the first waves response in sweden seemed to have led to a mild their recession than the other 19 countries where we operate. On the health concern, the jury is still out. Debated they strategy. It looks like the first wave response was a milder affect on sweden. Many are concerned about the National Response to the second wave and will discontinue . Think about that, what are you expecting to see for the swedish economy as well as the other countries where you operate when you think about lockdown measures being reintroduced in parts of europe . Sigh of relief. We have an increasing concern of the effect of the second. There is no lack of positive voices out there thinking a second lockdown will be much milder and have a lesser economic effect. We cannot afford to guess. Made what we deem to be prudent reservations. I think we will see the fiscal policy programs and their longevity before we make such a call. Monetary policy looks to be very stimulative and is here to stay. Stimulusl the fiscal be in 612 months . What are you seeing in terms of businesses willing to invest at this point . I was talking to the ceo of allianz just last week. There are high levels of uncertainty. Where do you see that playing out . Johan i would probably echo that. There are three phases the defensive phase. We saw that in april and may. Insurance for a rainy day. And then you have the Transition Area which is where i think we are right now. Which istion period where i think we are right now. We have seen an uptick in dialogue around consolidation across the board. A sign that confidence is returning. We do not see an investment led credit expansion as of yet. Anna and what about Investment Banking . You have expressed concerns around how resilient Investment Banking can be at this point. Today though we have seen a number of deals in the Financial Services sector including nexi purchasing nats. Purchasing nets. Are your concerns around the Investment Banking part of the business . Mediumthe small cap, company have performed well. But we have seen a lack of execution when it comes to largescale ipos and largescale m a. I would say they are being normalized to the level that we broke. Ore covid when it comes to the ipos, they have been in the making for some time and there are Many Companies that are benefiting Business Online models. And i think they do the right thing in capturing that momentum because the acceleration has been quite clear. Nets deal is close to home. I dont see a lot here in the nordic. [indiscernible] [lost connection] it seems that we may have some problems with our line with johan. Me, thank your very much for your time. M a to get his thoughts on and where we will and where we will not see further along that trend through the winter. Coming up in the program, President Trump continues not to concede the election. We will get more on that process, next. Anna welcome back to the European Market open. We are some 40 minutes in to europes trading session this monday morning. 600 is up 0. 7 . The ibex up by 1. 8 . By 15 . Up other banks moving higher on the prospect of further m a in the sector. The business flash Pnc Financial has agreed to purchase operations for 11. 6 billion making it the nations largest regional bank. Americagan and bank of move into new states and sectors. Italian payment provider nexi is for 9. 2g nets billion. A wave of consolidation in the industry. The Worlds Biggest Oil company is set to return to the bond market for the First Time Since last april. Saudi aramco is looking to fund its commitment after Weak Oil Prices left it unable to cover dividends. President donald trump is still refusing to concede the u. S. Election. He tweeted overnight i can see nothing after speculation i concede nothing. Hardline moves against china. Jodi schneider joins us. He tweeted overnight and over the weekend. Overview of his latest tweets and what he is communicating. Jodi he is communicating that he is not going to concede or at least not anytime soon. It has been more than a week now since joe biden was put overthetop in terms of the Electoral College with pennsylvania. The current President Trump has had a fair bit of time to digest this. Some allies were saying that his earlier tweets, the one where he refer to arefer new occupant of the white house in january, that he has walked away from that. At this point, he is still saying that he won on twitter and he continues to try to legally fight this as well although the legal challenges are not going particularly well. The problem is that joe biden and his team cannot start the transition until the Current Administration of allows that to happen. One of thewhy reasons why we focus on this. What is the latest on President Trumps lawsuits . His the weekend, it seems challenge to the Election Results seem to be getting less convincing. What are we hearing about these lawsuits . Jodi there is a much more narrow path for these challenges. Speechlection day in the he gave in the middle of the night, washington time saying he would push this to the supreme court. These cases are getting nowhere near the supreme court. They are getting kicked out. One that the campaign walked away from over the weekend in arizona regarding improper voting machines. Conceded that it was going nowhere. They have not profited much with these lawsuits. There will be a recount in some counties in georgia where it was very close though it will not final tallythe after pennsylvania put joe biden overthetop. Anna Jodi Schneider with the latest on the u. S. Election. M a deutsche m a andking about crossborder m a is not attractive if there is no Banking Union. A message to regulators. What stands in the way of crossborder m a . Is it the regulators or a lack of appetite from the ceos themselves. Our financial m a reporter joins us now. This will be something that interests you but lets get to the bbva story this morning. Pnc financial has agreed to buy bbvas u. S. Unit. What do we know about this . There are various trends at play at the moment. Consolidation which is happening globally. We are also focusing on regional lenders. Bb t and suntrust, that was one of the biggest ones. And there is consolidation in europe. It has been picking up. Banks are under pressure with a lot of regulatory costs. Banking m a has been focusing on domestic consolidation. See smaller m a deals. Is creating a lot of optionality. With 10 million, you can do a lot in terms of m a but you can also buy back shares and pay out the dividends. There is also capital for some covid uncertainty. Theme oflays into the banking consolidation. Putting other lenders under pressure. Anna this is interesting. Talking about crossborder m a not be attractive if there is no Banking Union which puts domestic m a within spain, for center of things because you dont need Banking Unions to make sense of that. Where do we expect to see the spanish story kicking off . We have had two significant deals. Im not sure about the crossborder m a. These deals can be very complicated. Capital buffers. You cannot move liquidity across borders. If you want to do something that changes the european landscape, if you are serious about creating a true european champion that can compete, you could do something crossborder. I think the ecb is very a of all of these issues. With regard to domestic consolidation, this is much more complex. Bbva could even think about a merger with santander. These are not the largest banks in spain. That is one possibility. Bbva could also look into purchasing sabadell. Andd is an uncertainty focused on loans to small and mediumsized enterprises. These deals are likely now. And with the cash from this transaction, you can sit down wherever you want to. Anna thank you very much to talk about m a. Gettingnue to keep these lines. How will bonds price vaccine optimism . Getting the 10 year yield above 1 . Will talk to market li market live editor Kristine Aquino anna welcome back to the European Market open. 52 minutes into your trading session. European equity markets flying. Up by 0. 4 . Not really flying but moving to the upside. The Banking Sector is doing very well. Up by more than 2 . Largest gaining sector this morning. It is a day when we are purchasing up cheaper stocks. See much appetite for health care at this point. Joining us now is Kristine Aquino. M a in the Banking Sector is something of a perennial theme and within spain, that seems to be something that is captured the attention of the market. Today, we see not only m a being done but piles of cash building up to do further deals. Kristine the consolidation theme has been big in the european Banking Sector creating including banks that have been more on the back foot. It speaks to the story of this inr where we got a battering the sector and now investors are questioning which are going to be the strongest ones that will survive . In which will give investors the shareholder value they are looking for . Especially in a space that has various factors including negative or 0 near zero rates. A lot of factors hurting the sector so investors are looking for the banks that will give them value moving forward. We make ofhat do movement in the bond market . Been askingeam has how far will the market price vaccines . A lot of talk about whether we could get that over 1 . Perhaps that would require a risk on environment. The thing is that we do see a risk on environment even though the virus continues to be a negative. Kristine when it comes to bond markets, there is that tension between vaccine optimism and virus realities. Looking back to last weeks price action, we see those in sawds power higher after we the pfizer news come through and now we are looking for a readout from other vaccine trials, specifically the madera no one. It will be interesting to see if that creates the same upward momentum for bond yields as did the pfizer news. The question is longterm it he. There was a fading. Is there going to be enough from the moderna readout to sustain yields this time around . Anna thank you very much, Kristine Aquino. Thank you for joining us. Eight 56 in london. We have a lot of news on the Banking Sector. Point 3 . P by one the Banking Sector the biggest gaining sector in europe on the back of thinking m a in spain and asset sales. Selling to pnc. That is just one example of another Banking Company in spain moving to the upside. Nine point 6 . A lot of focus on m a. He has gone on to say he does not see m a and the next 12 months. That is from deutsche bank. Will it be a part of some kind of m a story . That is it for the market open. Surveillance is next. [announcer] imagine having fuller, thicker, more voluminous hair instantly. All it takes is just one session at hairclub. Introducing xtrands. Xtrands adds hundreds or even thousands of hair strands to your existing hair at the root. Theyre personalized to match your own natural hair color and texture, so theyll blend right in for a natural, effortless look. Call in the next five minutes and when you buy 500 strands, you get 500 strands free. Call right now. upbeat music francine balancing act. President elect biden says National Lockdown isnt on the agenda, president comes close to admitting he lost but walks it back. The hardline moves against beijing and the final months of his term. Minister isme