Daybreak europe. Im kriti gupta in london. U. S. Stocks poised for their biggest monthly loss, as the bond selloff defense, at the same time as the boj announces unscheduled bond buying. Euro area epi due later this morning, the next puzzle piece for the ecb, one day after german inflation plunged to its lowest level in two years. The uaw plans to expand its strike against detroit automakers. Over in washington, a Government Shutdown draws closer. A lot of crosscurrents around the world. Quick market check. We do know Chinese Markets are closed today. The rest are open and having a read through into futures action. Euro stoxx 50 was virtually unchanged, ftse 100 slight outperformance. Similar story looking at the futures and nasdaq 100. The narrative is the idea that you are not going to be seeing a ton of movement when there are so many unknowns. We are getting commentary on the rates story, earnings are trickling out, but all eyes on that Government Shutdown and what that might mean for union negotiations. Earnings are sleeping back into the narrative. Nike is the big one. In after hours trading in the u. S. , you saw a major move upward, higher almost 8 . Nike which we use as a global bellwether, that inventory glut easing, profit beating estimates. This is a big deal in the Retail Sector but also for nike which has extreme exposure to not only the supply chain in china but the consumer. Quick check on cross assets. A lot of commentary from central bankers. 10year yield inching barely higher. 4. 58 at the moment. You had a major selloff in yesterdays overnight session. The curve inversion getting slightly narrower, tos and 10s at 48, brent crude at 95 handle, still have got 100 on the horizon having read through into commodityexposed currencies like the aussie which will be the biggest weight on the dollar this morning, higher by 0. 1 . Im joined by avril hong and eric will make in singapore, and Valerie Tytel joins me in london. Walk us through the asian trade. We are seeing asian stocks rising, gains accelerating from the start of the session. The msci asiapacific is well in positive territory. This has to do with optimism of spending, as china heads into the long golden week holiday. There is chatter about a possible meeting between the leaders of the u. S. And china. Hang seng leading the charge. The msci asiapacific is still set for losses of 4 for this quarter. Its biggest quarterly decline in a year. We are monitoring whats coming out of japan. We had tokyo inflation data this morning. It showed inflation is cooling. It came in below what economists had expected for the month of september. Lending weight to the boj argument that inflation is set to ease. That is why it has to keep its ultraloose Monetary Policy unchanged. We saw unscheduled bond buying operations from the bank of japan earlier today. This is as they yields are rising across the curve on jgbs. We saw the yield on the 30year hit its highest level since 2013 earlier. Kriti avril hong in singapore with the crucial asia trade. Avril mentioned the jgb story. Lets bring in valerie to connect it to the rest of the world. Your a bond girl, in both senses i would have to say. Why do we care if you are not a japanese investor . This move is due to this treasury selloff that has captured attention not just this week, but this month. 10year and 30year yields rising 50 basis points in september alone, pressuring this japanese market, tempting the bank of japan to defend yield curve control again. Last time they intervened was 10 basis points away from here. The trigger for them was that 10year jgb crossing 77 basis points. It only crossed 75 for the first time in over a decade yesterday. This is capturing the attention of the bank of japan. There has been little move on the yen side. I want to go back to fixed income. Yesterday was a monumental they. Not just for treasuries, but what happened in gilts and goons. Bunds. Intraday, you saw gilts spike higher by 20 basis points and bunds spike higher by 15 basis points. Down to the pressure of the treasury market. There has been no trigger for this, which has been the most concerning things for traders. Kriti the selloff completely snowballing and going quickly. Then you have to factor in what central bankers around the world are saying. We have a sound byte, Thomas Barkin, the richmond fed president. Too early to know. There are a wide range of possible outcomes you could argue for resurgence based on the numbers. You could argue for a downturn, as you have been talking about, and for a return to the precovid economy. All of those are in sight. Kriti we heard Thomas Barkin talking about potentially being too soon to continue that hawkish path. Is he the consensus there . The thing that grabbed Market Attention yesterday was comments from goolsby. He commented that this rise in yields might do some of the feds work for them. He was one of the first members to say that out loud. There has been speculation that this rise, how it is tightening financial conditions, might lead the fed to hike less or drop that threat of an additional hike. We did see a rally in the front end yesterday, twoyear yields move lower four basis points on those comments. Consensus is this treasury selloff still has legs. We heard from bill ackman, he had an interview with cnbc, he is short the 30here. He thinks yields will go higher and he thinks that 30year could go into 5 . We crossed 4. 80 in the session yesterday, so he thinks there is likes to this selloff. Kriti do we start to see the bond bears in control . We thought the bond bulls might be back. We got the Monetary Policy. You have markets and you have to factor in fiscal and even labor negotiations. United auto workers capturing our attention again. Saying they want a 30 pay rise from strike action at detroits three major automakers. Derek, we have been talking about this story for at least a year in terms of labor movements. The uaw really trying to attract some steep pricing. Thats right, yeah. Sean fain, uaw head, is embarking on what has been a reasonably unconventional strategy. It has been a reasonably effective strategy. Remember, recently, he got joe biden to become the very first president to join a picket line. Joining in the state of michigan. You are seeing a little more action here. The story you referenced, the uaw seeking at least a 30 wage pump out of these talks with u. S. Automakers, its an interesting play. Its a climbdown from their public positioning around 40 had been. This is a number the uaw believes would not just make their numbers happy their m embers happy, but also get the uaw enough juice to go out and organize some other places it hasnt been able to get in. The big white whale of that of course being tesla. Its a signal of where you can go from here. At the same point, fain as in this adopted strategy, as i said unconventional. They are not all striking at once. He has the ability to escalate and has threatened another escalation if there is not Real Progress made by friday u. S. Time. You are seeing an avenue to get out. A way that this could possibly get worse. Overall, sean fain overall a mick lynch of america, is keeping the automakers on their toes. Kriti just when we thought the Teamsters Union negotiations [indiscernible] sean fain throwing that out with the bathwater. You talk about bidens role in the picket line. Lets talk about his role in shutdown negotiations. How bad could it get come october 1, 12 01 a. M. New york time . Is possible you see a red headline. Its convenient timing for me in singapore, its right at noon. But yeah, it will be an absolute midnight moment in the United States if that happens. These shutdowns get worse the longer that they go on. You have a whole bunch of people who are required to show up to work to keep the essential functions of government going. And they dont get paid. That creates a big trigger point for political pressure that builds and builds and builds. No one wants to see military members having to go to work, keeping the country safe, and then have them not get paychecks and he worried about their mortgage and things of that nature. At the same juncture, Kevin Mccarthy right now, Republican House speaker probably has the votes if you wants to to extend the government operations. It would probably pass with 300 votes in the house. The problem is if he does that, he will face intense political blowback from his right flank that remember, it took him many votes to get elected speaker in the first place. He has only got thin margins. Joe biden, what is his role . Mccarthy wants him involved in negotiations. Biden doesnt want to get in mccarthys way of himself. Kriti you mentioned people not getting paychecks, museums shut, social programs halted. For investors, payrolls next week could be delayed, a virtual number for Monetary Policy. Derek joining us this morning. Lets get to the day ahead. Yes, it is friday, but no, the trading session is not relevant because at 7 00 a. M. U. K. Time we get u. K. Gdp numbers, how quickly is the economy decelerating as a major question, especially after that increase in midjune 2022. Growth is going to be a question, this time, for the euro area, we have dvi later today. This follows german Inflation Numbers from yesterday that fell to a twoyear low. That data coming out at 10 00 a. M. U. K. Time. Lastly, u. S. Bz, the feds favored metric of inflation, those numbers at 1 30 p. M. U. K. Time. Marketmoving data on this autumn friday, if we can call it that. You can get a full roundup to get your day going in todays edition of the debris terminal. Type in dayb on your terminal and youll get the major story specifically around banking and treasuries and major calls out of wall street. Coming up, huaweis new high end smartphone may be a message to the u. S. That tech curbs are not stopping china from developing advanced semiconductors. This is bloomberg. The economic model which i favor is to have a global competition. Im very much in favor of globalization. Billions of people in poverty came up to middleclass in many countries. Many new cities had been built and will be built. We see new highways and railways all over the world, airports, hospitals, universities, schools. All of these spreading all over the globe and this is a good thing. Our task must be that this is not just a part of the world, even if it is a big part, our task must be to work for the whole world to participate from the chances of globalization. Grow and have their own infrastructure and industrialization. This be a much safer world. But the economic model, lets say, of germany is a model that fits for the whole world, is that we are not working protectionists. We want to sell our cars in europe, north america, in japan, in china, africa, south america, and all the places. But this means that we are open to get the cars of other countries also in the market of germany. And i still remember what was the big debate that started when the Japanese Cars came to germany. But they are part of the market and there is now german cars in japan, and Japanese Cars in germany, what is the problem . The same happened with when korea became competitive car producers. They are doing a very good job. Now there are german cars in korea and korean cars in germany. What is the problem . We should look on these things like this. It is the better alternative than the protectionist way. Kriti german chancellor olaf scholz speaking to bloomberg exclusively. Breaking news. We are watching the u. S. Government shutdown. House republicans released that stopgap bill to fund government. We dont know whats in the bill yet. Any stopgap bill if it is voted in just cakes the can down the road to november 17. We will bring details. As talk about another major global story that has its roots in washington. The recent thank you of huaweis high end smartphone phone maybe a message that tech curbs are not stopping china from developing advanced semiconductors. Thats the subject of todays big take. Lets get more with our Asian Technology executive editor, peter elstrom. How big of a deal is huaweis latest smartphone . To understand the significance of this phone, go back a little ways. Huawei emerged as a Secretive Company a couple decades ago it became the biggest supplier of telecom equipment. Competing with ericsson and cisco, came the biggest in the industry. After that, mobile phones, and became the biggest provider of mobile phones, too. Surpassing samsung and apple. The u. S. Government took steps that not while out of the Smartphone Market knocked huawei out of the Smartphone Market. It blacklisted the company and cut it off from supplies. Last year, the Biden Administration exposed export controls on the Semiconductor Industry in china that prevented them from buying critical equipment, too. When huawei dropped this mate phone in late august, it said one, that huawei was back in the smartphone business, and two, chinas semiconductor abilities were more advanced than the u. S. Hoped for. Kriti at its core, it comes down to geopolitics. There has been scrutiny around the chip, smic, but there is broader geopolitical ramifications. Thats right. The company that made the chip for the huawei phone is smic. It is the leading provider of chips within china. With these Biden Administration controls, there were hopes it would hold back smic, along with other chip companies, what we found out is they can make these chips. They are seven nanometer chips and the u. S. Was trying to hold them back a couple generations beyond that. The major question is whether Chinese Chip Companies can make semiconductors at scale and in volume and economically. Nobody cares whether the chinese are able to produce advanced smartphones. The key issue is whether there will be enough chips that they can use them in applications like artificial intelligence, supercomputing, and especially military applications. Kriti when you talk about going back to the smartphone, where is the market for it . It doesnt feel like it is in the United States. It is a domestic market for huawei. We did a fair bit of reporting on the streets in china looking at how this mate pro is selling. The iphone 15 just came out, too. There is Strong Demand for both products at this point. We have heard that the Chinese Government is also imposing restrictions on the iphone within china, especially for use in Government Agencies and stateowned enterprises. This leaves the u. S. With Big Questions about what they can do. If china is advancing more rapidly than they had been expecting, hoping, what does Gina Raimondo do from here . Can they tighten export controls even more . They need their allies to be on board, if they are going to tighten restrictions, especially the dutch. In the netherlands, asml makes the most important tip making chipmaking equipment. And the japanese who supply other kinds of components that are needed for these advanced chips. Kriti suddenly everyone in washington is becoming an expert on the nittygritty that goes into a to. Peter elstrom joining us this morning on our big take. I want to stick with the tech space. French antitrust enforcers have rated the offices of a business suspected of engaging in quote anticompetitive practices in the graphics card sector, targeting nvidia. The companys dominant role is coming under closer scrutiny. Frances Competition Authority says they do not presuppose the existence of a breach in the law. Why 155 maybe the magic number for japan when it comes to currency intervention. We get the outlook from the man they call mr. Yen. This is bloomberg. Kriti former japanese finance minister known as mr. Yen says the government may be close to intervening to support the yen. He spoke to us exclusively. It depends upon the situation at the moment. But Something Like 155 is the level which they would start to worry. Kriti so, 155 seems to be the magic number. If you look at what the market is pricing, its 150. Those coming from the japanese former finance minister speaking to paul jackson in tokyo. We are at about 149. 32, so you are seeing this massive acceleration. If you zoom out the chart, the move higher gets even stronger. This comes at a time when yes, the governor of boj ueda talked about the possibility that yield curve control may not be the way to go. But you need to Pay Attention to how much pressure the boj is facing from markets. This is at the core of the trade last year where a lot of Hedge Fund Investors with money to spare shorted the gdb market. Now that trade is coming back into play as you see yen swaps start toprep for that kind of move. May show you why this pressure is crucial. The pressure is only building. It is showing you just how crucial and dire the situation is. Yes, japan would welcome the inflationary story. But they need to really keep an eye on import prices. Jgbs and 10year yields are testing the bank of japan when it comes to yield curve control. It shows you the band and how much wider they are going to get. The first three iterations of the yield curve control since 2017 are smaller margin of increases. From 2022 to 2023, the bands get even wider. How much wider is the major question as we watch that 155 level from mr. Yen, but 1 54 nervousness around the markets. We look ahead to european cpi data and focus on germany after inflation sank to its lowest level in two years. That conversation next. This is bloomberg. Youre probably not easily persuaded to switch mobile providers for your business. But what if we told you its possible that comcast business mobile can save you up to 75 a year on your wireless bill versus the big three carriers . Have we piqued your interest . You can get two unlimited lines for just 30 each a month. There are no Term Contracts or line activation fees. And you can bring your own device. Oh, and all on the most reliable 5g mobile network nationwide. Wireless that works for you. Its not just possible. Nice footwork. Its happening. Man, youre lucky, watching live sports never used to be this easy. Now you can stream all your games like its nothing. Yes [ cheers ] yeah woho running up and down that field looks tough. Its a pitch. Get way more into what youre into when you stream on the xfinity 10g network. Lets get to the top stories that set your agenda. U. S. Stocks point to their biggest monthly loss this year as the bond selloff deepens as the boj announces an unscheduled bond buying operation. Euro area cpi due later this morning, the next puzzle piece for the ecb as it mulls the rate path after german inflation plunged to its lowest level in two years. Showdown weekend. The u. S. Plans to shut down a strike of detroit automakers of detroit automakers if progress is not made while a Government Shutdown gets closer as the gop releases their stopgap funding bill. Crosscurrents around the world. Quick check of the markets. Chinese markets are closed. The rest of asia open. Not a ton of action in euro stoxx 50 futures or any of the futures contract at the moment. This is not necessarily indicative of a friday kind of vibe. It is indicative of the chaos you are seeing in the bond market, the volatility and the threat of the u. S. Government shutdown. That creates a little bit of a lack of willingness to hop into this market. Thats what you are seeing. On the other hand in addition to the monetary and fiscal policy and geopolitics you have earnings starting to creep into the story. Nike higher by 8 almost in the after hours u. S. Session. This is significant because weve had a lot of pressure in the retail space in the u. S. And around the world. Nike saying the inventory glut is easing. The issues weve had in the last two years are abating. The market not expecting that kind of update. You are seeing volatility. Heres is where the monetary and the fiscal kick in. Yesterday during the european session and overnight u. S. , the 10 year yield really grew quite a bit. A bond selloff across the curve. You are seeing the twos and tens down about excuse me, inverted. Down about 60 basis points. What is important to keep in mind is the inversion is getting more narrow as you see chaos. Is that the direction of travel in the long term . Brent crude still 100 on the horizon but not there yet. 95 on the contract. The aussie really becoming the biggest weight on the dollar. April hung in singapore has an update on the markets in asia. Asian stocks pairing earlier gains in the session but still headed for a positive close. Theres optimism in the market. We are going to see spending as china heads into the long golden week holiday. Theres chatter of a possible meeting between the leaders of the u. S. And china. Msci asia pacific about 0. 3 percent higher. The hang seng climbing about 2. 5 . This might not be the full picture given how markets in the mainland thomas south korea, and taiwan are shut today the mainland, south korea and taiwan are shut today. The biggest quarterly decline in a year for the nikkei. We have development in japan with data on tokyo, inflation showing that is easing. It is also coming in below what economists predicted for the month of september so lending some weight to the boj argument that inflation is set to ease and therefore they have to keep Monetary Policy unchanged. We saw an unscheduled bond buying operation from the boj earlier today. This is on a day the yields are rising across the curve on those jgbs. We saw earlier in the session the yuan hitting its highest level since 2013. Kriti really scrambling for markets at a time when you have a liquidity story in the u. S. Treasury market. We thank you for the update this morning. You had the inflation data, euro area cpi hitting the terminal at the 10 00 a. M. London time today. Italy and france published their reading this morning as well. Germanys inflation figure has dropped to its lowest level in two years softening way more than expected. On the surface that might be good news but is it really . Bloombergs oliver crook in berlin all over that story. When we see a deceleration like that, it seems like good news, but is it . Or is it an early sign of a recession . Both can be true. In one sense it is good news about inflation coming down but there is a spuriousness in this figure. We are down from 6. 4 which feels dramatic. Part of that was do to the base effect. Last year they did this crazy, very intense subsidy on train travel within germany were you paid nine euros once a month, took a train anywhere in germany. That was june through august and that went out in september. September surged and now it comes back down. A be the figures. The question is going forward, energy is going to be one of the main focuses. Lets not forget, still you have 25 percent of russian gas going through pipelines that are still coming into europe. This is burning in the background. And the labor market in germany is a bit of a mixed picture. On the one hand you see companies are more reticent to hire witches what you are speaking to which is what you are speaking to. Germany is losing workers to retirement and not filling those gaps in terms of new labor coming into the market. Kriti the favored phrase of media and investors alike is that germany is the sick man of europe. Is that true . Listen, the economists came out with that cover and a lot of germans took that personally. Ive spoken to a lot of executives about this subject. Obviously the immediate fear is you have manufacturing in contraction since july of last year. This is a manufacturing heavy economy. You have services heavy economies that have done better. That is the shortterm. We had growth projections down for this year expected to contract 0. 6 . Next year not looking great either but lets look longerterm. One of the main issues here is china. The German Economy is more tethered to the chinese economy than other european ones. I spoke to the siemens ceo yesterday, they are trying to balance that. Here is what he had to say. China is a huge opportunity. The risk the rest of the business, being able to deliver or being able to live up to the expectations of customers outside china does not depend on china. So that is for me the topic. We have also worked on decoupling the supply chain, but we are extremely committed to further investing in china. This market is important, we are continue to be committed, but we have ring fenced are supply chain so we are not exposed to the downside. The other thing about german executives i keep hearing is with all this negativity on germany, part of it they say is the german character. They are selfdeprecating and pessimistic by nature. Kriti sounds pretty german to me. All of crook in berlin, thank you for joining us oliver crook in berlin, thank you for joining us. Spain expected to lose a vote to form a parliament. The conservative leader fell short by one vote. A second failed vote would put the Prime Minister one step closer to retaining power. Leaders of nagornokarabakh have said they will disband and hand power to azerbaijan. The leader of the armenian territory said the republic of Nagorno Karabakh ceases to exist. Lets shift back to europe. Party Conference Season is upon us in britain. The Prime Ministers party, the conservatives will meet in manchester. The Opposition Labour Party were ahead in the polls and they kick off their conference the following week. Lizzy burden joins me on set. The backdrop to this Party Conference is train strikes and we have to drive up to manchester, the best city in the world. Its hopefully going to be a different atmosphere to last year because of course this time last year the administration was floundering. This is rishi sunaks first conference as Prime Minister. Hes going to hope it is a different tone. It seems as if we have a new tory leader for every Party Conference at the moment but really, at the start of the year he sent out his five priorities. It has been difficult to achieve them. Theres been limited political success on some of them. His strategists say behindthescenes this is the opportunity to reset, to show hes a Prime Minister for the longterm. Meanwhile for labor, the analogy that is used is that, back to tony blair, is he going to carry the ming vase to the election or present the positive case to vote labor . That is the challenge for keir starmer. This time labor is going second. You would think that means they are going to have the open hand. They get the last word. But theres never a last word in politics. We get the kings on november 7. In the runup you expect lots of leaks that would potentially put labor back on the reactive foot. Kriti what if they have one word to say to the businesses that are watching this Party Conference very closely . What did they say to them . Lizzy they have the smoked salmon and scrambled eggs offensive. Really trying to woo the city. By our data, the mliv survey, it seems to be working. Two thirds of finance professionals say starmer would be more market friendly than rishi sunak. Our colleague reported the big businesses in britain are going to labors conference rather than tories. You have barclays, goldman, vodafone going there. Really this is a challenge for the Consumer Sector to continue this presentation of themselves as the party of business, especially when there is so much damage on the tories economic reputation. Kriti lizzy burden with colorful references. Plenty more of her reporting in manchester all next week. Lets get you to other top stories on our agenda. Hsbcs head of Public Affairs set to step down shortly after controversial comments about the british governments handling of its relationship with beijing. A source tells bloomberg that Sherard Cowper Coles will leave the firm, he apologized for calling the u. K. Week and allowing the u. S. To negotiate business deals with china. Abn amro will cut 70 of new york jobs next year. A move that puts 800 jobs at risk. 52 roles will go in new york this year as abn nears completion of its withdrawal from the United States. Quick check on commerzbank. Citi intends to return 3 billion to shareholders as the german lender details his longawaited capital return strategy. Commerzbank has been a key beneficiary of the ecb rate increases as it relies heavily on lenders taken on lending to consumers for income. Things to put on your agenda, at 7 00 a. M. In london we are going to get a final print of Second Quarter u. K. Gdp. 7 45, a preliminary reading of french cpi, followed by italian cpi at 10 00 a. M. U. K. Time. Also a preliminary reading for september. 10 00 and we get the full euro area inflation print and 1 30 u. K. Time, u. S. Pce data falls upon us. Coming up on the program we take a look at nike firstquarter earnings after the u. S. Sportswear brand profit Beat Estimates. That conversation next. This is bloomberg. At ameriprise financial, our advice is personalized, based on your goals, whatever they may be. All that planning has paid off. Looks like you can make this work. We can make this work. And the feeling of confidence that comes from our advice . I can make this work. That seems to be universal. I can make this work. I can make this work. No wonder more than 9 out of 10 clients are likely to recommend us. Because advice worth listening to is advice worth talking about. Ameriprise financial. Nike jumped in late trading after the companys profits Beat Estimates for the first quarter. There are signs the inventory glut is easing. We are joined by bloombergs often ostia joining us through these numbers. Lets go through the numbers and where nike actually stands. Profit estimates. Beat on that but also there is mixed picture. Revenue did not grow as much as expected and the profit beat was connected to some one off headwinds. Tailwinds, sorry. Then you know, the inventory news is really good news. Inventories fell by 10 . Thats great because if you have a glut of stuff waiting that nobody wants to buy, you have to discount it which eats into margin. Kriti not so great for the rest of us because we dont get the discounts but for nike it is good news. I think there is a factoid years ago, when the penta mx. Supply chain really kicking in pandemic supply chain was kicking in, it takes for a pair of air jordans to get to germany. In china theres a bit of slightly disappointing picture. Nike missed revenue estimates. It speaks to a broader trend of companies saying the recovery in china has not been as strong as they hoped. And that they are looking for things to pick up. Particularly relevant for nike. China is a huge market and it is popular for chinese consumers. It has not been as hardhit by this switch to local brands. Kriti one of the things i was warned about before moving to europe was that at leisure athleisure was less of a thing here. Tell us about broader trends in consumer. Across the european consumer what have we learned out of the nike story . The broader situation in europe is that it is a lot. , it is the lagging region for a lot of consumer goods companies. A lot of them are looking to asia. Thats an old narrative but on the other hand, this year has in some ways been better than expected because at the start of the year if you look back we were so worried about energy prices, so worried the european consumer was not going to have anything to spend on yoga leggings and air jordans. That is in a broader sense, it has gone better than it could have. Kriti the resilience is becoming a global story. Thank you for walking us through that. Joining us this morning to walk us through the crucial consumer story. We thank you as always. For other top corporate stories, u. S. Federal prosecutors have charged a former Goldman Sachs and blackstone employee with securities fraud for allegedly giving friends tips on deals. 26yearold Anthony Viviano told friends about transactions he knew about from his time that the wall street firms. The group made more than 400,000 on those trades. The two men deny the allegations. The u. S. Equal Employment Opportunity commission has sued tesla alleging it created a hostile Work Environment for racial minorities at its california factory. Tesla subjected lack workers to severe, persuasive pervasive harassment. Bloomberg has learned several u. S. Investors including sports giants are considering investing in the pga tour. Sources say endeavor group, fenway sports, and kkr cofounder henry kravis may provide alternatives to the pending deal with saudi arabias Public Investment fund. In june the pga tour agreed to a shock a shock merger with saudi backed liv golf and the dp world to her. Coming up, the s p 500 heads to its worst month since december of last year. Valerie tytel joins us ahead of the european trading session. This is bloomberg. Kriti for a look at the markets, Valerie Tytel has our story. Valerie it is a good time to talk about how big the month of september was for markets. The s p 500 is headed for the worst month of the year down 4. 6 if this move holds today. It will be the worst month since december 22 and the worst month this year. Your next question is going to be what is driving this . I will show you in my next term. It has clearly been the treasury route. This route in long and yields. We have seen a 50 basis point rise in not just the 10 year yield but also the 30 year yield in just this month alone. I have a yellow circle there on the screen. That is the beginning of august and i want to highlight that because that is when the u. S. Treasury first announced they will be issuing larger auction sizes for treasuries. That is what spurred a lot of this move. This worry about the supply and demand dynamics when it comes to the treasury market, when it comes to the u. S. Government spending lots of money and issuing too many treasuries into the market for them to absorb. It has been a big month for treasuries alone. But not just treasuries. It has had an impact on global bonds. We have seen such a gyration in the bond market just this week. We have had the entire u. S. Curve at cycle highs. It has caused the german 10 year yields to also hit decadelong highs not seen since 2011. Lastly we have japan. The long end of japan, the 10 year, 20 year, and 30 year seeing decadelong highs. If you look at japan on just a quarter basis, it has seen the worst bond rout in 20 years down to this move we have seen in the treasury market. Its going to be the key driver for risk moving forward as we head into october. Kriti we are going to be watching the equity story as well. We thank you for joining us this morning. The bond story is important but i want to bring in the stock story. The nikkei to 25 erasing all the losses 225 erasing all the losses. What tone does that set for the european session . We are going to be watching that. The nikkei virtually unchanged but you can see the recovery in the last couple of minutes. Some buying perhaps as we go into the european trading session. We want to bring you other interviews you should be putting on your agenda. Monday we will be speaking to jp morgan ceo jamie dimon. He is right here in london for i believe a tech summit. Theres going to be a lot of interesting crossover between the banking story and the technology story. Coming up today specifically we bring you our exclusive conversation with blackrock Ceo Larry Fink at 8 30 a. M. London time. Dani burger is in berlin, going to be talking about that. Watching very closely. A quick check on the markets because we are seeing green on the screen in u. S. Futures but we are also going to be seeing perhaps movement elsewhere. The bond market gets really interesting because the equity market is seeing more green on the screen. Euro stoxx 50 futures higher by 0. 1 . But no major conviction. The bond market is where you are catching. Today feels like a buy everything kind of day when you are starting to see the bond market around the world catch that bid from investors. On the other hand the weakness you are seeing, the bloomberg dollar index is weaker. Really a function of the commodity story. The aussie dollar, the biggest weight on the bloomberg dollar index. Brent at the same time just shy of 95 handle. Interesting liquidity stories there. Im sure our next show will walk you through it. Mark cudmore, tom mackenzie, joining you now to take you through the markets today program. You do not want to miss it. This is bloomberg. Good night hey corporate types. Would you stop calling each other rock stars . Youre a rock star. You are a rock star. No more calling coworkers rock stars. Look, its great that you use workday to transform your business. But it still doesnt make you a rock star. So unless you work with an actual rock star. Hi, im ozwald. Hello ozwald. Pam, you are a rock i wasnt going to say it. 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