Transcripts For BLOOMBERG Countdown 20150218

Everyone in the world is one of the great challenges of our generation. We are happy to play whatever small part we can. Breaking now, the fourth biggest brewer is releasing its numbers. Welcome to countdown. Coming up, another bloomberg exclusive. Despite recent difficulties, luxury is still growing. First numbers coming through this morning. We kick off with Fourth Quarter. The market was looking for 563 million the costs of doing business is dropping. A nice buffer of capital. But no news is news. We were waiting to hear whether philippa soccer we are still waiting for that. No new ceo. Lets talk danish beer. Sadly there was a bit of a miss. If you are looking at earnings, coming in slightly low. Not too much. 9. 2 3 billion they say profit is up, mid to high singledigit percentages. M a agenda will have to be a low priority. This is a company that is weathering a russian storm. They are the worlds fourth biggest brewer, but the biggest in russia. That is why we saw the share down 20 last year. They have been really hit by so many different forces. The weakening ruvell means ruble means it is having less of an effect on your bottom line. Russia is also affecting demand. You have to remember that the government is trying to crack down on drinking. Overall, they say they are seeing accelerating inflation in russia and ukraine. This is big news the ceo is to retire. We are slowly but surely getting news of who he will be succeeded by. He will be stepping down. He has had a very strenuous last couple years. He is hiring a new chief executive. We can dig into this the person will be, succeeding him. They were expecting another doubledigit drop in the Fourth Quarter. 2015 is continuing to be difficult. The chief executive is to leave. I know barty has it up there but i thought we would trump him the total return for the ceo, he has been here for 7. 3 years. 0. 2 . What to does peers do . 9. 5 . [laughter] yeah. We will be back in a few moments to discuss who will be taking over and how much experience they have, been if they can take this in a new direction. The current ceo of the Dairy Company one of the Largest Dairy companies of the world he is appointed president and ceo. He will start on june 15, 2015. This is according to a press release. He has led the integration of two former competitors and developed a strategy route. He comes from a different sector, though still the food arena. Just want to talk about the french cement maker they are seeing a net income for 2014 by 10 . Up by 10 . Analysts we surveyed were looking for a decline. The revenue for the Fourth Quarter is below expectation, 3. 20 billion euros. It is all about the proposed merger with its rival, which will create the world posse biggest cement maker. The companies have recently said that they expect the merger which was agreed last april, to be completed in the first half. Shareholders approved the deal. We did have some big news earlier this month lafarge had sold to crh, the irish group to remove the final merger hurdle. 6. 79 million for the Fourth Quarter, which is lower than estimates. When it comes to this stock, it is all about the proposed merger, which should be wrapped up in the first half. Both Companies Stay tuned to bloomberg. We will be speaking to labarge chief executive about the earnings. Greece could try to buy time on its Loan Agreement. The indebted nation may request a sixmonth extension that could ease gridlock with european creditors. The antiausterity government will ask for an extension on wednesday, according to a person familiar with the matter. The deal could come with new strings attached. George osborne has said to have riled his european counterparts in brussels. People with knowledge of the meeting say osborne question finance ministers on whether the impact of greece running out of money had been fully considered. Lets get to brussels, where hans nichols has been following the story. Good morning. What is the likelihood of a request for an extension being filed . What is it they are asking to extend, the loan or the bailout . From a great official last night, we heard they want to extend the Credit Facilities the bailout, not the actual program. That is a crucial distinction because the germans and other finance leaders have been so clear that they want him to continue with the imf eu ecb program. They are going to request some sort of extension. They were on german broadcasters today and they said the crucial question is not whether or not greece asks for additional money but whether they complete the program. In some ways what we heard last night, especially when you overlay it with a speech to the parliament, he was going against everything well, a large part of what is in the bailout program. Talked about pension and tax reform. They clearly want to exit the program, and that seems to be a nonstarter. What we heard coming out of the meeting yesterday was that greece needs to fill its obligation and the question is up to greece. Greece has to give a clear credible, and reliable commitment about the time ring in which the country will implement its program. If it is not possible by the end of february, an alternative date has to be given. That greece has no aim to do that, the discussion is about basis. We couldnt get any clarity yesterday. We heard from that greek official late last night and from German Government officials saying the actual proposal what it is as an extension of the Loan Facility and not a completion of the program. Doesnt seem like this gets us any closer to getting greased back on track. Hans, we may get some news later today from the ecb. On whether greece is going to continue to have access to the emergency funding what is the latest there . In frankfurt, the ecb will have a meeting where they may discuss greece. The key question is will they keep the emergency liquidity lines, liquidity window open . Two weeks ago, when talks were spiraling here they went ahead and cut off using the collateral. Using greek collateral. The question is will they make it clear that if greece wants access to ecb funds they need to stay in the program, not the loan bailout or the Credit Facility . That will be a key distinction. The ecb could put more pressure on them tonight, especially as this proposal falls short of what many finance ministers were very clear of what they wanted, that greece stays in the program. Loan versus bailout thank you. Hans nichols joining us from brussels. That state a look at some other stories. The bank of japan has made a stimulus. They to stoke a recovery from recession. The central bank will boost an annual pay of ¥80 trillion, 670 billion. They say that exports and production have been the king. Rebels and ukraine say they have taken over the strategic crossroads. Fighting is undermining a fragile truce. Vladimir putin has urged here to let the soldiers go. He accused of Arming Ukrainian fighters. According to our information, these weapons are already being delivered to ukraine. There is nothing unusual. Second, i am absolutely sure that whoever delivers whatever kind of weapons, it is not good to deliver weapons to the conflict zone. Whoever delivers weapons, the number of victims can increase the results will remain the same as it is today. Tesco has appointed john allen as its new chairman. He begins on march 1. Allen, who is currently deputy chairman, will be paid 655 million. Exxon mobil admitted a sink in oil prices. It has ravaged oil Company Profits forcing some to slash spending. Holdings cut in u. S. Stocks and sugar that and shipped out. Other bighead sponge made a similar call on u. S. Equities on oil prices. Bank of america has cut chief executive officer ron moynahan. After the profit dropped he got 11 and a half million dollars. His salary was left unchanged, and he received no cash bonus, according to a person familiar with the decision. Snapchat is seeking a new round of funding that would value the company as high as 90 billion. It would make it the third most valuable company in the world. Sarah frier is in San Francisco with more. Sarah, 19 million the price tag for this company just keeps going up. They were offered 3 billion originally by facebook. It is stratospheric. Yes. In late 2013, we heard how they are rejecting facebooks offer. Not too long after that they raised 10 million and now are at 19 million. The price of snapchat they have added quite a few features since then. They are now allowing people to post more publicly. They have added a content Network Several channels for editorial content, and they are starting to have advertising. It disappears in the same way that the pictures do. Thanks. Lets see where it goes. It is almost the same size as instagram. Breaking news from sony it will split out its video and sound as a different division. Of the companys corporate midterm strategy in tokyo now. It is in japanese. If you speak japanese, good for you we dont. I cant give you some of the highlights he is giving a new business strategy. Pictures will have a Film Division and they will continue to drive growth. That big news which has just been announced, he is to split out the video and sound division as a wholly owned unit in october. So it is also forecasting a surgeon operating earnings by fiscal 2017. They will drive the turnaround with games and entertainment. He says that operating profit will reach ¥500 billion starting april, 2017. That compares with its forecast for ¥20 billion in operating profit this year. They are targeting a boost in its return on equity to about 10 . We will continue to keep an eye on this and give you the details. Lets take a break you can join in the conversation on facebook, in japanese if you like. Coming up how much of an impact will the situation in greece have on Foreign Exchange markets . Not a lot, according to our next guest. Greece has to give a clear and reliable commitment about the timeframe in which it will implement its program. Itf it is not possible by the end of february in alternative date has to be given. We couldnt get any clarity about it yesterday. The german finance minister. Lets stick with europe. Are next guest says that situation in greece is unlikely to have an impact on Foreign Exchange markets. When i rent the greek story on the way in today about how greece may ask for an extension it is not an extension to the current a lot. The current bailout. It does seem to be progress, doesnt it . There is progress but the progress is slow. They will probably be another 10 days of slow progress. It is interesting from a market perspective the Market Reaction has been completely different than back in 2012. The reason for that is we have the ecb qe that will be buying a huge amount of government bonds. Do we read into that, then that greece will leave and that is why markets are worried . Or if they did leave, it wouldnt matter . What enables the market to focus on the qe . We will have to wait before the night of the deadline but even if tensions were to increase, the markets we also got some data today in the u. K. I love what you put in your notes, that sterling is set to sparkle in the markets are crackling. They are adjusting themselves for a hike earlier than the thought. They thought. The economy is very strong, but we have got inflation and the election coming up in may. However, over the next couple of months, the underlying economy should be strong we think it will be a stellar number. Minutes from the fed were released. Is it going to detract us from the view that the fed will probably raise rates around the middle of the year . The market always has difficulty trying to interpret the minutes because there arent really anything to look at, just headlines. You need to get a bit more airtime in the minutes. However, events have moved on. We havent seen anything like that. They are paying more attention to the yen than the backward looking minutes. Thank you. The ceo of the french luxury Goods Company says he hopes a new creative director can breathe fresh life into the gucci brand. Global luxury did well, 5 overall for the whole year. In our portfolio you have various top performers. We are growing at 27 , 20 . We also have smaller brands growing strongly. And of course, we have my situation in which we look flat over the year and we find improvement. Regarding gucci, you named a new creative director. How long has he been in gucci . It is not a turnaround the point is that the strategy will consider the size. If we want to have more potential of growth, we need to be in that strategy. It will him the execution of the strategy. We think that by opening a new chapter in terms of creative direction, we can give a new status to the brand in terms of attractiveness. That would be very important in the near future. We are already working on that direction. A new image, a new product, new creation. As i said, we will receive the first impact of that new management, that new creation team, in the second semester of this year. We will have the first semester and all those action plans, but this year we will have the first results. How would you describe the luxury market in 2015 compared to 2014 . The market will continue to grow structurally. It will be very complicated, because not only is geography moving in terms of growth, america will continue to grow i think it is still strong market, we have a Strong Program in europe because of the europe situation, and because of the foreign impact in different countries. It is difficult we will have a positive impact on our sales, but of course mathematically speaking, it will put a ceiling on our percentage. Not on the improvement of the line. Speaking exclusively to bloomberg. We will take a break. Mark zuckerberg tells us how he plans on revolutionizing the internet once again. A short break here on countdown. Manus youre watching countdown. Viewing the risk markets at the moment let me leave the quadrants. What is trending . There is a hovel of indecision. There is no clear direction. He ranked the issues on the Foreign Exchange market. It is the Federal Reserve minutes today. That is what you will get later on. You will also get u. K. Unemployment numbers. Lets talk about the dollar virtually unchanged. Will the words patients remain in those minutes . It could incite the view that rates will rise in the next two months. Keep a word on the wording. Keep an i on the wording eye on the wording. We have had the statement, no major rush to change seems to be the consensus. The view from the analyst community, 26 of the 35 say it will be october before you get further stimulus. This is dollar down, yen rising. This bank doesnt seem to be in a hurry to reclaim the supremacy ran. Jonathan mark some breaking news from vivendi vivendi. They have received an offer from numeric double numericable. The vandy owned this group until vivendi owned this group until last year. Numericable has come back to the table and said we want to buy your remaining stake for 40 euros a share. The vandys vivendis board will examine the offer. 40 euros a share and the entirety of that is worth 3. 9 billion. It is all happening in the french and Telecommunications Industry this week. Shares surged to the highest in more than four years. They are reported to have stepped up plans for a successful takeover of the telecommunications assets. Already he is interested in telecom and numeric cable numeric obloquy numericable once to buy their stake. Lets talk about cars. The french carmaker 2014 recurring operator profits of 209 million euros. That doesnt sound great but on the upside they are accelerating cash flow targets. What they were hoping to generate are now bringing that all the 2015 and 2017. Interesting what they say about the russian business, the mound down by demand down by 13 in 2015. Time for our top stories. Greece may request an extension of its Loan Agreement or six months. A stance that could increase its standing with loan adjusters. Snapchat is seeking a new round of funding that would value the company as high as 19 billion. The move would make snapchat which makes a mobile application, the third most valuable Venture Backed Company in the world. The advantage ban is maintaining unprecedented monetary stimulus. The central bank will boost the monetary ace at an Monetary Base at an annual pace. He also says exports and production have been picking up. Mark zuckerberg has revolutionized the way the world communicates. Can he do it again . The tech billionaire is hoping to do so with internet. Org which aims to provide free and basic internet across the globe. He sat down exclusively with emily chang. It is one of the most populous nations in the world, starved of one of the most precious resources. The internet is how we connect to the modern world, but today worldwide only more than one third of people have access. In india, the numbers are more dire. Of 1. 5 billion people only 15 are online. So we find Mark Zuckerberg visiting students on the outside of new delhi. He revolutionized how people communicate. Now he has a more ambitious goal. We believe collecting people in the world is one of the greater challenges of our generation. Zuckerberg calls his plan, internet. Org. He is spreading the message from india to indonesia. It is our effort with a handful of other Technology Companies to bring affordable they sick services to everyone affordable basic services to everyone in the world. His team admits it has been far from easy. There are Market Dynamics in every market that is different. You ask these villages, do you want the internet . They say why . You ask if they want facebook and they say definitely. They have been crisscrossing the globe. How does having the internet change lives . The mission is to convince mobile carriers to offer a limited version of the internet for free. Facebook custom builds an website for each partner country. It links to local weather news jobs, Health Resources and facebook. All at zero cost. The idea is users get hooked on the internet and by a data plan when the free access ands, create a new customers or carriers and new users. Why call it. Org . Is this nonprofit . If we were primarily focus on profits, the reasonable thing would be to focus on the first alien people. You said connectivity is a human right . If that is the case, why not give access to the complete internet . The model we consider to be most similar is 911 in the u. S. If you have not played paid for a phone plan you can always dial 911. Tim was a professor and Public Policy advocate. Why would a Country Company giveaway a product for free . They think they can build the most powerful device for accessing the hearts and minds of the human race and sell that to someone else. Facebook is one of many internet giants in an epic global battle. Whoever gets the biggest share of the planet might expect to dominate the future of media,. Media, period. Google has projects, a fleet of High Altitude illumines, beaming the internet down to earth. A new Company Called one web and spacexs elon musk both launched plans to launch satellites that will carry the internet everywhere. Facebook has moon shots of its own. Wizard communications is where you can get much higher data rates. A team of former nasa engineers are developing lasers that will send the internet to earth in a beam of light. For all of the developed markets we are looking at, trying to improve access, we want to use laser communication. Maguire plans to put lasers inside unmanned area vehicles. The world record for solar powered flight is around two weeks. We need to figure out how to make it last months two years. The advantage . They dont rely on cell towers or any earthbased infrastructure. Maguires is connectivity from the sky is still three to five years out. Expects to test the first drone this year. Once you have the power to reach them, how do you use it . It is all about enabling people. Whatever that means, in india and indonesia, his plan seems to be working. Carriers recently announced partnerships with internet. Org giving millions access to the internet and facebook. How will you judge this has been a success . If we can make it so Free Basic Services are available in 100 or more countries, that is a huge win for all of these people who have access to jobs and health care. You said you hope for more than one billion by 2020 . Can you get there . We will see. It is the kind of grand plan you can only expect from Mark Zuckerberg. The question is, can he change the world twice . Just want to show you some pictures of the bank of japan governor, making statements now. He is saying the bank of japan wont hesitate to adjust if the trend changes. Yen is spiking a little bit lower. Dollaryen trading at 1. 1930. Slightly more dovish comments, a great deal of discussion has been circulating and their lack of movement and lack of easing. 10 year government bonds in japan have doubled in the past 30 days. We go from. 2 they will take their time before they actually do any more kinds of quantitative easing. Any more kinds of on buying or asset buying bond buying or asset buying. It is a fact. Anna you can join the conversation on twitter. Mark coming up they will talk about the internet of things. We will speak to the founder of a startup, incubator making it a priority. Stay tuned. Manus welcome back to countdown. Greece looking for an extension of its Loan Agreement for six months. It could ease the standoff creditors. Greece and euro area members have been at odds over the formula used to extend their 240 billion euro rescue. Prorussian rebels in ukraine said to have taken over the strategic crossroads town. The fighting is undermining a fragile truce. Vladimir putin has urged kiev to let his soldiers surrendering. According to our information these weapons are already being delivered to ukraine. There is nothing unusual. Second, i am absolutely sure that whoever delivers the weapons, it is not good to deliver them to a conflict zone anyway. In this case, whoever delivers them, the number of victims can increase but the result will remain the same. Manus tesco has appointed john allen as its new chairman. Richard broadbent said in october he will be stepping down in the wake of their blackhole. Alan, who is currently the deputy chairman at dixons car phone will be paid 270,000 pounds per year. Mark breaking from the italian oil company. Adjusted net income has missed analyst estimates. Analysts were estimating 570 9 million. We had a loss of 2. 3 4 billion swiss francs. Oil prices in the Fourth Quarter were lower than they were in the prior year. Oil and gas reduction at 1. 6 5 Million Barrels of oil a day. 1. 6 5 Million Barrels of oil a day. They are cutting production and maintaining their dividend to ensure that investors still ids shares. We spoke to the chief executive in january and he did tell us that they can do well with oil at 65 to 70 dollars a barrel. Oil is below 60 a barrel right now. Anna the londonbased startup indicator opened its doors to entrepreneurs specializing in the internet of things. They have taken on their first three startups. Here to tell us more is emmanuelle. Thank you for coming to talk to us. How competitive is it to try to find a viable ideas in the internet of things to invest in . It is very competitive. Everyones hands are in the pocket of the internet of things and the idea to have is to provide something more in the traditional investors. We provide funding which is a precondition that most importantly we provide something which is kind of unique and healthy for startups. Services like Data Transfer and go to market capability. Anna tell us about what you have invested in. Brain control. Controlling devices with your thoughts. It had implications for health care but could go further. Guest the Health Care Industry is the most popular target for this company. The idea is to have people with als syndrome to communicate in a very easy way with the external board. Anna another one that is interesting cocoon. This is a smart Home Internet of things. It focuses on security. It learns the normal sounds and movements your phone home makes and then alerts you with a message or video as to what is going on. How much potential does that have . Guest it has Great Potential because it is easy to use. It is based on a learning system which enables us to understand the common behaviors within the house. Anna can it cope with cats and pets . Guest absolutely. Anna the other of the three is an energy usage at which tells how many appliances you are using. Are there not others that do that . Guest there are and when you have a growing market you have a lot of players out there. The difference is the way you play the game and if you provide some been useful to the user. Anna give us insight into how you decide which startups you are going to back. Is it all about the product itself or the Management Team . Guest definitely a combination of items. The Management Team makes a difference in the business. We look for a great team and then brilliant ideas. First the level of innovation secondly, how big is the market they can address and thirdly how will it be used by the user . Anna you have a great deal of experience in the telecom world, we talk a lot about consolidation in the italian market and the u. K. And france it seems to be happening everywhere. Did you see this coming . Do you think this is inevitable for europe . Do we need fewer Telecom Providers . Guest this is inevitable due to a couple reasons. There is an industry of consolidation with technologies such as mobile fixed media. Then there is something related to the investment level required every year, not only to develop and to maintain. It is inevitable that it would go to a consolidation process. Guest you have a lot of experience anna you have a lot of experience as i say. You worked in london for the italian business. When you look at the eurozone, are there reforms that you think the eurozone should make . Guest absolutely. Any reform that can some ways help is welcome on our side. We see some transformation. If we look backward up to five years ago, brilliant startups were used to leave europe and go to the u. S. To be properly developed. Now there are more options for the startups. We are one of them. Because the infrastructure is there, services are there and funding is there. Anna thank you very much for joining us. Guest thank you for having me. Mark lets talk about our digital text. It is almost 7 00 in london. I love my oscars. What is happening as the bookies and experts tell us a two ors race between heard man and birdman and boyhood, a film shot over 12 years. Usually you can look at previous awards. The winner from the top honor of the Producers Guild of america has gone to capture the Academy Award for best picture in each of the last seven years. Birdman won that award but bafta boyhood won it. It is a tie. Even the bookies are split. It is completely changed. William hill has birdman at 8 to 13. It is the tightest oscar race in years. Manus when we get the results, guess who will be first to say. Mark i wont sleep. Manus we are spirited young anna edwards from the floor. Anna not magic. Manus im going for rollsroyce. They are not producing an suv. They are producing an everywhere, everything vehicle. It is a rollsroyce suv of course. We asked recently and they wouldnt answer it. They will announce they are going to produce an suv but there is no sketch, timeline and what this does is leave ferrari as being the only nonover luxury non uberluxury brand without an suv. I must correct myself an everywhere vehicle. The is effortlessly everywhere. Sales rose from 2008 to 2013 and one in eight will be an suv. Anna based on the average price he paid in 2003 and the average price in quarter fallout, but it is not as simple as buffett is getting out of energy. What came out yesterday is he has also increased his stake in phillips 66, a refining business it is a more complicated picture. Other interesting moves he is made. He has increased his stake in ibm. That is one of the biggest things he has. He increased his stake in deer and co. Manus we are going to kick off the next hour. We will talk more about some of the management shuffles and we will go live to the land milan. Greece, represented by its democratic elected government has to decide what it wants. I cannot extent something the country does not want. Mark those are the words of the german finance minister as greece is said to be poised to request a loan extension to end the gridlock. Anna snapchats new price tag could get fresh funding that takes it to 19 billion. Manus Mark Zuckerberg tells us of his plans to revolutionize the internet again. We believe connecting the internet is one of the great challenges of our generation. Mark sony forecasts a surge in operating earnings by 2000 down 17. Thanks to a turnaround in games. Mark welcome to countdown, i am mark barton. Anna i am anna edwards. Manus i am manus cranny. Anna also coming up another bloomberg exclusive despite recent difficulties, the market for luxury goods is still growing. All the markets are not going in the same direction at the same time. But were in a normal situation. At the end of the day, the luxury market as a whole is structurally growing. Anna greece could try to buy time on its Loan Agreement. The investigation may request a sixmonth extension. Manus the antiausterity government suggests that they will ask for an extension on monday. There could be new strings attached. Mark osborne is said to have riled his european counterpart in brussels. People say he questioned the finance ministers on whether the impact of greece running out of money had been fully considered. Anna lets get straight to brussels. Hans nichols has been following this story all week. What is the likelihood of a request for an extension. If it comes through, what is the likelihood of asking . Hans it depends if the request is just about the Loan Agreement or if it is about staying and completing the program. That is a crucial distinction. We havent seen a copy of what theyre going to be asking, but it looks similar to that proposal that caused the meeting to and is so shortly the other night. If this is just a formalization, this is likely to go nowhere. We heard the german finance minister last night say the crucial question is not whether or not it asks for a bailout but whether or not greece fulfills the current program. You saw the Prime Minister yesterday making a defiant speech and moving to roll back some of the austerity measures. Some of the conditions that were in that program. The key question everyone here continues to ask themselves is what does greece want . What are their goals . Greece has to deal with clear , credible and reliable commitment about the timeframe in which the country will lament a program implement a program. If it is not possible by federer a, an alternative date has to begin in possible by february , an alternative date has to be given. Hans we are talking semantics and they will be able to gloss over it. This will facilitate both sides to make it more palatable. Or two, we are talking about fundamentally different things. A little bit of the market things we saw it night could not be worn to. Warranted. Anna i might need my thesaurus the end of this. We might get some news later this evening about whether they are going to continue to apply the same access to emergency funding that currently applies. Hans what greece did two weeks ago what the ecb did was cut greece off from using collateral for a lower refinancing rate. They kept open the emergency liquidity assistance. Theyve made it clear that if greece does not stay in the program they will lose ending. The question is, will they extend it to the end of the month . Will it be cut off quickly . If it is cut off quickly before the end of the month then greece could be left out in the cold. There could be a banking crisis. Anna thank you very much, lets bring you uptodate with what is happening in the u. K. The markets company has been running an energy probe into the sector. They say that their view of the sector may change. They say the u. K. Energy rules need investigation. Do those codes that govern the electricity sector, they stop new entrance and one of the companies responding, scottish and son say they will maintain their approach of working constructively. Mark sonys forecast as the chief executive officer drives the company turnaround. Lets yet more details from zed. Hello mark, this is a winwin for investors. You could see operating profits at the company of as much as 4 billion. ¥500 billion. It is an increase of the current forecast. They oh it all if they can deliver owe it all if they can deliver. They command a market leading condition. These are companies built into things like the apple iphone which is so popular on the market and will be coming to computers and automobiles. Those are the key elements of the strategy and cost cuts. We know the cfo has been working hard to deliver significant cost cuts. They say autonomy will be critical. Also accountability. We are seeing a wholesale Corporate Culture change. One that looks to make sure that investors are taken care of. Return on equity, the company says this will be the primary performance indicator. Sony targeting an are only for 10 an roe for more than 10 . We have seen the stock react today, again of as much as 3 . Mark thank you. See you later in hong kong today. Lets look at some of the other stories. The bank of japan is maintaining unprecedented monetary stimulus. As the governor wants to counter a slowdown in inflation. They will boost the Monetary Base at an annual mate of ¥80 billion. Anna prorussian rebels in Eastern Ukraine city have taken over the strategic crossroads town. Inciting and undermining a fragile truce. Vladimir putin has urged kiev to let its soldiers surrender. First of all, according to our information, these weapons are already being delivered to ukraine. There is nothing unusual. I am sure that whoever the livers whatever weapons, it is not good to deliver weapons to a conflict zone. In this case whoever delivers the weapons, the number of victims can increase but the result will remain the same as it is today. Manus tesco has appointed john allen as its new chairman. He will replace Richard Broadbent who said he will be stepping down in the wake of the banking scandal. Allan who is currently deputy chairman at dixons car phone will be paid 650,000. Mark the decline has ravaged oil Company Profits and forced major producers to fire thousands of workers. Anna Funds Management cut its withholdings in the Fourth Quarter and shifted globally. They moved about 2 billion dollars into asia and europe. Other Big Hedge Fund managers made a similar call as the slide in oil prices hammered energy holdings. Manus bank of americas chief executive officer cut after profit dropped by more than. 5. His salary was left unchanged and he received no cash bonus. You can find more on that story his pay is always an interesting topic. Anna join us on twitter if you want to take part in any of our conversations. Mark up next, are we starting to see resolution between greece and the troika. Our next guest says it is possible. Greece has to give a clear credible and reliable commitment about the timeframe in which the company will implement its program. If it is not possible by the end of february, an alternative has to be given. If they dont do that, we couldnt get any clarity yesterday. Manus that was the german finance minister. Lets stay with europe, our next guest says greece and the troika have a willingness to meet a resolution but may not happen anytime soon. When i was reading the top line of your nearterm outlook i almost fell out of the chair. You sound mildly positive on europe. Europe is not an equal play so break it up for me. Guest if you talk about greece first of all, it is presenting opportunities. It is shaking up valuations in some of the more risky markets. You can say what is happening to the bank stops in the periphery hasnt done so well. The other thing to look at is what the implications of q we are. It is difficult to resist the near term positive momentum. Who am i to step in the way of 60 million euros. We also know the valuations are selective. Q we is obviously the key factor qe is obviously the key factor. Anna talking to George Osborne it seems as if he was shaking things up last night. Are you thinking about what would happen if greecwe left . Guest you need to have a plan in place, that is normal Risk Management. Secondly, this nation, the u. K. Is a country of shopkeepers. We are more sensitive. It has always been this way and it matters to us that things are fixed or it for our economy to do well there are two thoughts. One is Risk Management and the other is the economy. Mark the net issue in the eurozone could be negative for the first time. What is that mean . Guest it means Everything Else you have to squeeze in bonds. Weve known this for a year. We had 12 months to see that german capital is big and the free float of available bonds is small. Large amounts of this is in. We are in the last 10 of the move. Lets be straight. Manus u. S. Treasuries have had the biggest monthly decline injured 10 years. Hedge Fund Managers have cut their bets on on 10 year notes. They have cut and run before the drop in february. Have you changed or shifted . Will we hear the word patience tonight . Guest there is a lot to learn. Were probably seen the low point for yields. We probably had it already, 1. 64 or whatever it was. I think there are several ways of looking at it. The more conventional approaches looking at things like rate hikes. We probably should worry about that. What i am worried about is something you cannot see and measure. The term a premium. It comes down term premium. It comes down imagine if they change what they promised. If they said we will not keep reinvesting the change. That is one of the risks. I think the term premium is too low. Anna what is that mean . Guest it is the catchall phrase for that area above the growth inflation and above normal rates. There is something else. This having else is weak and negative. Once you realize that you can get comfortable with the idea that on yields below 2 may not prevail. We could easily go toward 2. 5 or higher. I have been a on bull for a long time bond bull for a very long time. Those market moves are people starting to allens things. Balance things. Mark in the face of a possible rate hike by the u. S. And the result of that currency volatility, how does that play into our assessment . Guest volatility is another concept that comes into term premium. Youve increased uncertainty and you want more premium and more yield. If this is rising the yield curve will go with it. There are lots of moves happening in currencies. This year you had 17 rate cuts many of the positions have interest in fx markets. Again, that does have a wider read across the bonds. So if people are focusing elsewhere what are they doing at these levels . There are a number of factors conspiring at the same time to make some of these investors take some risk off the table. Manus we will have to draw a line under it there. No crash in bond yields. Thank you so much. Head of Global Fixed Income at hsbc. Anna stay tuned, we will take a short break, back in two. Mark some breaking news from the Spanish Power company. Net profits for last year 2. 3 3 billion euros. 2. 33 euros 2. 33 billion euros. Dont miss our interview later. Manus the ceo of a luxury Goods Company has said the german brand can consolidate its as if and as the worlds third sportingGoods Company. The ceo spoke exclusively to bloomberg. I am not selling houma. Selling puma. Full stop. It has improvement in the quality of the distribution. The brand is moving in the right direction. Im confident we will be able to turn around puma. And deliver strong goals. How much does caring kering currently own . 86 . We are focusing on supporting the teams to relaunch the brand worldwide. Many plants have been activated with great success. This is the top priority of the brand. You said you are confident about luxury, what about sportinggoods . It is a market that is not at the same pace but still growing. Targeting younger customers. They are very attracted, they are young. As you know sports is global. What you can sell in one part of the world can be sold in another part of the world. This is why we decided to go into sports. To take it vantage of geography and take advantage of the potential of that brand. You think it will go faster or slower than luxury . The luxury sports market wont go as fast as the luxury market might. Puma will grow faster than the market. We come back to our market is asian. The note market position. The number three brand in the world. The product, brand image and distribution network. Everything is realigned now. Manus you are watching countdown. Time to see what the trends are. You can see there is a little flatlining. No real gutsy determination. The u. S. Dollar up right an eight. The jp why just moving up. How boring can it be . The euro flatlining. As greece prevaricates. Procrastinates . I dont know which word you want. The bank manager has spoken and has said there is no need for extra action that the drive in sales tax is ending, Capital Expenditure will pick up here in what did this do for the yen . Not a lot. They are just not playing that easing game with the same got. Dollaryen, a fairly sanguine response. Hsbc, stephen major has just left the building. He had a conversation with mark anna and myself. Go to twitter, the view is that rates have autumn doubt in the United States from hsbc. You will see those rise by the end of the year. The market is repositioning itself. What you need to focus on today is whether the word patience remains in the script. If it drops out it suggests the Federal Reserve are ready to slip it into six gear. Back to you. Mark top stories on bloomberg greece may request an extension of its Loan Agreement. That is according to a person familiar with the matter. Snapchat is seeking a new round of funding that would value the company as high as 19 billion. That is according to a person familiar with the matter. The move would make snapchat the third most valuable Venture Backed Company in the world. The bank of japan is projecting unprecedented monetary stimulus. The central take will boost the monetary basis of pay by 7 billion. They say exports and production have been picking up. Bp published its 2035 Energy Outlook this week. The report anticipates a slowdown in the growth of u. S. Shale oil that will allow opec to maintain its market share. The ceo said that the recent roller coaster ride should not have come as a surprise. What we see is a pattern of continuous change over a long wavelength. The volatility we are experiencing is not some apparition. It is more aberation. It is more the norm. For more on the report and their longterm future lets turn to read the interview. I think broadly i would agree with what they are saying that opec has not lost its power and will regain the market share it could lose. And shale does slow down. Anna they are saying the saudi strategy worked. Without this the general consensus would be that shale tops out like 2020 by 2020. Given growing demand, they would regain a lot of market share. What is going on now is it might help them regain it quicker. Mark four weeks of gains through this week. You will say it is a red herring in the shortterm. It is because even though rigs are falling now, production doesnt turn off overnight. They are just moving rates around from the unprofitable to the more profitable. That means you will see even more production. If you look at the weekly numbers it is steady or rising. Demand data tends to lag. I was in asia two weeks ago with phenomenal numbers coming out of there. We forget that but for middle class economies, this is the lowest they had seen prices since they came up the ladder. Manus you also go on, it has been International Petroleum week, that is where the greater good comes together. When we talk about gasoline and heating, you said they are different stories and we are missing a beat. Put it in plain english. Anything driven by low oil prices is doing very well around the world. U. S. Asia, strong numbers. Diesel is slightly more Economic Growth oriented. The economies are still not doing very well. Anna we read other research and talk to other guest who say the demand environment is weak and you say it is strong. Demand has been week. Last week was very weak. Like i said, people are still talking about it. The numbers coming out strongly our december, january and february. They will turn a little bit. Mark give us levels, amrita. We love levels. We have had this bounce from 46 for brent to 62. I think we will head back higher worst into the 60s. I think 68 or 70 is very much first intrasite. What in site. But u. S. Oil producers might come out and hedge a little bit of the production. We have to come back down in the spring which is also the weakest period of demand anyway. I read an article this morning that says production would be similar to in 1979. Libya is in a state of crisis, so what happens to the production ability in libya . The writing has been on the wall since last year. They didnt even target infrastructure and they manage to never go above 9000. They have already been losing a lot of their underlying reserve. They have not taken care of the reserves and now theyre actually targeting the infrastructure. It is going to be very difficult for libyan reduction to come up anytime soon. We were talking about this as a big swing factor. Are you factoring in, are you assuming there will be any growth in that . I think the difference was all the instructions are protest. When things got better they could ramp up quickly. This is the first time they are damaging the oil infrastructure. We just revised our estimates and were expecting around half 1 million. Now we are expecting at best 250. Mark what about nonopec supply . Russia, angola . Take your pick. The damage from Lower Oil Prices is being done elsewhere the Latin Americans and the russians. Ultradeepwater is not cheap and so is the arctic. Huge cap ex cutbacks. You will see the fault late this year. Manus you can join the conversation. I cannot type as fast as you can talk. Her levels have improved. Mark it leads perfectly into todays bar chart. The word over oil. Next. Is the worst over for oil . Yes if you listen to peterson. He says the consolidation of the supply side followed by a supply drop, the next stage will be driven by a recovery. Lets see how far it has come. That yellow circle right there 46. 59 on january 13. Since then it has risen by 34 in 36 days. It is also on track for the north consecutive weekly gain. The longest winning streak since september 2013. Brent is of course 46 below the purple circle. That was june 19. Top to bottom a plunge of 60 . Is the worst over . A shrinking number of u. S. Oil rigs is bolstering views that the rebound does have further to run. Other bullish factors include opec. The iea says a faster economic expansion will help demand growth accelerate. Throw into the mix bad weather lower production. That is boosting the outlook for oil. Chuck into the mix, an etf tracking oil. Also we have to gauge tracking expectations for oil volatility. Those are the bullish factors. But the rig he says it is still fragile and the recent turn may turn shale production profitable again leading the industry to keep up output. Goldman sachs says reduction intrau. S. Rates isnt enough to sit efficiently curb output and address the current excess. Arguments on both sides, what you think . Is the worst over for oil . Manus time for the top stories on bloomberg. Greece may request an extension of its Loan Agreement, a step that could ease a standoff with creditors over the future financing. Greece and the euro area members have been at odds over the formula used to extend the 240 billion rescue the lawn beyond its and of february expiry. Infighting that is undermining eighth fragile truce a frag ile truce. Vladimir putin accused the u. S. Of Arming Ukrainian fighters. According to our information these weapons are already being delivered. That is not unusual. Second, i am absolutely sure that whoever delivers the weapons, it is not good to deliver to a conflict zone. In this case, the number of victims can increase, but the result will remain the same. Manus tesco has appointed john allan as its new chairman. He is replacing Richard Broadbent who said he is stepping down in the wake of the 263 Million Pound accounting blackhole. Allan will be paid 650,000 pounds. Anna if you have a diamond on your finger there is an 80 chance that israel had its hands on it first. The company is disrupting every part of the industry. Elliott reports. When it comes to diamonds, you cannot beat the human touch. That is how it has always been. If you cannot be with a diamond in person the next best thing is this the latest in diamond technology. Allows you to view every aspect of a diamond online including how it sparkles in the light. To do that they photograph the polished time and from every angle. The machine which can cost over 200,000 displays complex algorithms to calculate the optimal way to cut stones. It started intrathe 1990s. Normally you take one rough diamond and make to polish out of it. Today make six and sometimes 25 separate polished diamonds out of one rough diamond. This technology really transformed the entire industry. It also transformed serene from a small israeli startup to a 700 billion company. Next month it will launch its latest innovation which it hopes will convince diamond dealers they can buy and sell stones without touching them. The ceo of the diamond exporter isnt so sure. I still think people will what to touch and feel the diamonds they are buying. There is a certain feel and romance that diamond dealers enjoy having with the diamond they are buying. I think seeing it online will not take that away. It should be able to help buyers decide which stones they dont want. It could mean fewer diamonds shipped and saving on cost. It may not mean much of a discount. Mark you are looking at a live shot of the city of london. Futures indicate that stocks will open higher. Welcome back to countdown your code countdown. Nayim, good to see you. We heard overnight that some billionaires are getting further away from north american stock markets. You think investors should continue buying stocks . Guest thank you for having me. When i look at my bloomberg terminal in the morning we look at the fund flow. Where it is coming and heading. We do like to drill down into where the money is going whether the u. S. Market or the european market. Im actually speaking with mark and we set the trend for the next year will be in the european market. Just purely on this reason that the ecb quantitative easing is coming up. Mark we cannot derail that or can it . Guest i think there is a 20 chance for that. 80 chance that greece will cave in. We do think the rumors that are in the market today would say they will reapply for that extension is because of the ecb. Lets look back to 2010. Ireland was forced to go and ask for money and the reason was the ecb said we will cut your ela, and you will have no more funding for us if you do not apply for the extension. In 2013, the same thing happened with cyprus. Today the news is primarily based on that fact. Manus you have a lovely comparative which is what everyone is worth, do you have a position on apple . Guest for disclosure purpose i do have a position. I have it in my portfolio. The reason i like apple is it is a dividend play, a growth plate and a valuation play. That is 100 for each person the thing that i like is apple has the ability to surprise the market and create a need for everyone which it could never even imagined. Could never even imagine. Like an iicar. Guest there are rumors. Whether it is a prototype we are not sure. But the people they are employing are coming from motor cars. Anna thank you for joining us today. It is 7 55, that is it for countdown today. Stay with bloomberg. Jonathan good morning and welcome to on the move. Im Jonathan Ferro in london. Moments away from the start of european trading. Lets get straight to your morning brief. The bull market charges on. The s p 500 closes above 2100 points for the first time ever. The ftse 100 climbed to the highest level since 1999. Monster valuation. Snapchat said to be seeking as much as 500 million in funding to give the tech Company Evaluation of much as 19 billion, just short of the 22 billion facebook paid for whatsapp. Kicking the can. Greece is said to the close to requesting an extension of its Loan Agreement as talks continue. Greek banks face accelerating deposit flight. Futures are a little bit higher. Euro stoxx futures higher. Dax futures up by 50 points. Manus cranny is at the touchscreen with the open. It is indeed. Go to bloomberg. Com and get a real good flavor of what is going on. Equities have got a nice relief. The stoxx 600 has had the best january since 1989. 7. 3 in january. Weve delivered almost 10. 3 in terms of equity returns since the start of the year. All predicated on the view that the firewalls of this map are so robust that anything that happens in