Transcripts For BLOOMBERG Countdown 20150320

Region and a third part of the special series. A very warm welcome to countdown. I am manus cranny. Mark england takes on twickenham. I set down with the ceo. He told us its all about the passion in rugby. One of the great things about sport, although we think it is a business, its a passion. There are 82,000 people doing the same. Thats the great thing about sports. Mark its official. Its a deal. Wholesome and lafarge agreed to terms. Wholesome says the new ceo will be proposed. Bruno lafond will move to cochairman. They will become nonexecutive cochairman. The deal is done. Caroline hyde has been following the steel every step of the way. Caroline it was the 11th hour and it has been the 11th month since they first came to this deal. 40 billion back in april of 2014 is when they first struck it. Suddenly problems getting in the way about financial and wanting to rearrange because they helped they thought perhaps lafarge was getting too good of a deal. I want to dig into this deal. The biggest since 2012, since extraordinaire and glencore came together. Xstrada and glencore came together. Initially they were agreeing to 1 1. Not anymore because wholesome has been outperforming. There we have it. 0. 9 wholesome shares holcim 0. 9 holcim shares. Bruno lafond was meant to lead the combined units, but suddenly there seem to be a personality clash. The two chief executives didnt seem to be able to get on. They didnt seem to be able to show that he is a largerthanlife character. He is chewing gum much louder holcim than the than the holcim chief executive. He will be cochairman with the holcim chairman. Together they will take the helm. As of yet what happens as of ceo . We understand a lafarge executive has been agreed upon. A candidate has been put to the four, but as of yet, that hasnt been dotted and crossed. They havent exactly come to the eventual agreement. That is unlikely to be announced today. We know we had that scoop coming from bloomberg at one minute to midnight last night, saying the deal had been agreed in the background. You will see how tumultuous the share prices have been. As we went from highs to lows, hoping the deal will come through. It is 1. 4 billion euros expected to be saved for holcim and lafarge if they combined to become the biggest cement maker in the world. Question as to whether bruno lafond, given he had not been performing as well to get those cost savings. There have been highs and lows over the past year. This is what the deal was first announced. April, 2014. Since then we are seeing lafarge, even though the share price has been up 16 percent, it has been not performing as well from a sales point of view as holcim has been. Holcim up seven and three quarters percent. Keep an eye on crh. This is a deal that matters to them. The irish Building Company is going to be buying 6. 5 billion euros worth of assets to help holcim and lafarge meet the regulatory hurdles. The deal is done 11 and half hours after announced. Mark a dialogue with detail is what Angela Merkel and counterparts one from greece today as they head to the second day of the eu leaders summit. This is greek minister tsipras to unlock funds that would save his country from potential bankruptcies by the end of the month, and sanctions on russia are extended. Caroline is in brussels. What is the latest on greek talks . Caroline it was another tense meeting last night. A lot of leaders expressed frustration towards greece towards lack of implementation of reforms. There were two summits. The main one and a minisummit between alex tsipras, Angela Merkel, and francois hollande. That summit was requested to the greek Prime Minister to find some solutions. They said the most important of courses to implement the eurogroup agreement reached one month ago. The most important was to restore trust with partners. Declared he is willing to submit such a list and willing to do so quickly because the situation is one where trust is needed. It is needed to focus ones mind and find constructive data without being able to go into details. Caroline officially, the german chancellor has been saying she wants greece to remain part of the eurozone. However, behind the scenes, there has been a lot of tension with her german finance minister shall able minister saying they were lying to the greek population. Some of the other countries like belgium or luxembourg have demonstrated this meeting was not part of the main eu leaders agenda, but that was very important for Alexis Tsipras, who spoke directly with chancellor merkel. He said he was optimistic about the future. Tsipras we are more optimistic. I think they reveal their intention to do their best to overcome as much as possible. Would you say there is a new deal . Tsipras lets see. Caroline greece says they will be able to repay the 2 billion euro debt that is due today, but the question remains when and whether they will run out of cash and whether they will get or not the next 7 billion euros from the european union. We had some news on russian sanctions. Whats the latest . Russia was actually on the agenda, and they decided they might extend a bit later in the year sanctions on russia until the end of this year. The idea is to match the minsk agreement, because at the moment eu sanctions were supposed to expire in july. The Eu Council President said the most important was full implementation of the minsk agreement. The European Council agreed the duration would be linked to the complete implementation of the agreement, bearing in mind this is only foreseen by the end of 2015. Caroline no decision on whether these will be extended. They postponed just before eu sanctions expire. They also discussed how they can cut Energy Dependence on russia by adding more transparency in the russian gas contracts. There will be more discussion on gas and Energy Dependence on russia later today in brussels. Mark caroline thank you. We will speak to you later. Its one year into the conflict in Eastern Ukraine, and the signs are everywhere. After months of siege, Ryan Chilcote visited donetsk, inside separatist territory, where he watched firsthand as the ceasefire failed to lift the fog of war. Ryan we are being driven to the Donetsk International airport, the most soughtafter real estate in the war, by a prorussian fighter who goes by the nickname crimea, to get a sense of what lies ahead. Two truces have failed. Crimea thinks this one will, too. He says a ukrainian militia that enjoys the billionaires backing is shooting at them right now. Keep a low profile. There could be snipers. Ryan a series of strange moments awaits me. It is International Womens day a big holiday here, and crimea and the fighters have come with gifts for another member. Ukraine spent hundreds of millions of dollars building the airport. Donetsk was about to host the european soccer championship and the country wanted to show the world it could have a firstclass airport. Its now a wasteland. Its only value is that of a buffer. This is utter destruction. I have been in demolition sites, or zones. I have never seen anything quite like this. Its not every day you see an armed personnel carrier in an airport terminal. Its more than clear no one is going to fly here for a long time. The apocalyptic scenes go on and on, and we didnt even see all of it. Half of the airport is guarded by another battalion with its own chain of command. Just like the ukrainian side, the fighters over here are not always on the same page. The ukrainian position, the other side of the front lines is just about 2000 acres that way. The ukrainians have set up in the coal mine at the top of the elevator shaft. The idea of rebuilding this airport with the two sides so close, still shooting at one another, even sporadically, is unthinkable. Ryan we visit ukrainian troops on the other side of the front line. It dropped shrapnel, and our brother, the only boy with a flak jacket, is the only one who died. Its easy to see how the conflict might explode again. There are tens of thousands of miners with nothing to do and plenty who have already taken up arms. There are also plenty of weapons moving around. How would you know whether you have been with or just moved for another day . Firepower and firewood are essential ingredients in wintertime warfare. Its no surprises syrians call this part of the world the blood land. I didnt meet a Single Person on either side who thought the fighting is over. That includes a commander from the battalion. If you analyze the previous truces the side uses it to analyze the troops, and it starts with fresh troops. Im afraid its what will happen again. Brian right around the corner we bump into another reminder this is war. The group of men are resuscitating a fighter just hit in a mortar strike, but they lose it. The outlook for Eastern Ukraine is bleak. I would hate to see what a return to fighting might look like. Mark the top stories. Teaming up with google to take on apple. Its becoming the largest brand to make a smart watch. The chief executive told bloomberg the partnership is a big one. Its an enormous partnership because we are going with two giants to make an incredible swiss luxury connected watch. The israeli Prime Minister Benjamin Netanyahu is pulling back from his campaign remarks and saying he now supports a two state solution with palestine. He told msnbc he remains committed to palestinian status of circumstances improve. The move comes two days after he was reelected as Prime Minister. A Solar Eclipse could leave the u. K. And parts of europe in the dark this morning. The move will cover parts of the sun. It was said to be the best Solar Eclipse in years. The visibility will depend on the weather. You can find more on that story at bloomberg. Com. Caroline you can join in the conversation on twitter. To let us know what you think about the show, tell us the stories you want to hear about. An incredible picture of donetsk and the rebel held parts of ukraine. Do let us know what you thought about that piece. I am carlolinehydetv. Mark coming up we bring you an excuse of interview with ukraines foreign minister. Exclusive interview with ukraines foreign minister. Welcome back. Lets talk about the dollar. It rebounded from the dovish statement from the fed, which triggered the largest selloff of the currency since 2009. Our next guest says this cyclical trend is here to stay. Lets get more from the senior strategist at the Commonwealth Bank of australia. You decided to set yourself off from jp morgan, who say the dollar run is over. Its all priced in, yet what did you make of what she said . Is it really that dovish . Peter i think the initial reaction was the market was thinking they announced some paradigm shift, but the day before people were saying they forecast was unbelievable. Now they move the forecast back down to where the market was 24 hours earlier. Its much more believable prospect for Interest Rates. You need to consider they acted in a stronger dollar in the forecast, yet they are still forecasting to rate hikes later this year. For us, the Monetary Policy dynamic is well priced, but it has another like to go. We are still looking for rate hikes later this year. We think the boj will announce more stimulus at the next april meeting. Other Central Banks are looking to ease policy, particularly around europe. The ecb has announced a large amount of stimulus that has just kicked off. The yield dynamics in europe is going to become more negative overtime. Its really the trends are still going to broaden out. The pace of the dollar rally is going to slow. But we are still looking for the dollar to continue to strengthen into the end of the year. Caroline give us a sense of scale in terms of the dollar move, because it is off again. We are off about 10 your today. Where do you see it closing . We are looking for the eurodollar to move below parity down towards . 98. We are looking for the aussie to get down to . 70. Sterling will be around 1. 45. We think the dollar rally can continue another four or 5 , but it will stay. We dont see it kicking much beyond that. As the fed pointed out and other Central Banks know, its not mutually exclusive. Tightening Monetary Solutions come through the currency. Mark you have a call for eurodollar. What sort of timeframe has as the euro still remains on track for its best weeks since july, 2013. When exactly are we talking parity . Peter we are thinking the end of q2 or early cue the early q3. It is a little bit out of consensus. We think the noise as they have made suggest the next move will be up. That will come through in june. We think the data will start to improve of expectations come off a little bit, so we are still looking for the cycle to start in the middle of the year. Manus where are we in the u. K. . We have the election coming. Volatility is rising. People are going to get more nervous as we go to the closing days. The chief economist at the bank of england yesterday made comments. Get ready. B fleet of foot. Caroline could go up, could go down. Manus he outed himself. Carney is trying to guide us in terms of build lead into the inflation. Where are we in the sterling debate . I think the risk premium is going to be priced into sterling. It has been priced into the Options Market for a while. As we get closer and it looks like a close call, and potentially youre going to need a second election. Uncertainty is going to weigh on sterling. In terms of Monetary Policy, the u. K. Economy looks quite well from a global sense. Europe is doing better, which is a positive for the u. K. Real wages have turned positive because of low inflation. Consumption growth should remain quite firm. We are looking for policy to start to tighten early next year. It always seems to be a year way for the bank of england. The next move, the direction is still higher for rates. Manus sterling has a sevenyear high. Does that carry through for the euro . Peter we think we can get below 74 the year. The election risk does come into play. I think we would be looking to sell into that rally. The nine mx between the u. K. And europe are going to continue to widen from dynamics between the u. K. And europe are going to continue to widen. Caroline you work cut off by norways bank not cutting rates. Where will it go . Which centralbank in europe is not going to be stimulating apart from the bank of england . I cannot pick of one. They have all seem to engage in a european currency war. It is really against what the ecb has done to offset that. They compete in the export markets. I think everyone was caught offguard yesterday by the norwegians. The four cats show they are factoring in another rate cut. Forecasts show they are factoring in another rate cat. Cut. The next meeting that is life. Beyond that they could cut rates further. Mark he says the frank is still overvalued. What is the right level for euro frank do you think . Over the mediumterm it would have to be above 1. 20. Whether it is going to get there is highly unlikely. You are seeing the comments was it is overvalued against the euro. It looks like they are targeting more of a trade weighted basis. If you get more dollar strength, that offsets the euro. Mark thanks a lot. See you soon. Manus manus welcome back to countdown. The u. S. Set for the weakest decline on the dollar since july, 2013. Let me show you the week trading in the dollar. This is the dollar index, down over the past five trading days. The steepest weekly decline in 20 months. 15 out of 17 policymakers see a hike by the end of this year. Hsbc said the dollar rally is over. The Commonwealth Bank of australia. It is going to continue higher by about 4 . Hsbc says it is overvalued. Jpmorgan says it is overvalued. Is it the most overvalued currency in the world . At the moment the trend is coming a little bit easier into the morning trade. How is it playing out with the asian currencies . You have the dollar trading higher and the Malaysian Ringgit lower. They say they are probably going to downgrade malaysia. The currency down over 1 on the week. That is carrying through as well. When it comes to how to move your currency. We saw the dollar move quite aggressively. One of the biggest intraday moves on the euro since 2000. We had that big move higher in the dollar. Retracing its steps. 76 point 93. Glenn stevens from the reserve bank of australia saying there is a debate in the margins over how much we cut our Interest Rates by. When he was asked to name his chosen level and December Stevens referred to . 75 against the United States being his preferred measure. When he was asked, can you give a level on the aussie dollar you are going to be happy with, he declined to comment. Traders are betting a 50 50 probability of an april cut on the dollar dollar, but this is the daddy of them all, and it will dictate everything in terms of the direction for asia europe and when we hit parity. That will be next month against the euro. Ask lets kick off to the top stories. Vodafone reached a preliminary agreement for a stake in metro web. That is according to people with knowledge of the matter. A nonbinding letter does not include financial details. Vodafone may fund the Capital Increase. Facebook is on the rise. Shares closed at a record price on thursday, indicating Investor Confidence in the companys ability to grow advertising. Facebook hit 82. 75 at the close in new york, giving a market value of 232 billion. At t is shelling out 40 million in a Patent Infringement case because its lawyers did not read a court document. The Telephone Company missed the deadline to appeal a jury verdict. Twoway media claims at t used it streaming video tracking technology. You can find more on that story and many more on bloomberg. Com. Lets shift gears. The president of the Swiss National bank pledge to keep Interest Rates at a record low to weaken the frank. Jonathan ferro caught up with the central bank and asked if further movement in the currency is now out of his hands. Quest the International Environment has a big impact on exchanges. You have to realize the swiss franc is heavily overvalued against all currencies together with very low rates and negative rates. It makes the swiss franc very unattractive. Jonathan work at participants are not recognizing that. Market participants are not recognizing that. Why not . They need some time. Over time i am convinced the markets will rally. It looks like it is overvalued. That is not attractive at the moment. Submarket her disappearance may be listening to your words and saying, you know what . The s p does not have the credibility it once had when they maintained they will keep the floor. We believe when the snb speaks they are not going to follow through. What do you think . We would have lost credibility if we had not taken the decision on january 15 when it was clear the minimal Exchange Rate is not sustainable. We are convinced our Monetary Policy gains credibility because we talked about the right decision when it became clear the policy was not sustainable. You can join the conversation on twitter. Let us know what you think of the show. Tell us the stories you want to hear more about. I am at Caroline Hyde tv. Com. Mark i gather manus cranny is our Solar Eclipse expert. Caroline somebody has to. Manus you see it with your special sunglasses. Still to come, mark barton caught up with the england ceo. Here is a sneak peek from the interview. Mark im standing inside twickenham stadium, the home of the english rugby unit. I will be speaking to the chief executive in this weeks business of sports segment. The timing is perfect ahead of the world cup to take place here in england and tomorrows encounter between england and france. Right here in about 35 hours time. Manus top stories, teaming up to take on apple. Its becoming the large luxury swiss watch brand to make a small watch. The ceo told bloomberg about the partnership. It is in a norm his contract. Its an enormous partnership, an enormous contract. Its an enormous partnership because we are going with the giants to make the luxury was connected watch. Manus israeli Prime Minister Benjamin Netanyahu is pulling back from his campaign remarks and saying he supports a two state solution with palestine. He told msnbc he remains committed to palestines status if circumstances statehood if circumstances improved. A Solar Eclipse could leave the u. K. And parts of europe in the dark this morning. The men will cover parts of the sun and what is set to be the moon will cover parts of the sun and what is set to be the best Solar Eclipse in years. Visibility will depend on the weather. Everything in this country does. You can find out all you need to know on bloomberg. Com. I am protesting at this stage. Caroline lets kick it on. It is rugbys tournament. 2013 will be recovered for some of the big hits severed by highprofile players. In the u. S. , compensation claims for concussions have cost nfl hundreds of millions of dollars. Our lawyers in the u. K. Are warning they could face a similar bill unless they tackle the issue. A gray afternoon. The home of saracen and the home of big hits. It is wellpublicized that it is stronger and faster. That is leading to more head injuries. The concussions have been increasing a lot over the last couple years. They are Pioneering Research into causes of concussions research that starts on the training ground. This is how practice sessions start for the players. The patch, made by a seattlebased tech firm, monitors the force and direction of head impacts. We want to make sure we are not damaging our players. If he was to run into one of our players and 30 years time, and to have loss of memory. The study will run for three years. It could help better understand the longterm effects of concussions. It could make Good Business sense. Unless rugby gets its act together, it could find itself facing an nfl style compensation bill. If the authorities want to avoid the litigation we have seen, they need to put into effect the various protocols the local rugby unions have been discussing. Those in the sport say nfl and rugby are different because of tackling stars and protective gear. Just this week the american footballer from the 49ers quit the nfl because of his concerns over repeated head injuries. Mike brown recently mr. Game after being knocked out against italy. Whether rugby missed a game after being knocked out against italy. What is the early action by clubs could make all the difference for players and the sport. Staying with rugby for the business of sports segment, we head to west london. England takes on france tomorrow in the final match. I sat down with the chief executive of the english rugby football union. I started by asking if he was nervous with england trading scotland 3010 and facing the first home loss against its northern neighbor in over three decades. I have got myself in a state where i am now a nervous wreck every day. It doesnt matter what it is. Then you get to the inevitable even if you win, how he won by enough. There is a fantastic situation on saturday where points difference is crucial. It is almost every conversion. One of the great things about sports, although we all think it is a business, it is a passion. Im not the only one biting my nose to the quick. There are 82,000 people during the same. Whether you are scottish or english. Thats the great thing about sports. Im a total nervous wreck from beginning to end. Its a great place to be. Ask your a man who executed many of business plan. We english supporters are hoping the team can execute your plan and execute better, especially after saturdays many chances that came and went. Does it concern you with the world cup only a few months away consistently hasnt consistency hasnt yet been landed upon for the english team . We should be in a position of going into every game wanting to win. It was very frustrating and the first game of the autumn. We should be in a position of going in to win every game. We want to. Its a wonder for all of us. When youre on the pitch it is slightly different. We are very proud of the culture of the team and the way they developed. I think they are an outstanding bunch of guys, and i think they will give it their best. We will see where we are. The six nations whats the benchmark for success to get on the pitch . We discussed that. You met all your criteria . I think we have. Rugby is interesting. It is now a fully professional game. We are all about investment into the game. The are a few is all about putting its money back into the game so we get money from people coming here, from tv, from sponsorship, and we have invested or are in the course of investing around a third of a billion pounds back into the game, and we are ahead of target, so we are ahead. We are in a good place. This is all about investing back into the game. More referees, more volunteers, better facilities. I think right back to the grassroots. Thats what we are about. I think we are happy with the place we are in. I want you to say to those who point out, england has more players across the spectrum and more money across the spectrum as well, yet they have only one one world cup since 1987. They could or should be better. What is the response . I think i have to agree. You look at the track record whether it is world cup or grand slams. I think we would all feel we could and should be doing better. Why arent we . I think the margins on world sports are extremely difficult and very small. I have watched five hour tennis matches in wimbledon. You can put it down to a couple points in the middle of the third set. I think the margins are very small. We need to make sure we are consistent. We need to make sure we will be aiming for sustainable success. We are in that position off the pitch, and we need to make sure we are on the position on it as well. A couple of issues i would like to ask you about. Money in the game. As we know there is a salary cap in england. It is roughly 5. 5 million. France has roughly eight. 6 million. Can we keep pace with the france, the top 14 competition . Can we keep pace when they are paying players more money . Will we lose our best players particularly after the world cup . Is it a concern for you or not . Ian i think its a concern and we need to look at it, but i think we should address it. This is a joint ambition to make sure club rugby and International Rugby is the best it can be. You want to have the best players. There is an arrangement whereby we keep english qualified players in the country. I think thats good for the game as well. They announced a new television deal. We have done some decent deals as well. We have to be competitive. I think we will be because its important we keep the best players in the country. Also, its a matter of balance. I think that will be a good thing as well. Mark the talk is the Satellite Broadcasters will be able to bid in the next round of rights auctions. Is that true . Would it be a huge loss if rugby wasnt aired 43 in the u. K. , or is that were sports rights are taking us . I think you have to find the right balance. I think its always a matter of balance. Theres a balance between england and wales. In cardiff they had 9 Million Viewers on the bbc, which is fantastic. You want to get the interest. On the other hand financial rights are highly lucrative, and they are important to us. What you need to do is find that competitive mix. Thats what we will try to do. Be sure to catch part two of my interview right here on the business of sport. Caroline some breaking news from a big smart phone and tablet maker. The chairwoman cofounded the company. I spoke to her before. Is becoming the chief executive. That is because the ceo is going to be leaving, effective immediately. He is relinquishing his reins as chief executive and president. He takes on a new role as the head of the development lab. They have been getting into smart wristbands, trying to look beyond the overall smartphone. They lost the title to the likes of apple and samsung. A cofounder of the company now becoming the current ceo. We are going to take you into bloomberg. Com, the land of digital and outputs. Amazon gets a green light. Stay with us. Caroline just over an hour from the start of european trading. We are going to shift gears. I am going tech. Amazon at last is pushing to go ahead when it comes to drones because we have been hearing so much about wanted to deliver parcels by drones. So far the federal Aviation Administration has been putting off giving them the thumbs up to Start Testing the drones. After much pushing, saying they might not develop them in the u. S. If you dont give the goahead, they have got it. They are able to go ahead, and within 400 feet of the ground and inside of an operator, they are able to fly the drones during the day. Soon enough we could get them right where we want them, rather than having to time them. I love it. Manus it will save me having to go down the road to pick things up. Im going to talk about the value of the ruble and what it means to some people around the world. The businessmen are buying toilets. It is one great story, which is basically the company saw the opportunity to stock up on tires, toilets, and porcelain. Kazakhstan are trading. Go long on lose. Put this date in your diary. Sunday, december 18, 2022. It is officially the date of the Qatar World Cup final. There you have it. Stay with us. Off to brussels, next. Manus holcim and lafarge reach an agreement. We bring you the details of the merger. Eu leaders tell the great Prime Minister they need a clearer reform path. Caroline europe extends russian sanctions to push the kremlin to uphold a ceasefire in Eastern Ukraine. We bring you an up close look at the wartorn region in the third part of the special series. Manus a warm welcome to countdown. Mark also coming up, teaming up with the tech giant. The chief executive speaks about the deal. Thats we announce an enormous partnership. Silicon valley has met switzerland. Google and intel will partner together in order to make the next connection. Resurrecting a 40 billion deal. They reached an agreement to salvage a deal that will create the worlds biggest cement company. The announcement comes after months of wrangling and a week that nearly saw it sink when holcim called it off over differences over management and financial terms. This woman has been following the story from the start. It was the 11th hour. It had been 11 months in the making. Finally, we get a deal. They managed to get through their differences, which seemed to erupt after they came wholeheartedly. Suddenly unraveling when it came down to financial details and personality as well. A 40 billion deal is the biggest since xstrada and glencore in 2012. Initially they agreed on a share combination. This time it will be 0. 9. I think nine to 10 in terms of ratio. Basically, holcim getting a sweeter deal because lafarge has not performed as well. Holcim wanting a slightly sweeter deal when it came to finances. It came down to personality. It was thought the chief executive will take the helm of the combined company. Suddenly her help they were not as well liked. They were worried about his ability to push through cost savings. Now we understand the lafarge chief executive will take the cochairman. Now the question is who will become the ceo. We understand someone has been identified from the lafarge team. They are able to put forward a candidate. Lets look at the scale of the deal. It is 40 billion. The biggest deal since 2012. There has been a battle over management. 1. 49 billion per year. Will they be able to push that through . He hasnt been living up to some of the calls. That is where they got rallied. It was this irish Building Materials company that is going to pick up some assets. They have to sell off some of the assets to be able to jump through regulatory hoops. What do they need to sell . They are going to pick up 6. 5 billion euros worth. They have already raised money to do so. They raised funds by selling shares to finance the deal. They are terrified the deal might not actually go through. They had a plan they would be able to pick up assets elsewhere, but they would be particularly pleased if they could get a hold of those assets yesterday. It looks as though crh is going to be able to take on the massive deal the biggest in their history. Keep an eye on all the share prices. Back to you. Thank you. Another stock we will be keeping an eye on at the start of trade. A bit of breaking news on credit squeeze. The swiss bank says they are being sued as part of a 3 billion euro lawsuit. There is a lawsuit ongoing. This is in regards to unauthorized financial issues. They are cooperating fully with the italian police. This is on a date Credit Suisse released the report. They will earn a package down slightly from the year before. The bank also stating clearly they have no material exposure to libor or Foreign Exchange issues. Mark, you have some breaking news . Mark we knew this story on the 12th of march. The spanish lender announced its intention to buy the british Banking Group tsb. It was a surprise to the u. K. Banking industry. Here we are a matter of days later. They have confirmed the bid. The price is the same. It is to buy tsb. The value is 1. 7 billion pounds. That does have the approval of the board. The initial interest came as a bit of a surprise. Seven Dell Sabadell is the fifthlargest bank. It still owns tsb. Lloyds is still partially owned by the u. K. Government as well. Sabadell confirmed its bid for tsb. That equates to 1. 7 billion pounds. Caroline thank you very much. Deals aplenty, but a dialogue with details. That is what Angela Merkel and her european counterparts want from greece today as they head into a second part. Sanctions on russia are extended. What is the latest on greece . The leaders had a special meeting with the great Prime Minister. They broke up around 2 00 this morning in brussels. They emerged higher but optimistic from the meeting. It seems they agreed greece is going to submit a full list of the proposals it needs to keep its agreement it made on february 20. This was a special meeting tsipras requested with Germanys Merkel and with hollande and eu officials in order to push forward with negotiations so they could unlock some of the bailout funds they need to keep the economy going. Caroline give us a sense of the other thing that was key in everyones mind. Russian sanctions. Whats the latest . It seems they promised to keep them in place for 2015 . The leaders made a pledge to have the sanctions depend on the minsk agreement. And russias ability to adhere to the agreement. That says russia is supposed to give up the territory it is occupying in Eastern Ukraine at this point. They are supposed to give it up by the end of the year. The pledges for the sanction to adhere by the end of the year. It is not a concrete abstention. The leaders have given room to readdress the situation at the next meeting in june. At this point sanctions are in place through july, and the leaders will come back in june to see what the situation has been. Caroline thank you very much indeed. Manus one year its the conflict in Eastern Ukraine, and signs of war are everywhere. Construction blights homes and infrastructure after months of siege. Ryan chilcote visited donetsk. He watched firsthand as the ceasefire failed to lift the fog of war. We are a driven to the Donetsk International airport, the most fought after piece of real estate in the war. Two truces have collapsed already. Crimea think this one will too. He says a ukrainian militia that enjoys a billionaires backing is shooting at right now. Keep a low profile. There could be snipers. A series of strange moments awaits me. It is International Womens day. A big holiday. They have come with other gifts for a member of the battalion. Ukraines been hundreds of millions of dollars building the airport. The jets was about to host the european donetsk was about to host the european soccer championship. Its now a wasteland. Its only value is that of a buffer. This is utter destruction. I have been in demolition sites war zones. I have never seen anything quite like this. Its not everyday you see an armed personnel carrier in an airport terminal. Its more than clear no one is going to fly here for a long time. The apocalyptic scenes go on and on. We didnt even see all of it. Half of the airport is guarded by another battalion with its own chain of command. Just like the ukrainian side the fighters over here arent always on the same page. We just had a burst of gunfire. The ukrainian position is 2000 meters that way. The ukrainian set up a coal mine at the top of the elevator shaft. The idea of rebuilding this airport with the sides so close, still shooting, even if sporadic and occasional, is unthinkable. Ryan we visited ukrainian troops on the other side of the front line. This soldier lost his friend to a separatist shell. It blows up in the air and dropped shrapnel. Our brother was the one who died. Its easy to see how the conflict might explode again. There are tens of thousands of miners with nothing to do and plenty who have already taken up arms. There are also plenty of weapons moving around. How would you know whether they are being withdrawn or just moved for another day. Firepower and firewood are essential ingredients in wintertime warfare. Its no surprise historians call this part of the world the blood land. I didnt meet a Single Person on either side who thought the fighting is over. That includes a commander from the battalion. If you analyze the previous truces the ukrainian side uses it to reorganize and it starts with fresh troops. That is what happens in the summer and fall. Im afraid its what will happen again. Around the corner we bump into another reminder this is war. The group of men are resuscitating a fighter just hit in a mortar strike. But they lose him. The outlook for Eastern Ukraine is bleak. I would hate to see what a return to fighting might look like. Dallas Ryan Chilcote with a special report from wartorn ukraine. Mark teaming up to take on apple and is becoming the largest luxury swiss watch brand to make a smart watch. The partnership is a big one. Its in a norm is partnership because we are going with two giants to make an incredible swiss connected watch. The israeli Prime Minister Benjamin Netanyahu is pulling back from campaign remarks saying he supports a two state solution to palestine. He said he remains committed. The move comes two days after he was reelected as Prime Minister. A Solar Eclipse could leave the u. K. And parts of europe in the dark. The visibility will depend on the weather. You can find more on that story on bloomberg. Com. The debate is whether i should go to the roof to cover the eclipse in the dark. Tell us what you think. Mark get to the roof. Manus im not going on that roof again. You can see all the details. Go to my twitter account. Everything is down to timing. Caroline coming up, greece needs a more concrete plan. That is after nearly four hours of talks with the greek Prime Minister. Lets get back to our next guest after the break. The greek Prime Minister Alexis Tsipras sat down as talks continue. Dining companions included Angela Merkel, mario draghi, and the chairman, but what is next for the troubled state . Lets bring in the chief economist. Is greece going to run out of cash . Jack yes, they will. The europeans adopted the only strategy they could adopt, which is starving greece of cash, with the hope this is going to focus minds on greece, and they will align themselves with the european framework. For now, i think the europeans hope they will win the selloff. Caroline how much does it matter . Is greece the main event . Jack its sad to say compared to five years ago greece is no longer the most important risk factor at this particular juncture for as long as this is not an exit scenario. Anything else is probably manageable. I would agree that it would be a benign situation. It would be too optimistic. Caroline why . Because there is too much integration . Its the beginning of the entire Monetary Union over time. Delegating to people is an extremely difficult situation. Its no longer druggie who decides whether the Monetary Union can stay in one piece. It is people who might decide it. If the greek people decide, the market will never know if other people will decide the same over time. You might buy a few weeks or months or years, but i dont think its possible to maintain the Monetary Union. Manus money is literally walking out the door of these banks. 300 Million Euros left the greek Banking System yesterday. What does it take to stop this . That is what we are seeing. Does it take another election . Actually, we will get another election. Jack the lack of money should focus eyes on greece. It will lead to a better agreement. Where the money will come from and europe, which is how you can stabilize a situation. Can you buy a few more weeks with money flowing from europe and disbursement coming through as greeks provide what the europeans have answered . Otherwise, i dont think the europeans are in a position where they dont where they want to provide concessions. This is not the way its going to evolve. The concessions will need to come from greece. If they dont provide concessions, or some internal political resolutions. We see a broader set of outcomes in elections. Something needs to happen, which will be the next step in terms of agreement. Mark are you surprised by the small amount of increases in the amounts of liquidity assistance the ecb is granting greek banks . Some say they are playing a political game. What is going on . There are two elements to the story. There is one, which is the ecb has a role in providing aela. I think as long as there is not a default and perhaps a situation in the Banking Sector because its unclear if the state defaults whether that means something for the Banking Sector in terms of the solvency which would be the trigger for the ecb to stop the ela so in the end i think it is a political decision, whether they like it or not. They are on standby and are watching what politicians do. It is not an ecb decision. Its a political decision. What is in ecb decision is the projections. You are saying they are far too optimistic. Perhaps he is being too hopeful. Talk us through. Why do you think he is too hopeful . It is interesting. It comes right at the end. I have about half of the forecast. The question is who is going to win in terms of rising inflation. Whether we get enough wage growth, we think we need between 100 basis points and 150 basis points to achieve what the ecb wants to have in terms of core inflation forecast. We think it is a low likelihood. We have five years of relatively strong recovery. There is no sign after five years of declining rate quarter after quarter there is Much Movement on wage inflation. I think it is a reasonable bet to assume wage growth is not going to do that on the ecb. Mark thanks a lot. Manus the new strategy in london. That was yesterday. After the break, we are joined by the companys ceo. An exclusive interview right here on countdown. Stay with us. Manus welcome back to countdown. It is on target for its biggest weekly decline since july 2013. This is the dollar index. It had that nice little reprieve yesterday. It had the biggest drop in almost 56 years the day before. There was a relief rally. Are we going back to the biggest drop in six years . Relief rally yesterday. Fomc policy makers still see a hike in 2016. We caught up with Commonwealth Bank of australia. They say that other will end 4 higher this year. Hsbc says the dollar rally has run its course. All of the news is in there. The disappointing data, people beginning to ignore the disappointing data. Jpmorgan also joining that club. Overall, what you want to get a perspective on is the trades. A big paradigm shift. Jacques cailloux, we had a conversation with him. It wasnt really a paradigm shift, seems to be the consensus. Nevertheless, that of a coming down by 1. 3 on the week. I want to go to the Malaysian Ringgit. I always find it fascinating when a Ratings Company manages to say, we probably will downgrade a country. What youve got here is the Malaysian Ringgit. To get that within perspective, what weve heard from fitch this is dollar rising, a bit of a relief in some of the asian currencies except for the Malaysian Ringgit overnight. Fitch probably will downgrade the country. Crude is at a sixyear low. Crude oil still under pressure today. The aussie dollar, even a good old jawbone doesnt do anything to help the aussie dollar. The ever present man, Glenn Stevens saying donating more rate cuts for australia is at the margins. The target is . 75. He declined to mention a target. The aussie dollar, a bit of a relief rally. It shows you that stevens doesnt carry the same bang for his buck as he used to. Caroline thank you. Lets move on to our top stories on bloomberg. Spains fifth biggest bank is buying up tsb for 1. 7 billion pounds. The deal gives sabadell access to the british mortgage market. Shares have risen about 15 since investors said they were considering the offer. Sabadell has dropped about 11 in that period. Vodafone has reached a preliminary agreement to buy a stake in italian fiber optics. That is according to people with knowledge of the matter. The letter signed by both companies doesnt include financial details. Vodafone may fund a Capital Increase of as much as 500 Million Euros in a unit of metro web. Facebook shares are on the rise. They closed at a record price on thursday, indicating Investor Confidence in the Company Possibility to grow its advertising business. Facebook hate 82. 75, giving the company a market value of 232 billion. At t is shelling out 40 million in a Patent Infringement case. The Telephone Company missed a deadline to appeal a jury verdict. The case was won by twoway media, which claimed at t used streaming video tracking technology. You can find more on this story on bloomberg. Com. Mark italys largest utility presented a Strategy Plan in london. Here to tell us more is francesco. Thank you for joining us today. It is the line that we focused on in bloomberg. It seems that investors focused on. Sending your shares up the dividend announcement. You are going to increase your payment for this year by 50 . In 2018, it will be 65 . How are you going to achieve this . Francesco first of all, we did one thing more. We gave for 2015 and 2016 a floor. Not only there was an increase on the percentage, but also a floor, just in case. For two years, investors know what they are taking at the minimum. Mark guaranteed. Francesco yes. We did that because this is a transition. It is a new plan. This new plan focuses on new things. We wanted investors to feel confident about it and give us time to deliver. To go back to your question, how we do that, two things first. First, we become much better in operating our assets. We have a huge set of assets. We are very large, very diversified. We coverall technologies in many parts of the world. Theres a lot of good practices around the company. We want to put these good practices at work everywhere. We created an organization that has at the main focus just that. Let Operational Excellence surface and release resources. These resources can then be dedicated to growth, which feels dividends. Caroline so you are focusing on efficiencies. You are also saying youve got a wideranging portfolio of assets. Where are the key priorities . Francesco basically, the big sale is slovakia. That is a sale we initiated in june last year. We are going to get the binding offers within the first week of may. Caroline has that been good . Francesco so far, yes. It is a large generator. It is basically the monopoly of the country. We think it will be a sale at the end of the year. Caroline price point . Francesco soso. Caroline can you share what sort of target you are looking for . Francesco i think we have indicated that this company is worth something in the range of one billion euros. Manus where are we in the writedowns the business of writing down 6. 4 3 billion euros in writedowns. How confident are you that the bottom is insight . Francesco in many ways, what we did, we changed two things in the strategy. First, we said, lets align our outlook on power demand, energy prices, Commodity Prices extreme great Exchange Rate, to what the consensus is saying. Second, lets have a fiveyour strategy, not 10. Some assets needed to be written down a bit. Manus you mentioned the currency. I hear what youre saying in terms of realigning yourself but the dollar, the eurodollar move also helps your cost structure as well in terms of input cost. Francesco it is quite a thing. Not only an helps the cost structure, it also helps the reporting sales in dollars. We have latin america, the u. S. We have a lot of dollardenominated [indiscernible] when it gets converted into euros we like it. On the other side of the coin we deported debt to europe. That is a little bit of a impact. We have one billion more reported debt because of the euro. Mark can you give us a sense of your take on the european economy francesco . You are a ceo of a big utility in europe. 40 of your sales come from italy. Do you get a sense that the economy has turned, that it is on an upward path and will be held further by measures begun to be implemented by the ecb . Francesco lets say that in january and february this year we have the first in four years and a half first uplift in power demand in italy. Spain started already the last three months of 2014. From that standpoint, yes, there is a sign of recovery. For us, the basic indicator is is our demand going up . It is. It is the first time in 4. 5 years. The sense is that things are moving. They are moving because the euro devaluation helps the manufacturing cycle. And the quantitative easing is indeed working. This is finding its way to the economy. I would say, yes, it is picking up. Manus i really want to pick up one point. You really believe qe is beginning to work and make it into the real economy . Francesco it will take more than six months to get to the real economy. The Small Companies that need credit, that get it not from the bond market but from the banks that in turn get it from the Central Banks this cycle will take some more months. Manus i feel a lunch invitation coming on for you and mario draghi. Francesco starace, thank you so much. Mark join us on twitter. Let us know what you think. Tell us what you think of qe. Is it working . How long will it take to see through into the system . Up next, it is bart charts time. What it stock market is driving euro back to y2k . Mark time for todays bart chart. What is the stock Market Driving europe back to y2k . Y2k of course is the year 2000. Have you been watching germanys dax index . It gains just two points today. It will have risen for the 10th consecutive week, which is its longest winning stretch since april 10 2008. That run started on monday, january 12. That is the green circle. Since then, the dax has gone pretty much in one straight line, jumping by 23 in local currency terms yeartodate. It is 21 higher barely 2 below its record set on monday, march 16. That gain is the biggest since the end of 2000. Some of the figures are mind blowing. This year, the dax has added almost 2100 points. In money terms, the gains equate to an additional 206 billion euros bringing its market capitalization to 1. 1 7 trillion euros. On a stock basis 25 of the 30 companies on the dax have seen their share prices rise by more than 10 in 2015. Two are down this year. The industry that is driving the gains is all those. Vw up daimler 31 higher bmw surged by 30 . Between them, 69 billion euros in value to the dax this year. Only Nine Companies in the dax are worth more than 69 billion euros. How is it looking on the valuation basis . Given the gains this year, it is trading on almost 20 times earnings. That is the highest since 2009. It is on 15. 2 times projected earnings, also the highest since 2009. The 10year average for projected earnings is 12. 35. It is well above the average. One final point, the dax has added the most in valuation terms. In percentage terms, it is number three in europe this year. Number one denmarks copenhagen 20 index. It has risen more than the dax. Number two portugals psi 20. Both have gains of 22 in 2015. Germanys dax, the stock market, taking europe back to y2k. Caroline amazing points with euro being week. Does help those german exports. Manus where were you in 2000 . Mark right here. Manus no champagne for me. Lets look at some of the big headlines on bloomberg. Holcim and lafarge have reached an agreement to salvage their merger to form the worlds biggest cement company. The two reached a deal but have yet to name the chief executive of the new company. Israeli Prime Minister Benjamin Netanyahu is saying he now supports a two state solution with palestine. He told msnbc that he remains committed to palestines statehood if circumstances improve. The move comes two days after he was reelected as Prime Minister. A Solar Eclipse leaves the u. K. And parts of the europe in dark. This is said to be the best Solar Eclipse in years. The visibility of course will depend on the weather. Caroline we got a picture of you throughout that story. It will be you that we are sending up in the dark. Manus yes. Caroline we are catching the eclipse live with manus cranny on our roof. Switzerland meets silicon valley. Tags hoyer has teamed up with american tech giants google and intel to create a luxury smart watch. Can the timepiece compete with Apple Gadgets . Stephen has the story for us. [applause] it is official. Tag heuer once the smart watch and theyve got google and intel onboard. At the worldwatch show, these three companies lay down the government for the rest of the industry by announcing the first luxury smart watch with android. The original idea was to make a collectors watch. We believe there is a market in the future for collectors watch. The watch would not be just a product that tells what time it is, but should connect you. The watch needs a third dimension. Thats the dimension of emotion. It is that i mention of sex appeal. It is the dimension of design. It is the dimension of beauty. All this will be in the tag heuer connected watch. To make this a reality, tag heuer had to look beyond switzerland. A big part of it is having a power efficient enough chip. Ive never actually found something that has to much battery life. We always find a way to take up whatever slack we build from a hardware perspective. Having hardware and Software Work together from the beginning provides lots of opportunities. Intel, with other partners we have, are able to really go deep and think a lot about what are the right sensors to bring to a platform and a device, what are the right display technologies to select for the exact look and feel that we want to achieve. It is definitely the case that by using the three companies expertise together, we can achieve a lot. It is strange to think, but in just a few years, we could hear these guys talking about software too. I think they will be surprised that we managed to have first the idea to try to get this partnership and that we managed to get it. They might start asking themselves, why havent we done it . Mark you are looking at a live shot of the city of london. Yesterday, the ftse 100 finished at its highest point ever. 6962 was the close. Futures pointing to more moves upwards. Stay with us. Mark the market opens in five minutes. Shes been holding her breath for three days. She was poised like a panther at our touchscreen. Here we are, a couple hours later. What do we know . Caroline 40 million. Job is done. The guest m a deal and it has been a tough one in the making. Holcim and lafarge merge to make the biggest cement maker in the world. Look out for shares to drive higher today. Manus 6 billion euro deal. They normally do a couple billion a year. This is a big one for them. Caroline 28 it is going to drive up sales. Mark whos got the ceo position . Caroline this is the question. The candidate has been a but hasnt been announced yet. It will be interesting to know. The ceo of lafarge isnt going to take the helm. There were some problems with character traits. Mark him and fontana were a bit , not like this, the opposite of that. Caroline they didnt trust bruno. 1. 4 billion euros of cost cuts per year is what they need to achieve. They didnt think this was the man for the job. Manus and a lawsuit for Credit Suisse. We will see what is going to happen. We will talk to the lafarge ceo at 9 00 a. M. First reaction as always on bloomberg. Jon ferro is up next. Jonathan good morning. Happy friday to you at home and at work. Welcome to on the move. Im Jonathan Ferro in london. European equities starting the day near a record high. German bond yields starting the day near record lows. Lets get set to wrap up the trading week. Heres your morning brief. Stocks surge. The stoxx 600 has rallied 17 this year, leaving the index just 1 short of an alltime high. Greece in crisis. The eu pushes greece to make more reforms. Leaders meet again in brussels. Time is running out. And a morning of dealmaking. The 40 billion merger is back on. Holcim and lafarge salvage a deal. They are three things we will be watching this morning. Im looking at futures markets a little bit higher. Manus cranny is joining us for our Friday Market open. Manus you sound very excited. That is because we are 1 away from an alltime high on european equities. It is only march. Goldman says they are not the only ones to be shy of this move. The best since 2009. Denmark, portugal, and germany, all up more than 20 . Go to bloomberg. Com and go to the bart chart