Transcripts For BLOOMBERG Countdown 20160301

Manus welcome to countdown. 6 00 in the morning here in london. Manus super tuesday. Anna the picture around the asian stock trading session. The chinese data we have weighing on a number of asset classes. It is talk about what is going on in japan. Japan selling 10 year bonds at a negative yield for the first time. Manus this is joining the club. You have the 10 year yields being negative. The Central Banks have gone into negative territory. We are showing the bid to cover them. Level in the demand this auction. The yield going into the negative territory. Volatility is at the highest and the yield curve in japan is the flattest on record. In thes a dramatic shift perception of risk and what to do in the bond market. Anna a lot of talk about whether we will see fiscal stimulus. D. O. T. Boj easing. Let us talk about some of the other risk assets on our radar. We are talking about mental prices. Getting those numbers from glencore. Talking about the copper price. Down around, shy of half a percent. Reaction to the stimulus activity. From china already seems to be wearing off and you look at the data moves. Manus check out the aussie dollar. There is a reasonable prospect for growth so says the rba. . 66 in therop to next six months. Eckstein of the major counterparts have said that this will be the trade. Dollaryen, money is flooding into the yen. the japanese government says that is particularly salient. Anna it was a good month. Nejra chinas factory gauge has followed for a record seventh month. The measure of services has dropped to the weakest in seven years. They seek to cut overcapacity in manufacturing without derailing growth. The yuan has dropped the most in three weeks. It is the currencys first rise in eight days. Franklin templetons Money Management unit in shanghai says the worst is over for chinese stocks after panicked investors caused the worlds deepest selloff. 5. 3 trillion dollar market will rebound as much as 20 in the short term. Theyll get has revealed it is under investigation. The company declined to say what the inquiry was about. From anseparate existing investigation into a company theyll get bought last year. It is also facing questions over its performance and its ability to cut debt. Fell more than 18 . The u. S. President ial hopefuls are gearing up for super tuesday. About half of the delegates needed for the republican candidate to win the nomination are at stake and about one third for democrats. Donald trump and democratic leader Hillary Clinton seem poised to win in landslide victories. Anna we have had a number of big u. S. Voices overnight giving their thoughts in the asian session. U. S. Secretary adding his thoughts to the mix. Overnight. T data china assure them that there was no plans or needs for currency devaluation and gave strong commitment to reforms. Can concluded his remarks. Recent market turbulence would not affect the feds moves. Economic manage its transition. China doing a good job. A tip from dudley. Anna lets go over to the asian market. A lot happening in this part of the world. A lot of upgrades to the china market, positive sentiment coming back in. You can see that we are seeing a turnaround. The shanghai composite has been swinging between losses and gains today. With the pmi coming in. Kong, we are also seeing a pickup in late trade. Look it india. 23 percent, the best rise we have seen in around to go weeks. Risk on appetite coming back into the region. 225 openinge nikkei up. Japanese equities have had quite a bad start to the session. They were in the red for most of the day but have closed higher. Australia also getting a good boost from the Commodity Prices. Looking like a pretty positive session coming through for asia. Looking at some of the stocks we have been watching. The biggest drag on the regional index after it cut its operating forecast. The rba leaving Interest Rates on hold. Saw thatee where we big spike when the minutes came through. The rba not mentioning the aussie dollar implied that the central bank is pretty happy with where it is at the moment. 71. 5. Let us bring Peter Fitzgerald in. No crash bang from g 20 but bang with the chinese. The reserve requirement went. This economy is filled with overcapacity. Was this a smart move . The things i have maintained on china is that you cannot analyze it through the lens of traditional western economic view. What you need to understand is what i call the tacit agreement between the chinese authorities with the chinese population which is if you do not get too involved in politics we will ensure that you have the economic environment necessary to get wealthy and to prosper. And i think one must recognize that china is going to do what is right for china and the chinese population. Anna we hear a lot of voices being concerned about the indebtedness of the chinese economy. One of the ways they are ismulating the economy increasing the capital they have to put aside. Is also a high visibility move for the chinese. In recent months, they have gone lower for the measures. Peter they intervened in the currency and their equity market which was pretty high visibility. I suppose this is another means to try to stimulate some of that domestic demand. It goes back to the point that it is easy to analyze this in terms of what they will do is what is required to effectively maintain social cohesion and inshore prosperity. That wehat is the prism talk through, this western democratic voice. Have assured us there is no need for a currency devaluation. If there a migration in policy . Ive never seen any authoritative figure coming out to say we will devalue the currency. I would not expect anyone to ever say that we are actually going to do that because it is then too late. Our view is that china probably does need a weaker currency of the question is how will that come about. Anna we should view those assurances through that lens. The biggest names in the Auto Industry are gathering in geneva for the auto show. More than 120 global companies. Anna ryan is there for us. Ryan good morning. I am joined at the bmw stand in front of a spanking new vehicle. We are talking about china on the air this morning. A country on many peoples minds today. You were just there, what did you see . I was at a dealer meeting. Isear on, i think the mood much more stable. Last year was a lot of uncertainties. The dealers are seeing some stabilization in the market, some lift in the market. We had good tales in january and february we had good sales in january and february will continue that trend. We will not see high doubledigit growth but singledigit growth but we will still have a positive momentum. Ryan in january, you outsold mercedesbenz which is getting closer to you. You sold more cards than mercedes in january but boarded but boy, did they have some growth. Your is about a. 5 . In february, you saw some momentum. Continuing at that growth. At the end of the day, it is not just about volume. E have a clear position we want balance around the world. Profit guidance. We have maintained that over the last five years. That are you suggesting they have to discount to get that sales growth . Themu would have to ask but for us we will not chase the last car. Ryan is it fair to say, if mercedes growth was more than could was a. 5 , you 8. 5 , you could buck the trend . We were doing 45,000 cars when i started in last year we did 465,000 cars. We have seen that momentum. It is fair to say that others are coming into the arena. We enjoyed that success. Representation there. Ryan how convinced are you that you will still be the World Biggest luxury carmaker at the end of the year . Look at the group numbers, we are significantly ahead. As a brand, it will be a stretch. We want to be in a profitable position. Ryan you have the hybrid version of your seven series. That bmw hasings done successfully is not only out produce in terms of numbers that really been a leader in terms of innovation. Moving into segments are creating segments before your competitors. What is the next segment you want to target or create . You are right. We have grown at the sab segment. We have a full lineup now. There is some additional x products. There will be an additional one at the lower end of the spectrum as well. The one technology we are now pushing heavily is hybridization and ultimately more electric drives. We launched on the market. Sales were really strong. In a challenging environment. This is more of a marathon than a sprint. Hybridization is coming across the whole range now. Unheard of in a car of that segment. Ryan you mentioned a electric carmakersall of the and the moneys they have spent on electric cars, consumers are not i am large going for those. When you see that changing . Let us look at where a electric cars are working. We use norway as an example. Hope comprehensive plan for the government. Looking at california, strong sales. Strong sales. , it does require the government to make an integrative plan in order to make the can tumor come forward. Over time, that will start to improve. Legislation is driving in that direction. How does the vw scandal change things . All of our cars are legal to the requirements in any part of the world. Diesel is still a very good fuel. For us, it is an extremely clean fuel. However, over time we will see more balancing with gasoline. Diesel is primarily a european feel. Fuel. Ryan what does grexit mean . Mean . Xit believe firmly that from a labor point of view and the flexibility to move around europe for components and cars, it is much better for the u. K. To remain a part of the eu. What is important is that the eu standshe u. K. Because it for free trade and avoiding protectionism. Without the u. K. , there are more challenges for the eu. Ryan you dont have any completely new cars. Is that because you are in a lull or do you have a surprise for us under wraps for next monday when you celebrate your 100 universe 100th anniversary . We had an extremely high number of new cars last year. Next week we will show you a vehicle that is not just a few years away but many years away from now. We are concentrating on the next 100 years. Ryan thank you very much. Ian robinson at bmw. Anna let us find out what is on the slate for the day. We get february unemployment figures and pmi from germany. Manus manufacturing pmi for the eurozone as a whole. And then it is the uks turn. Data we get unemployment for the month of january for the eurozone. Ceo turnn barclays new things around. Anna we preview earnings ahead of our interview with jeff bailey. Stay with us. Anna welcome back. The troubled Banking Sector is in focus again today with barclays announcing earnings for the Fourth Quarter are likely to have been tough but they will be more focused on the strategy under the new ceo as he tries to shrink the Investment Bank and perhaps exit african operations. Manus Caroline Hyde has the details we could expect. One is africa and one is the Investment Bank. All of thelmost Fourth Quarter numbers will be pushed aside. Net profit is likely to fall 68 . In the Investment Banking unit come it is also africa they are looking at. How they will separate the retail from the investment side in the best this. In the business. Hetaley jes staley has to get to grips with how he downsizes the Investment Bank. 1200 drop cuts. He has imposed hiring freezes. Could beonus pool constrained by about 12 . The african element is interesting. Investment banking and the african unit are less profitable versus the personal and Corporate Banking unit and the berkeley card unit. These are the two areas that perhaps they will start stepping back from so they can overall cut their costs in capital and start rejuvenating themselves. Anna what are the benefits of offloading the african unit . Are looking atu this particular chart you can see the likes of the return on equity and the operating margin is less than if you compare it to other units. Clearly come it is not getting so much bang for its buck. In the third quarter, it was the only major unit to see a drop off overall in its numbers and today he again we are expecting the Fourth Quarter to show a negative expert taking. The rand was so hampered and has big exposure to south africa or the African Business and it is a slowing business a slowing area. Analysts say if you had listened from the comments from mcfarlane, the chairman at barclays, he said and the Second Quarter earnings that berkeley would prefer to increase in africa rather than decrease at it looks as though you could redistribute the cost of capital in africa if you sold off the unit. You could bolster the banks capital to the tuneup 1. 5 adding to their first quarter. They had the weakest tier one ratio across the u. K. In terms of the key banks. This is where they will focus. Ceo of barclays will join anna and mice and myself. We will talk about this tragedy for the bank. You heard caroline outline the challenges. If you think about the changes at barclays, many banks are under pressure. Have we passed the worst . Peter the chart you have showed is the stoxx 600. Theou compare the bank to overall market, they have done materially well. That difficult to say banks have actually turned when you have an environment where Interest Rates are negative. It is difficult to see where banks will go to earn those margins and you also have an industry that is highly regulated and the regulation and cost of regulation for compliance is increasing. Are thosebanks here that have an Investment Banking headache and have set out to transform their Investment Banking practices. Are they on the right path . Peter Investment Banking has its challenges. The challenge for any industry is it is difficult to shrink yourself so you need to find one of those growth areas and what are the profitable areas. The way we look at banks is we think that even if they do manage to increase that you really and profitability the regulators will find ways to ensure that doesnt find its way to shareholders. Air is a Strong Social angst towards banks which is lingering from the 2008 crisis. Manus you draw a clear distinction between the accuracy equity value. Anna only one bank in europe. You draw the differentiation clearly. Bondould say look at the side of the equation and not the equity. Peter the bond market for banks is large. We think it is deep and there is value in that particular area. See, one that is going to particularly on the senior debt side we are not dabbling to the material extent. Anna Peter Fitzgerald. Is staying with us a little bit longer on the program. Talking about glencore, it can it take itself out of a commodities route. Two parts to that business. We will talk about the earnings and preview the earnings after the break. Stay with us on countdown. Think the 7. 5 is unachievable. I look closely at the level that exists in the United States. The ability to close the gap is more and more difficult. Youre going to get a between the United States and china. Which means there will be a big slowdown in china. Manus the former Federal Reserve chair, alan greenspan. And as outlook for china. You can see more on that interview. Let us get the bloomberg first news. Nejra chinas factory gauge has fallen for a record seventh straight month. A measure of services has dropped to the weakest in seven years. The data underscores the challenge for policy makers as they seek to cut overcapacity without derailing growth. In more than two weeks. It eased pressure spurred by yesterdays cuts. It is a currencies first drive in eight days. Franklin templetons Money Management unit in shanghai says the worst is over for chinese stocks after panicked investors caused the worlds deepest selloff. The 5. 3 trillion dollar market will rebound as much as 20 in the short term. As you one volatility decreases. The japanese government has been paid to borrow money for a decade for the first time. It comes after the bank of japan pushed yields lower across the curve with the announcement of negative Interest Rate until the end of january. U. S. Residential hopeful star gearing up for super tuesday. Half of the delegates needed for the republican candidate to win the nomination are at stake and one third for democrats. In roughly a dozen state races, donald trump and Hillary Clinton seem poised to win in landslide victories. Manus thank you. Let us get into what will set up the rest of the trading day. Guy johnson joins us along with peter. Stocks bucked the global trends. Trading volume in europe is at the highest level since 2011. There is a shift in terms of volume. You think about volatility and what is happening in the world and i am not surprised that we are seeing volume pick up. Some of these visit big funds are moving money around. Being pulledwas out at an aggressive rates. We perhaps have gotten lost in the nuances. A substantial turnaround since the middle of the month. Peter a 10 rally in some of the main equity indices. In concernsget lost about what the future may bring. Volumes can be high when youre when people are trying to figure out what will the next trend be. Anna mining stocks and oil prices and Commodity Prices. When they have fallen this far, it doesnt take much to create some impressive headlines. The oil price. Glencore. Guy it depends on where you are starting from. Glencore has had a great run. The data is going to be interesting today. That is going to be one of the medical factors. How glencore and berkeley, of today. E the gate we get critical information from italy and spain. We talk about the inflation information. Anna the asian markets have turned around. They were looking worse than where they are now, an hour ago. Look athen you yesterdays inflation data and the pmi today, what does the ecb have got to deliver in your view to underpin the turn around in some of these numbers . Peter part of the role of the ecb is moving and soothing. That goes a long way to what they need to do. What i am not convinced they need to do is turn around and do more you week in the same format they have done. One has to question what is the merits of sending the german 10 year yields from 11 basis use basis points to five. One of the things that you may be should look for although politically it is difficult is to focus on narrowing the spread between italian and spanish bonds and the german yield. Anna price affects worse. S. Fx war manus let us see what glencore and barclays will deliver for us today. Glencore report in just under half an hour. We are focusing on the debt and Commodity Prices there. Anna we are going to get those numbers. We have a preview of what we can expect from those glencore numbers. Nejra we could see net income 1. 2015 ali 72 to billion. That is what analysts surveyed by bloomberg are predicting. Here are some of the challenges they face. The route in Commodity Prices, the slowdown in china. Profits from mining are evaporating. Glencore is trying to cut a 30 billion debt loan down to 18 billion by the end of this year and although shares have rebounded 47 so far inin in 20, they are still down about 55 from the last 12 months. I have tracked glencore shares against copper. This is interesting. The relative strength index. If we look at that, it is at dixie seven, approaching 70. If it hits 70, it needs the shares are overboard. Manus bring me some cheer. I am the one that brings the doom and gloom to this show. Give me a rest on china. Nejra glencore has become increasingly reliant on trading. It is the biggest and more diverse. It made we could see that increase when they report today. What is interesting is the company has traditionally boasted that the trading unit can make on a no matter what Commodity Prices are doing but in december, they lowered its forecast for trading and said conditions would continue to be difficult in 2016. The question is can they trade glencore out of the hole. Anna i do the small print. Peter is a senior independent director at glencore. The very personification of the china story, the Global Growth concerns is encapsulated in lynn court. The ceo is forced into selling assets. Forced into cutting debt and forced into a magnificent uturn. Has he done enough . Issues and itthe is not just glencore but the whole sector but they have been dealing with falling Commodity Prices ands this typically iron ore. To finally realize that these prices are staying low for an extended period. Something we have been saying for the last 23 years. On balance, there is a broad recognition in the mining interstate that they need to look at their cost and cut their dividends. The real challenge will, in the oil industry because oil prices have started falling three years after some of those other Commodity Prices. The question we have is is this a playbook for what we can expect with some of the integrated oil majors. Anna you think the Mining Industry has dealt well with the challenges. You dont think that is the case with the oil companies. A timelyt necessarily fashion because it has taken three years to get here it is at least the process is beginning whereas it does not seem 12 started in the oil industry. It does not seem to have started in the oil industry. Piece there is a lovely which is if you look at what has happened in oil and iron ore for copper producers that they should begin to turn. That is one of the biggest challenges. A huge overcapacity. Peter the huge overcapacity and supply but one also needs to understand that there has been enormous technological change as well in these industries, particularly the oil industry. If you look at what happened to natural gas it traded at 20 or thereabouts for over 10 years. It had a 50 rally up to 30 and then it traded down to 10. You had a 70 rally during that downtrend and today it is trading at 95 lower than its heat. These Commodity Prices can last for a step a substantial amount of time. manus you thought i was the grinch of the show. Peter once people stop asking where the bottom is, you are getting to that particular point. Manus we are trying to find the floor of these markets. From 80 tooil went 180, it was incredibly negative for the economy. When it turns around and goes from 80 to 30 it is also negative for the economy. There are going to be winners and losers in each situation. One has to identify who will be the longer winners. Manus who are the biggest winners . Businesses that benefit from lower Commodity Prices. Anna Peter Mandelson will today weighed into the debate over britains exit from the eu. Speech regarding a warning that england will struggle. Let us get peters thoughts on the brexit question. This is the importance of the business of a business like yours. Peter youre asking the irish personnd married to a spanish person and living in north london. The only positive thing i can that the date for the referendum is sets and reasonably close. As an investor, and as someone looking to grow the assets, i not be a goodould outcome for the value of the savings. Is obvious inket terms of the depreciation of sterling. There is a dissipation in the International Demand for guilt gilt. Are we underestimating the risk within the bond market . General, people are underestimating the risk with brexit. If it word happen, it would be highly negative not just for the u. K. Economy but also for europe and even globally it would have implications. The focus is very much on what would happen in this country come it is bigger than that. Get the impression that investors are Contingency Planning . Peter investors have always got to look at the high impact lower probability events although the probability of brexit is slightly higher than one would like to see. You have to build these things into your outlook. Next, as president ial hopefuls get ready for super tuesday, we speak to a u. S. Policy expert. On the democrats chances. Anna welcome back. Let us get the Bloomberg Business flash. Nejra apple has won a crucial victory in its privacy battle with the u. S. Government. A new york court rules it does not have to unlock a drug dealers iphone. Today, apple is on capitol hill to testify he for the house judiciary committee. The landbased intercontinental isintercontinentalexchange exploring a counter offer from the london stock exchange. It would create the dominant Exchange Operator in europe. Ice owns the New York Stock Exchange and is set to be unlikely to make a move before the march 22 deadline for a formal offer. Talks with u. S. Regulators on a mission may take a few more weeks or months. Negotiations are continuing and the company may have to buyback some of the cars with rigged engines on americas roads. Vw ceo would not say if would meet a deadline but says had am progress has been made. The discussions are going on. The constructive dialogue makes some progress. We will see what happens in the next weeks and months. Meanwhile, daimlers ceo says the car manufacturer will cooperate fully with the Environmental Protection agency after a lawsuit accused them of manipulating the diesel engines. We have like other manufacturers in other countries we have seen tests about the car production. With theully cooperate epa and other organizations as we do in other countries. Is there any merit to the allegation . No. Nejra that is your Bloomberg Business flash. We are having an internal debate. It is super tuesday. The biggest day in the contest to me to win the parties nomination. Hillary and donald trump look poised to have landslide victories. For a closer look at clintons prospects, we are joined by james. Great to have you on the show. Let us start with the democrats. Clinton. Your pet topic. What will we learn about the Democrats Campaign during super tuesday. About one third of the overall delegate count will be awarded today. We will find whether Hillary Clinton can continue the momentum she is managed to get so far coming out of a huge win in South Carolina which was monumental. I still maintain that if she was in the position that Bernie Sanders was in, there would be huge pressure on her to bail out and get behind the other person. It is telling that that has not happened. It comes back to the idea that there is a double standard for Hillary Clinton that has been present throughout her life. Manus a higher benchmark of thed from a variety antichoice. She has held some lofty positions. She has been secretary of state. She has the credentials for the job. The question is, is america ready for a first female and is america ready for hillary . Ago, she wasyears hoping both situations would be the case. And instead we had the first africanamerican president. What you will find is that whoever wins the nomination this year is wellplaced to win the presidency. People forget the republicans have only one bank the popular vote once since 1980. The tide of history is in the democratic favor. She has not been facing a tough opponent. I make the case that if there was a young, vibrant individual, a bill clinton of this generation, she would be having problems. She is well based because few others have the credibility. Side, we willther learn more about the republicans on tuesday. Opportunity opportunity to earn about half of the delegates necessary. Where are the key states to watch donald trump . James texas is vital. Largest pot available today. Donald trump is winning in a lot of the polls. If ted cruz loses his home state, it is difficult to see how he can make a credible case going forward. Same thing with regards to florida and marco rubio. If they cannot challenge donald trump in their home state, it is difficult to make a case on why they should be president. Manus you call them walking wounded. How narrow will this field become . James great pressure on the bottom two candidates including carson and case it. If those two people drop out and their support went behind ted cruz or marco rubio, they could start challenging donald trump. Donald trump is that 33 . The other two at about 25 . Would put about 10 pressure on donald trump. Anna he is someone that polarizes opinion. Is he someone that within the Republican Party how far through the process do we get before the rest of the Republican Party decide they need to unite against him . James there is already pressure in that direction. He was not happy to condemn the klu klux klan. There will be a lot of pressure higher ups in the party. You will start to see people like him, party elders coming forward and talking about breaking with convention to put someone else in place. The risk then is will he run as an independent. Manus he has the money to. James if you feels he is being cheated out of this, nothing will stop him. He has no loyalty to the Republican Party. He could say that he wants to go his own way. Anna it is fascinating to watch outside of the United States how he can sell how wealthy he is and independent of corporate influence. James it is fascinating. With american president ial candidates, they claim to be born in a log cabin or they try to hide their wealth. With donald trump, how can he avoid it. He will keep pushing that. The epitome of the american dream. So far, you have to give him credit, it is working. Doesnt know when care that he has broken regulations . No one seems to care. James i dont think the people he is appealing to our reading a lot of the trade press. They are very much bluecollar workers. Who field visit bandaged by the american system of barack obama. Anna what will be the immediate fallout from super tuesday . We can almost write them now carry a very strong sweep for donald trump and we will see a lot of big wins for Hillary Clinton. I think sanders will pick up a couple of states like massachusetts. See is him winning the predominately white states in the north and northeast and Hillary Clinton sweeping the south. Manus let us see what the Morning Headlines bring. Will beily chang speaking to the u. S. Attorney general Loretta Lynch in an exclusive interview. 9 00 p. M. In the evening. Manus we have the earnings from barclays plus we speak to the ceo, jes staley. What is the future for barclays . Over the pastos few years. A conversation with anna edwards. What happens to africa . What happens to the Investment Bank . Manus fresh figures from china paint a horse picture for the worlds secondlargest economy. Where do policymakers go from here . Anna bringing barclays back. The new ceo reports results. We feature jes staley later in the olympian manus we get an insight into the impact of the commodities crunch on glencore. The earnings are set to come. It is super tuesday. The race for the white house keeps up on the most important day yet in the president ial campaign. Manus welcome to countdown. Anna a warm welcome to the program. It has just gone 7 00 in the morning in london. Cominggetting this through from barclays. Caroline hyde has joined us on set. She has the details of this story. He will be talking to jes staley later on about it. The early headlines coming. Caroline Net Operating Income of 22. 4 billion pounds for the full year. That is adjusted. Overall, profit before tax, five point or billion pounds 5. 4 billion pounds. They said overall they are going to sell down the stake in their africa operations. This set of numbers is about the Fourth Quarter and the future and strategy of jes staley. The future and strategy is they are going to sell down the 62. 3 interest in african operations. They are managing to see equity r one ratio more at this at around 11 . People want to see it more at the 13 level. That could happen selling down the african unit. They are also seeing a reduced pretax number for this fiscal. Ear of 5. 4 billion pounds fourthquarter numbers are not going to be stellar. We have seen that across the board with rbs and other competitors. Profits are down. Operating expenses are managing anna we have not had a great deal of detail about any changes to the Investment Banking side. That is where people have questions. Caroline they have already done quite a lot. 1200 jobs already going. They have been imposing hiring freezes and looking at the bonus pool. The expectation is jes staley has been there for three months. We are not expecting a dramatic uturn. Manus shareholders do want to see something substantial. Maybe this african headline will move it. They are paying a dividend. The analysts are saying, why not give up on the dividend . The least capital relative to deutsche bank, credit suisse, and even here in the u. K. , sellinghe headline down 62. 3 of the African Business. Where do they put their capital to work to deliver a doubledigit return on equity . Caroline some analysts saying this could at 1. 5 to their core tier one ratio. It could boost it from 11 up to about the 13 level. The numbers have missed on a fouryear basis on a fullyearbasis basis. Africa. Issue is for shares in Barclays Africa are dropping, reversing previous games. Anna the ceo of barclays will join us on countdown at 7 20 u. K. Time. A quick word on what is happening at glencore. Fullyear adjusted net income coming in at 1. 34 billion. That is higher than the estimates of 1. 17 billion. Better numbers coming through there. Trading side of this business, such as the Industrial Mining side, fullyear industrial operations, 292 million. More fromt getting their marketing unit. Industrial capital expenditure, 5. 7 billion. The overall collapse in profit, 69 . You have oil, copper, iron ore all under tremendous pressure. To 1. 34ncome comes billion. Beat the analysts estimates of 1. 17 billion. Yeartock had its worst since 2008. Ater bauer is the chairman glencore. Anna lets talk about where the markets might open up. The outlook from asia was negative but improved a little bit. Not necessarily reflective of what is going to happen in europe. Manus london, paris, and frankfurt all a bit lower. Yesterday, versus the purchasing managers and all of the sub indices all under pressure. Some of the china indices coming in at the lowest level that we have not seen in almost seven years. There is that level of pressure. Lets have a look at the risk board very quickly. Money going into the yen and traveling out of the aussie dollar. Oil is shifting as well. Copper down. 8 . Ymex crude up over 1. 19 a real turnaround from where we were just under an hour ago. Dollaryen reverses its position. Government did not intervene from the 28th of january until the 25th of february. Anna lets go to caroline. Caroline chinas factory gauge has fallen for a record seven straight months. Data underscores the challenge for policymakers as they seek to cut capacity for manufacturing. Has jumped the most in three weeks. It is their first rise in eight days. Meanwhile, Franklin Templetons moneymanagement unit reckons the worst is over for chinese stocks. Think the market will rebound as much as 20 in the shortterm as Economic Growth picks up. U. S. President ial hopefuls are gearing up for super tuesday. About half of the delegates needed for a republican candidate to win the nomination are at stake, and about a third of the democrats. Clintonrump and hillary seem poised to win in landslide victories. Your news 24 hours a day followed by an powered by more than 2400 journalists. Manus lets get up to speed with the asian markets. It is a push and pull between the reserve requirement top drop yesterday and the reality of the data today. Absolutely. Have a look at how the shanghai composite has fared today. We started to see the pmi number coming through. We did see the losses coming in. Then a pickup before the lunchtime session. A drop again in the afternoon session and a big rise in the afternoon, which has seen the shanghai composite close higher, over 1. 5 . This is after u. S. Treasury secretary jacob lew came out saying he was assured by chinese officials that the country has no plans to devalue its currency. Quite a lot of buying coming through out of the pboc after the pboc cut the reserve rate requirement for the first time in four months. It has been an interesting story. A bit of a mix between greed and fear. We have seen the yen continue its rise. Japanese stocks close higher by. 4 . We also had copper falling and gold rising. Looking elsewhere around the region, the hang seng index of life about 1 up by about 1 . Indias market has had its best session in about three weeks today. The rba in australia leaving Interest Rates on hold. They have been on hold at the record low of 2 for 11 months now. The asx 200 being buoyed by copper, gold, and stronger oil prices. Generally, we have handed you over a pretty good start for european equities today. Manus thank you very much. Autos. Ll about never mind super tuesday. The Geneva Motor Show is this week. They show off more than 120 global and european premieres. Ryan chilcote has the right job, hasnt he . Anna it is not a bad job. He is in geneva with all the shiny cars. Ryan you were calling me aggressive when we spoke an hour ago. Over caffeinated is how i like to refer to it. , thejoined by carl thomas boss at opel in europe. Thank you so much for joining us. You are standing in front of your concept car. Toryone that i have talked says you have got to get into the business of suvs. That is where the money is, the premium is, the loyalty is. That is where people by all the extras. You think there is a Business Model for a sports car like this. What is it . Launching an suv, so that is important. Important tolly rebuild the emotional part of the brand. The brand is important. 1965, we launched the first concept car ever in europe. It was a huge success. Now we are reminding people of this. The design is one of the stars of the show. Manus ryan some people said it is a poor mans corvette, which is what the first opal was accused of. You have gotten a lot of great reviews, saying that gm should take this car or the basis of this car to the United States. Are the u. S. Colleagues saying something is good . It is not to be decided. That is not easy. I admit that. This car shows the future in design language. Ryan the ceo of gm was here a while ago and said it looks like you are on your way to breaking even this year, the First Time Since i can i nine. That is a pretty exciting thing opel to make money or at least break even. What needs to happen to accomplish that . We are on track. Three years now, we are winning market share. We met our financial commitment year after year. We grew 10 in january. We had a great february. The trick is, we need to grow in europe. That is what we are doing it we need to reduce our costs. That is what we are doing. We invested into new models, everything you see here. It is working and that is why i am confident we will break even this year. You have a whole slew of cars coming out by 2020. Which are the ones to be profitable in 2017 and beyond . The ones that are actually there. We are launching the Station Wagon and our entire spectrum. Suvs are playing a key role now. We saw half a million of the previous model. Crossovers,ting in pretty much like suvs. The investment goes into suvs. Ryan you also have an electric car coming out next year. 30,000 of them in all right now in germany. Presumably, that is going to get better. What i want to ask you is you know, the vw also has some electric cars. What opportunities does the scandal that vw has found itself in present to a gentleman like yourself . I cannot wait. The year, we are launching a breakthrough electric car next year, we are launching a breakthrough electric car. There are two problems with electric car. Range and the price. We would be able to offer this at a price so that people can afford it. There is all the discussion about diesel and emissions. Helping to think more and moving into this push towards electric cars nevertheless, the majority of the market is still combustion engines. That is why it is important that we invest into combustion engines. Like the gt, for example. We are going to have a threecylinder, very efficient turbo engine. Needt gmshat to be tight with cash as an advantage for a company like yours . I do not see it as an advantage. It looks as if we are all treating, which is not the case. We have invested tremendous amounts of money into clean diesel and clean gas engines. They are important for the future. That is why i think it is not a good thing for the industry or anyone. That youranalysts say presence in the United Kingdom would give you a competitive advantage should britain decide to exit the european union. I guess you would like to see that happen. Is that true that you would be better placed than a lot of the carmakers because you produce a lot of your cars inside the country . Way that there is a the u. K. Can stay part of europe. The biggest exposure is about the towns. Where is the town going . There is an advantage if you are hedged, like we are, but it still is an issue. We would hope for britain to stay in europe. Opel that was the boss at talking about the pound and how the volatility we have seen remains the single Biggest Issue when it comes to the issue of brexit. Back to you. Manus thank you very much. Ryan chilcote in geneva. Anna up next, barclays will sell a majority stake in its african operations. We will be speaking to jes staley next. Anna welcome back. This is countdown. Barclays says it will sell 62. 3 interest in its african unit. At the same time, it posted a profit. Manus the analyst estimated 5. 7 billion pounds. Lets talk to jes staley now. The decision is to sell down your African Business, the 62 stake you have. Can you talk us through the reasoning behind that . I can hear the climbers from the market saying that this is a fire sale. Ou hope to do it over time have you had any conversations . Have you had any interest shown in terms of your asset there . It is a very difficult decision. Our place has been in africa for over 100 years. We have a Terrific Management Team and enthusiastic colleagues. We are across the continent. It is a very difficult decision. We own 62. 3 of Barclays Africa. On the other hand, in terms of how the regulators think about our ownership, we own 100 through liability. So we look at the capital charges that we have, funding torges, and it is very hard devote 62 of a business where you have 100 liability. That truncates significantly the returns that are generated locally in africa when they are translated to returns for barclays here in the u. K. We have announced that we will, time, slowly of reduce our state to a nonconsolidated position in Barclays Africa. It is a great bank. A lot of investors are clearly interested in africa and Barclays Africa. We think there will be Significant Interest over the next couple of years as we moved to a noncontrolling position. Anna Significant Interest. Have you had any conversations ,ith the likes of bob diamond any conversations on that front . We are just announcing this decision today, so there have been no conversations with anybody. This is just public now. We are going to give ourselves to her three years to do this in a way that preserves the share price of our clays africa and allows the franchise to continue to grow and excel. Manus 14 of your assets are tied up in the African Business. Where are you going to relocate the capital . Where are you going to make the capital work better for the shareholders of barclays . We are going to simplify the bank to be a Transatlantic Bank focused on the consumer business, our corporate business , and our Investment Bank. We have a number of franchises within the Transatlantic Bank generating doubledigit returns today. We have an excellent credit card position in the United States. We are the number one credit card issuer in germany. We have a tremendous digit business in the u. S. Which is generating doubledigit returns. What we are doing with technology in the Retail Business in the u. K. , we think we are at the forefront and are generating good returns of growth. There are lots of places to deploy our capital. We will be doing so in a way that gives shareholders value. You used the word doubledigit in a number of locations. When is the possibility of a doubledigit return at that Investment Bank . The market wants to know what you are going to do with that. When will the Investment Bank make a doubledigit return . Think the most important issue is that our core franchise today, which includes our consumer business, our corporate business, and Investment Banking business, that it generates a return on double digits today. That is an important thing that the street needs to get its hands around. The Investment Banking industry is not covering its cost of capital. In our view, the world has learned that we cannot rely on Bank Balance Sheets to fund Economic Growth. We need a robust capital market. I have to believe that the Investment Banking industry will have to leave itself financially healthy and it will. Anna i am sure you have read the reports suggesting radical action that barclays might like to consider. I do not know what you make of the analysis where they said maybe you want to ipo the Investment Banking part of the business or sell barclays cards in the u. S. They do not think you are big enough to compete in that market. What do you think of that research . We have a great Business Model. We are focused on consumer, corporate, and Investment Bank. I do believe there is value in being large and diversified. The balance of a wholesale business with a consumer business. Throughout the financial crisis demonstrated there is a diversification in the revenue stream which benefits the safety and soundness of those large banks. We have the portfolio. We have a core franchise that is very profitable. We have a defined noncore business and businesses that we are getting out of and selling. We need to accelerate the wind down of the noncore business so we converge our Group Results with our core results and the stock price will take care of itself. Barclays and the strength of barclays will become very transparent and very clear to everybody. Manus the one thing that the market really rewarded rbs for was the expedited noncore business drop, that reduction. How quickly can you achieve give us some intangible in terms of the noncore business. Everybody is trying to get out of noncore business and legacy businesses. Put a time frame around that they can reassure the market. That is a great question. We started our noncore business with 110 Million Pounds billion pounds of riskweighted assets two years ago. We are to 47 billion pounds in under two years. We have slightly picked it up as we narrowed the core franchise. Exitwe said is we will 2017 with 20 billion pounds of riskweighted assets or less. We are going to accelerate getting out of those riskweighted assets. Another thing i would add is so much of what we have not seen our business is that we have sold but not yet closed. We sold our italian retail franchise. We have not closed it yet. The structural costs, employment costs, we have to get out of those. We sold our index business to bloomberg. Months toke about six close that transaction. So the pathway to getting out of our noncore assets is very clear. We will execute on them. This can i ask you about activity that regulators are bringing in in the u. K. . Is everything clear for you in terms of the timescale . Are you expecting that to change when those arrangements have to be brought in . Will there be transition or transitionary arrangements brought in for the final structure . We are working very collaboratively with regulators and that is what we should do. The contracts that barclays have articulated will be run through two divisions. Number one, barclays u. K. , which will be our u. K. Credit card business and Small Business activities. It will be solid financially and wellcapitalized, very profitable. Then we have barclays corporate and international. We will focus on our Investment Bank, our corporate business in the u. K. And around the world, and our credit card business in europe and the u. S. Also have solid investmentgrade ratings and be very wellcapitalized. Those are the two divisions that will make up barclays going forward. It is a very complicated operational process. We will take our time and do it in a methodical fashion so that we deliver a barclays u. K. And Barclays Corporate International in a couple of years from now that everyone will be very comfortable with. The other discussion in the marketplace, i am sure you have read these comments as well, is capital relative to. Our peers my question to you is, is there any merit or have you thought about forgoing the dividend to bolster the capital story. Have you considered that . Did you look at that . Is that a strategy of merit . I see that you are continuing to pay the dividend. Even with all the conduct issues and litigation issues that we have used in the last three years, we have moved our Tier One Capital ratio from 9. 1 to 11. 4 . We have clearly demonstrated our ability to generate capital with recurrent business and we will continue to do that going forward. Have a Strong Capital risk what we have done in order to accelerate the closure of noncore is reduced our dividend for 2016 and 2017. That is a very difficult decision to make, but it will allow us to accelerate the closure of noncore and illuminate the power of core franchises so we can get back in 2018 to paying a significant percentage out of earnings in dividends and we will. For joining us. Jes staley joining us from their headquarters. Get the bloomberg first word news with Caroline Hyde. Caroline the japanese government has been paid to borrow money for a decade for the first time. They sold 20 billion of debt. The bank of japan posts yields lower across the curve. Has ended a 15year spat with u. S. Creditors. Aires hass buenos signed an agreement in principle that would have argentina paint paying 4. 6on billion. U. S. President ial hopefuls are gearing up for super tuesday. About half of the delegates needed for a republican candidate to win the nomination are at stake. Roughly a dozen state races. Donald trump and Hillary Clinton seem poised to win in a landslide victories. Bill dudley says he is less confident on the inflation outlook in the United States. The president of the united risks says downside