Resign following his firing of the finance minister without Consulting Party leaders. Nejra ive got the imap on the stoxx 600. You can see the stoxx 600 has taken a bit of a turn to the downside. Fallingustry groups than gaining, and intels providing the biggest lag, down 1. 2 allah by consumer discretionary. On the upside, materials were gaining earlier, but they are pretty much unchanged now. We are seeing quite a lot of red across the wheel, even Energy Stocks are down. 4 . This comes after three quarters of gains for the stoxx 600 but it looks like we are heading into negative territory on the first trading day. I want to look at sterling. Butre seeing some weakness, we keep talking about shorts building up in the sterling trade. Totalhows a percentage of speculative positions and it shows the markets bearish tilt has been more extreme in the past. Is courtesy of one of our first word strategist. Here, i want to take a look at the german yield curve because if you want to know how eurozone bond will perform bonds will perform now that he repurchases have been reduced to 60 billion euros a month, it has been outperforming in general, we have also seen a bit of curve steepening toward the end of this line on the chart. Finally, just to show you a snapshot a snapshot, you can see broadbased losses. 1. 2 , you can see sterling, dropping for the first time in three days against the dollar as u. K. Manufacturing grows unexpectedly. You can see the two year yield in germany dropping almost six basis points. Brent crude off by. 6 . We are seeing a dip, now. Earlier we saw strength. It is largely attributable to the financials as you are seeing weakness in europe. Looks like we have a feed issue. Difficulty, now solved. We are seeing a fallback in the major averages. Well is hasing love. Tesla. As love of 25,000 is the shipment that has love tesla may. Made. Their market cap has now taken that of ford elsewhere elsewhere within autos, not just among the automakers in the week sales, autoparts makers, we are seeing weakness among them. Cleveland research down corroding downgrading. Carmax and hertz global are trading lower. Quarter according to a broad measure of volatility, the bank of America Merrill lynch index. At the slowest at the lowest level since 2014 is where it was, friday. It is bouncing a little bit, but we talk about low volatility in stocks. It is not limited to stocks. Vonnie thank you for all of that. Lets turn to private equity investing in europe and the u. S. And africa. By variety of yield and political risk. Here,airman of mondale is based in france and is one of their oldest Industrial Companies and has merged into morphed into a private equity firm and you are everywhere. Welcome and explain why you are exposure to france. It represents only 12 of our value because we have invested our activities very much throughout europe and north america and africa. Have 40 years in investment with a 300yearold company. Why are you particularly seeing opportunities in africa and brazil . Your shareholder is the family, so you can hold onto longerterm investments. You are seeing much more opportunity than in france. It sticks to our financial structure. We are a longterm investor, so we can invest on the back of very longterm trends and africa is a place where we can make gross capital. We have learned africa with the Largest Holdings working with the government in the past. We knew earlier than others that there was potential there and that in spite of the ups and inevitably, it has been a long growing aspect. Vonnie you are in countries like morocco and nigeria and investing in shopping malls and you are investing in the consumer, so what have you learned about working with governments that are unpredictable, that might be useful for people investing in the u. S. , and europe these days . We try to be far from public authorities. We are willing to work with private businesses that are absolutely essential to the development of the covenant. We are lucky that we found the right investment very soon. It takes all of our boxes. Boxes. Icked all of our what i can tell is that it is the safest way to avoid if you are invested massively in one country, you are exposed to political risk. All of our companies are multicountry ones that hope to cover the whole continent. Vonnie has the prospect of Brexit Change the way you are doing business in any way . Not significantly. I regret brexit, personally because i think the European Union is one of the great achievements since world war ii based on the example by the United States, by the way. Unless we continue with london in our business, we have a large office in london covering all of europe and i think that will remain. I think most financing banks will still be there. I was interested by the decision to relocate. There might be examples of that it might change the business of some industry. I was looking at some of the m a and ipo data and it shows that the u. K. , m a has really step in the First Quarter but they have been there have been lower ipo volumes, not just in britain but all across europe. One person in the market said this is because private equity exits has been down. Is this something you have noticed, that concerns you at all . Last year, british markets were really flat. Everybody was expecting the referendum. I think it might happen exactly the same in rants since the election. Marginally, what i see in europe is that those private markets are very high in terms of prices paradoxical,sound but it is more interesting to invest in north america now that the market is deeper and because somehow it has less competition. It is a reverse on public markets. I do believe that the European Public markets are undervalued. It is common wisdom to say that the american markets are high. Vonnie how do you deal with currency fluctuations . We have seen a huge weakening of the euro, recently. You are translating from the euro into currencies like the nara. The euro is important for us, we are taking risk outside of europe, which we tried to mitigate by operational hedging which we try to mitigate by operational hedging. We are not that hit by the major valuations and marginally, 10 in the parity will vonnie where else in the continent are you looking . Would you consider anything in south africa with all the political turmoil . We just invested in south africa. The rand was weaker. We are not in a bad situation. We think the minister was a reliable man in the political system needs to read take into account the view of international investment. The company we invest in will be growing anyway. It started in south africa and is expanding right now and that will work, whatever the currency or political instability and that will work all the more because it is based on not only south africa. Vonnie thank you for joining us. Chairman of lets check in on the first word news. Authorities in russia investigating an explosion on a train have found a second bomb at another station. Deactivateds been and the first bomb killed at least nine people. Antiterrorism Officials Say they are tightening security at all transportation facilities. In southern colombia, the death toll from a flood has fun to over 200. Riversain caused three to overflow, sending a torrent of water, mud and debris through the streets. President trump will meet with the egyptian president at the white house, today. Administration says the goal is to rebuild relations that were strained during the obama years. The president came to power after the 2013 overthrow. A senate panel is opening a weeklong partisan showdown over president Trumps Supreme Court nominee. This comes as democrats are steadily amassing the votes to block neoprobe neil gorsuch and force republican system rules to longstanding commit him. Global news 24 hours a day, powered by more than 2600 journalists and analysts. Up, a look at the growing pressure on south who may faceident a noconfidence motion after he fired his finance minister. This is bloomberg. Vonnie live from bloomberg World Headquarters in new york, i am vonnie quinn. Nejra and from one day, and from london, i am nejra cehic. Lets get back to the latest on south africa. Thepressure is growing on president to resign following his firing of the finance minister without Consulting Party leaders. Joining us for the lead us from cape town is robert land. Lets start with this chart i have appear which is showing how net 835s bought a million in the weeks ending march 31. That was more than double the previous week in the most since 24. Five days ending june train risks to this trade if we get rand weaker weakness. While this is happening against a Broad Spectrum of it does suggest that some foreign businesses are developing a higher tolerance to political noise in south africa. Willlieved that the crisis blow over and the rand will rebound and you are looking at deals you look at my bloomberg, you can look at the risk profile. Somean see that we have investmentgrade ratings, but in under stress, what happens if we do get a downgrade from one of the issuers . We would have to downgrade from at least number two move. Tech it happen as soon as this week. People expressed their concern about possible policy changes in the wake of this cap reshuffle and should it happen, a reversal of these bond flows we would see higher inflation that would off is that also probably put an end to the economic recovery we have been months. N recent nejra what should investors be watching from here . Big local noise is real and is going to stay around for a wild. There is a National Policy conference coming up in june where we should get more clues that will only culminate in december, so i think there is going to be a lot of political noise and it is not going to die away anytime soon. Nejra thank you so much to robert brand, from cape town. Ie still ahead, as the bank gets a hit with a sweeping tax evasion case, details next stop this is bloomberg. Vonnie live from bloomberg World Headquarters in new york, i am vonnie quinn. Nejra the european close is just minutes away. Credit suisse is facing a tax evasion and Money Laundering investigation spanning five countries that could involve thousands of account holders. During us now is blue nagged at Bloomberg Finance reporter. Thank you for joining us. Bloombergs finance reporter. Thank you for joining us. Is Credit Suisse cooperating . Let me answer the latter question. The bank is cooperating, at least that is what the bank is saying. We talked to the management on friday and they could not provide further details on how they are cooperating with authorities. That thence suggests bank is not being entirely clear in this investigation. Individuals may have Health Accounts at Credit Suisse at some point and there might be some Money Laundering involved. It seems that the investigation is still at early stages and we hope to find out more from the banks. The bank has pledged if they find any wrongdoing then they will take measures against it. So far, no employees have been suspended, so the bank and not be as much involved in that probe, but they said it is something that remains to be seen. You may get some more color on the in the next days where swiss financial regulators will hold the press conference with a lot of questions being asked about this matter. Vonnie it is coming at a bad time for Credit Suisse in the ceo. Explain why. If you think about the Business Model of a private bank, to grant together assets and you want the confidence of your clients. When your bank is in the headlines of the context of Money Laundering, it is certainly a bad thing. Credit suisse is revamping its strategy, it wants to have less Investment Banking and more wealth management. The bank is currently set to look into Capital Options such as the capital rates. Do anitial plan was to ipo of its swiss unit, a partial ipo, so it is probably not reassuring for investors at this nt in time that there are there is a moneylaundering investigation going on, something that is historically pretty bad for a wealth manager. The Market Reaction was pretty , so probablyday people got over it and moved on and are awaiting further details. Credit suisse down 2. 2 at the moment. Thank you, from zurich. We are heading to the market close, lets take a look at where european equities are trading. The stoxx 600 off by 5 10 of 1 , some pretty broadbased losses. This is bloomberg. Vonnie live from london and new york, this is the is this this is the european close. Equities finishing up the day in european trading. Lets take you to the market action. If you look at whats happening in the equity space, we are seeing some broad based losses. The euro stocks 50 down 7 10 of 1 . 7 . We are seeing a little bit of a down day on the worst trading day of the quarter. The fxbased seeing some sterling weakness. The euro has snapped a fourday decline and we have seen the swiss franc the swiss franc looking at the fixed income space, seeing a little bit of curve steepen steepening. You can see downward pressure on the twoyear, down six basis points in the. Third year in the u k, down seven basis points. In the u k, down seven basis points. Across sectors on the stoxx 600, you can see it is pretty much read across the wheel, financials providing the biggest drag on europes equity benchmark, down 1. 1 , material stocks were gaining earlier but pretty much flat now in stocks have given up their gains, down 5 10 of a percent so overall, we are seeing the benchmarks down. I wanted to show you sterling intraday. It has erased all of fridays gains and we have seen the pound dropped for the first time in three days against the dollar as u. K. Manufacturing growth unexpectedly cooled. Sterling also down against most of its major peers. Finally, just wanted to show you the euro. Snapping a fourday decline, showing the premium on euro dollar increasing, this is partly on election risk around france, but also on some dovish comments rum areas ecb policymakers. Vonnie we have seen a little bit of dollar strengthening in this session. About a quarter of a percent stronger. Earlier,as mentioning consolidation as well for crude oil prices, down about three quarters of a percent. As we start the quarter, we saw the yield and the 10 year drop five basis points, so i want to onshore ande offshore you want because markets are closed in china, so there is no on short trading, but offshore, you have a very quiet market and we are seeing the yuan it 6. 7 and head of the president s visit this week. Take a look at the g movers g20 movers. South africa is obviously rebounding a little bit after its political turmoil, but not so for the rand. The rand is trading close to 14, now. We will have a look at some of the other Asset Classes later one, lets get Abigail Doolittle with a look at the u. S. Financials. Abigail banks are starting off with a bit of a marriage bank. Bearish bang. The Financial Sector is the worst sector of the s p 500 right now, on pace for us for its biggest drop since that big selloff. Mirrors the action First Quarter to some degree. This, thelook at white is bank of america and blue is the s p 500 and in orange, we have the s p 500 banking index. All are up to some degree, but the point to be made is from the beginning of march, bank of america went down 14 . The s p 500 index down about 9 . Sincep 500 down about 2 about one month ago. The banks have the worst month since the brexit had the worst month since the brexit there worst month since the montht their worst since the brexit. Says that he thinks that the First Quarter is an Inflection Point relative to profits. When we look at trading revenue for morgan stanley, we have a great chart that shows trading revenue relative to fixed income currencies and commodities had been down, but then higher for several quarters. They expect this to drop back down, taking the Banking Sector with it and he thinks 2018 estimates for the big banks are going to have to come down to credit deterioration and that overall, we have seen but Charles Peabody thinks there is going to be a bear market and if he proves to be right, you can be sure that will be a big drag on the stock indexes. Perhaps there will be volatility ahead. Vonnie big volatility for the rand as well. As s p has athis negative out long outlook. 2. 1 weakness. A spikes for the u. S. Dollar. It is trading above 13. 7. Another like lower for the rand. South africa cut by the s p in junk territory. Nejra the rand hitting its lowest since january of this year. Less than a week after the u. K. Triggered talks to leave the European Union, the first direction is over gibraltar. The first the first corruption is over iraq ption is over gibraltar. Joining us is the Spanish Bureau chief from which read. Madrid. Much read it remains to be seen, we are very early in this process. It took people by surprise because it is a sign of how complex these negotiations are going to be. People had been looking at spain as a potential ally for theresa ,ay in the brexit negotiations saying spain and the u. K. Have a lot in common. We have this stone in the shoe, which is gibraltar. It is causing problems. Nejra what is spains view of this spat over negotiations . Spanish commentators are kind. F praising spanish diplomacy they have managed to put this issue on center stage. From the Spanish Point of view, well done. It might be seen as a diplomatic step forward for spain. At the same time, we have heard spanish officials today that intend to play down the issue. We heard the foreign minister it is not the time for people to get hot under the collar. Vonnie how does the situation with gibraltar different differ from the situation with norther ireland, scotland, wales . Case. Raltar is a special it is a territory on the southern tip of spain. It has been a british territory since for 300 years as a. Esult of a treaty territory and it is a defining feature of daily life in gibraltar. Vonnie how do you play this out, because voters in gibraltar did vote to stay within the European Union. It is a difficult situation for the gibraltar aryans gibraltarians. Ofis another element uncertainty about the future. Areget the sense that they nervous about their previous experience with spain which has friendly. Been there have been instances where the border has been closed in the past. There is a history there. At the same time, there was a lot to play for an a lot more to go. Vonnie thank you to bloombergs Spanish Bureau chief from much red madrid. Speaking to Bloomberg Anna edwards, sturgeon maintains that any resistance or delay from the u. K. Government is untenable and that the scots have a right to create their own destiny. Scotland is a great place to do business. We did not choose to be in the position of the u. K. Leaving the European Union. It is important in light of that that scotland works harder to say to companies around the world that we are open for business and a great place to do business. A leading American Tech Company is already based here in doing cuttingedge work and investing in expanding. That is a great vote of confidence in scotland. To america, my purpose is to encourage more american businesses look to forland for investment and scottish businesses to look for Investment Opportunities in american markets. Some may say the Investment Case is more uncertain than the rest of the u. K. You might or might not be in the eu water u. K. Or using the pound. So many uncertainties. Remainland wants to within europes of the we can remain within the Single Market and be able to trade. Of course, as i stand here right now, the office of an American Company that sees the benefits of investing in scotland so the reality is very different to the one that you have just outlined in scotland has so much to offer. Modern infrastructure, a highly educated population, an open approach to business. Many American Companies have already experienced investment in scotland and this is a good place to do business and we are determined to make it more so in the future. That is the message i will be taking to america. It is about to it is about supporting Scottish Companies that want to extend the reach in north america. Their reach in north america. We are currently establishing new investment hubs in key european markets. This is an outward looking at a Scottish Government and that is the message, that did that it is more important than ever to get across that we want to welcome people from around the world to do business in scotland. That is the message i will take to the u. S. You are going to the u. S. , do you want to welcome donald trump to scotland . You said at the time of the conversations about immigration that perhaps a state visit should be blocked. What about the return . Will he be welcomed in scotland . Im sure President Trump will visit scotland at some point and of course i will have political differences with President Trump , like many others. It is important that we are able to air those disagreements but the links between scotland and america are deep. It is those links with america, based on some longheld mutual values that i will be looking to talk about an underlying in the United States. Underlying inand underline in the United States. Outlook negative see south africa, you can that we are off our lows but the South African rand is trading weaker by one point percent versus the u. S. Dollar. Bonds also showing a big movement as the 10 year yield at 8. 9 . The downgrade reflecting the divisions of the government and changes in executive leadership. This is bloomberg. Nejra live from london and new york, i am nejra cehic. Vonnie and i am vonnie quinn, this is the european close. Another big week for President Trump as he will welcome the chinese president to his resort of maralago later this week. Mckee. Us now is michael they will not be playing golf. I think that is a face that having that is a fair assessment. He has crackdown on playing golf. Im not sure trade is going to go anywhere as an issue for this summit meeting. The trump administration, there is nobody home. Eight of nine senior positions are unfilled and there are no deputy secretaries or their deputies at the treasury department, so who is going to negotiate these things . We know the President Trump does not have much about the details, the stories that were reported on his meeting with Angela Merkel say that he was very unprepared. What would not expect him to want to go deep into trade details. What they might talk about at , with thenorth korea stories coming out recently like today in the New York Times about selling excess materials to make Nuclear Bombs so they obviously have enough. There is a new emergency to that. Vonnie what is the potential for conflict if the president , thatll trump, talks about the year one talks about the yuan . The u. S. Trade deficit with china shrank 5. 5 . It would be hard for President Trump to make a case that china is manipulating for gain against the United States. To talk about issues in terms of unfair chinese trading practices , but the yuan itself is not a huge issue right now. That tradeow you say may not be gotten on gotten into, but in any case, when trump talks about a trade deficit, isnt it actually a sign of strength in the economy . Consumers wanting imported goods and the dollars that the u. S. Exports get reinvested in the u. S. This is one of those economics questions. It depends on why you have a trade deficit in one of the reasons we have it is because we want to buy a lot of cheaper goods that the chinese make that we dont as a country want to make because the value is not that great. It is painful for the people who lose their jobs and a lot of manufacturing jobs have moved to china. The standard of living in the United States rises a little bit higher. There are areas where china could improve. No one thinks they are a very fair trader. The currency manipulation is too easy an explanation for what is going on. Vonnie on other news we just fault saudi downgrade by s p of south africa. What does this mean for the country . Do we need another Ratings Agency to downgraded . Moodys and fitch still has them as investment grade, but barely. Another downgrade from either one would severely hurt them and they would all but disappear, which is a real problem for them because their budget deficit is going up. The government has been spending a lot of money and the Economic Outlook is not good. Ratesntral bank raising to fight inflation and hurting growth and then you get the political concerns raised by the president hiring nine cabinet officials and you have a real issue for the ratings agencies on what are they can honestly say south africa is on whether they can honestly say south africa is in a good position. Our thanks to michael mckee. Nejra coming up, battle of the charts championship round. We cannot wait for that. We judge, this is bloomberg. Nejra it is time for the championship round in our battle of the charts tournament of champions. Vonnie i cant believe its actually here. I cant believe i have lived to see it. With the ncaa mens finals tonight and we have a womens final last night and it turns out we havent all womens final here as well. Pitino. El and christine lets turn it over to christine in london alex we will start with you alix, we will start with you. Alix you can check this chart out. It was the isn prices paid, that is that white line and that reached 70. We have not seen that level since 2011. The blue line is the oil price. They tend to move in relative tandem. As oil prices fall, prices paid fall. Whats been happening recently . You see the big jump in prices paid over 70 and oil prices are not only flatlined, but declined little bit and that goes to show you that its not just oil thats contributing to the rise in inflation and you can point out most of the 23 products reported in the isn that have prices paid have little or nothing to do with energy. It also means you are seeing prices build across many sectors as well. This is pivotal and a good impact when it comes to that core pce we are watching. Vonnie this is why many of these fed officials are little more comfortable. Alix and everything has to do with oil. Vonnie you would say that. Christine the senate shining in london and im feeling cheery so i will show you a chart that will give you reasons to be optimistic for the meeting between President Trump and xi jinping. Have a look at the top panel which shows you on the bart chart that the yuan posted its against quarterly gain in more than two years, also its first gain in three periods. Also a drop in the foreignexchange reserve what you can see on the blueline. That stands at a six year low. What does that mean for what chinas policy is . It means china is pulling back from intervening in its currency to weaken it and that is good news for the u. S. Trade position with china because its deficit is now receiving and all that lazy positive foundation for this weeks meeting between president s trump and xi. Nejra thank you, christine. I dont agree, alix, that it is all about oil, but i have to give you the round. Vonnie i agree. The champion is alix steel. Alix where is my trophy and my prize . Vonnie there is confetti coming, i promise. It is noon in new york. I am vonnie quinn. Welcome to bloomberg markets. We are going to take you from in thiscisco to detroit hour. Here are the top stories around the world we are following. The u. S. Stocks are near session lows, despite Strong Manufacturing data. Financials, Energy Materials leading the s p 500 lower. Crude near 50 a barrel after libyas output is said to have rebounded. Imagination technologies are having their worst day ever, plunging more than 60 after apple notified imagination it is cutting ties within the next two years. The news is weighing on shares of other suppliers as well. Auto Sales Numbers are falling short of estimates, despite heavy incentives