What highend features could be included. Equities, so much for easing into the post easter holiday. Theresa may calling for a snap election and Parliament Vote tomorrow. If we get a two thirds majority, june 8. The ftse is down by 2. 8 . Look at sterling, up by 1. 5 . For the ftse, the biggest drop since june 27, three or four days after the brexit vote. Sterling up 1. 6 , the biggest increase since january 17. Breaking through its 200 Day Moving Average. All of these currencies are rising against the dollar. I will just move away from brexit because there is a big election taking place in france on sunday, and if it was not for theresa mays surprise i would be giving you chart after chart on the French Election, hedging, how the markets are coping. This is the yield differential between france and germany, lowering a bit. Almost one third of the electorate is still undecided. The front runners are clustered around 20 of the poll for the first round on sunday. The race is unpredictable, perhaps the most unpredictable in the countrys history. Supportingerday macron, 24 , le pen, 23 , fillon , 21 . Upset, for a political goldman sachs, deutsche recommending selling french debt into the two round election. Pimco says it would be illogical hedge. A buy the it would be logical hedge. Signaling increasing hedging ahead of the big vote on sunday, this is the risk reversal rate. Finishing off with the French Election, be away, merrill lynch, jeffries, barclays favor european stocks despite French Election risks. The white bars going back to 1988 is round one and the blue bar is the one day move after round two. Round two. Will history repeat itself . 90 minutes into the trading day in the u. S. All three major averages have turned deeply into the red, health care weighing on them the most. Drug distributors are down since card cardinal brought bought business from medtronics. The bank of America Merrill index of this Financial Stress index of Financial Stress, this is one that goes back to 2012. If you look at year to date you will see what is going on. We see a spike in that financial by increaseddence volatility across asset classes, and declines in stocks. Lets take a look at the financials, we had all these earnings from various companies. Goldman sachs trading revenue disappointing. Bank of america has turned into the red even though that company on the face looked like its numbers Beat Estimates. The increase in net income will moderate. Down, financial predicting to see numbers flat to slightly down. Schwab reported numbers that Beat Estimates by the but is down with others. I want to talk about commodities, remarkable moves in copper futures after they were allowed to reopen a mine. Copper was trading at its lowest since january, and iron ore having a big move, not just today but it has been slumping, down 3. 5 today. Citigroup is bearish on iron ore. Much. Thanks very lets get to the big story out of london, Prime Minister theresa may calling for an early election on june 8 to strengthen her hand as she heads into brexit talks with the e. U. She made the announcement outside her residence. The other Political Parties oppose it. At this moment of enormous national significance, there should be unity in westminster but instead there is division. The country is coming together but westminster is not. Party leaderor Jeremy Corbyn is ready for a fight. I welcome the opportunity for us to put the case to the people of britain to stand up against this government and its failed economic agenda, which has last us {with problems and left so many people in certain. Mark as you can see on the sterling rising above its 200 Day Moving Average for the first times in since the june brexit election. Jeremy cook is here. Irony. An brexit wouldard send the market sterling down. Jeremy not quite as chaotic as in 2009, being kicked out with no deal at all agreed. The late part of march 2019, nothing in its hands as far as a trade deal, this is a gamble to strengthen her negotiation position within brussels. Unfortunately, time will only tell and there has been a history of countries having elections at home, and a Party Winning a strong mandate. , look at greece, for example but it does not give that much power in brussels. Mark sterling moving above it 200 Day Moving Average and check out this chart. We have been in this trend, pounddollar of 1. 20, 1. 27 since november. We have broken through. What is the upside . Jeremy markets have been so short that sterling, for many months, on the basis that the data has stated ok in relative terms. The recession that a lot of people predicted did not come through. There is a lot of sentiment to suggest the market has overplayed its hand and those who were bearish the currency are starting to bailout. Example, has, for now moved away from their 1. 06 that. Bet. Easter has been a good time for high street due to the devalued pound and the taurus coming in tourists coming in. Vonnie what about the bond market . We have the 10 year yield dipping below 1 today. Chart showing that level, that is pretty serious. Where does it go from here . Jeremy i think the bond market takes their cues from fx moving forward, and if we continue to see a strengthening of the pound than we may actually see a continua move into gilt by investors. This does not affect bank of england policy like the brexit vote did last year. Endall, this is a general election, yes, a snap election. Coming into the office this is the last thing i thought would be announced but the crux of it, it is an election. Imf has said they do not believe the world is headed toward protectionism, or a massive doubt protectionism. Do you agree . Jeremy i agree we will continue to hear more saber rattling around protectionism from the Trump Administration within the brexit negotiations and within the elections in france. Into de facto trade wars between the United States and china, no, that is not a central scenario. Mark we have an election on sunday and france, that was the big news before theresa may spoke. Risk reversal data. We have not seen since the height of, 2011. How confident are you of a market friendly outcome . Jeremy never confident in politics anymore. We are one polling area away from having a second round of this French Election which looks like le pen melenchon. Nobody has been talking about that. Everybody has been talking about macron and he could easily fall apart. The first round is very precedent and i think we could see a lot of risk as we open up on sunday and monday. The moves in eurodollar are interesting and the risk reversal is plunging off. Sterling has been predicated on the basis that we are overly short and it could bounce higher, eurodollar could fall to the low side. Mark trump was saying he wants a lower dollar and mnuchin saying the opposite. Who do we listen to . Jeremy i think you have to listen to mnuchin. Trump may want a weaker dollar but i dont think he will get it. If he stands by the policies that got him elected, which he may have moved away from some of them, if he stands by those they are dollar stronger policies. He may say he wants one thing but whether he gets it means to be seen. Vonnie one of the beneficiaries of this has been the yen because people are flocking to the safety. Does it continue to strengthen . Jeremy i think we hold around 1. 10 as we wait for the Political Risk around europe to start to settle down. Euroyen is an interesting pair. It has been falling for about four weeks or so and we have not seen five to the second of losses in many years, consecutive losses in many years so that will be the delineators of what happens with dollaryen. Some are talking 105 or move down to 100 but our scenario is to hold between 110, 112. Mark the longest stretch since brexit, it all comes back to brexit. Vonnie lets check in on the bloomberg first word news, emma chandra has more. Emma the International Monetary fund has raised its Global Growth forecast and issued a warning saying the worldwide economy will grow 3. 5 this year, up 1 10 of a percent. It left the you cast u. S. Forecast unchanged but rejectionist forces could undermine economic growth. President trump says talks of have causedident him to abandon his hardline on trade, at least are now. He understands it is a big problem and is working on it. What am i going to do, start a trade war with china in the middle of him working on a bigger problem, frankly, with north korea . I have Great Respect for him. We will see what he can do. Emma the president says he has not changed his position on trade with china, the chinese have. An unlikely lobbying force is trying to talk President Trump out of his desk out of withdrawing from the paris out of withdrawing from the paris climate accord. Exxon and shell are among those on board. There will be a highlevel white house eating on the meeting on the paris accord, perhaps later today. And france are hovering around 20 support and as much as one third of the electorate is undecided. Independent Emmanuel Macron and far right candidate Marine Le Pen could be headed to the second round, however francois are still within striking distance. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. Details ofhave got has in storeapple for its 10th anniversary of the iphone. This is bloomberg. From bloomberg World Headquarters in new york city, i am vonnie quinn. Mark live from london, i am mark barton, roughly 13 minutes away from the close of european tuesday session. Is introducing a new model. A revamped iphone for the 10th anniversary, joining us is Bloomberg Technology reporter mark gurnan. Tell us about the revamped version what specs it will have. Mark g. there will be three new models. One will be an overhaul. Apple is testing curved glass, and more advanced cameras for this upgrade. Mark it comes at a critical time, doesnt it, not only for apple but it is looking over his shoulder at them some . Mark g. absolutely. Samsung is coming out with their phone on friday the 21st and it has been recognized as a hit phone. It has a bunch of new features so apple would be going against this new phone, especially after it stale slide last year. Actually has to use samsung is a supplier, right . Mark g. samsung will be supplying the panels for this iphone because other makers like japan display and sharp are not ready. Vonnie samsung is a winner either way or both ways, supplying apple and gaining market shares for its own phone. It seems to me that friendliness from what we know so far, there are not as many new things about this iphone as people were hoping for. Mark g. samsung will be winning either way. Their new Mobile Division and display division and tips Decision Division from apple. The newpeople will like curved glass and stainless steel that apple is coming out with. You saw the iphone 6 a few years ago and the iphone 5 before that. People really want to focus on that new design so i think they will like it. Mark what matters most . You are a buyer of apple products. What is the three most important things when it comes to your phone . General,for a phone in people like battery life, software, and the screen. In terms of software and services, apple pretty has it pretty much has it nailed down. Some of their services really keep me and others locked in so even if there is one day where someone wants switch to android, they will steer soon realize there lou bubbles and i message will go away blue bubbles and i message will go away. Life, i do notry expect a big improvement. Inually when apple tries to th out a phone the goal is to retain the previous years battery life. Will be a big improvement over the current lcd models. , the price word, and china, what about cheap accommodation competition . Jeremy i dont think china is a since theyto apple are looking at the higher end versus market share. Apple basically keeps the same base price for the iphone but there will be three models this year for the first time so i would not be surprised if the two lower end come in at the current price and the upper model comes in a little higher than that. Mark mark gurnan live in san francisco, thank you. Vonnie we will hear from irish finance minister Michael Noonan on why the irish matter so much in brexit. That is a 11 40 a. M. New york time, 4 40 p. M. London time. This is bloomberg. Live from bloomberg World Headquarters in new york, imf vonnie quinn. I am vonnie quinn. Mark i am mark barton. Time for the Bloomberg Business flash, some of the biggest business stories in the news. A dubious distinction for goldman sachs, posting the smallest increase in fixed income trading. Revenue from bonds trading up 1 . Their First Quarter earnings and revenue missed estimates. Atlantia is exploring a takeover of spanish told giant a burtis and could create one of the worlds biggest highly operators. Shown interest in a possible deal. Anthonys garbage he says the data for the trumpet anthony scarlet mucci says the data for the Trump Administration remains unclear. I am unemployed. The good news is, i am not homeless. I still have an office at guy bridge and the deal will close sky bridge and the deal will close in five to six weeks. He hadedia reports said been named an advisor to the president. That is the latest Bloomberg Business flash for this hour. Take a look at where european equities are, minutes away from the end of the tuesday session. Today is the first proper day back. Look at the ftse, a big jump in sterling after Prime Minister may calls for a snap election. Hey youve gotta see this. Cmon. No. Alright, see you down there. Mmm, fine. Okay, what do we got . Okay, watch this. Do the thing we talked about. What do we say . Its going to be great. Watch. Remember what we were just saying . Go irish see that . Yes im gonna just go back to doing what i was doing. Find your awesome with the xfinity x1 voice remote. Mark live from london and new york this is the european close with vonnie quinn. Todayst i can say about if you are long european equities, the stoxx 600 was down the most since november 2. That is just one industry group. 9 percent. There is so much to tell you. Theresa may called for a snap election. Sterling dollar is the white line raking through its 200 Day Moving Average. Its breaking through the range it has been since october. Today, its rising for the sixth day in seven. Its the highest since december 5 last year. Ahead of the statement, it was down by. 4 . Pointsty is roughly 20 ahead of the labour party. Thats giving her a chance to consolidate her party going into talks to you leave the eu. Yield did fall below 1 for the First Time Since i over. It did postbrexit. Lower 50 basis points because of the strength and sterling. Nationals,e for the as you can see, its down. The third line is the blue line. Thats the ftse. Its down today. It has moved since frexit was 11 . Todays move, 2. 2 . Brexite latest since the vote. We had a record vote on march 20. We had a record on the 250 that has been a tear lately. It was just a matter of days ago. These are the indices that plummeted post the brexit vote during a have come back. The economy has benefited by Consumer Services and weak sterling. Anxiety, it can be measured by bank of america and merrill lynch. This is their stress index. Keep an eye on this. There are geopolitical concerns pushing the gauge of anxiety for global asset classes. Once important about this chart inthe peak reached the peak february, which rebounded from the lowland march. We are nowhere near the levels we were in november. Devaluation, what a wonderful wonderful chart. How is looking there. Vonnie we are below the 100 dollar mark. This will be right before Donald Trumps comments about preferring a weaker dollar. It doesnt look like were going anywhere. The yen is definitely one of them that is strengthening. I have to point out the current in the us. We have the tape 10 year yield at 220. It was a break of key levels. The 30 year is at 286. We have look at gmm and little bit. Mark earlier today, theresa may called for a surprise snap election. Everyone in british politics reacted. I have just chaired a meeting with the cabinet where we agreed that the government should call a general election to be held on the eighth of june. I welcome the opportunity for us to put the case to the people of britain to stand up against this government and its failed economic agenda which is less our nhs and problems in our schools underfunded and people underserved. We will put a case out there for the people of written. We won a society that cares for all and an economy that works for all and of rights it that works for all. This is the issue turn in recent history. Its a decision she has made the interest of her own party, none the interest of the country. She sees the opportunity given labors total disarray to crush her opposition and get rid of anybody that disagrees with her and give yourself a free hand to move the country in a direction. This gives britain the chance to change the direction and an opportunity to vote against a hard brexit. I think the majority of people are opposed to that. We want to make sure that written has a decent opposition. This is the lower lowest level since february. One of the big questions, how will this affect brexit talks. Thank you for joining us. A massive gamble or a shrewd move . Charles it seems people think this is a clever move. Labor is 20 points behind the polls. She is personally popular. The u. K. Electorate is not particularly fond of snap elections. It may come across a strange since she ruled out a step election. Most people assume and i agree that it is likely she wins this election and pulls it off and gets a good mandate to start her brexit negotiations from september. There is the possibility this doesnt quite go as she hopes it does. A vote fortimately or against hard brexit western mark Many Conservative Party people voted to remain. Is that not in itself complicating matters for the Prime Minister . Charles for the next few days when she has to agree with her own party what their manifest is. This is the brexit general election where we are supposed to give the Prime Minister her mandate to negotiate what seems to be a hard brexit. Perhaps some transitional measures, but a hard exit eventually. There are different views on what this should be. If you look at how the country or the political map works in the uks geography, it does seem likely most constituencies that voted tory will approve of this hard brexit. There isnt much of a risk as far as the election is concerned. Over the next few days, she does have to get her party to the manifesto. She has to have people who dont want to talk about the half soft half hard brexit. They just want to leave. Vonnie there are several different scenarios where it might be a 100 when. Give us one or two of those. The markets are happy. It seems like she is not going to lose this one. Charles a sort a scenario where she doesnt hold off . Vonnie that does not look attractive for her. Charles i think most people are focused on the liberal democrats did they are the thirdparty historically that doesnt have much of a presence in parliament anymore. Theyve taken the clear line against brexit. In 2015, the conservative party took a lot of their seats in the suburbs of london and the south west. I think they will want to put all their efforts into the seats to take them back since many remain. That means that from the current majority of about 10 or 11 that the tories have, they have a deficit. They have to make up that deficit and gain seats in labor seats. Here are many of them i think its more of an effort to people consider. There is a huge gap between theresa may and Jeremy Corbyn. Vonnie how does this change the equation at the europe level . Charles the europeans will be disconcerted by this. That once article 50 was triggered, they were in control of the timing. Formally, that is the case. They decide on when the negotiations will take place. They will talk about the future relationship. That is a european decision. They have control over the timing of the end. Even if the u. K. The law prolongs the negotiations, it is an eu negotiation. Wille is reelected, she have the endorsement of her own people and wont be conserved about the timetable. If she makes some mistakes or if there are problems with how the u. K. Exits, she is not worried about her reelection because the election wont take place when youre after brexit, but three years later in 2022. Isnt the main motivators domestic politics. Its timing in the negotiations. Mark what does do is crowds out the political calendar. We have had the netherlands, the u. K. Election now possibly, in five years time, germany, france, maybe italy. They are having elections in the same year. In, in 112 u. S. Time, what does that mean . What does that mean . Charles does it say anything about the direction of the politics . It is true that the institutions that most western democracies have are not satisfactory. Exceed the expectations of public opinion. As these get expressed, one of the best way to release this energy is the whole elections or often. French election happens to take place every five years, the german every four and five years. U. K. , we have a lot of referendums and a lot of elections in quick succession. That mustve something new with the frustration people have with the institutions and the way they work. We will speak to very much in the next weeks. Mark thank you very much. Lets check in on the first word news. Emma chandra has the latest. Emma President Trump is taking aim at Tech Companies bringing thousands of Foreign Workers to the u. S. He is ordering a review of h1b be. The h1b program will be criticized for allowing American Workers to ruby replaced by lower paid foreigners. Vice president mike delivered another warning to north korea. Vice president mike delivered another warning to north korea. The u. S. Vice president mike pence delivered another warning to north korea today. All options are on the table. Trump will work closely with japan and south koreakorea and all of our allien the region. President trump will work with all of our allies in the region. Emma he says washington would rather have multisited negotiations. In france, police of thwarted a terror attack. Days before the first round of the residential election. Two men have been arrested in marseille. Both the french turned to radical islam in prison. No details were given about potential targets. A fugitive indian tycoon in london has been arrested. Ofbanks have accused him defaulting on 1. 4 billion in debt accumulated by his airline. He left india a year ago. They have had to try the try to have him extradited. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries, this is bloomberg. Financeirelands minister joins us. We will get his take on the call for a snap general election. There are some votes on an evolving irish banking industry. This is bloomberg. Mark live from london and new york, i am mark artan. Vonnie this is the european close on bloomberg markets. Political headlines keep coming. We had the perfect one today. We are joined by the irish finance minister. Thank you for joining us. We have to get your reaction to the snap election called i theresa may. Earlieree years old than they are supposed to happen. There was a lot of speculation she would call an early election. Once article 50 to take the u. K. Out of the eu was triggered, we thought we settled into a long negotiation. Everybody is surprised this morning. Vonnie surprised and whats the follow . What position does this put you in . Its a obviously, british decision. We speculate as to why she took it. I presume she was to strengthen her negotiating hand after article 50 wound its way through the house of commons and the house of lords. She did not have a very dependable majority. Endorsementreater before the negotiations. Is ae opinion polls, she favorite to win. Vonnie she gets stronger backing in the house of commons. Does that make it more likely that brexit will turn out to be a harder brexit western mark michael its not clear. It gives the Prime Minister more authority if she wins the election. Reaches her the right to out to her cabinet. She puts a team in place. It will be her team rather than a team that she inherited from the referendum results. Certainly, it will firm up her negotiating position. Theprinciples of negotiations have been set out. The principles of the european position were set out. There is a meeting on the 29th of april. Willin brussels where they give the detail of the negotiating positions from the european point of view. Vonnie you have had four hours since you made the announcement. What conversations have you had about it . We have had some contact with dublin. We have had some contact with her department of foreign affairs. I have some officials with me. We dont think it affects our position very much. As you may recall, there were Assembly Elections in northern ireland. A newave yet resulted in administration in belfast. On, between going the negotiation parties, i think its more difficult to achieve a joint administration. Northern irish. It may have a consequence there. Vonnie how about sequencing when it comes to brexit. Effect have an adverse on if the divorce bill comes first . Michael the original positions are deadlocked. Was divorced person settlement later. The british position was to have them in parallel. Money owed by the u. K. Would have to be paid up front. The u. K. Position was lets settle everything first and we will talk about the bill later. Those positions have softened anyway. From missesm mays position, there is an indication of a compromise. Some issues would be dealt with in parallel with the primary negotiation. Vonnie there are informal negotiations being formed. Hollins Prime Minister has invited the irish Prime Minister and the representatives from denmark to speak friday. Are these informal coalitions supported by the European Union . Michael there are 28 countries involved. The three to which you refer including ireland, trade will be a strong concentration. May ally on the trade negotiations. If you look at estonia and lithuania and poland and bulgaria and romania, security is their primary consideration. There is no suggestion that the british position in nato would be affected, they will be very conscious of their eastern border with russia and they would develop longstanding friendships with the u. K. On that asus. Scandinavia is funded out of the city of london and through the city of london. They share a finance minister. They would have concerns about any importance of the city of london as a source of capital for the scandinavian economies. There are a range of possible groupings of countries around specific issues. Negotiationshe proceed, the open position is very clear. At theremainders are European Union set of the table and the u. K. Is not. Vonnie could there be different types of agreements when it comes to different matters so that if the Eastern European countries have more say in the portion about security and scandinavia more on the portion about banking. Do you see it happening that way . Michael i dont envision it happening this way. On specific issues, if the british authorities are looking for friends, there is a different set of friends around different issues. Vonnie i understand. Talk to us a little bit about the irish Banking Sector. We are awaiting your go ahead for the ipo. That may be the biggest ipo in london this year. We are getting perilously close to may. Michael the irish Banking Sector is quite strong. The banks are well capitalized and profitable. Serving and expanding economy. All of the banks in ireland are in a pretty good position. Vonnie we know all this. Are you michael there is no change. May or june is the first window. Vonnie will you announce for may or june . Michael it depends on the advice i get. We have not decided an actual date yet. Thate it sounds like first window of opportunity is closing. You have to make agreements with the exchange. When with the next window be . Michael around midmay i think. That is four weeks down the road. Vonnie what are you getting advice wise about pricing . Michael im not going to get into any of this about pricing. There is no pressure from the irish authorities. We can recover the maximum amount for the irish taxpayer. We dont have to sell to reduce debt or anything. Its too early to say. That is something i would have to think about and concern with our advises on. Vonnie we have to consult with the clock and leave it there. Thank you. This is bloomberg markets. Mark what a day. Theresa may called for a snap election. Parliament will vote on that tomorrow. On junehave an election 8. Because of the pound rallying, look at that, sterling is a. I will leave you with the bond order on a historic day here in the u. K. Bloomberg markets continues. This is bloomberg. Vonnie it is noon in new york. I am vonnie quinn. Welcome to bloomberg markets. From bloomberg World Headquarters in new york city, we will take you from san jose to washington dc and to shanghai in the next hour. These of the top stories. Bank is stunning wall street with a shortfall in bond trading revenue. Competitors gained momentum. A possible tie up between them. The largest retailer is in talks to buy the Mens Clothing started. It could boost their online cachet. We will talk more about ecommerce. We are halfway into the trading day. There are a lot of political headlines. Jie
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