The canadian winds and fires seem to ebb. Everybody is concerned about the output and the supply glut. But now, oil is back up. 4 . Peso. S the philippine it is currently higher, versus the u. S. Dollar after we saw the antiestablishment winner in the pack when it comes to the next president and the philippines. Of course, lets get to our bloomberg first world. Reporter thanks Credit Suisse has recorded a second consecutive loss. Of 302ported a net loss million swiss francs. Have predicted a loss of 344 million francs. That comes after a to motorist comes after a tumultuous start to the year. Chinas Consumer Prices continue to rise at a healthy pace in april, but still below the target rate of the government. The inflation gain of 2. 3 was driven by good prices, giving the pboc reason to hold back on another rate reduction. Meanwhile, the Producer Price index narrowed more than expected last month. Fighting poverty will be his top priority as he claims victory in the philippines. His platform included a zero tolerance approach to crime and corruption. His failed to damage appeal, capturing about 34 of the vote. Global news 24 hours a day, powered by 2400 journalists in more than 150 news bureaus around the world. You can find more stories on the bloomberg at top. Thank you very much indeed. Qualities to the space. A trading frenzy in china. Daily turnover on chinas futures market has jumped to the equivalent of 183 billion. Investors are starting to pull back a little bit after authorities introduced trading curves. Lets get the details now with alexander, who joins us out of singapore. Right. Er yes, that is you are seeing the market is losing some of that froth in china that had amassed over the past couple months. As you said, over march and april Trading Volume jumped to a peak of 280 billion in a single day across the three chines e commodity exchanges. Rally divorced from reality. Speculation about chinese Economic Stabilization and boostside reforms had speculations that there would be some constraints on supplies of raw materials. By its and turned into an allout trading frenzy, money pouring into commodities. Quellgulator has moved to speculation over the rate fees and rate margins. The margins the volumes are half of what they were at the start. Caroline this seems to be coming from the retail investor. This area seems to be piling ina out of the market. Alexander you dont have the same degree of reporting on positions as you do for example , in u. S. Commodities markets. The by looking at trading hours, you can estimate that the average contract in china, the average commodities contract was held for the matter of a few hours. The is compared for about 40 hours with wti or nymex. These are shortterm investors coming in and out of the market in a single day, leaving the market at the end of the day. So yes, it is shortterm speculation. Morgan stanley thinks about 60 or 6 of the money is speculative, as opposed to hedging, for example. Guy alexander, thank you very m uch indeed. An amazing roller coaster for the Mining Sector and some of these commodities there in singapore. Let me see if i c can show you what is going on with the mining stocks down under. They have taken quite a beating. An of these stocks trade on the ftse exchange. As a result, we have bhp down nearly 3. 5 . They firmed a little bit down to the close. Lets bring in the head of investments. Bhp stock down today. It looks like the store it in china, in terms of the Commodity Prices turning south aggressively, are we heading back to january lows . I would say it is quite possible. We have seen a decent rally, which is why we saw that number delivered from china that was dumb a not as bad. Have alarger picture, we supply side issue. People are not demanding money. So if you come back with the see thing, you are going to not much growth happen. Then you will see miners and Everything Else with lower value. Dont see a cyclical output in mining stocks. Caroline manish, do you feel we will see more chinese stimulus . Good morning. Today, prices were showing a little bit of stabilization. I think cpi actually picked up. Where do you sit on the future of china . I said the inflation number was encouraging, at the sense that it came in at 2. 6 , the same as last month and lower than what people were expecting. We wil sl see what the pboc does. The second point about bpi, we had seen that ease a bit. That takes into account that china will not be overly concerned about deflation. It leaves the door open for them to have stimulus, or have more monetary policies. I would be positive on that front. But again, if you look at the last meeting they had last friday, that says a lot about their decision. They want to ensure fiscal prudence as well. I think china will continue to see growth. So, there is a chance they will be more stimulus. Guy manish will stay with us. Up next eastyjet posted a loss. Usolyn mccal will be with and we discussed the possible impact of brexit on european travel. Guy welcome back. 41 minutes after the hour. 19 minutes until the market opens. Easyjet posted a loss of 24 Million Pounds. The loss is a little bit less than was expected. Easyjets chief executive is carolyn mccall, who joins us now. Dividendsu raising when life looks as tough as it does right now . Carolyn mccall good question. I think we have done a very rigorous Balance Sheet review. We do that on an annual basis and we have enough cash to do this. We would not be raising our ordinary dividend to 50 if we did not believe any longterm success of this airline. It really does underline the confidence we have in our growth prospects, ongoing. We can do this. It is the right thing for now. We have returned over one billion pounds to shareholders since 2011. We have done a couple specials a now raised it to 50 . It is the right thing to do. Guy capacity, lets talk a little bit about that. I look at you, i look at rynair. The amount of capacity in europe right now is eye watering. How you cope with this, and keep yields up . The capacityll environment is being driven by the airlines. Easyjet is growing at 7 to 8 a year. We believe that is the right amount of growth to take advantage of the opportunities we have. We are growing still organically, but there is still a lot to do. We still only have 9 of european of the european market. So, there is a lot more space for us to grow and we are doing that in a very organic way. You know, you are right. It is a very tough environment. But it is not capacity that is making it tough. Yes, it is a little bit higher, but it is not completely out of sync. If you look at our 24 Million Pounds of losses as this year, we are coming in about the same of last year at 5 Million Pounds in profit. Brussels, we and have been able to do very well in the first half. And that shows our customers like us. We are doing the right things for our customers. We are very focused on our passengers, but also we have a very resilient Business Model. It is the Business Model really in arlines that make the difference in europe. We are about profitable growth and strong returns to shareholders. Caroline but your revenue has fallen in the first half. The revenue per seat, that is. Will discontinue into the second half of the year . In somemccall sense, this is a reflection of the tragic events in brussels. This would be the same for all airlines. Prices are about 6 lower for us, which is great news to consumers. That is a combination of slightly more capacity in the market regarding the fuels. That benefits the passengers. Fact also an effect of the that the man goes down whenever you have a big event, or events we have seen that are external. You suppressed demand. Demand does not come back immediately. It takes quite a long time to come back. Caroline is a coming back . Is it coming back . Carolyn mccall we did nearly a 90 load factor for this year, which was the same last year when we did not have those external events. Your point is absolutely right, though. It is the pricing. You have to stimulate the demand for passengers to come back and fly. Of course, they want to return to normality as well. It is the pricing that consumers will really benefit from this summer. Guy how does it work, carolyn . With every attack, does the effect become bigger . Or is it the same . We have had two fairly big terrorist events in recent memory. How does the dynamic work when you look at how Consumer Behavior develops after it. Was a bigger after the first one . Does it depend on the type of attack . I am just find it get a sense of how it is modeled. Carolyn mccall it is a very difficult thing to completely model. What you can say for sure is, regardless of the terrorist event, demand always comes back. People return to normality. People do start flying again. And we have seen that with both of the tragic events that have happened this year. And i think that is what we have seen in the past. We have seen that post every big event that has happened. You see that it takes a little bit of time. People are a little bit more cautious when they start flying again. I would say the volumes there no w what is not the same as last year is the pricing. Guy you think pricing would go up in the event of a brexit. Talk to me again about how that would affect demand. Carolyn mccall well, the point there really is because of european deregulation, we have the freedom to fly across europe without any restrictions. It is very easy, very simple. There is no administrative complexity around that. So, fairs have actually gone down because that gave birth to the low fed airlines regulation, that the regulation. That deregulation routes have gone up about 80 , which is very important. Europe has opened up. Places where people never thought they would be able to fly to, now they are able to do that. Nice for passengers to be a part of that aviation agreement. That has brought fairs down. We believe that certainty and stability is very important to aviation and it has brought a lot of consumer benefits. And we just based our view on that. We absolutely recognize that people of different views about the issue of europe. Caroline carolyn mccall, chief executive of easyjet, wonderful to speak with you today. Keeping it here. We will be speaking to the emmeretts chief executive. Do stay tuned. Guy eight minutes to the market open. Move. Watching countdowon the reporter were seeing a bit of a mixed picture across asia today. Investors in japan had something to smile about with the nikkei up about 2 today, rising the most in a couple weeks. We are talking about a week or aker yen helping that. Also, a similar story for the korean currency, which is one of the biggest losers today. Gaining. 8 , as those investors are getting a boost. Risinglippine peso is march. Ost since duterte claimed victory in the president ial race. We have only a few minutes left in the shanghai composite before the close there. It is currently down. 2 and that is of course, after inflation data came in line with estimates. The hang seng remains unchanged at the moment, but chinese stocks in hong kong are now headed for their longest losing streak this year, down. 1 . But we saw a decline of more than 1 earlier today. That is but we are seeing across markets in asia. Caroline thank you very much. Seven Straight Days of losses on that hong kong enterprise. Lets have a look at what we are building up to with the european open. The biggest steelmaker in europe, and based right here in germany, it looks like a good fall at the open. It said, they would see 1. 4 billion euros. The estimate was previously 1. 6 billion euros. Clearly, the glut coming from china, in terms of steel pushing down on the overall environment is hurting the environment, hurting the biggest steelmaker there, which is thyssenkrupp. Investors could push this stock higher 1 to to presen 2 . We are also seeing the fact that the capital is looking better than previously estimated and the costs are coming down, guy. Guy lets pick up on that point. Manish, you still with us, sitting patiently through our programming this morning. Reason why you would even consider purchasing this. Because it is so cheap . For do you think then it could be a value trap . Have a concern about a big downside, but i dont see a big upside. It could be a trap. Also, look at where we are looking. What worries me about some of , they have to sell off. Second, if you look at the eu perspective on recovery, there is going to be a bail out. That is the cost of doing banking in europe. ,hen you dont have gdp growth it does not make you very positive about the open banks. And it is all about csots. All about costs. All the open banks have to control costs. To be theseems metric by which the market is judging it. I think yes, the is were the focus is. Masinish is going to stay with us. This morning it looks like a fairly positive scenario. London looks like it will open. 5 . Be aax look like it will standout, but it looks like we will see a fairly positive performance. If you want to follow along at home, just click the futures box. The market open, next. [ soft music ] e. T. Phone home. When you find something you love, you can never get enough of it. Change the way you experience tv with xfinity x1. Shoah, ha ha. Ew artist. Show me top male artist. My whole belieber fan group. Its not a competition, but if it was i won. Xfinity x1 lets you access the greatest library of Billboard Music awards moments, simply by using your voice. The Billboard Music awards, live sunday may 22nd, 8 5 pacific, only on abc. Guy good morning and welcome. You are watching on the move, right here in london alongside Caroline Hyde in berlin. We are moments away from the start of european trading, and carolyn has the morning brief. Caroline its cut, cut, cut. Credit suisse is restructuring its restructuring as exhilarating as restructuring. It says q2 is looking tough. Easyjet revenue comes in below estimates. The lowcost carrier is wellplaced to grow this year, they say. And miners in a hole down under. Shares of slide in sydney as futures drop a crush asia. Across asia. Are we heading back to the january low . Lets check it out where the futures are trading ahead of the market open. Were in the green across the got five seconds until the market open keep an eye on steelmakers, downgrading its forecast for profitability. Looks like it could see a bump in Credit Suisse. We saw that bank posting a smaller loss than expected, and those cost cuts in the banking unit are starting to help. Very change has the breakdown. Nejra thanks, caroline. We saw european stocks gain yesterday, shrugging off that data from china. Were seeing gains again today; the stoxx 600 up 3 10 of 1 , ftse u 6 10 of 1 p, looks like the dax moving higher as well. So much Corporate News to get through today; lets go straight to it. We start of course with Credit Suisse. What we saw here was a second consecutive quarterly loss; it has been a tunnel to a start to the year for the ceo, which prompted him to deepen cost cuts at the security business. This loss that we saw here did actually beat, because it was a loss of 302 million swiss francs predictions. Ts Credit Suisse actually moving higher, because that number was a beat. Ing as well looks like it is moving higher, up almost 1. 5 . It is a firstquarter profit declined 29 ; this is all glowing regulatory expenses and weakness in its Financial Market division. The net income, although it dropped to 1. 2 6 billion euros, was a beat. Perhaps where we are seeing that move higher. Uenech, it cut its fouryear profit target. This was previously in the range billion to 2. 8 billion. Ensures have been coming under pressure because of low Interest Rates. Lets switch of the board and look at germanys biggest steelmaker. It has cut its profit forecast because the industry has been having to contend with a glut brought on by record chinese exports of steel, but the fiscal Second Quarter profit did Beat Estimates. Still waiting for that to open. Lets move on to nokia, down 1. 6 as revenue missed estimates in its first Quarterly Report as a combined company. It was hurt by phone carriers cutting spending. Finally and briefly, easyjets first half loss is at a pretax loss of 24 Million Pounds, but analysts had expected a bigger loss, which is perhaps why we are seeing the stock move higher. Guy . Guy thank you. Nejra. Interesting stuff this morning. The miners in london are higher, despite been getting pummeled in australia trading. One of the big standout stories this morning, Credit Suisse posting a lost, the ceo telling Francine Lacqua that the banks difficulties are likely to persist in the costcutting will continue. Here is speaking about the volatility he sees ahead. There was a time in january, february where there was very much. March was better. April was better than march. May had some positive signs. Its always difficult when you are in that position. We still remain cautious, because it feels fragile. Sentiment feels fragile. Francine less than what you were expecting . Reluctant to make a prediction. I am hoping that the market has enough liquidity. We have to see. Francine what would be easier to make money would it be easier to make money . Not necessarily. There is clearly an improvement from january, february. It seems like the ipo pipeline is strong, the same pipeline is quite strong there are spots where we see strength, but there are also areas where we see volatility around global growth, growth in china, u. S. Numbers. Francine on the job cuts 6000 job cuts this year. Euro target . That was the target. We have done 3500. At the end of the First Quarter. We had the target of 1. 4 billion from 2015 of net savings. We believe we have already done more than half. Were confident we will be the target before the end of the year. Alwayssent topic, im sorry to have to talk about job losses, but it is a price we have to pay to create the platform we want for the future. We dont believe in the boom and bust model we have great years and terrible years. To be successful, we need a Strong Capital base. We need relatively stable income streams. Too volatile. And something we dont talk about enough, good compliance. Healthy growth. We can protect the reputation of the bank, our most precious asset, the trust of our shareholders. We really think about serving our clients and making sure they are happy. One quick example i always talk about the private Investment Bank relationship. We need 4. 2 billion in asia. One billion will be reference. People who know Investment Bankers, and said, went you talked our private bankers . We really believe in that model. We believe the numbers show it works. The potential longterm is huge for stable, high quality earnings. Caroline currently, Credit Suisses see if i was on the line. Line. Was on the he has been talking to investors, and if you want to track that go to our top life. You can see all the nittygritty on the breaking down of Credit Suisses earnings. To give even more, we go live to Francine Lacqua. You have been speaking to the man himself, the chief executive. Shares popping the most in the month. They seem to like what he has to say in terms of cost cuts. Francine yeah. I guess its a little bit of relief after a tough january and march, where he had to take more cuts to the Investment Bank. Today, that loss is not as big as expected. This is what a lot of analysts and investors are liking. He seems to be quite prudent, certainly in terms of market volatility. He says, look, we are not over the worst you. The worst yet. Everything he says he has put in place is on track. He has only been on the job for about 10 months, when he unveiled this huge, huge strategy overhaul back in november, also raising capital. It seems like the main points of regulation, the litigation capital cost cuts, and job losses, he announced those targets and they are all now in line. That is what he says. Guy thank you very much. Francine lacqua joining us out of zurich. Stock trade higher this morning, breaking it down it has suffered. The whole sector in switzerland has been under pressure. Saying, toughs times. Lets bring back the head of investment. Were hearing it from cs and ubs and a whole bunch of banks. Q1. Very tough that banks talk about the fact that transactions are done. They talk about the market being paralyzed, clients dont want to transact. What is it going to take to get the clients activity back up again . That seems pivotal. I think it is about growth. If you dont get real gdp growth, you wont get that up. If you look at the numbers, if you compare that to u. S. Banks, its different you have a massive risk aversion still going on. You can talk about brexit in u. K. , u. S. Elections in the u. S. Risk aversion is staying. There is not an animal spirit to buy things. I think it is all down to how the government what they are looking to do. Weve come back to this annual ritual of running out of money and finance ministers having an emergency meeting. The fact is that if you dont have any kind of debt, you wont get that money back. It lets it grow and live, in it is going to be good. How does that change . Does 2016 look like the reverse of 2015 . Does it finish better . We get past the brexit referendum one way or the other; we may even get past greece, the u. S. Election. At that point, do we have a visibility you know what, actually, with a bit of clarity, i can start getting back, i can put my toes in the water . Sure. I think we will look to the u. S. Take the lead. I believe when president clinton calls or cabinet, i think she will win. Then you will have a fiscal expansion. I strongly believe she will run a high deficit, increase the taxes as well. Inference be a narrow of those who have been saying for a long time that this issue needs a fiscal response. Things that were extraordinary five years ago, negative Interest Rates and fiscal moves, which are now coming under ratings, i think the u. S. Election will be that trigger. If democrats come, it will change things for everyone. And lets not forget that china has the play an important part. Youre not going to get massive growth in the west; it will come from emerging markets. There has to be some form of feeling, and if i may mention one more point, look at the situation in the u. S. 1. 1 trillion of student debt something has to be done. Students are going to buy houses, they arent going to put down mortgages. There needs to be response from congress, not from the fed. That is where we are heading. Guy you sound remarkably like Neel Kashkari, talking about how the market is relying on the economy. It has been a great pleasure speaking this moment. Havent seen enough of you. Now lets talk about the Airline Sector once again. We have arctic talked to karen mccall at easyjet,. And now we will move on emirates is reporting a fouryear profit up. We are joined now by manus cranny, and he is joined by mr. Tim clark. Much. Guy, thank you very youre right, a great set of numbers. Welcome to bloomberg. The pace of growth. Profits up 64 . Is this rate of growth sustainable . In our opinion, yes. There are headwinds in the Global Market for the moment, but we continue to have the plans. We are dealing with flatlining in the summer market, as we have done many times in the past. We face these Economic Issues that we will continue to grow as we have planned and take on another aircraft this year. Manus the next phase of growth this is what i want to put forward is it latin america . Is it those areas, the transpacific route . Is that where we can expect you to break new ground . I think the letter, you need a path for funding. The asian markets, although there are headwinds in places like china, were seeing a lot of the business moving out of china and it to places like vietnam. That is why we are putting one in hanoi. For myanmar asp from ja well. The leisure markets are growing quickly. We have been successful with bali. As the corporate segments diminish, we are seeing a growth in the highend, highyield religious segments. This will result in a yield dilution, but not as bad as if we didnt do anything. This isield dilution they are talking about overcapacity. That yield dilution has that pressure. Do we expect more pressure on you, and are you seeing from your perspective overcapacity . I think an answer to the first question, the yield will continue to be strong. Were seeing that in many places. But were denominated in u. S. Dollars, and anytime the dollar strengthens, we face the problem, but we have done it many times. As far as overcapacity is concerned, that is a view held by many carriers in the world today. We dont share that view. Manus why not . Because our Network Bring strength. We have 150 cities in our network and we are growing on th all the time dubai, ahub we havent super connector, we can move business around. That is the beauty. We arent concentrated on the north atlantic; we arent concentrated in south america; not on the middle east or north africa. We are a very diverse, very will spread operation. Manus there is push back. There is push back. Manus and the eu. Thats going to be a real challenge. I dont think so. Look at the american situation as an example. They started a campaign against the gulf carriers in january 15. Now in the middle of may, what has actually been achieved . We have increased our protection by son percentage into the u. S. ; we got into orlando. We are increasing on the west coast, we doubled seattle, we increased in new york, and we have more coming. Manus is there a risk that they may push back more . Point outching a where that pushback will kick in . If the track record so far is a measure, the answer is probably no. I think sense has prevailed. There are too many entities in the United States to support the gulf carriers particularly emirates. All the other people who have, as a result of this, stepped up and said this doesnt make any sense, we must let these people come in were seeing the same for your. For europe. Manus you are saying that you are repaying bonds. The question on everybodys mind is why are you doing that . Can you expect to raise more finance with so many new planes coming aboard . We have a very strong cash position. Im proud to say we built that from an internal cash flow. Were now in a position to repay the bonds in june. At the moment, we do not see a need for further liquidity instruments. Well beat happens, out of the market as we have done before, and we have all been extremely good investments. If you want to put money jolly good yield. You could get 1 of the bank. I assure you, you will get a very good deal. Manus there is a great line in your report you talk about oil prices. I get it. 28 is inextricably linked from the cost base. Revenue differs ever so slightly. That revenue dip in oil price is an extremely linked. How concerned are you . Well, clearly, the oil price today has had an effect on the wealth generation, the economic multiplier of what goes on, the planet facing new issues. It is a paradox, because the client we have had so many years how utility prices, power into homes, for the first time we had a major collapse and oil goes upside down. You would have thought that they would be a push in regard to the global economy, with low Interest Rates and power utility. We have also to things, all suggesting that we should be moving ahead, but we are not in many areas. This isaradox of all of that the price of oil is a collapse for the industry. You dont see the margins quite growing up the pace he would have thought, and that is because a lot of the segments to do with oil and gas and the supply chain, which is a very traveled group of people, has diminished. They are very highyielding. We have to deal with that; yield comes as a result of that. Manus the a350 and the green line or. R. You will hopefully make a decision. What is it that make you turn that key . Are you concerned about the a350 . No. I think they have issues at the moment, and i am sure their bus are dealing with that sure airbus is dealing with that. We will need the airplanes until the back end of the decade, and they should have made a production line instead of producing 10, 15, 20 month. Manus how many will you get . That is up for grabs at the moment. Manus [laughter] i am looking at any number above 50. Not only to populate what we do at this current airport, but when the new airport comes in, well be in a division to fly more. Manus to close, are you all in for another five years . Are you taking this brand forward . Thats for me to know and you to guess. Manus very well played. Thank you very much for taking the time. Were part of the region, and we look forward to speaking to you often. Good to see you. Manus there you go. A full and frank appraisal of the situation on bond repayments and the oil market; the global perspective. Goodbye for mr. Clark and back to you. Guy manus cranny, please send my regards. Thank you very much. Great to hear from him; looking forward to see exactly what he does with so many of those the questions. Manus cranny, talking to mr. Tim clark, the man who has really pushed emirate forward. Lets talk about what happens at the markets this morning. It has been fascinating, i think we will talk about cs in a moment, but the mining stocks are on the front foot. If you look to australia overnight and the stock prices and the fact that the mining stocks are being crushed, then you look at this mornings action in london. Glencore5 , bhp up 3 , up 2. 83 . Rio up. The mining stocks are very much on the front foot. Lets take a look at the stoxx 600 and show you whats happening here. Its interesting to see what is leading the charge, and it is Credit Suisse, mining stocks not far behind. Credit suisse 06 at the moment; next it is time, for our chart of the hour. It is all about the ball rally. We will talk about that next. Guy 24 minutes into the equity market session; welcome back. Chart of the hour heres nejra cehic. Nejra looking at emergingmarket stocks, the yield, the earnings yield, versus the yield on emergingmarket junk bonds. What this shows some are saying this is evidence that the bull market rally in emergingmarket stocks hasnt been extensive because the has risen tods the highest since november, 2014 relative to junk bond yield. Guy they are widening. Nejra exactly. Guy usually they are correlated. Nejra precisely. It means investors are getting a bigger return. What is behind that divergence is one analyst increasing projection for companiey earning and highyield debt. I spoke to strategist last week who said they are positive on dollar denominated emerging market sovereign debt because of the decline of the u. S. Dollar. Of course, some of those conditions dont hold. Manus absolutely. Caroline you give us a sense is this really what this chart is painting . Nejra thats its interesting. The chart is saying, look, ball really could continue, to what we have seen is that it really softened this month. There are specific reasons for that; in china, we saw the biggest twoday loss because of that traded we got earlier this week. In brazil, we have seen the markets fall on the uncertainty around dilma rousseff. But also its been about the rebound we have seen in the dollar so far this month, causing some repricing. For example, the msci down 4. 5 and emergingmarket currencies have been falling. Msci currency index down 1. 8 this month; and this is again about a stronger dollar and weaker oil prices, among other things. Caroline thank you very much. Up next, we will speak exclusively to john b. Emerson. Hes walked across the street in berlin to our studio. Guy 30 minutes into the trading session. How are things shaping up . Miners up in london, down in australia. Lets take a look at the way markets are going. This is the picture; up around 1 . Dax up, cac up. A number of stock stories we need to focus on; one of those is Credit Suisse. The numbers out this morning seem to be pulling it up, what you have to be aware of the context of what you are looking at. Yes, we are getting a very nice pop, but let me show you the chart. The stock has been trending lower into these numbers. You saw what happened when we had the ubs figures come out, and that had a massive impact. Today, it could have been worse, the costcutting story is going to be absolutely front and center. Lets get into the top stock stories; nejra cehic has the details. Nejra thanks. Im starting with pandora, the biggest gainer on the stoxx 600 so far. This morning, the danish maker of charm bracelets and other jewelry raised its first order profits, that Beat Estimates on growth in asia. That said, Revenue Growth was 46 in the First Quarter, so it did decelerate from the pace it had in 2015. But shareholders seem to be focusing on the fact that it is raising those forecasts, and on the profit. Pandora up 7. 6 . Performersworst is the french bank expanding its u. S. Advisory business, posting a 30 drop in First Quarter profit, curbing revenue and its Investment Bank and Asset Management businesses. Cco it unclear as to why this was falling, because sales did Beat Estimates for this company. Its a l weather for the global company. It was First Quarter revenues that Beat Estimates, but what it did say that friends, its biggest market that france, its biggest market, is slowly recovering, pointing to weaker trade. Adecco down 2. 8 . The french recovery is not explosive, by continuous. But continuous. Caroline thank you. Lets dig into politics. Political uncertainty is growing aileth sides of htthe with the unexpected success of Donald Trumps campaign; and in europe, it is the eu referendum. Joining us now exclusively is a guest with a unique insight into the political uncertainty, the u. S. Ambassador to germany. Ambassador, thank you for joining us. Thank you so much. Caroline give us a sense. Facto trump hes de expected to be the nominee for the republicans. Are we going to see a warm reception when he comes to germany . Ill, i havent heard havent heard that they made the plans for what he will do or where he will go. I think theres a lot of concern in germany, and the concern is even broader than donald trump. Theres two out of the three remaining candidates for the presidency that seem to be rejecting the longheld bipartisan consensus on Foreign Policy thats really been a big, significant part of the United States in terms of the commitment to a strong nato, the commitment to the americaneuropean alliance, which has really been a foundational element of our Foreign Policy and oru problemsolving around the world. And the commitment international trade. I think there is some concern here in germany, and more broadly in europe, as they are watching the election. Iroline two out of 3 guess you are hinting that Hillary Clinton is potentially going to support the areas you are mentioning. Give us a sense of trade within europe, and how it has been affected by the global slowdown we are seeing. Sure, u. S. Growth is posting positive, but it is not as strong as it has been. China is causing concerns. Are we in an area where we will see global trade start to retrench . That would be a mistake if that were to happen. As you look at the United States and europe, you have literally the opportunity with the transatlantic trade and Investment Partnership initiative to create the largest freetrade zone in the world. Looking just at germany, for example, the United States is now germanys largest trading partner. Germany is americas largest trading partner in europe. There are well over 1 million people, either american or german citizens, who work for companies that are based in the other country. And really, a significant part of shared Economic Prosperity for both europe and the United States is really a function of trade. When you think about high unemployment in parts of the eurozone, particularly the southern tier, a freetrade zone like ttip would in fact be a stimulus package that is virtually cost free for the governments. Its something that i hope will continue to be discussed and continue to be negotiated as we go through to the end of the obama presidency. Guy good morning, mr. Ambassador, from london. There is a letter in the london times this morning from 13 former defense secretarys and secretaries of state in the United States, arguing against the brexit, warning on Security Fears for europe. My understanding was and correct me if i am wrong that nato was the prime piece of architecture for guaranteeing that security. Well, i think there are two prime pieces of architecture. Obviously nato, which is a military and political alliance, but you also have the eu and important economic relationship between europe and the United States. I happen to believe that one of aspects ofcurity National Security is a good, the economy and shared Economic Prosperity. John kerry talks about that all the time. I think president obama, when he was here in germany just earlier this month, or late last month, made very clear that it is very much in americas National Security interest that we have a strong europe, a strong eu, and that the eu will be much stronger with the u. K. In it. We want a strong u. K. In a strong eu. Guy with you say, therefore, are those two equal . If nato and the eu are equally important . Im not going to get into weighing and balancing. I would say they are both indispensable, how about that . Guy ok, find, indispensable. Lets talk a little bit, therefore, about what happens next. How much damage would there be to european security, were the u. K. To leave . There has been a lot made in the u. K. Over the last 24 hours about a significant shift in the security arrangements in europe, and as a result of which people are generally talking about conflict in europe and the concerns they have. Are we over blowing this . Well, i mean, look, the reality is that we dont know, really, what the impact would be. We dont know what the impact of an unwinding of u. K. From the eu would be. We do know it would be significant, and there are a lot of unknowns to that process, which is certainly not reassuring to markets. That it we do know is think we are all better off with a strong transatlantic alliance; we are all better off with a strong u. K. In the eu. Probably, i would imagine i havent read this letter part of what is motivating these National Security experts to come together in support of the remain campaign. Caroline mr. Ambassador, when the policymakers across the atlantic call you up, they want your advice on whats happening on this side of the atlantic, and even in the eurozone. What is their key concern at the moment . Will, i think well, i think right now, the concern is and you heard this and the president s speech there seems to be a lot of anxiety in europe. Can we handle the refugee crisis . Can we handle the eurozone . The greek financial crisis . Can we handle our efforts to protect our people against terrorists and terrorist attacks . Wereruth is that what trying to communicate is europe has faced many, many crises in the past, certainly the past 70 years, and has survived them and thrived, notwithstanding those crises, when it comes together and act positively. We are trying to encourage that, and i think the president s speech was very much a buck up speech to europe. In addition, ever since i have arrived, there has been a lot of concern expressed about the possibility of the United States shifting attention to asia, for message, and the strong he also delivered was that we are engaged in europe; we care about europe. The european relationship is incredibly important to the knitted states, and we have no intention of going away. Ambassador, can i ask one last question from london . Sure. Guy do you think the germans gave the u. K. A good enough deal give david to cameron enough to take back and say we are going to reform the eu . Im curious to know as to your personal point of view whether or not that deal could have been better. A well, that would require level of understanding of the nuances of politics within the u. K. That, in this post here, i dont really have the ability. I will say this i think it is a great priority of chancellor merkels that the u. K. Stay within the eu, and i know she worked very hard within the construct of the eu to try to develop something that would be helpful to minister cameron in terms of addressing this political situation. I know she is very, very supportive of him and of the u. K. Remaining in the eu. Caroline we will see how obamas words and merkels words affects the referendum coming up. You can find much more on the bloomberg terminal. Mr. Ambassador, thank you very much. John b. Emerson, the u. S. Ambassador to germany. Up next, Credit Suisse shares are up despite posting a second Straight Loss as the bank deepens cuts. We will hear from the ceo, who has been speaking to our very own Francine Lacqua. The best day for the stock in a month. Guy 44 minutes into the equity market session. Lets talk about whats going on. Heres the Bloomberg Business flash with shery ahn. Lower this morning after a cut in profits, to a minimum of 1. 4 billion euros. Thats compared with previous guidance of 1. 6 billion to 1. 9 billion. Germanys largest steel maker also adjusted earnings before interest and taxes. Earlier20 from a year to 326 million euros. That beat analyst estimates of 295. 6 million. The cfo told us how this deal glut is impacting the industry. Clearly, we need to see some price increases, that price increases to reach the 1. 6 or 1. 9 makeup 1 3 of what we need to get there, so its not only about price increases. Igher. Ing shares are hir the dutch lindner says the from aender said it slid year earlier. That beat the average analyst forecasts. Despite the drop in profits, the ceo insists that the company is committed to a dividend strategy. We aim to continue with it. Weve set aside the entirety of the profits for this quarter, to put that aside for dividends. We are fully committed to that dividend strategy, and the results have enabled us to meet it. Anecco has reported firstquarter revenue that beaded estimates that Beat Estimates, hiring the Worlds Largest provider of workers. 5. 30 3 billiono euros that beatthe billion that beat the average compiled by bloomberg. Nokia has posted sales that missed analyst estimates, hurt by phone carriers cutting spending. As it combines company, a First Quarter fail hit 9 below. Analysts had expected 5. 70 6 billion euros. It beyond global infrastructure. The company is betting on a deal to top into new york product like ip networks to fend off rivals, including ericsson. Thats your Bloomberg Business flash. Guy. Guy thank you, shery ahn. For the first time in years,rofits will exceed estimates according to data compiled by bloomberg. Sophia cost us joins us, who helped us compile the data. She joins us now. This is something that analysts have been waiting for for quite some time. Is it too early to get excited . Perhaps on. Not. The last time this happened, the s p gained an average of 5. 5 , and it is a leading bullish indicator. We all know that profits in the First Quarter werent bad, so analysts are focusing on guidance. Maybe taking the glass halffull approach it might be a time to do that. Its not just in the u. S. ; its also negativity is pulling back a bit from the world, from profits around the world. The number of cuts are almost equal to the estimates being raised, and that would be the first time in two years that happened. It seems that the tide is turning more on the other side. Caroline we are getting more optimistic. Perhaps is it that analysts were too pessimistic . How much of a bullish sign is this kenzie 2 , 5 , 10 . What are we expecting is the average . Well, it will returnss. Thats the kind of message but its not just that it became twopessimistic, its tht at important things changed in the First Quarter, one of them being oil and the other being the dollar. The dollar finally stopped rising and oil finally stopped falling. Two importantare factors, bearing in mind that they were due to oil prices being low, and suffering on that huge dollar rise we saw. So that changing is feeding into ceos guidances. The reason why this is optimistic, caroline, is because ceos in the u. S. They tend to guide lower. That is what theyre incentivized to do, so they can go in oon and Beat Estimates. We even saw that this morning, even though profits might be terrible. As long as you Beat Estimates, shareholders are happy. Caroline fascinating to see how the dollar plays into that, if and when we see a rate hike this year. Sophia, wonderful to have you on. Some bullish signals, finally, it would seem, within the earnings for. Lets get back to our top story. Credit suisse shares up after the bank posted a lost for the First Quarter that was smaller than expected. The chief executive told Francine Lacqua its been a difficult start to the year and that costcutting remains ongoing. We have done 3500. re 58 and the target, so we think thats progressing well. We have a target of 1. 4 billion for 2015 of that savings. We believe we have already done more than half of that. Were confident we will hit the target. Tidjan tiame. Up next , u. S. Rate hike probability has been pushed more out. Will it come to a rate pass . Guy you are watching on the move. Speaking yesterday in minneapolis, Neel Kashkari had some thoughts about the market. I think Market Participants are too focused on the fed, and im reluctant to draw even more attention to shortterm Monetary Policy decisions when attention should be focused on solutions to the longerterm issues. Guy so lets focus on the fed and lets focus on shortterm Monetary Policy as well, while were at it. Our first were strategist Richard Jones joins us. They are all trying to avoid talking about what we want to talk about, which is june. Think for both him and others yesterday, you are never going to get a fed official to come out and say june is off the table. But if you drill down into what they said, he said there is a lot more work to do on both pillars of their dual mandate. Nss key point for me was that its not necessarily a bad thing to have an overshoot. Guy or even a bit of inflation. Richard to me, its reminiscent of what we heard from janet yellen. In contrast, with what we have heard from others. Interesting to hear him say that everybody is to focus on the fed, but Central Banks are so important to whats going on across all the asset classes. It is hard not to focus on them. Caroline richard, june is up and coming, but when you are looking at that graphic we just had, theyre signaling that we only have a 45 chance of a rate hike at all this year. Are we expecting any rate hike this year at all, do you think, from your point of view . Are you looking at the markets of the central bank . Richard well, i think the market has been out front on this for a very long time now, caroline. I think we are just seeing the latest iteration of all we have seen for the past few years. I think the fed is sensitive to market expectations, and i think, given where the market is pricing probabilities now, we probably wont see something until 2017. Guy the election will be critical, but it looks to me as if both candidates will be fiscally expansionary to whatever degree, but nevertheless, that will cheer the fed up. Richard it should. At the end of the day, the fed and central bankers around the world have said we need some help; Monetary Policy should not be the only game in town. We need support on the fiscal side. We were just talking off their, and i think the devil is the detail. Offair, and i think the devil is in the details. Guy Richard Jones joining us. The pulse is coming up next. Plenty more coming up with Francine Lacqua. We will also be carrying on the conversation on radio as well; jon ferro is up in new york. Jon and i will kick around all the big news of the day. We will talk about cs, china, and about what is to kashkari had to say. Both onhat coming up, Bloomberg Television and on bloomberg radio. From Caroline Hyde and myself, in the gloomy london and a lovely berlin, we will see you tomorrow. Show me top new artist. Ah, ha ha. Show me top male artist. My whole belieber fan group. Its not a competition, but if it was i won. Xfinity x1 lets you access the greatest library of Billboard Music awards moments, simply by using your voice. The Billboard Music awards, live sunday may 22nd, 8 5 pacific, only on abc. Clicks cutting deep. Credit suisse poses posts cutting the Credit Suisse posts miners lead the charge after yesterdays plunge. It is a green bay for european trading it is a green day for european trading. Chinese Consumer Prices rise for a Third Straight month as the pboc gains reasons not to ease. Welcome to the pulse