Good morning and welcome to bloomberg surveillance. I am Francine Lacqua in london. We discuss everything with monetary and fiscal policy. Look at. In london, we your markets. This is what they are telling us. We are getting data out of the euro area that manufacturing is a bit better than expected. 38 that was of forecast. Services pmi for the month of may for the euro area, a touch better than expected. Overall, i am looking at what the risk in china means for treasuries. They are advancing with the dollar. Lets get straight to the bloomberg first word news in new york city. Tensions are boiling over between britains chief negotiator, david frost, and his part, michel barnier. Key summit looks certain to expose key divisions between the two sides. The Spanish Parliament voted to extend its state of emergency by two weeks. Plan of a onemonth extension did not have the backing to pass the measure. Second mostes extensive outbreak, over 230,000 cases and 28,000 deaths. The Federal Reser
Euro bailout investors price in the prospect of negative interest rat rates after opening the door to the policy of course we are keeping it to where the access would be a very warm welcome to street signs. Weve got some fresh data coming through. This is flash pmis as a whoeld. The flash manufacturing pmi for may has come in at 39. 5 up from 33. 4 in april in terms of the composite number for the eurozone, that has come in at 30. 5 up from 30. 6 in april the services pmi which has been the hardest hit sector as a result of the lockdowns. That has come in at 28. 7 up from 12 in april, we already had france and germany come through and we have the overall eurozone number. One other thing, one of the key kpoen nants here, the new business pmi has come in at 28. 4 in april an uptick there. Contraction did ease in may but still very sharp we have the euro trading slightly weaker versus the dollar this morning. Lets bring in our first guest Chris Williamson geoff and steve also with us chri
Rates can go. Deal toor merkel says a bailout lufthansa is edging closer. Warns of ad airline multibilliondollar rescue. 7, 8. I found the roadmap. One thing we have touched on. It is about demand. It is not about which camera. It is about demand. You have mark cuban of the Dallas Mavericks obviously supporting, talking about. Usinesses that cant survive jp morgan, citigroup, goldman sachs. This is the issue. Synchronized, un dislocated reopening which is know when youre 100 , which pulls into question that the veracity of the argument goes from 20 that unemployment goes from 20 to 10 . The road is dislocated. Nejra you got a sense of that in the fed minutes. Gloomy prognoses. What might be considered more is yield curve controls from here rather than negative rate. They were apparently not discussed as much to. That was kind of the take away from the fed. Yieldted discussion of curve control. They also said some banks should limit payouts to shareholders then you have the u. S. China
It looks unchanged. We did get the data earlier on as well and then you do have a rally today, so that trend continuing as well. Europe, lets take a look at where markets are going. Markets are down. The euro is up a little bit. My sense is that what were changeis the rates of starting to ease up a little bit. Maybe we did see the data bottoming out in april. Rate,is points off the some people anticipating 50 basis points. 1. 75 , unch on the yield. One, vonnie. N this the nines we know, week total was raised to nearly peopleion, more than the that filed claims during the entire great recession. We are joined now by a Senior Investment manager. Once again, it sounds like we werent expecting this. We knew the economy was ground to a halt. How bad does it get . Guy is right in terms of what we are at the moment. We are starting to see some of the improvement and it is essentially mechanical with the Economic Situation weve found ourselves in. It was government policy to stop Economic Act
Disinformation and propaganda, President Trumps rhetorical assault on beijing steps up a gear. The u. S. Senate passes a bill to the last Chinese Companies on european and delist Chinese Companies on european indexes. The bank of england president said get of rates are not being ruled out. Plus, cut to junk. Angela merkel says a decision on the lufthansa bailout should be expected shortly after the German Airline becomes the latest to lose its Investment Grade status on the s p. Take a look at futures this morning. We do see losses in futures. Euro stoxx 50 futures down a little bit more than 1 . 0. 6 6 . Ures falling we see drops on u. S. Futures, as well. S p, and nasdaq futures all down by more than 0. 5 . Anna, the gmm . Anna lets have a look at the gmm. Quite a mixed picture in the Asian Session after some gains in europe and the u. S. Yesterday. Lifted in part by some better corporate reporting in the u. S. We see a little bit of nervousness around geopolitics and the ongoing ten