catch up. not such a happy new year for chinese stocks. they reopened to huge losses after the extended lunar holiday. containment. the pboc seeks to mitigate the fallout, slashing rates and pledging ample liquidity. and crushed. commodities are also hit in china as bloomberg learns demands for oil falls 20%, iron ore futures dipped by the daily limit. we are just under an hour away from the start of cash equity trading across europe and in the u.k.. let us take a look at futures. you have green arrows here on all the major equity indexes. dax futures up 1/10 of 1%. you can see ftse futures are up as well as cap, about 0.3%. if you look at u.s. futures, they are showing bigger gains. half a percent or more in terms dow, and nasdaq futures. what do you see on the gmm? anna: we will return to the macro picture in a moment. a bit of micro news, imperial -- will join as ceo, stepping down another company and joining the board of imperial brands. we will keep an eye on that. back to the big picture story, this is the thing that matters this morning. china reopening after the lunar new year holiday. 7.9%hinese csi 300 down by this morning, more than 2600 stocks dropping by more than their daily limit. hard, we have seen measures from the pboc, we have seen cuts to reverse repo rate. that combined with the response or the catch up in fx markets, we see the yuan going through seven, something to be aware of. hsbc, the pound is also weaker on another story entirely. it is a canadast deal or something that looks like an australia deal. we will talk a little bit later. the pound is weaker. let us look to the other side and show you how much appetite we are seeing. fixed income this morning, and how little appetite we are seeing for certain asian listed commodity. we saw in the chinese session the iron ore price, the copper price, the palm oil price, all dropping by their daily limits. big moves and big catch-up in play. chinese stocks plunging after investors returned from the lunar new year holiday. that is as the death toll rises from coronavirus. the pboc injected liquidity to cushion the blow. joining us now is stephen engle. juliette saly has the latest on the market impact and mark cudmore is looking at the global impact. let me come to you first. bring us up-to-date with the spread of the virus. what are the numbers we need to know? >> chinese officials are not only trying to contain the virus, but also they are coping with lots of shortages, particularly in hospitals at the epicenter of this in wuhan and in hubei province. 90% of deaths have been from hubei province and the death toll has been climbing. we also got our first death outside of china. this was in the philippines. deaths,xceed one -- 361 an increase from the numbers i gave you on friday. the number of confirmed cases has jumped to 70,205, 75% increase from friday. 65%, are incases, hubei province at the epicenter. coping with the current prices and containing it are the biggest challenges for the chinese right now. matt: juliet, let me get to you. we knew this was going to be horrendous. we have been talking about it every day for the past week. take us through some of the limits we have hit. >> absolutely. on the open we saw all three mainland chinese key indices fall by more than 9%, setting them on track for their worst day in around 30 years. we did have that pboc liquidity coming through and also the rate cuts. you saw some of those losses stemmed somewhat, but still on the close on the csi 300, that is one of the worst days for that index since we saw the equity bubble burst in august, 2006 hundrednd stocks falling by their daily limit by telcos, technology producers, some of the big falls you saw in commodities, the benchmark iron ore contract falling by its daily limit of 8%. the steel reinforcement contract at its downside limit to trade at the lowest since december 2018. copper, crude, palm oil, and the yuan trading for the first time since january 23 as well, and it fell. the dollar, its biggest one-day drop since august. anna: thank you. let us bring in mark cudmore from our markets live team. i want to think about where we are the global picture. clearly we are rightly focused on the way china is reopening, reacting to the events taking place in china. but global stocks, global assets, seem to be happy with the amount of risk they have already over the last week priced in. is that where we stay? this is just the china catch-up story? >> that is a fair way of portraying it. we are always going to be focused on china. athink we are reaching turning point globally. every day last week we said we expect more pain from the coronavirus story. we said monday was the first day we start the turning point. it is interesting to know, even on the virus situation, most cases and certainly most deaths and fatalities are in hubei. situation, agic bad economic situation that will have long-lasting consequences. for a global market story, we might be getting toward the end. the weekend suddenly saw this become a global crisis, you saw traders get worried. ofhink in the next couple days we will probably see markets trade in a slightly more positive narrative, more focused on liquidity again. maybe taking the great earnings we have seen out of the u.s. using that to drive prices higher again. the virus is one thing, but the response is another. when you corentin 15 million quarantine 15 million people, this has to cripple the economy, right? >> i think you are absolutely right in terms of the long-running economic story. we are seeing the impact across asia. flights are canceled, supply chains are broken. most of asia will be impacted. talking about this in the third quarter of this year, the damage to buyers of what happened. it is crippling for china. we do not know the extent of damage. markets outside china and outside asia will move on from this quite soon. even in china and asia, markets themselves may be forward-looking. the amount of stimulus we are getting from the pboc, they cut rates. the chinese government has made it clear they will do whatever it takes to support markets, so i think at some point even chinese markets will start saying, we know it's a terrible economic situation, but we know that will be a read stimulus package. they will be boosting growth once we get beyond the virus. maybe that turnaround point for china and asia is another week away, but not too long away, i suspect. anna: what does that mean from the pboc? we see them taking action around liquidity and reverse repo, but lots of talk about other measures. do they wait? >> the market wants to see they will provide enough immediately. everyone knows pboc will support the market. they areeed to know is willing to follow up with more measures. i think if we see the market, equity markets down another few percent tomorrow, expect the pboc to act again in some way. they will do whatever it takes to turn the sentiment around on the onshore markets. . matt: thanks very much. mark cudmore along with juliette saly and stephen engle, our team in asia giving us the rundown on what we have seen and what to expect. next, a look at stocks to watch at the open this morning, including ryanair as the company posted a profit for its winter season. remember, bloomberg radio is live on your mobile device or on dab digital radio if you are in the london area. tune in. ♪ anna: welcome back to "the european open." under 40 minutes away from the start of the european equity day . many people focused on not europe, on china today. the market after the lunar new year. you see the damage across chinese equity markets. the death toll tragically continues to rise. very much thinking about that, but in terms of the market reaction, this is what we are seeing at the moment. with of these markets closed over in china. european markets have had a week to think about what kind of impact this is going to have on the chinese economy. european equity markets and u.s. futures expected to go higher, showing up as a result of what we have seen the pboc do. some global markets kicking hard from the action we have seen taken by the central bank. interesting to see the chinese foreign ministry commenting as well. let's focus on the stocks we are watching around the newsroom. bloomberg's annmarie hordern is looking at ryanair. we had profit numbers move them. instead is covering -- cm unstead.-- sam 88 million euros in the third quarter compared to lost a year ago. all of this is a by last-minute bookings for christmas and new year's. i'm one of those last-minute bookers. one thing they did reiterate is any earnings we are going to see him the max jetline is going to be a year away given the fact that has been grounded. a bigthe airlines are focus for us today. mining companies obviously a huge part of the picture as a in a bigin demand up year for the markets. >> that's right. see correction this morning. there has been a big move in china. mining company investors this morning, we will take a look at that. maybe reposition. european futures are higher. if you look at the move, sentiment in mining is not going to be good today. iron ore, copper hit very hard. it may be as the week goes on we will see this mostly priced in. anna: what's the story? quick steeper cost cuts at the swiss private bank. the next few years they are going to cut $208 million. that's double what it saw last year. they are really just trying to create a leaner bank. at the same time they have scrapped their new money target after having missed it. all this earnings just emphasizes the difficult environment for julius baer. they have increased competition in tighter margins, so it is no wonder earnings look like they did this morning. matt: thanks very much for joining us. you can get all the latest stock stories by going to first go, type first go on your bloomberg terminal. you can also get your first word news on the mobile app. we have european earnings coming up. obviously we are smack in the middle. let's take a look at the highlight. bp is reporting fourth-quarter results. watch out also for earnings from copenhagen-based jeweler pandora and danish beer brewers carlsberg over in italy. .ollow results from ferrari wednesday, earnings are announced by pharmaceutical gskanies novo nordisk and as well as bnp paribas. anna: we have not even got to thursday at. a slew of earnings across different industries. highlights include the banking ,ector results from socgen, ing and unicredit. plus watch out for total and ecuador. -- equinor. friday, maybe we get a rest. let's get a first word news update. >> oil demand has plunged by 20%. executive described the scale of the demand caused by the coronavirus outbreak. it dropped by 3 million barrels a day, the largest amount since the financial crisis. opec and its allies are considering how to respond. eu,u.k. may have left the but the battle over brexit does not look like it's going away anytime soon. boris johnson is using a speech in london to walk away from talks. he does not want to sign up for the single market regulation or the ruling of top courts. he says britain will prosper with or without a deal. president trump's impeachment trial is drawing to a close. senators are preparing to acquit the president. lamar alexander supporting the move to dismiss charges despite saying the president crossed the line by withholding u.s. aid to ukraine. tosays it should be up voters to decide president trump's fate. global news 24 hours a day and on quick take by bloomberg powered by more than 2700 analysts -- and journalists in more than 120 countries. . matt: thanks very much. your first word news out of london. next, take a look at a story you need to know this morning. the slump in chinese demand for oil. there's so much going on surrounding the commodity. annmarie hordern has all the latest for you. this is bloomberg. anna: 7:21 in london. hey quick look at how chinese markets have closed. how has china responded as it reopens after the lunar new year holiday and asked the coronavirus continues to take its humans whole? this is the picture across chinese markets. these markets are now closed. interesting lines from the central bank. the pboc saying the stock plunge today is panic. irrational factors seen in the stock plunge. the pboc having taken some action in terms of liquidity and reverse repo rates. futures look a little different. u.s. futures point higher. global investors price all of this in, that is the big question. bloomberg's scoop that the coronavirus is leading to a 20% slump in chinese demands for oil. manus cranny joins us with a look at the oil sector. how bad is this going to get for oil? you talk about the language the pboc are using, irrational reaction. at the moment, the assessment is that we are looking at an almost catastrophic demand destruction -- disruption. looking at the largest demand shock in the oil market in china since 2008, 2009. it is the most set an and vera drop in demand -- sudden and ent drop in- virul demand. china consumes the equivalent of france, italy, japan, germany, and south korea amalgamated together. demand the scale of china usually has, and that is -- has invoked an immediate response from citigroup. let me run you through. record sub 50 oil is a possibility in the first quarter. chinese demand is inspected to drop by about 20%. the virus drastically shifts global economic outlook, but if you look deeper into what oil demand in china means, 55% of oil demand growth is made up of jet fuel. diesel and gasoline. it is quite an interesting amalgam on the demand side. the question for the market to assess is with this kind of concentrates a producers mind more than the prospect of crude oil prices. hence the reason why we have an ant hill-like frenzy in opec plus. it is a bit like me in an oil pack at opec. matt: you in an oil pack, an anthill, thank you very much for that. the kind ofs about frenzied behavior we are seeing amongst the decision-makers and the concern about demand. joining us now is global head of debt syndicate at ubs. we have seen that kind of frenzied activity in the debt market as well. in terms of buyers, investment-grade debt, i was reading a little bit earlier int we saw 23, 20 $4 billion inflows last month. that makes it one of the biggest months ever. what's going on? yearvery busy start to the . particularly in europe. more than 230 billion of issuance, a number which we never had before. as you rightly say, this is down to the fact we seem very strong on inflows over the course of the past couple weeks, actually months, driven by very strong returns. anna: how much is the coronavirus making a difference? either to issuance or the money available to invest? this is clearly making a lot of people seek some relative safety. armin: it is definitely in the short term a game changer. we have seen slowdown the past week already. impact already in issuance. we saw it in the broader market as well from a performance perspective. hopefully in the medium to long-term we can return to what we have seen in the past couple weeks and months. matt: we are going to keep you with us. of debtter global head syndicate, ubs, our guest cohost for the hour on this monday morning as we see. a huge route in chinese stocks. massive drops that are not looking like they will carry through to european tour u.s. trade. we have green arrows here in terms of futures. key storiesdup of including hong kong's fourth-quarter gdp rating. alphabet and european bank earnings as well. ♪ matt: welcome back to bloomberg markets. this is "the european open. " matt: i'm matt miller in berlin alongside anna edwards in london. you are seeing green arrows across the european equity index futures. it looks like we could have a positive start to this week, even with the huge route we have seen in china. investors quite pleased with the extent they have already priced in damage to the chinese economy. let us check out the other stories we need to be watching out for today. reporters have their eyes on california. majoruropean capitals, banks start reporting their earnings. in hong kong, fourth-quarter gdp numbers coming in the next hour while the coronavirus outbreak rages on. lookingg intelligence to add alphabet. can the company -- the success. europeaner is watching banks, which will show the impact of the negative rates and -- on revenue and profitability. stephen engle is focused on hong kong. kong foroking at hong the moment through the lens of gdp. this is going to be a backward looking number. from protestcome activity into the coronavirus. things are not going to look good. >> over the last year we have had the lingering effects of the trade war between china and the united states. that was hammering hong kong. on top of that, violent protests .n the streets on top of that, now we have the coronavirus, which will not necessarily be baked into the fourth quarter numbers. it is the harbinger for more pain to come. growth fell 2.9%. the fourth quarter contracted 3.9%. for the full year, down 1.4%. hong kong is trying to hang tough. whammy punches are going to be hard to overcome. what are we watching out for in terms of european bank earnings. is really a trading revenue story. though we did see deutsche bank and ubs outperform, they were dwarfed by the likes of morgan , which doubles their outcome. markets are expecting perfection. the negative rates environment is going to be problematic. they have been for some time. investors are expecting better than will actually come from bnp given the negative rate hit. there are early of issues. nordic banks this week. generally, the issue with the european economy is in low gear. rising loan risk could gain more attention this earnings season. anna: let's focus on the technology sector. what are we expecting from alphabet? >> analysts are expecting $47 billion of sales for the fourth. alphabet makes most of its money from advertising. the focus is really going to be on what they can do in the cloud services area. they make a small amount of money there, dwarfed by the area of -- but it is an estimates -- analysts think can grow. they are expected to make a bigger push. they want to overtake at least one of their big rivals in terms of sales volumes in cloud by 2023. focus on any incremental exposure around revenue and profit they currently make from google cloud and what their plans are for the next 12 months. the other area that continues to be in focus is regulation. that is a huge amount of focus on google as a dominant player in the u.s. and europe. competition for markets authority has a big review of the advertising market. there are threats to the current structure. the new ceo has quite a bit on his plate and expectations to deal with. >> thanks very much for that. stephen engle out of asia. armin peter, global head of debt syndicate at ubs still with us. inflowstalked about the in investment-grade and how popular that asset class was. in terms of a sector breakdown, looking at bank earnings, tech earnings, what kind of trends are you seeing? >> but we have seen since the start of the year is we were led by the financial spectrum in terms of issuance, which led to record volumes you mentioned. corporate's probably in that regard. so far they have been slightly behind volumes we would have expected. as you rightly say, we are coming out of the reporting season in the next couple of weeks. the corporate space is catching up. there are no favorites, probably in light of the coronavirus. it may have infected some sectors. with other words, generally speaking, everybody gets good reception by the market. terms of example we have seen so far this year. anna: maybe you see corporate's catching up. what about the appetite for the year market in general? you see non-european issuers. what is the attraction? fa