Ready and waiting. Jerome powell says the fed is willing to use all weapons to combat the coronavirus downturn. Philip lane says the ecb is prepared to boost bond buying. Andrew bailey testifies in front of lawmakers today. A lot of centralbank action. Global coronavirus cases near 5 million, as one report throws cold water on modernas vaccine testing. That is what drove stocks lower yesterday and now we see futures down here, up in the u. S. And asia, say mixed picture. J. P. Morgan joins a Goldman Sachs in saying that further quantitative easing is needed to cap bond yields. The u. S. Is so strong a billion dollars of 20 year treasuries today and it looks like a lot more supply is getting mopped up by the central bank. An hour away from the start of cash equity trading in europe. Take a look at the picture here. Arrowslooking at all red in terms of futures, euro stoxx, ftse futures and dax futures are down. If you take a look at the u. S. Futures picture after the downturn yesterday, you will see green arrows, as the s p, dow jones, nasdaq futures traded up about 0. 5 . Different reactions i suppose to that moderna report around the virus or lack of detail in that report. Lets get some breaking news. We have headlines coming through from rollsroyce in the u. K. Least 9000loss of at jobs. They are proposing a major reorganization. The headwinds that currently are being faced by anybody attached to the Civil Aviation cycle. This certainly the case with rollsroyce. They are talking about the loss of 9000 jobs. The cost will likely be about 800 Million Pounds, they say. Headcount contributed about 7 Million Pounds in savings. Expected to save 1. 3 billion pounds. What iskeep an eye on going on with rollsroyce at the start of trading. Matt has goneind, through the different outlooks we are seeing in the various futures. This is what we see in the gmm. A mixed picture coming through in asia, india and japan trade higher. We see the new zealander dollar moving higher as the Central Bank Governor in new zealand in an interview with bloomberg talked about how he does not want to see negative Interest Rates. We see some readjustment. We also see readjustment in the fixed income market in new zealand. Broadly speaking, we are mixed across the asian session. Moderna headlines around the vaccine or lack of data to prove the efficacy. Ongoing geopolitical tensions and powell testifying, all of that in the mix for investors this morning. Matt absolutely, so a lot going on. Lets get the bloomberg first word news for you. Powell,chairman, jerome dodged efforts to get him to take a side in the debate over stimulus. He testified at a virtually hearing of the Senate Banking committee and reiterated his stance that more fiscal support may be needed but stopped short of calling for it immediately, saying he was reluctant to talk timing or specifics. It is a very political issue in washington. Brexit talks have soured, with the u. K. s chief negotiator accusing the eu of only offering a low quality deal. Isid frost says the bloc treating britain as unworthy of a freetrade agreement. Michel barnier says britain wants to keep the benefit of being a member state without the obligations. Moderna tumbled yesterday after hitting an alltime high. A healthfter publication highlighted the preliminary nature of the data surrounding its potential coronavirus vaccine. The journal also cited the lack of a press release from the u. S. Officials, who partnered with moderna on the trials. Global news 24 hours a day, onair and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Anna . Anna lets talk about these markets a little bit more this morning. It took 33 days for stocks to drop 34 , and then just three weeks to gain half of the back. Investors have been thankful for a dose of calm in recent sessions but signs are emerging the lull may not last. Simon flynn joins us. Perhaps you see some clues and volatility that might lie ahead in emerging markets. Even if we have seen some example, the, for s p in recent days. If you look at the options market, there seems to be some thationing saying investors are bracing themselves for more volatility. Do you see volatility had . I had ahead . Yes, i that investors are bracing themselves for more volatility. Do. The phenomenon you are talking about with respect to options is very important. You have a very low put to call ratio. That means investors are not taking out much protection against risks. That is particularly true of very small investors. These guys are often contrarian indicators. Particularly against the bark round of poor fundamentals and background of poor fundamentals and high stock prices. Matt what do you think the biggest movers are right now . Is it a vaccine . Is it stimulus . Is it reopenings . How do you see the biggest winds blowing for stockmarkets . I think at the moment, the most critical thing is the appearance of a vaccine . If we had certainty in that respect, then we could be reassured that at some point, ones that vaccine is widely available, we can all go back to our normal lives and there will not be a permanent shot to the economy. I think that is extremely important. You are also right that it is y important, the policy is that policy is essentially created near zero riskfree rates. Despite what i just said about stock prices, if you are it against holding a 10 year treasury in the u. S. , that 10 year treasury has exceptionally low return so its very unappealing. Anna going back to normal life, simon. I almost forgot what that looks like. Let me ask you about the emerging markets versus developed markets. Emerging markets being your bag. You assessed of economies may lag in a postcrisis recovery. If you assume we are heading for one, why do suggest that . Yes, it is quite interesting. Is that all, the theory the wellinformed and relatively wealthy population can choose to afford to socially distant, if you like, in response to a second wave of the covid virus. There are a couple pieces of evidence thats true. First of all, both korea and taiwan reacted this way. Even before the government january, up back in people were socially distancing in korea and taiwan. The second piece of evidence, most recently, if you look at the google mobility data, there are signs that the koreans have increased social distancing since may 7, which is when we had the commencement of the kind ini second wave. I think developed economies could have a bumpier recovery. Matt thank you for joining us. You can reach out to us or to the mliv team with any comments. Coming up, the ecb may be finally getting what it long called for. Governments coming to rescue with stimulus and doing it together. Thats the key, thats next. This is bloomberg. Matt welcome back to Bloomberg Markets european open. We are still just over 45 minutes away from the start of cash equities trading. We are looking at futures pointing lower here in europe. They are higher for the u. S. Trade this morning. But of course, we have a lot of time and volatility probably between us and the star of wall street. Lets get the Bloomberg Business flash. These are two greats top corporate stories. Yesterdayares surged after the company signed a deal with the comedian and Television Host joe broken, gaining Joe Rogan Joe rogan, gaining exclusive rights to his very popular podcast. It is a coup for spotify. Rogans show regularly ranks at the top of apples charts. Facebook is limiting offices to 25 occupancy. It requires temperature checks and masks when it lets employees back into the building in july. The social Media Company outlined the plans to staff. It will create six put spaces between workstations. We used to call those offices. Citigroups chief executive says take friday off and thanks for the hard work. In a memo to staff, he acknowledged that many have been juggling work, home schooling children and taking care of family members. He says please take the day off and relax. Of itsid roughly 80 staff is working from home last month. That is your Bloomberg Business flash. Nejra thats a nice story. Lets talk about the ecb. The ecb may finally be getting what it has long called for. That is governments coming to the rescue with stimulus. The proposal by french and german leaders for a 500 billion euro package is seen as a significant step towards a common fiscal policy in the union. The plan must be supported by all 27 members. The ecb stays alone on the front line. From the plane says the centric philip lane says the central bank is fully extended to extended emergency Bond Buying Program. We are joined by samy chaar from bank lombard odier. Dirty Emmanuel Macron today save the euro, you think did they save the euro, you think . Samy they are giving a very important additional tool to the eurozone and european union, which is the fact that you can do fiscal transfer. Oneoff that they are proposing. We can imagine that in future crisis, whenever they come, they ine opened pandoras box allowing to tap into this new tool, which basically would allow transfers between nations it. Need it is extremely significant and kind of the missing piece of the european project. Matt this is essentially shared debt, right . The eu will be able to borrow this money. To ais the keystone federal transition . Not yes, it is, but it is a Permanent Transfer mechanism. Again, it is a oneoff for this recovery fund. Scheme alayet in a the United States of america. When faced with economic difficulty, you can engineer this fiscal transfer. For once, the funds are not allocated function of the size of a countrys gdp in the european union. They will be allocated to the country that needs the most because they have suffered the biggest economic damage. That is new in the making for european countries. Nejra i suppose we dont know much in the way of details, do we, about how the allocation will happen . We look forward to those details. Ask you about the trajectory for recovery. What are the points in time youre looking at for significant upticks for the eurozone economy as we recover from . Samy what was absolutely key was the ability to contain the damage in time. For now, it seems we have kind of succeeded in limiting the damage to the first half of this year. Very clearly from now on, we might have seen the worst and it is all about now focusing on the so the second half of the year and 2021 will be all about the recovery process. There is always the risk of being hit by a second wave, we know that. Hopefully, we have the tools to avoid the second wave being so disruptive. Basically, the recovery starts now and that is a very positive signal. We know that the problem is that the recovery will be difficult and uneven. The fact that now the recovery is starting his very positive news. Matt do you think that the ecb has done all it needs to do . Samy mostly, frankly, the ecb has been a very significant contributor to the response to the shark. They did a lot. They can still do more. The pandemic Emergency Preparedness program probably has to be increased at some point. It is significant already when compared to the fed already. When compared to the fed, it is not that impressive. It might have to be increased down the road. Up to now, what the ecb has done is extremely significant. Kept the issuey well contained. A lot was expected on the fiscal front. Sovereign nations had done a bit. We were having high hopes for a common european answer and it seems to be happening. That will allow also the ecb to be more comfortable in the way it drives its monetary policy. Nejra thanks very much. Stay with us. Samy chaar, chief economist at bank lombard odier, stays with us. What about the stimulus story in the United States . Further stimulus may be needed. Jay powell starches the debate on specifics dodges the debate specifics. This is bloomberg. What congress has done to date has been remarkably timely and forceful. There is scenarios within main street where we could lose all of our capital and we are prepared to do that. I wanted to call out the risk of longerterm damage to the economy. There is the risk of permanent damage and as ive said before, we are conscious of the health issues. It is all about the Service Sector and in particular, those parts of the Service Sector that are, where there are lots of in person contact. We do intend to send anybody back to work without the protections. I was prepared to go today. I thought it was safe to testify. Is it enough . We need to be prepared to act further and i would say we are if the need is there. Matt that was the fed chair, jerome powell, speaking, as well as treasury secretary steven mnuchin. Both of them testifying before the Senate Banking committee. Meanwhile, the treasury secretary plans to use all of the 500 billion dollars congress provided to help the economy. He would do this through direct lending and by backstopping fed programs. There have been a lot of complaints in the u. S. About stimulus that never arrives. Samy chaar, chief economist at bank lombard odier, is still with us. I wonder what you think about the debate, the current political hot topic washington, which is, his stimulus more important than reopening or vice versa is stimulus more important than reopening or vice versa . Samy first and foremost, this is a Public Health issue. If you want a strong and uninterrupted recovery, one where you dont have to shut everything down again down the road and get back to square one, you need to make sure that basically everything has been done on the sanitary front for a safe reopening. If it is the economy that matters, well, you need to be safe on the Public Health side. Hopefully there are tools. Better capacity is an important tool. To be fair, the americans are testing quite a lot from europeans as well. We are testing more than the south koreans now relative to the population. Thats an important tool to reopen with confidence. Clearly, if you have to shut the economy down again, you are back to square one, it makes no sense. Very clearly, the reopening has to be done in the safest way possible. Anna anna so do you [audio dro] both sides of the atlantic. Thats what you need right now and you dont actually need stimulus until the economy is on its way to reopening. Give us your thoughts on the timing of when a fiscal boost has its biggest impact. Samy i mean, basically you need both. You need to make sure you are able to contain the first wave of the epidemic. The first phase basically of this crisis is now behind. We are getting into the second phase, which is reopening process, recovery process, and hopefully without being struck by a disruptive second wave. A lot has to continue to be done on the testing site and well. Lly the front as when it comes to the fiscal and monetary response, it is a two step process. The first step is you have to prevent the liquidity crunch. Central banks have to provide liquidity. Governments have to compensate for the income gap. Basically, people who are going to be however, some companies are going to like business. It is up to government to offset the income shortfall. Once this is done and you have stabilized the situation and can reopen, this is indeed when a very important variable gets into play, which is Public Investment. We are in an environment where there is not a lot of private investment because of the uncertainty. So its very important that the public side is able to step in. Matt in some economies, there just is not a lot of private investment because of the culture. I wonder if you think certain countries are doing better than others, just briefly here . Capexfrankly, i see no cycle anywhere. Even before covid, we were running very low on u. S. Capex. Obviously, investment in europe is very well as very low as well, in the u. K. As well because of the uncertainty around brexit. There is an issue here. , the of investment is private investment. When you dont have it, better Public Investment the no investment. Matt absolutely. Thanks so much. Nejra thank you. Matt chief economist at bank lombard odier. We both thank you for joining us. Anna . Anna yes, indeed. Unicredits german arm is playing a big role in facilitating government loans to german companies. We will talk about that with unicredit germany next. This is bloomberg. W . W . Uhiono anna welcome back to the European Market open. Half an hour to go until the start of cash equity trading. U. S. Futures dewpoint a little bit higher. Lets get to some of the stories we are watching for. Later today, the European Commission will unveil its spring package. This will lay out recommendations for Member States taking virus impact into account. The bank of england governor will testify before the u. K. Parliamentary Treasury Committee about the economic fallout of the pandemic. No doubt he will be asked about negative Interest Rates. The u. S. Energy Information Administration will release its crude Oil Inventory report, an important gauge of demand in the market. Finally, at 7 00 p. M. U. K. Time, the fomc will publish the minutes of its april meeting, where it held steady on Interest Rates. But lets face it, it has done already. Some nine packages of support from the fed around coronavirus. Math . Matt all right, lets bring in another big interview, the ceo of bank of america. Consumer spending is picking up as government relief programs cushion the impact, Brian Monahan spoke with david westin. This is a Health Care Crisis. Theou are starting to see Health Care Crisis be mitigated, you are starting to see the economy start to recover and we can talk about that, but the approach to winni