Biggest rally since april. Zoom and tesla lead the balance for the electric carmaker jumping over 10 . Lawmakers become lawbreakers. The e. U. Considers legal action over the u. K. s plan to breach the brexit deal. The two sides hold an emergency meeting today. Class growing confit plus growing confidence. Hold ass set to stay on bloomberg learns some officials now see a reduced need for further stimulus down the line. As i said, just under one hour away from the start of cash equity trading in europe. Lets take a look at futures first. We do see gains on dax futures up about. 4 right now. Also, euro stocks futures are up. But you do see ftse futures down this morning so keep your eye on that divergence. In terms of u. S. Futuress, after the gains yesterday, we see continued gains in futures with dow and s p many contracts up. 2 . Anna . Talk about whats going on in the Asian Session in terms of the gmm. We have had a day where we have seen real resurgence as you mentioned in stocks, and now, asian equity markets just reflecting that essentially, up by. 9 on the asiapacific. We build towards the ecb meeting and that is partly why the futures for europe looks little less inspiring, a little less convinced in either direction. Futures in europe fairly flat as we wait for the ecbs meeting. Expectations for them to actually do anything seems incredibly low, but in terms of the language used around the that is key and something Christine Lagarde will be pressed on. We have a big move in indonesia. Art of this is a reminder of what can happen when you reimpose any restrictions or movements around coronavirus and that is part of the story in indonesia so the stock market is down by 4. 9 . Elsewhere, fairly mixed picture. As we move into the european trading session, perhaps a little bit of a Holding Pattern, waiting for the ecb. Here is laura wright. Is considering legal action over the u. K. s intention to breach the brexit withdrawal agreement. That is according to a document seen by bloomberg. The initial analysis suggests it may have a case even before Boris Johnson controversial plan is written into domestic law. The Prime Ministers threat to enege has prompted a warning from across the atlantic. House Speaker Nancy Pelosi said they would be absolutely no chance of a trade agreement with the u. S. If johnsons actions threatened piece in northern peace in northern ireland. Donald trump has defended comments in which he intentionally downplayed the severity of the coronavirus. In march, the president told bob woodward he liked playing down concerns to avoid causing panic or price spikes. Democratic president ial nominee joe biden said trump failed to do his job and is responsible for tens of thousands of deaths for not giving adequate warning about the dangers of the virus. One in five u. K. Companies is a socalled zombie with profits only just covering debt Interest Payments according to the conservative think tank onward. It is calling for the chancellor to relax the rules on virus loan repayments, morning the recovery will be hampered by crippling levels of corporate debt. It says borrowings since lockdown began threatens to Push Companies employing 2 Million People into technical insolvency. The worlds animal population has fallen by more than two thirds in the last 50 years. Thats according to a study of more than 4000 species by a Conservation Group, wwf. It found the biggest drops had occurred in latin america and the caribbean, where populations fell by 94 . Agriculture and landuse change were a key driver as Natural Habitats were converted into farmland, but Climate Change has also been a factor. Global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Anna, matt. Anna thanks very much. Laura wright in london. The rebound in global stocks seems to have fizzled out after the excitement of yesterday with u. S. And european futures edging lower and asian equities retreating from session highs even though in aggregate, they remain in positive territory. Thats after u. S. Shares snapped a threeday rout as dip buyers came into shares. Lets get into the markets with laura cooper. I guess a lot of people are still asking is it safe to come out from underneath the bed if that is where you have been hiding from the tech rout . We had three or four days of it and we saw something very different yesterday. The nasdaq doing fairly nicely. Actually, if you look at where we have been on the nasdaq yeartodate, it was always going to look like a positive performance, even with the extent of the selling we have seen. We are up 24 on the nasdaq yeartodate. Laura c. absolutely. Im still seeing signs of frost in the nasdaq, even after the threeday correction, and that suggests we need to see a greater selloff in order to really spook the key driver of that and those are the Retail Investors. If you look at the price action yesterday, it does suggest that these animal spirits are coming back, the fact that tesla was one of the stronger top performers and that nasdaq had sincerongest bounce april. Going forward, we may not see the pace of exceptional gains given the fact that stocks face a wall of worry. September is not a great month for equities. And then we also have the fed next week and potential fines could see them deleveraging from risk assets. For now, it does look to be the case that we are still seeing stocks likely to grind higher. Matt what are you looking for from the ecb today . What do we expect from Christine Lagarde . Laura c. the hype heading into the meeting has been around euro strength and whether they will continue to talk that down. There certainly going to be this balancing of Market Expectations where its going to be all talk and very little action. When it comes to the euro, they are unlikely to actually allude to it in the opening statements. That is extremely rare. Its likely to be pressed on it in the press conference. Its likely to be the case, which is going to pin any kind of concern for the currency strength to inflation. We saw core inflation print a record low and that is perceived as true by the stronger currency. Its likely not going to talk down the currency outright. Any mixed messages on that front could see things gaining further ground if they strike a less dovish tone. The of course, eurodollar, its partly the euro story and its partly the dollar story. What are your expectations for the greenback as we head into what could be a very volatile election in that period . Laura c. certainly the fact that we have seen this rebound in the bloomberg dollar spot index over the past number of days. I closed below a key technical level earlier this week and it is testing a trendline that has been in place since march. Its able to break through that. It suggests nearterm upside. Part of that reflects the fact that we do have these extended dollars short conditions on. Risk is strength on the off environment. It could spur the dollar further. Ultimately, the dollar is on pace to have the further decline over the medium term, but in this riskoff environment around this election uncertainty, should that prevail and dominate, i would expect the dollar to catch a big. Matt thanks very much for joining us. Laura cooper, the bloomberg mliv macro strategist. You can check out her work and the work of her colleagues by typing in mliv on your bloomberg terminal. Coming up, it is decision day for the ecb with policy likely to stay on hold. Attention is on commentary around the euro areas, slowing recovery, and the strength of the common currency. This is bloomberg. Anna welcome back to the European Market open. A European Equity markets in a bit of a Holding Pattern perhaps at the start of trade. It is still 50 minutes to go until we see the start of the cash Equities Trading session. The ecbs meeting is the big thing today. Lets get a Bloomberg Business flash. Its more right. Laura lvmh chairman Bernard Arnault asked the french government to pull out of a deal to buy tiffany. Franss richest man was directly involved in the decision to call off the 16 billion purchase. Tiffany has accused lvmh of trying to leverage protests against Police Brutality and the covid19 pandemic to seek a lowerpriced but they have denied exerting any type of pressure as he said the french government requested a delay for reasons related to the trade dispute with the u. S. Forcuts make more woes the german car industry. They are eliminating more than 5 of its workforce. They are selling several plants in the home market as the impact of the pandemic bites. The announcement follows a plan laid out last week by continental to slash its workforce by 13 . Barclays is considering replacing its u. S. Headquarters in times square. Sources say the bank is looking for. 5 million square feet of space. The development had reshaped manhattans west side. In new york has slumped this year with many corporate employees working from home. That is your Bloomberg Business flash. Matt, and i. Anna. Anna thanks very much. More business lose. The unlisted lloyds of london, the insurance market, getting updates from that company around their profitability or loss. Lloyds of london reports a loss of 0. 4 billion pounds in the first half of the year. Pay 5aying they expect to billion pounds for covid customer claims. Interesting because we have seen such a lot of conversations in recent weeks about the extent to which there was validity of insurance policies around covid19 and pandemics. You have other breaking news. Matt it is interesting in so many ways. This is the famous Trading Floor that rings a bell whenever a ship goes down. I want to talk quickly about reliance. That company is said to offer 20 billion for a stake in a retail arm to amazon, so amazon is holding talks about an inestment or investing Reliance Retail and reliance is mulling, which is letting it simmer i guess in their brains, up to 40 retail arm stake sale to amazon. A source says amazon has no final decision on Reliance Retail. Keep that in mind. We will continue to bring you any breaking news on this big deal involving amazon. Now, the mood music will be key at todays ecb meeting. Policy is likely to stay on hold but officials will have to confront a slowdown in the euro areas recovery as well as a stronger share currency. The euro itself yesterday gained after sources told brexit and policymakers have become more confident in their forecasts, potentially reducing the need for more stimulus down the line. We are joined by the chief economist for europe at ubs. Reinhardt, good morning. Thanks for joining sp at what do you expect today . What are you looking forward to for the ecb meeting . Good morning. As you said, today, its probably not the day where we would see big policy decisions from the ecb. Instead, the ecb will take todays meeting as an opportunity to take stock of the Economic Performance over the summer based on a new set of macroeconomic projections. We think that the ecb will probably increase the growth forecast for this year a bit because the Second Quarter gdp numbers were a bit better than expected, likely to keep the outlook for 2021, 2022 unchanged. In terms of inflation, although everyone is speaking about the strong euro, we think that in fact the ecb could increase the inflation forecast for next year and 2022 because oil prices have actually increased and they might well overcompensate the strength of the euro and its impact. Anna that is interesting to good morning. The reason people worry about the strength of the euro is for exports but it also makes the ecbs job of reaching its inflation target more difficult because a stronger euro is disinflationary but you do not think we are in a problem where we need to worry about that too much or just think the oil price in this particular instance offset that . Reinhard in this particular instance it as always, the ecb has to worry about the strong euro. I think what we are likely to hear from the ecb today is that they do not target the Exchange Rate. They do target inflation. But of course, the Exchange Rate does matter to the ecb because it affects growth, and through that inflation through that, inflation. At these levels, the Exchange Rate is not an outright concern. The issue is more if the Exchange Rate were to appreciate further, it would become an issue. Christine lagarde needs to nce her words mic carefully. Make it clear if the currency were to increase a lot further, it would become a problem. I think she also has to acknowledge that the euro appreciates partly for good reasons. One of the reasons is the recovery in confidence and a reversal of safe haven flows over the last couple of weeks. The other is that also, with the Recovery Fund, strong fiscal policy interventions from national governments, i think the Economic Policy response in the euro area has been a lot better than many people expected at the beginning, so these are good reasons, not bad reasons, for currency appreciation. Matt does the ecb need to do more in the future . I mean, we are hearing comments that suggest they are more confident in the recovery. On the other hand, we see, you know, furlough schemes coming to an end. We hear concerns in the u. K. That one in five companies uses all of its profits to pay, you know, make its Interest Payments, and Zombie Companies are really a concern across the continent. I mean, after consumers, companies, and countries have loaded up on debt, isnt there a reckoning down the road . Reinhard indeed. At ubs, we maintain a cautious stance on the outlook. We think that you rightly refer to this that the infection rates, if they were to increase further over the next couple of weeks and months, they remain a key risk. The fact that unemployment is well likely to increase further if and when the furlough schemes are going to come to an end and more and more corporates face and proxies and layoffs. Against this background, while we are confident that the ecb will not do will not take any concrete policy decisions today and not in october, we think that by december, december 10, the time will come for the ecb pandemicledge that the Asset Purchase Program will have to be extended by another six months from the end of june 2021 to the end of 2021 and that would then go along with the decision to also increase the envelope of this program again from 1. 3 5 trillion so theres more for the ecb to do because the inflation outlook, it will not recover back to the precovid19 set up for quite some time. Thanks very much. Stay with us. Reinhard cluse, chief economist for europe at ubs. He will stay with us on the program. 7 20 in london. Coming up on the European Market open, the e. U. Considers suing the u. K. Boris johnsons plans to breach the brexit divorced deal have rattled leaders in brussels. We are live in the belgian capital. Thats next. This is bloomberg. Anna welcome back to the European Market open. 40 minutes to go until the start of the European Equity trading day. The European Union is considering legal action against the u. K. Over plans to breach the brexit withdrawal agreement. According to a document seen by bloomberg, the e. U. Believes it may have a case even before the u. K. s internal market bill is written into domestic u. K. Law. Lets discuss with our guests, reinhard cluse, at ubs. When you look at the conversations that are taking place across the channel, trying to get to a trade deal before the end of this year, if not before, what are the percentage chances you put on certain outcomes . What are you assuming when you look at the u. K. Economy in terms of getting a deal or not . Reinhard based on the news flow, i think its very difficult to say at the moment what the chances of a breakthrough are. I think its obvious that the chances have certainly decreased over the last couple of days given the news flow. I mean, therefore, i would be hesitant to come up with a definite answer to your question. Obviously, the Economic Outlook is not favorable. We are expecting a contraction in gdp of 9. 4 this year followed by a recovery of 5. 5 next year. And in this environment, we are of course hoping very strongly that we will not get additional burdens from eight to factor nodeal outcome of these negotiations. So that would be very unwelcome. Matt you noted that the strengthen the euro is in some ways for good reason. You have got this recovery package. You have got this unity among European Union nationse. U. K. Of course 1. 30 seems pretty bullish to me if we are looking in the face of a nodeal brexit. Reinhard one explanation could be that the markets do expect that we will get a decent outcome. Part of the new flow we have seen in recent days is reisman ship. That would be overcome brinksmanship. That would be overcome. Various players from europe are getting involved, trying to gain influence on decisions in london and westminster. So overall, may be markets believe that this is not the final work. If we work to see elements of a heart exit towards the yearend, the currency might well be exposed to further risk to the downside. Just and what would the briefly i know the ecb has been assessing their negative Interest Rate