Daily virus cases. In some cases, records. Chancellor warns of an unemployment tragedy. Markets tick higher in spite of the dire warnings across europe. Europeile section on ends in the green after the s p dipped into negative territory. The trillion dollar gap. A 2. 4mocrats draft million stimulus bill. As mnuchin says he is ready to talk trump. We will be following this closely for you. Lets take a look at what futures are showing. Pointingfutures higher. We are looking at gains of 0. 4 . U. S. Futures also pointing higher for this friday, about 0. 25 . The pain in which contract you look at. The c anday in the gmm . The asian equities session going to the upside. Futures pointed out in the asian equity session, up 0. 4 . Indonesia, australia, india, all those markets moving to the upside. Is pushing us upwards just a little bit. We are all about the physical right now. The fed talking about the need for fiscal stimulus. Very much talking about the you of things as side well. Lets go to the first word news. Here is laura wright. Good morning the official global death toll for covid19 is nearing one million. The really telly the real telly may be higher. It may be hired closer to 1. 8 million and could hit 3 million by the end of the year. House democrats have started drafting a new stimulus proposal in roughly 2. 4 between dollars. The plan could get passed by the house next week. It is much larger than what Senate Republicans say they can accept. President Donald Trumps indicated he will go as high as it comes after a grand jury chose not to charter murder charges against any of the police officers. That decision sparked protests in louisville. One has been released from hospital. The other in a stable condition. Global news, 24 hours a day. Powered by more than 2700 journalists and analysts. This is bloomberg. Laura wright here in london. Stocks in asia rise with u. S. And asian equity futures. Of ators weigh the chances stimulus package against an uptick in coronavirus cases. Lets get into the markets with laura cooper. It is interesting to see what is at the front for investors. We look at headlines for record infection numbers in the u. K. And france. The highest number since april. The market is not preoccupied by that. What fiscalupied by stimulus can do to cushion that blow. That certainly is the case. Futures are telling us to stay positive. I think it is too soon to declare that for the day. Whipsawexpect to see price action. What we are seeing is this tugofwar. Yes, we have these stimulus hopes in some progress in terms the democrats proposal, but there is a wide gap between what republicans are going to accept and like you mentioned, we do have these rising case counts. Markets are signaling positivity. Ultimately, this friction underneath the surface remains. We are seeing tech outperform small caps. We are seeing the reflation trade begin to unwind. There is a lot of uncertainty. Markets are going to struggle in the near term. Be whipsawed a lot on stimulus debate. Outcome, untilhe really the fat lady sings. The news from yesterday. How should investors take that today . It was sort of interesting, the fact that markets fairly reacted to the actual details. We did see the biggest reaction gilt. The this is telling us, government is struggling between balancing fiscal sustainability and protecting jobs. The fact that we are seeing a better quarter than what we saw earlier this year does suggest we are going to see a spike in unemployment through the end of this year. That adds to the headwinds ahead for the u. K. Economy facing the potential for further restrictions of virus cases. There is going to be quite a struggle in terms of u. K. Outperformance. Range bound. Ultimately, going forward, we have these risks in terms of growth headwinds in terms of u. K. Assets. The next think question the market asks is whether the bank of england needs to do more, cutting Interest Rates . About even if not committed to permit is that the next question . Or is it, does the fiscal side need to do more than it is doing now . Looks the outlook is so uncertain it is the case, if we do have to go into another potential lockdown, which is likely the worst case scenario. The government clearly wants to avoid it. It is going to mean more fiscal stimulus is needed. The preference is actually on the qe side which is going to be difficult to funnel through the real economy. If you look at this new furlough schema placement, it only targets workers currently employed. They have to work about a third of their regular hours. We would clearly need additional replacements. More directionhe than a reliance on the bank of england. Esgour question concerns investing. Is it trending or is it for real . I think it was an interesting question. I think esg is in the mainstream. We are likely to see the rgence of a lien sovereign the question is, what is esg . That is confusing investors. We had a report recently that not result in reduced carbon risk with the todit risk is comparable credit risk. Avoidingd be a case of the greenwashing. Ultimately, esg is here to stay. It is becoming more of a mainstream issue. See as bpting to tries to pipit. Of the macro strategist for bloomberg. Britains winter of discontent. We will revisit this topic. The chancellor lays out his keeping businesses as the night straw and. This is bloomberg. Anxious andople are exhausted at the prospect of further restrictions on our economic and social freedoms. For the next six months, the virus and restrictions are going to be the fact of our lives. Say every business. I cannot say every job. Directlynment will support the wages of people in work. Give mean businesses facing rather thands making them redundant. Policies we have never tried in this country before. Spoken aboutten this virus in terms of lives lost. The price our country says is wider than that. Laying out the next stage of fiscal response to the pandemic. The fiscal scheme will end in october as planned. Lets bringve chiefhe conversation our european strategist. Fiscal response is enough will depend on the lockdown measures. What was your assessment . Was so dramatic. Talking about the price we pay. And yet would need to wonder why firms would need to pay 50 of the salary of the worker for only 33 of the crisis . If that works, if there is a shared burden on the fiscal side, the firms and the governments to put up the workers and ensure some certainty, every country in our area is expanding its scheme as well. Europe including the u. K. , of wants every government they are at home, trying as much as they can. In the meantime, their objective is to provide some certainty to consumers about the path ahead. Firms are going to decide, we dont want to be taking on more debt when we are going to be earning far less revenue. Lets just close the doors. How many do you ask act to do that forward . Understand thee rationale. Why would the firm want to do this . What is their reward . I dont know. Maybe it is a virtuous circle by they areng wages, supporting demands for their own goods. That is a selfsustaining, virtuous circle. I would need to look into details at the small script. Sure, the central fed,like the ecb and the they are there. Hinted thatready liquidities are abandoned. The Central Banks are buying bonds. Thank you very much. Stay with us. Joiningu very much for us. More with agnes on the euro zone. Lets get a Bloomberg Business flash. Public and dowgo jones is promoting saying the is 22 expected value billion. Investors valued the company 20 billion. They declined to comment. Into the hotlyg contested market for streaming video games. Plus service will cost 5. 99 during the introductory time. Amazon also introduced new spherical models of echo and it is parters pipit of the real estate move away from brick and mortar property. Hospitalityty is continuing to struggle. That is your Bloomberg Business flash. Thank you very much. Up, germanys sanctuaries keep the economy driving forward. Andmuch faith can we have survey data . This is bloomberg. Welcome back to bloomberg markets. This is the european open. We are about the minutes away from the start of cash equity trading every looking at green arrows. 0. 3 higher. Definitely in the green. Agnes. Talking with she is the chief european strategist. What you you spent 10 years with the imf and help put together the european stability mechanism that is the veil out fund. I wonder how you think that billion with the 750 euro recovery fund. I think it is amazing progress. Of a very big crisis. It wasa very late night, made at 4 00 in the morning. It was intergovernmental. Everybody was paying a share. Issuing and the markets, obtaining funds that could be unlocked at a super rate. Plan is made half of grants and half of loans. This is solidarity. Let me ask you about what you see in the european sector at the moment. We have been looking a lot at what isnd seeing clear is the pmis do turn at the right moment. Do tell you when sentiment has turned. They dont tell you the extent of the downturn. You look at what the pmi has dropped to. The latter is much more serious, much more negative read what is your assessment of the downturn and the rebound . That is exactly what it is. We are at a time when confidence is king or queen really. This is what matters. Surveys are expectations. They are revealed by panelist. Be influencedan by many things. Are the which we policy of lockdowns and reopening spirit which is the way to avoid a more drastic generalized lockdown. And avoidingmptive a higher rate of hospitalization. Now, the Service Sector is not in good shape. Of growing, that is not the case right now. The euro area as a whole. In terms of timing. Lets see what happens in october. Surer, what we know for his services are in bad shape you bid benny factoring, which is less affected, is flowing ahead. Here. See the Pmis Services are bad for germany. If you want to break it down between service and manufacturing, manufacturing looks fantastic for germany. Shifted back into cyclical stocks. What do you think about the investment picture in europe right now . Europe is a very diversified area. Some blue ship Type Companies that produce value have a veryds that strong demand, particularly from china. These demands for those high value goods are priced up to a certain extent. By thell not be affected recent acquisition of the euro. These talks are quality value. That interest investors. Depending on their strategies. Other cyclical trends are appearing. Links about those. These included tech stocks. What is happening to tech stocks . What will happen when a vaccine will take place . Will that be negative for tech . Or are these changes, are they here to stay . To invest inas right now. It down. Narrow i wonder about german stocks, the big blue chips. And specifically telecoms. Not just carmakers. I saw a story about Angela Merkel pushing to get Deutsche Telekom access to the Chinese Market in exchange for not locking out huawei. It is interesting the way germany is interested open to working with china where is the u. S. Is trying to shut out the western world read what you think about that relationship . Stands ofre pragmatism in germany. If you remember a few years ago, hadcellor merkels phone been found to be traced by the cia. Complex picture of who is spying and what are the consequences of these geopolitical trends. For worldhting dominance. It is a complicated matter. Being hopefully coordinated at the eu level. Pragmatic,being very as are other european economies. They are accused of being neutral. It is a very complicated relationship. I hope we can have you back on very soon. The chief european strategist. Thank you very much for your time. We are going to talk about the best performers. Matt welcome back to bloomberg markets. This is the european open. 30 minutes away from cash trading. Futures are looking higher. About 0. 25 . What is the best performing asset class so far this year . Not gold. It is cryptocurrencies. We are not seeing the 100 gains from 2017. But it is up 57 . Bitcoin has performed well this year but much of the gains are due to other coins like a theory etherium. We are joined now by antoni trenchev, cofounder of nexo. Start off by telling us why you think we are seeing these big gains. Antoni it has something to do the something called decentralized finance. Of taking outise the middleman and the needs of trust when you transact on a daily basis as you would with your bank. We are seeing Adoption Across the board for such applications and that is what has driven the price to this high level recently. Finance tralized is that the next big thing or is it a shortterm craze . Is it part of the crypto universe that is here to stay . Antoni it could be so. This is layer two. They comes in addition to what we have already seen with bitcoin. Morewe are getting even possibilities of borrowing and lending and earning yield in a transparent and efficient manner. There are obviously still risks because it is still a young space but there are possibilities. And with nexo, we are partnering fi guys and implementing some of the solutions because this is the future of finance as a whole. We have seen that through the institutional adoption and the guys coming into this space as well. It hasets be honest, been a dream scenario for you. You make money by lending out fiat. As the assets climb or remain so stable, that is the perfect environment. Are you concerned at all about a downturn . Antoni not at this stage. Wet time i was here in may, talked about how it seemed like a permanent barrier. The market has given strong support and now the 10,000 mark has another strong support. The risks are on the upside. We are in the Perfect Place because we are positioned at the bridge between the brave new world of the Digital Economy and the traditional world and we have been able to capitalize on that. Anna how many of those Digital Assets do we need . Limit to how many we can have . Is there a sense in having many or few . What is the logic . Love how we are slowly converting you into a crib no fan crypto fan. Last time i was here you were rather skeptical. I would suggest anyone new to the space to start off with bitcoin because this is digital gold. It has been around the longest and the fundamentals are the strongest. As bitcoin has established itself, people are hungered for additional things. There are different assets that might perform very well. Butto toot our own Horn Companies like ourselves are positioned in the middle ground between centralized finance and decentralized finance. Beingn but the risk is outside rather than being inside. Matt how much has your business grown . To many people are loathe sell their cryptocurrency and would rather lend it to you in exchange for cash . The past six months we have seen doubledigit percentage growth month on month. It has been incredible. More and more people come to the realization that holding the bestperforming asset of the assetecade and the same is outperforming any other asset year to date is better to borrow against that rather than sell it in the open market. It keeps your upside potential. And i looked at a statistic recently. We see from a year to year basis, it a quadrupling a quadrupling of the boomers coming to such platforms as nexo to conduct their business and get engaged with cryptocurrency. Anna thank you for joining us. Antoni trenchev, cofounder of nexo. 7 36 in london. Johnson johnson is starting its phase three trial of a vaccine candidate to combat coronavirus. Bloombergs david west spoke to about ongoingfels research. In theave 60,000 people study. It will be mainly run in the u. S. And south america as well as six countries in south africa. There will be diverse people, both young and old. As well as the diversity of latinos and africanamericans. This is a singledose vaccine. We have been able to show through our research and earlier testing that the singledose will be sufficient to protect people. We are going to study the singledose largely through these trials. Elderly andentioned hispanics who have been disproportionately affected by the virus. Do you take that into account when you put together your trial . We have been working for the past several months with virologists to find out where in the u. S. We can find regions of high transmission as well as population groups which are over with elderly, africanamericans, and latinos to make sure that the at risk groups are well represented. David im not a scientist. But you are working with harvard. What advantages do you have . Is it difficult to store this vaccine . We have been working on this for 10 years. We have done several vaccines including the ebola vaccine being deployed in africa. Factor which carries a piece of the genetic material of codvid. Spikedy produces the protein which then produces the immunity. Celsius. At into the vaccination area at a certain temperature. Singledose and hopefully available on a large scale. Is it islso important impactful 15 days after the injection. It protects you almost immediately. When you have an outbreak somewhere, you want to be able to protect people fast. Protectiondose, fast and easy to disperse. David President Trump has talked about how fast he wants to have a vaccine. Is it unpredictable . It is unpredictable but of , wese with 60,000 people are well set up at over 500 sites around the world. See we want to learn if it is efficacious but also whether it is safe and we will not stop the study until we are sure we have the safety data to assure ourselves and then talk to the regulators. It could be at around a year early next year. About five months would be the timing to get to that point where emergency use would be possible. Matt that was Johnson Johnsons chief scientific officer speaking to our very own david westin. Up, pandemic resurgence. Another virus wave seems to be crashing in europe with record infection in the u. K. And france as well as rising infections here in germany. We will get the details next. This is bloomberg. Matt welcome back to bloomberg markets. This is the european open. We are 18 minutes away from cash equity trading across europe. Futures are trading slightly positive. Juliette saly joins us from singapore. Traders could be overestimating the risk of a delayed u. S. Election result. What is the story . That the we know Financial Markets are pricing in that there could use some volatility leading into and out of the election if there is a delay in the results but Goldman Sachs says you should reduce your expectation of that. They say there is going to be a nothing data to determine the winner election night. We have been seeing Financial Markets pricing in extended postelection volatility. Threemonthen, volatility. Goldman saying the high level of uncertainty could be muscle memory of outside moves we saw in the 2016. And the s p 500 should still be able to trade the outcome even if Associated Press does not call it on the night. Anna interesting to see if we need to wait for the account and the politics that follow. And the transatlantic trade suggesting it will rotate out of european equities. We are still having a lot of conversations about rotating in. Saying when they look at their surprise gauge on economic tech to be in the eurozone and the emerging markets, they are starting to see more negativity coming from europe. The pickup in virus cases and the disappointing pmi for the eurozone. That chart is starting to look it could go negative. That is why there saying get out of european equities and go back into the emerging market. And there is further weakness in the dollar which is to the upside for the yen. The msci emerging market index is little changed. E. M. s overg european stocks. Matt Juliette Saly in singapore with some of the morning calls. Bloomberg first word news and for that we go back to london and laura wright. New York Governor Andrew Cuomo says he does not trust the Trump Administration over the vaccine. Dosays the state may not things recommended by the federal government. Growingso discussing mistrust over the vaccine. U. K. , rebel members of the conservative party are power from to seize the parliament and block the rule. Wiping out the government majority on the issue. They are going to review the pandemic legislation sixmonth after it was an act it. It would still need backing. The Federal Reserve lyle Bernard Bernard has been the been thebrainard has focus of the joe biden campaign. Would beat brainard universally accepted. Some say she is more interested in fed chair. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Anna laura wright here in london. Worries are not just mounting in london but across europe over another wave of the virus. Record daily infections reported. Germany saying the infections are at levels not seen since april. Maria tadeo is in brussels. What is the latest . What we are seeing is a virus is in circulation and there is a concern that you could see a crossover between the flu season and coronavirus. Pressure stepping up on hospitals. We had a record daily number of cases in the u. K. And in france. Germany going back to its highest levels since late april. You could argue that this is because we are testing way more people than we did at the start of the pandemic. But the data coming out of hospitals show that it is true that the number of people needing medical assistance because of the coronavirus is increasing. Forward isn going what does that mean for the economy and future lockdowns . Yesterday, the french prime current said that the precautions will be sufficient to avoid a lockdown. But sentiment is changing. Restaurants are being affected and the Service Industry is not operating as usual. The virus is top of the agenda here in europe. Matt and we have been talking about it a lot again. As specially, the rising cases in england and in spain and in france and germany as well. One of the things we have not been mentioning is italy which was so hard hit at the beginning. How is italy managing to avoid this second wave . Maria the curve is flat. No question. If you compare the situation to his spain and other neighbors if you compare the situation to spain and other neighbors come it is true that italy is doing a good job keeping the case is flat. It is a nedisease. Ins could just be a delay the new wave of infections and italy. Look at what the Scientific Community is saying. They say it is a combination of strong restrictions at the start of the pandemic. Italy went into a very tough lockdown at the start of the crisis. And what they believe and call active participation by members of the society. Respecting thee rules and wearing a mask. I would point to the fact that this was almost a national trauma. Many elderly died. It was a shock at the psychological level for the country. The words of the italian Prime Minister from yesterday saying italians love freedom but they are also serious people. Matt interesting stuff indeed. , covering this for us out of brussels. We are minutes away from the open. Up next, we will get you the stocks to watch including Credit Agricole. Looking for deals in italy. This is bloomberg. Anna welcome back to the European Market open. It is friday morning. European equity futures pointing slightly to the high side. We have the results of the investigation into working conditions and practices. What does that reveal . News from the investigation. Ofe working conditions t their u. K. Suppliers are not up to standards. This comes off the back of earlier reports saying the garment producers have been paying their employees less than minimum wage and had unhygienic conditions amidst the coronavirus pandemic. They were leading investigations and reviews of their different suppliers since 2016 but this time around saying they pledged to improve their auditing to fight such abuses. Matt if you are getting something at a low price, you want to check out why that is. What is the story with the Discount Airline . Airlines have been struggling especially those based in europe with tighter restrictions coming into play. It is out with a capacity update. For october it sees a 50 capacity. Restriction stay in place, 50 capacity is not going away. It will be the same through the winter season. This goes against what they had said earlier. They said 60 before and then 80 so the outlook at wizz air keeps getting more pessimistic. Anna catching up to the reality. And what is the story with Credit Agricole in italy . Small and to purchase midsized banks. Some of the targets may also move to the upside. A french firm had been leading talks. Those have been put on pause because of the pandemic but they are starting up again. Look for some stocks to move around as possible m a story. Add to thatr to list come electrolux. List,ther to add to that electrolux. They say they have seen a substantial recovery in earnings and cash flow in the third quarter. If youn understand have to spend a lot of time at home, you may want to buy a new vacuum cleaner or upgrade your refrigerator or washing machine. Up, the european open. Futures pointing slightly higher. U. S. Futures up as well. Cooper warned at the top of the hour that you could see a lot of swings depending on these amulets debate. This is bloomberg. Give you my world how can i, when you wont take it from me you can go your own way go your own way your wireless. Your rules. Only with xfinity mobile. Anna good morning, everybody. A minute to go. The next wave france and the new cases. Unfazed. Markets seek higher despite dire warnings across europe. A volatile session on wall street ends in the green. A trillion dollar gap. A new stimulus bill. Steve mnuchin says he is ready to talk. Pushing futures higher. Matt absolutely. That is what drove the u. S. Market to gains yesterday. The optimism which is interesting because it looks like a debate that will be difficult to get done. Take a look at futures here. They are up. Not huge gains. Futureslondon and dax are up 0. 3 in germany. We had a drop in European Equity indexes yesterday and the u. S. Finished just slightly in positive territory. Globala look at the macro mover screen. Each column represents a different risk asset. Far lefthand column is equity indexes. You can see the ftse up about 0. 3 . At the start of trade. The ibex also coming out of the gate in positive territory. Just barely. The dax opened early on a friday morning. Above theg waterline. And the cac down about 0. 1 in paris. Little bit of a mixed trade this morning. Anna opening to the upside as investors wave off the stimulus set. Coley,talk to justin sanlam u. K. Polio manager. When investors weigh how concerned they are about this Public Health crisis in the uptick in ases. Stimulus coming from the u. S. , investors are happy to set the markets higher. Justine that is exactly what we have seen. It comes down to points relating and lookingrength at value versus growth. They are waiting for the stimulus. We have seen that in the behavior at the moment. Matt if you see dollar weakness, continued dollar weakness, and that is the forecast we hear from most fx experts, does that mean investors will want to rotate act into europe, even the u. K. . Opinion thats our there will be dollar weakness. The only reason there is Dollar Strength at the moment is it is waiting for the stimulus package. We believe there will be a swing into value. Well,er for value to do we need a strong economic Covid Vaccine which we do not have at the moment. Anna does that mean you stay underweight in the u. K. . Where would you like to get exposure . Justine we are not the kind of company that focuses on geography. Companies that have growth, strong Balance Sheets. Ones that are not going to have a massive problem either way when it comes to the macro forecast. So we are are trading underweight u. S. And the u. K. As well. We are looking for Growth Opportunities predominantly in asia. Matt you Want Companies with low debt which i think well, how difficult is it to find companies with strong Balance Sheets and low debt . Justine we have a stated methodology that we deploy that screens the universe of stocks which ensures that we have a certain Balance Sheet criteria, certain cash flow and earnings forecast. For that reason we do see quite a few opportunities. Anna let me ask you about things that might throw your portfolio offtrack. How nervous are you about the u. S. Election on the horizon . There seems to be a great deal of volatility around the election and maybe for a month afterwards. Others say that the market will have enough information to work out who has won very quickly. Goldman sachs makes that point. Can you look through it . On our it does weigh thoughts and for that reason, we have taken lucrative positions to useu. S. And look those profits elsewhere, for example in asia. We are seeing opportunities but we are being cautious in our allocation to the u. S. Coming up to the election. Of the riskms there, how high do you think it is . Do you still look at the macro issues that could affect your investments . Justine it is difficult to tell what the outcome will be for an election. The strategy that we tend to do play when there are Election Results is to have enough on the table that we could benefit from ensure thatut also if it goes in the opposite direction, that we will not be significantly hurt. Sanlamustine coley, send portfolio manager. She likes health care and tech but she does not hold tesla. Up next, we will discuss justines strategy. This is bloomberg. Anna welcome back to the European Market open. Eight or nine minutes into the trading session with a mixed picture across European Equity markets. Some individual big movers but in terms of the overall market, not much movement. Here is laura wright. Laura volunteer will go public palantir will go public next almost 22 at billion. At 20, it was valued billion. It declined to comment. Amazon is diving into the new and hotly contested market for streaming video games. During the introductory period, permitted to play without shelling out for expensive systems. Colony capital is selling. Heidi is part of the real estate move away from brickandmortar properties. 2. 8 oh yen valued at dollars. Hospitality continues to struggle thanks to the pandemic. That is your Bloomberg Business flash. Matt laura wright with the business flash in london. Lets get back to our guest, justin coley. Colley. Justine sanlam portfolio manager. Know you like tech stocks and you are also invest it in the Data Analytics space. Justine we have quite a high allocation to technology in general. 20 of our portfolio is in the areas tech names. E do not hold tesla we are in various other. Ompanies such as facebook and a medical supply company in the tech space. Anna i was looking at a chart with some of the big tech names in the u. S. And some suggest they are losing momentum at this point. Is that something that concerns you . Whether they can continue to make the gains that we saw post march . Is very topical for our clients. We see a lot of room for growth in the tech space. These companies are cashrich and they have strong Balance Sheets. Very good cash flow and good growth prospects. The rally was extreme. Facebook, already about 44 this year. It is a worry but for our investment methodology, we still have a significant exposure to tech and we will continue to do so. At investingu look insolar and wind, investing alternative energy, we are talking about that on the mliv blog today, whether this is a trending fad or whether investors are serious about this. What is the timeline you are looking at . Justine we are relocating to more esg names. We are naturally moving towards more esg. A perfect example of this trading methodology is moving away from Oil Companies into more alternative companies such as alstead. We would much prefer to be part of the solution. Road we are currently taking. Anna and inflation preoccupies many in this market. The absence of it and whether it can be created. Looking at some headlines from the ecb. The ecb may allow inflation to rise above 2 for quite some time, echoing the fed. That is a nice problem to have because we dont have much inflation. Into yourhat play strategy . And what about gold . Hold inflation linked protection assets and gold is one of them. Gold has recently been under a little bit of pressure. Asset itis as an forms a crucial and core part particularly in our more conservative clients. The what about geopolitical risk involved in real estate . Or do you think that is right now at a low level . Justine the geopolitical risk at the moment is at a relatively low level. Estate hase to real changed significantly over the year. We have had a far more broad exposure to real estate but we have narrowed that down more to companies with residential landlords. One example is we are focusing on companies that are in the u. S. In residential as well. Narrow focusmore in order to take control of the risk involved. Anna can i ask about other picks . The Intercontinental Hotel is one of those. Is that just because you think the sector is cheap but will recover at some point . Justine the Hotel Industry has been heavily hit by covid. Intercontinental hotel is a great company. One of the three reasons i would talk about is that it has a strong Balance Sheet. It is a capital life company. They do not own assets. We are not concerned about that. Point to make is they have a lot of exposure in the u. S. But the Growth Opportunity in asia is one that is very appealing to us. The other point is that the Balance Sheet strength and growth they have they have the ability to grow hotels at an exceptionally high rate. Overall, the hotel sector is under pressure. Matt justine, thank you for joining us. Portfoliolley, sanlam manager will continue the conversation with us on Bloomberg Radio at 9 00 a. M. U. K. Time. As virus cases rise in the u. K. , france, and germany, the original hotspot in europe appears to be skipping the second wave. Anna welcome back to the European Market open. European equity markets are fairly divided in terms of which direction they should head. U. S. Futures now look flat to positive. Easyjet. World or at the he made that point at the World Aviation festival speaking to bloombergs guy johnson. Case is say that the situation we are in and the consequences of the government associated policies on the restrictions for travel, that is the result of the pandemic which we clearly all except, have an enormous affect. Im not against that at all. But what is not acceptable is that it is so different and unevenly distributed. If you take easyjet as an example going into the crisis, it was one of the financially strongest airline. We are not in that desperate need to get the funds to survive next week or next month. We are not being seen as a risk. And the same thing goes for a number of other companies in the u. K. Where billions have been poured into a number of other airlines. That is what i am against. we put this question the other day on bloomberg tv and he said that easyjet received a massive handout. At what scale do need assistance . I assumed you would push back against that very strongly. Thatan look at the amounts have been received by the likes of air france and other carriers. At what scale do you need assistance . Illinformed decision. Not beould making comments without knowing the information. If you divide the support versus the revenue, up to 38 . We received less than 10 . Getting access to this scheme which was available for all companies who had a credit rate investment. That are companies there do not pay the corporate tax. Those that have a couple hundred employees versus easyjet that has 8000. We also had the furlough. That has been helpful, i should say. But it is the difference in the scale that is the concern. What would we be looking for . We would like to see first of all a generous support package for the industry. Ut this is not enough in terms of the removal of the charges. We would also need a much more refined quarantined system. We also need testing introduced which would ring back confidence to people to fly. A testing system will not system the quarantined but if you had a much more targeted approach when it comes to the quarantined come you could introduce testing to the higher risk areas and that needs to happen at the same time as the support coming into the whole of the industry. There needs to be specific support coming in to companies such as ourselves. Ceo ofhat was the easyjet speaking to guy johnson at the virtual World Aviation festival. As it europe strains to control the resurgence of the pandemic, germany, france, and the u. K. Are all reporting a surge in covid19 cases. Slowedn, the cases have though hospitals are under alarming strain. Meanwhile, italy appears to be coping better than its european counterparts reporting lower number of daily cases. Juliano joinsando us from bloomberg opinion. That isitaly doing keeping it safer then other countries in terms of increased infections . We have learned this year that it is hard to make precise explanations about what a country is doing right. In the spring, for example, we saw countries that locked down earlier seemed to be doing better but then we saw swedens cases falling even though the country had adopted more liberal policies. Is thea it is doing well Health Care System which is doing a good job tracing the spread of the pandemic and i think doctors are doing a good job at treating patients. And there is widespread compliance with social distancing rules and wearing masks, especially indoors. It is a combination of what the Health Care System is doing and what the population is doing. But again, this could just be a delayed wave. Maybe it will pick up in the coming weeks for various reasons so we need to be careful. Anna maybe there is wea what or how ready is rome for things to get more difficult as we get into the winter months . That is the key question. Weve been told there has been investment in health care particularly with regard to Public Health which was a place that had been underinvested in before the pandemic. They say they have more intensive care unit which was an area of stress. That in february and march, the country was caught off guard. Now, the big question is the schools, we have three open schools. Systemkeep a tracing when you have kids testing positive . I think we can be mildly optimistic but it is a big challenge for everyone to stay safe. Matt fernando, thank you for joining us to talk about italy. He also has some great pieces lately on the ecb. I recommend you check out the opinion sector on your terminal. Britains winter of discontent. Sunakllor ritchie soo lays out his plan. We talk about u. K. Equities next. This is bloomberg. Look here, its your very own allinone Entertainment Experience xfinity x1. Its the easiest way to watch live tv and all your favorite streaming apps. Plus, x1 also includes peacock premium at no extra cost. This baby is the total package. It streams exclusive originals, the full peacock movie library, complete collections of iconic tv shows, and more. Yup, the best really did get better. Magnificent. Xfinity x1 just got even better, with peacock premium included at no additional cost. No strings attached. Anna welcome back to the market open 30 minutes into your trading session. Lets look at where we are. Were making modest gains in aggregate. That hides divergence. Cac down100 up, the 410 7 . We do have. 4 . Well keep an i on that. Breakdown, telecom moving health care moving to the downside. Theres not a clear picture in terms of which pictures are hot today. If i pull up the detail, i can see telefonica is the biggest gain or in that sector gainer in that sector. A bit of a defensive flavor to that perhaps. Lets get a brick first word news update. Started democrats have the plan would get passed by the house next week. While a smaller version past in may, its larger than what republicans say they accept. President trump said he will go as high as 1. 5 trillion. Thus south korean says the agency must be revitalized so it can settle some of the trade disputes between the u. S. And china. South koreas trade minister is seeking to be the first woman to lead the global group. Them urse, we expect overnight. But still, [indiscernible] could it be part of the solution . The Federal Reserves Lael Brainard is seen as the focus on joe bidens search for a treasury secretary. Sources say the more productive provocative option of senator warren is not likely. It can be accepted by wall street and progressives. She said she was more interested in the role of fed chair. Global news, 24 hours a day on air and on quicktake by bloomberg, powered by more than 2,700 journalists and analysts in more than 120 countries. This is bloomberg. Anna, matt . Much,laura, thanks very laura wright with your first world news. The chancellor has laid out his plan to protect drums after the furlough scheme ends in october. The treasury will top off the wages of parttime workers, business loans, and vat cuts for the hospitality and tourism sectors have been extended. What does this mean for u. K. Equities, which have struggled to rebound significantly since the selloff in march . Joining us now is waiver 10 Investment Management head of equity research. What do you think about sunaks plans yesterday . Good morning. Thank you for having us. An improvement for having a furlough scheme not being extended from october. However, it will mean much more hardship for those sectors that are completely closed because clearly there is no support to be had. To so, where employees are working, companies will need to pay more. Support,ll, its less but its still better than nothing. However, i do think we can fromt rising unemployment the end of october onwards on the back of this plan. Anna and well see how bad that story gets. Good morning. Let me transition from the macro support, the fiscal support into hell you invest in u. K. Equities. Is not direct because the ftse 100 reflects more global themes than domestic ones. I was looking at the companies you were interested in. You like shall. The shares m. V. P. Have been selling aggressively, but also shall under shell selling. How esg has performed by contrast. What is your thinking around having a conviction in favor of shell . Well, in order for the world to transfer, successfully, in the different, from fossil fuels to renewables, we need to have the Major Power Companies to contribute. Otherwise it doesnt happen. Shell was one of the first oil majors to lay out their Energy Transition plan, and it was probably announced a couple of years ago, and they were very firm, saying this can only happen when the whole industry surrounds us. And also went all the customers rally around us. Only recently announced their Energy Transition, so all oil majors are now committed to overtime, move away from fossil fuels. And bit by bit, increase their role that they can play in providing Renewable Energy and to us consumers to be able power our cars by whatever means necessary. Shell and bb havp very large and bp have very divisions. They are concerned the battery will run out, and then what do we do . So we need Energy Companies to help us transition. And bp areeve shell saying the right things. This will take time. An earlier in the program, you mentioned divergence. Because of share prices of both bp and shall really dont give them any credit for any success that they might have in this Energy Transition. And frankly, we need them to be successful for us to be able to etc. Lot more from hydro, matt yeah, well it would be interesting if shell and bp would install highspeed chargers in all of their petrol and diesel stations because as of now, its difficult to take an electric cart trip any length of distance, certainly here in germany. Im not sure how it is in the u. K. I noticed astrazeneca was on your list, as well. My covid antenna go up instantly, wondering how much this plays a part. It doesnt, does it . Tineke youre absolutely right. Astrazeneca is not a vaccine company. So their decision to help manufacture and distribute the oxford Covid Vaccine, its successful clearly, is a humanitarian response. Astrazeneca is a global company. Fully go behind this vaccine. But it will make no money off this whatsoever. Help theis really to world manage covid and prevention through vaccine. Its clearly one of them. They are doing a little bit and trying to see if some of it will prevent or treat or some of their existing has been might be able to protect organs, for example, organ failure is the big severe for patients. Its not the reason why we like astrazeneca, which is really there policy focus and china focus. Right, thanks so much for joining us, tineke talking to us about their focus on a few of their picks. Appreciate your time this warning. Up next, did eating out help out . Restaurants fear a crippling blow just as they begin to regain their footing. We speak to the chief operating officer of Restaurant Operator dnd next. This is bloomberg. Anna welcome back to the European Market open, 41 minutes into the trading session. Overall making some modest gains, of around. 3 . U. S. Futures point modestly to the upside. Britains restaurants, a measure to cushion the economic blow of the virus over the summer. They subsidize meals during the summer months. The government says it helps to protect 1. 8 million jobs. Virus cases rising, Boris Johnson announced a 10 00 p. M. Curfew for restaurants and bars. Could it deliver a crippling blow to the industry as it regains footing . Coo,ng as now is the dnd operating a number of restaurants. Good to speak to you, david. After youve had a day or two to think about the regulations any listen to what the chancellor had to say yesterday, for think all of your businesses will make it through to the other side of this . David yes, i think our businesses will make it through, but its a big kick in the teeth. It out and help out was a fantastic eat out and help out was a fantastic initiative. Orbits were starting to come back and corporates was starting to come back and it was going to normality. And this is a great big kick in the teeth. This is a total overreaction from the government. 5 of cases come from the hospitality world and this is a big, big, big kick in the teeth. Well make it through, but im not the chairman of the Restaurant Association of britain. And a lot of restaurants wont make it. Its going to be carnage out there. Matt why is it so important im in early riser, so i hit it as early as ike can as i can why is it so important to stay open as late as you can . David its not just the 10 00 p. M. Youre right. Of course well make it through. Our customers will eat earlier. But theres the pub sector, the bars, where people go out and drink. And actually, the restaurant world are very conscientious. We put a lot of effort into making sure people are safe, making sure our staff are safe. And thats why they been very, very, very few cases coming out of hospitality. But why is it so important . Its a lack of confidence. If the government saying restaurants and pubs are dangerous. Go home. Of course people wont go home. The other people will go home and party. So, in an effect, its going to considerably make it worse, not better. Its an overreaction from the government, but it shows a lack of confidence and saying to people generally out there, its dangerous. Anna its a point i heard made by others in the industry, that there are more deaths in other sectors. But this is something that can be done with high visibility. What about innovation from this sector . I met a managing to cushion the blow with, delivery, or collect meals . I know thats probably not something your business did before, but correct me if im wrong, business meetings, playing host to other types of events. Are you able to think creatively to try to cushion the blow . David yeah, restaurants have to think on their feet to survive. Yes, of course. Delivery has gone up. But people have been eating at home for a very long time. There are two parts to the restaurant building. Business even at home, people are being told you can only have six people in your house. Is not as if you can have a party at your home. That was before there were those regulations. Of course, the delivery business, moving businesses around. Sorry, covers around, so people eat earlier, as you said. Making people go out at lunchtime more. The customers, its very early days. Yesterday was the first day of the new regulations. A lot of customers were bringing up and moving, shifting their bookings. Maybe the government thinks that covid doesnt come out until 10 00 at night. Thats certainly an interesting observation. Whynot understood by the time of date really makes a huge difference. But i have to say, i think were all pushing for you. Certainly, the government wants restaurants to make it through, even if you think they are doing it, handling it in the most is misguided way. If i come to london, ill be sure to come to your restaurants as much as possible and drink as much as i can. David thank you, thank you. Its a pleasure. Matt its safe to say everybody wants the restaurant and pub business not only to survive, but to thrive, right . Anna absolutely. Everybody wants it to survive. A lot of it will depend on whether further lockdown measures are deemed necessary. If that decision is taken, or health decision, whichever you take it, to further clampdown, that could be the thing that further sends businesses under. David is chair of the Restaurant Association, so tapped into the fears that industry has. Citi will spend 1 billion on assets to close the racial wealth gap over the next three years as the u. S. Banking giant six to become an seeks to become an antiracist institution. To thee, lets talk managing editor for finance and investing. Actuallys is citi taking . What is it looking like . Good morning. So, more than half of the funds that citigroup has earmarked for this, for this project, or this plan, will go towards homeownership and supporting homeownership for disadvantaged people, minorities, people of color, and help get Affordable Housing by minority developers off the ground. Itself, in and of there is a very big disparity in terms of homeownership all over the world and in the u. S. , it is fairly pronounced along racial lines. That will go a long way in addressing some of that and balance. And dish imbalance. Imbalance. And the other thing, that we use 250 million for opportunities for black suppliers, for procurement opportunities. And that too will help businesses that are owned by minority business owners. Matt so, what does this report actually say where the findings . Opportunities there have been a lot of lost opportunities, lost wages is really very big component of this. Fewer opportunities for people to go to college and higher education. Less access to Small Business loans, to property. And all of this has really shaved off a huge amount of iney from gdp, 16 trillion the past. And citigroup found that the u. S. Could really make a very big difference adnd end sort of a lot of not only would they be able to end economic discrimination, but also, it could boost gdp over the next five years to the tune of 5 trillion. So these arent small amounts of money we are talking about and it is a pretty stark number. How much of a difference these forms of economic this commission can make to the economy . Anna interesting story. Thank you for bringing it to us. On thef breaking news Utility Space in france, were getting further comments from the ceo, saying he will improve the price for the big. Veolia was saying it will buy suez despite what it says is a poison pill and put off visitors. They offered to buy the stake from r. G. Ahead of the board meeting. That comes later on friday. Up next, gold is challenged by raising rates. Bloombergs markets lifes current rates strategists joins us next. This is bloomberg. Matt welcome back to bloomberg markets. This is the european open. We are 53 minutes into the session, looking at a mixed trade with the dax and cac down. The ftse still gaining 1 10 of 1 , about 7. 5 points right now. Joining us to discuss these markets is been romp, bloombergs mliv currency and rates strategists. Strategist strategist. Youve got a macro piece out on gold, saying its challenged by rising real rates and the dollar. What is the story . Ben morning. Even though its neither of those, im looking at gold rather than as a commodity. And what my model shows is that two factors basically real rates and dollar can explain more than 90 of recent movement in the metals. So gold is getting hammered this month as real rates have slammed about 20 basis points. And weve also seen the dollar come back with a bang this week. We take the view that treasury rates will be around 50 basis points, give or take, and breakeven rates wont climb any further if we adhere to the view that gold will have a hard time going back up to record highs of almost 2100 an ounce we saw earlier in the year. Matt . Anna and a lot will depend on the dollar. A lot of businesses will be thinking about whether where the dollar is in addition to the euro. It was subdued through august and september by recovery in risk appetite. Now that seems to have changed. Where do we see the dollar heading . I think the dollar has a good chance of coming back. If you remember a couple of months ago, we discussed on the show, and i was positing at that point that the dollar might come back around the time of the u. S. Elections. Think its got likes to run, really, because what happened with the euro is a bit disconcerting because the ecb flagged that they were ok they were tolerant for appreciation in the euro. But the next couple of quick days, Christine Lagarde and all the other policy officials began saying oh, the euro levels to concern us, and that kind of put some, taken some stock out of the euro sales. The dollar has potential to go further. Matt thanks very much. This is bloomberg. So youre a Small Business, or a big one. You were thriving, but then. Oh. Ah. Okay. Plan, pivot. How do you bounce back . You dont, you bounce forward, with serious and reliable internet. Powered by the largest gig Speed Network in america. But is it secure . Sure its secure. And even if the power goes down, your connection doesnt. So how do i do this . You dont do this. We do this, together. Bounce forward, with comcast business. More voluminous hair instantly. All it takes is just one session at hairclub. Introducing xtrands. Xtrands adds hundreds or even thousands of hair strands to your existing hair at the root. 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