Beijings economy. He says the world has entered a transformation period but warns against the closed domestic cycle. Watching wall street, Goldman Sachs, bank of america and wells fargo report later today. This after j. P. Morgan and city shares fall despite surprising to the upside. Very warm welcome to our viewers just waking up. Manus is off this week. A much do holiday and very welldeserved. The pandemic really was maines front and center. We have the latest projections from the imf, warnings from the u. K. Scientific advisor. The netherlands entering a partial lockdown. The pause from eli lilly and Johnson Johnson on their latest medical trials serve as a stark reminder that the pandemic is a perennial Market Driver even amongst the uncertainty of brexit, the tugofwar over u. S. Stimulus, and the noise surrounding the u. S. President ial election which today is now 20 days away. Against that backdrop, the markets this morning a little softer in asia. Xi jinping speaking in shenzhen, lifting the 300. Euro stocks futures point to a brighter start. Look at whats going on across assets. We do have eurodollar and the pound a little bit weaker. 10year treasury yields steady. For euro and the pound, tomorrow will be key. The selfimposed deadline on thursday. Many waving it off as not a real deadline, but will talks continue . Set to speak today. The only bright spot of the imf forecast was china, where output is expected to exceed 2019 levels. Such an outlier from the rest of the world, that the chief economist had to separate china from both emerging and advanced economies. The imf endorsement comes as president xi jinping lays out his vision for the socalled greater bay area. Joining us now is the chief north correspondent Stephen Engle. Very good morning to you. He just wrapped up a little bit ago. Xi jinping very light on specifics. He did want to showcase chinas resilience by going to shenzhen. What stood out in the speech for you. Stephen yeah, i was seeking those hard bullet points, the headlines, and some of the policy specifics but we did not get them necessarily. If this was like a designing of a house, we didnt get the blueprint, we got the grand concept of what he wants to turn juan dong into. For the past 30 years, shenzhen has been this Pilot Program of innovation, but also opening up to the west. The foring at the time asian tigers, south korea, hong kong, taiwan and singapore as a rival to hong kong. It has now almost surpassed that in many ways on the innovative front and past the four tigers. Shenzhennping wants and the greater bay area, the river delta to kind of bring hong kong into the fold and complement each other. Hong kong is the gateway to the raisingd the capital with the International Ipos is a huge one. Shenzhen, like has been playing now with the likes of the headquarters of huawei and tencent, they can be the innovative hub, rivaling silicon valley. Big pictures but now how are you going to do it . Annmarie i think the market was looking for the blueprint. There was a lot of excitement going into this speech. What impact will this have on hong kong even if it was a little bit skim on the details . Executive carrie lam who was there for the speech is now kind of having to redraft her own policy speech. Stephen keep in mind, today, she was supposed to give her annual policy address for priorities for hong kong. She postponed that as late as next month. Wanted to hear what xi jinping has to say and how she has to integrate those priorities into her plan. One thing thats that out to me was xi jinping overture to the young people not only in hong kong but he called them the compatriots in china be at hong heg, macau and taiwan included to have the young people, live, work and study in the mainland to file part of economy and chinese place in the world despite the troubles and some would say bifurcation of the tech world with the west and this more selfreliant push that xi jinping has talked about. He said we need to create a sense of belonging to the motherland for all of them. It was his plea to the people of hong kong who did take to the streets of protest over the last yearandahalf of our so to try it out in china for work and living and studying. Annmarie bloombergs chief north asia correspondent Stephen Engle. Joining us this morning to digest all of this news is michael metcalf, global head of microstrategy at state street. I want to start with china. We had president xi speaking hours ago and china is really the only one that stands a chance. Look at the imf projections that is going to grow this year. For years, we have talked about chinese exceptionalism and i wonder if it is coming to a point this year specifically. Does the rest of the world stand a chance to catch up to chinas growth . As you say, china is the standout positive in the Growth Outlook. Large part and significant part of the Global Economy now that that will actually help the rest of the world we know that chinese exports are still an important source of growth and we know that domestic source of growth will become more important but i think the fact weve got such a big growth driver doing so well is positive overall for the world of growth and the gap will eventually narrow but it does not look like it is going to narrow anytime soon. Macro point of view, is china the place for returns on a yield basis, it has been a search for yield given the sovereign debt but also the yuan even if the dollar has strength. We do see the euro and pound come all of these currencies not doing well against the yuan which could last into year end given Brexit Uncertainties and the pandemic that is going to research in europe. Michael it is a very good point that you make. Not only is the Growth Outlook attractive, nominal and real almost it is only the only place you could go for yield. Do you compare the currency space things like the amount of yield relative to the level of , it is very little that gets close to it. That is why i think it is interesting we began the week with measures from the chinese authorities may be to try to remind us that the currency should be a twoway bet but yes, it seems difficult in this environment where if investors are looking for growth or yield, china is the go to place and that would suggest more downward pressure. Annmarie the other go to place in china seems to be china tech and that is what Stephen Engle was talking about, even outperforming the u. S. Counterparts. Xi jinping kind of alluded to this bifurcation of the tech market. Do you think chinese tech will continue to outperform even if we have a Different Administration in the white house come november 4 . Michael that is a good question. The one thing china obviously does not escape is the uncertainty around the u. S. Election. Assumption s an what is clear is we dont go back to where we were before 2016. Unlikely thatems if you get a Democratic Administration that you will get an escalation that weve had under the trump administration. Yes, that obviously does factor in to the chinese fundamental story to which way that will go but it does not deny the fact that whichever way the election goes, china is outperforming. Annmarie what about the trade war . Does the trade war remain intact, do tariffs remain intact . And might get turned into Something Else rather than the trade war perhaps. It seems unrealistic to assume straightaway that the tariffs will get reversed. I think weve almost gone too far along that route already. I suspect what we would be the fact that china is performing so well economically, politically might make it hard for any administration to walk back the tariffs significantly. I think what the market will be looking for is some kind of stability, some kind of guarantee that the tariffs dont go up from here and maybe get themselves on the path where you get gradual reduction. I think it seems to be unlikely that you get a complete reversal of tariffs. That would be a huge Economic Policy positive. Annmarie this week, this has been a major talking point about a change of hands potentially in the white house, what does that mean for chinese relations and the cohead of affairs at Goldman Sachs has Climate Change might be one area where the two could come together and forge a partnership. What other areas do think we could see a potential partnership between washington and beijing if there was to be abide in presidency . Think the Climate Change and green jobs initiatives and collaboration on green projects could be really quite significant. I think the other interesting , not necessarily collaboration but you get very similar policies from china and the u. S. Which could be very positive for Global Growth as you get big infrastructure plants. You could potentially get collaboration on that. Aboutk this is all opening the fiscal spigots and making sure the growth comes back properly next year. China has already done it and now we are waiting for the u. S. We talk about china being the main engine of Global Growth for now and we need the u. S. To get back onto pushing Global Growth strongly. Climate change will be the huge one and china has emerged as a leader on that and the u. S. Needs to catch up, i think but also in terms of stimulating Global Growth, that is one way there has been some kind of collaboration you end up having. Annmarie china certainly has in terms of putting out there map for it, how they will deliver, think that will be key in terms of whether or not they can get their admissions down. We will talk about u. S. Stimulus coming up next. Michael metcalf stays with us. Up next, hitting the pause button. Eli lilly halted antibody trials because of safety concerns. We discussed that and the state of covid right in europe. This is bloomberg. Annmarie very good morning to you. 6 15 in the city of london. Hope for a quick virus care take another hit. Eli lilly is the latest to halt Clinical Trials of its antibody therapy because of safety concerns. Shares fell on the news and this follows Johnson Johnson. They hit pause yesterday on its trial after a patient illness. Several European Countries are taking steps to control its record surge in cases. Citizens are being called to make more sacrifices. Bars and pubs are closing today in the worst hit parts of inland as Boris Johnson faces growing pressure to order a National Circuit breaker lockdown. For more, we are joined by maria tadeo in brussels. Czech republic, netherlands, what is the state of play across europe . Seeing his you are daily restrictions when it comes to coronavirus. The tone has changed. Last week, 700,000 cases, the most since the pandemic began. That is triggering all the government action. The Prime Minister is under huge pressure to declare a National Lockdown for two weeks in the u. K. In the netherlands, more restrictions, a partial lockdown that sees all nightlife being stopped. No more alcohol sales after 8 p. M. This is a major uturn for the dutch permit is there who until now has said we want to go for a smart lockdown. We dont want to put in place measures or restrictions that could hurt the economy. Onay, the focus is very much interviews this afternoon, it does signal a real escalation. It had been the Health Minister and Prime Minister diab dealing with this another president elzie has to say something. Theres big speculation that there could be a curfew, meaning you are not allowed to leave your house after 8 p. M. In cities like paris. Annmarie with all these fresh restrictions, but as the Economic Impact going to look like . Maria well, thats a big question when you look at it from this side of the channel. What you have is a situation where there is no effective treatment for coronavirus at this point. Restrictionst could be in place for a long time. We are probably going to be in this for months. I would point to the fact that Angela Merkel did not rule out we could see some type of lockdown. When you look at the projections that came out from the imf, they believe the contraction this year will not be problematic. The concern is 2021. The rebound we were expecting perhaps may not be as strong and may not be as quick as we anticipated as a result of the restrictions. Annmarie thank you. We will be looking out to see what Emmanuel Macron has to say later today. Michael metcalfe from state street is still with us. Yesterday, the imf warned the pandemic would cause lasting damage to living standards. They are pushing for a twoweek lockdown. We really seeing economies in the west struggled to stamp out the virus and keep the economy going. It is a hard line for them to walk. When did the markets stop pricing in all these fresh restrictions . Michael yeah, it is a very good know whatecause we ultimately the restrictions bring which is a version of what we saw in q2 which was a very sharp slowdown in growth. Right now, were in the midst of getting the data from q3 which we know as seen a significant rebound. Right now, most of the forecast, the imf included, you do have the recovery continuing. Lockdowns are just partial or not quite as strict year,had earlier in the the moree stringent lockdowns get and you talk about these Circuit Breaker levels and no national thosewns, obviously forecasts will have to be revised down. I think right now, the market has not got that in their projections, the idea that you could have in some cases, you might be talking about double recession. The market has not priced that in yet but it may begin to do so as lockdowns get more stringent. Annmarie just yesterday, the u. K. Job losses jumped to a record. Potentially, we could see more. It does not seem like the Financial Markets are pricing in the real pain we are seeing on main street in the u. K. , europe and the u. S. This has been really a debate throughout the entire pandemic. Are the markets just convinced that regardless of what happens, the Central Banks will come to the rescue . Michael yeah. Bankusly, the Central Support in terms of liquidity and asset purchases is huge and remains huge. That is a very significant support. You touched on the jobs market there. Obviously, the thing that is really keeping the real economy going is all the support, particularly in europe, all the support we have gotten through the labor market through fiscal policy. Is interesting question now if we are heading back into much stricter lockdowns, is that really going to stymie any Market Recovery or it will get worse again. It puts a lot of pressure on all the fiscal measures that have been put in place to basically keep spending going and to keep the real economy at a certain level. All of that is some comfort to markets, but the interesting thing to watch would be the bond market, i think, to see if yields dont react to the idea of the fiscal situation will get a lot worse. Markete the bond yesterday, italys first sale of bonds, 0 coupon. I am told we have to wrap it up but we want to get your reaction to what happened yesterday. Michael metcalfe stays with us. Lets get a first word news update with laura wright. Laura prospects for u. S. Fiscal stimulus for election day waning. Nancy is calling on the white house to rebound its latest offer. Mitch mcconnell is pushing for a smaller scale strategy, but pelosi quickly rejected. Proposals a pozo seems to be opposed by donald trump. The European Union has won submissions from the wto to hit u. S. Goods with 4 billion of tariffs over the ongoing boeingairbus dispute. The bloc will likely hold fire until after the president ial election next month. The eu was hoping to reboot negotiations and see if the talks fare any better in the results joe biden becomes president. Larry fink says the world could be a lot greener if Office Buildings never reach full capacity again. At an imf event, he said if only half of workers return, to the office, traffic could be reduced and quality of life improved. Companies could have 50 always working from home. Global news 24 hours a day on air and on Bloomberg Quicktake in more than 120 countries. This is bloomberg. Annmarie. Annmarie thank you. He saidlarry fink, climate risk is an investment risk and some anymore investors are looking at Climate Change. Coming up, bank of america and Goldman Sachs earnings on deck. How do they stack up to the big lenders we have already heard from . Thats coming up next. This is bloomberg. Annmarie good morning. This is daybreak europe. Jp morgan and citigroup reported betterthanexpected earnings yesterday but shares in the group fell. You to discuss what they did and what they will do later today, dani burger. Liber investors disappointed in the lenders results, because actually topline, it did pretty well . Dani not just the top line, but the low loss reserves were half of what strategist expected. We saw premarket this year rally but when they turned and investor disappointment said call. S the earnings it was the executive commentary that make clear the loanloss picture was not because they had a sunny outlook on the economy. Instead, they set aside so much in the first half that they built up a significant amount of loanloss reserves. At the same time, it is not clear whether soured loans and whether we have come to the end of the line.