Were going to have to be patient until the hard work of tallying boats is finished. Manus biden on the brink, michigan and wisconsin edging closer to the 270 electoral votes. Trumps campaign sued pennsylvania to stop counting votes. Treasuries are bid on policy uncertainty in the fed is set to focus on the pandemic, while the boe is expected to boost qe. The results may continue to flood in. Majors welcome to the show, and marie. Good to see you. What a difference 24 hours make. My guess in the past two hours have been saying you possibly have the genesis of chaos and hyperbolic language. Why . Because were going to begin to understand what the faceless Electoral College dissenters might do to spoil the road to the white house. Good morning. It is still risk on in these markets, but the question is the validity and veracity of a challenge to joe biden, if he gets the numbers. Annmarie we are still counting those boot those votes in america. Nevada, pennsylvania, georgia, were still waiting and they are still county because so many mailin ballots due to the pandemic. The markets are contending with the fact that we could see a biden presidency, but a split congress, how is it going to push through all those plans you spoke about . We are seeing Global Equities push higher, the Msci Asia Pacific having one of its best since march of 2018. Yesterday the nasdaq closed up nearly 4 . We are seeing weakness on the dollar, and what is going on in the bond market . When i walked in the building yesterday, we were at 90 basis points. We now trade at 73 basis points. Sinceggest oneday slide march. This of course is about that divided government. Thats delivering the prospects of the blow of the super mega stimulus deal and that is playing out in the bond market. Joe biden is on the brink of victory after flipping both michigan and wisconsin, two key skates in what democrats call the blue wall. Hes just six electoral votes shy of the 270 needed. Ed, you were in arizona yesterday. Arizona has been called the ap and by fox news. Were getting Fresh Results potentially in the next couple of minutes or hours from maricopa county. Walk us through the latest on the electoral map. Arizona,it comes to there are around 400,000 votes still to be counted. Posters onely both sides of told me they still expect those to skew toward joe biden and the democrats. The hope was that would see a big surge of republican voters, but what im hearing, that didnt quite happen. Biden has her razor thin lead in nevada with 75 of the votes counted according to the Associated Press, and it should could be some time before we get a result there. Ballots butreceive november 12 to count them. The gap has been narrowing, there were around 90,000 votes still to count in georgia as of a couple of hours ago. We know they are probably skewed toward democrats, so its a tight race but the most direct path for biden is nevada. Theres a chance in georgia as well. Even though the race has been called in arizona by the Associated Press and by fox news, what happens there as the gap narrows between the two candidates. Manus we been seeing Trump Supporters arriving at the maricopa,tations in weve seen some supporters arrived there. What is the strategy of trump, is it to stop voting in certain counties and to threaten the Supreme Court . Talk us through the strategy as we understand it right now. Ed its both, its a contradictory strategy, where the president wants to stops stop votes where he is ahead and have them continue in states where hes behind. Pennsylvania, according to joe biden, is still up for grabs, even though he is behind, because in urban areas like philadelphia, for example, those votes are very much skewed toward democrats. As you said the president and his campaign have instituted Legal Proceedings in that state and others to basically halt votes in the states where he is ahead or have them continue. Also basically where ballots have come in late, in wisconsin which former Vice President biden climbed earlier today, he wants a recount. Biden has a margin of around 20,000 votes there, which comes as no stranger to recounts. Difficult to see how her recount in wisconsin would work in the president s favor. How a recount would help in his favor. Manus weve got our work cut a raft of, weve got corporate earnings to get to. Reductionk seeing a in provisions, theyre talking cutting revenue 2. 3 billion. The estimate was for 306. All these banks, the loan loss provision, we still see the loan loss provision that commerzbank is being 1. 31. 5 for the year. Lets have a quick snapshot of unicredit. The 202021 profit target for the year. 731 in the third quarter, and that is below the estimate of 1. 37. So we are just seeing that come in their on the unicredit side. So net income also beats. You can hop on and grab those numbers a little bit later on. Well come back to socgen because that is the other major story. Well catch up with frederick a little later on. This is all about Loan Loss Provisions improving at the bank and also the equity side of the business doing better as well. They had that right in the first half on the equity. Cominge and net income in at 860 2 million euros. That is almost double the estimate so they pretty much beat on all of these fronts. From the first lost in 12 quarters. Will speak to the softy and ceo coming up around 6 30 a. M. London time. You dont want to miss it. Lets get a recap of the news this morning. It even before the results are known, the online bookmaker the a similar call in 2019, coronavirus pandemic is accelerated new records and infections. It continues to rage in wisconsin where hospitals are at or nearing capacity. Issuek had an outbreak in population that triggered a mutation. Italy is ready to improve new stimulus measures this week. The Prime Minister said the nation will sell bonds to raise funds as needed. The government is clamping down on northern cities with new restrictions and introducing a new threetier system dividing the country into different risk levels. Englands new lockdown starts today, closing pubs, gyms, and nonessential shops. Boris johnson said the nhs would be in extraordinary trouble without urgent action to cut the spread of the virus. Yesterday the u. K. Reported 492 more deaths. 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. 6 10 in the city of london. Coming up, it is fed and boe decision day after highly contentious election in the United States, and the u. K. Going into lockdown. We discussed the Economic Impact and Monetary Policy on all this next. This is bloomberg. The overall theme is that things are going to be incomplete and we just have to wait. Voices across our networks discussing the implications of the slowly developing election picture. A quick snapshot in atlanta and georgia. The counting is still alive, we are waiting on these final votes to come through. No democrat has carried georgia since 1992. So the voting continues. We will take you through those as they come. England, it is decision day. A highly contentious election day. The fed is likely to stress the urgency of the need for first further fiscal support. On this side of the atlantic, the u. K. Back in lockdown. The bank of england set to announce a new round of stimulus there. Morning, host this yesterday the market faced a , but there isrio no blue way. Today we seem to be embracing, where literally hugging divided government. Does that add up for you . Is it correct to be pro risk in a divided government scenario . Right, u. S. Yields are dropping and the weaker dollar makes sense. You are right around the stocks. The market is saying are probably not going to get weve seen tech outperforming financialse underperforming if you look at the s p. Annmarie i have a question on bond yields. I came in yesterday and we were at 90 basis points on the 10 year. Today we are at 73 basis points, and absolute wild swing on the tenure paper, something we havent seen since the pandemic hit in march. Where do you see bond prices going from here, given the divided potential government . If you have this divided government, it seems like the most likely scenario. Ithink what is combined with expectations that fard temper initially how it goes to the upside. I think yields will head lower. 6570 would still be the way we are thinking about it. 30us you could say that year paper is fixed yet he yesterday he said he was going to the Supreme Court. The fed will make the noise they want to have a fiscal deal. People are saying to me the republicans offered 500 billion before the election. You could look at something very skinny and that fiscal void and fiscal narrative is a bigger risk that we are not discounting enough. Say mitchan mcconnell is 500. Maybeould put a number, 1. 3. Clearly more than the 500 billion. Bad, buthink its that its going to be smaller, and that is what the fed doesnt like. Annmarie talk about in your in theat if trump wins senate is republican, stocks though higher. If it is trump its going to be growth and if its biden is going to be value. Are you rotating . Thomas its a good point, good question. It goes higher, no matter what. Wins, if he had had a blue suite, you would have some pressure, think thats fair. On the other hand, you would have the value stocks. You would banks performing better. Now you are somewhere in the middle. I think in this scenario the the value is not theg to be supported from higher yields. Your back to the same tradeoff with financials and cyclicals during relatively poorly compared to a blue suite. Back and forth between the vaccine and the virus and stocks are going to head higher again. Manus vaccine, virus, and victory. Yesterday the fed so theyre not going out further on the curve in terms of issuance. What more could or should the fed do in a fiscal vacuum or void that we might go into . Whated my last guest dexterity does the fed have on the Balance Sheet . Thomas i think they have a lot. I dont really see the constraints on the Balance Sheet. Yesterday you saw huge drop in inflation, and that is what the fed can do something about because they have this idea that theyre feeding into future inflation. I think they should step up qe eventually, but it would end on how much fiscal stimulus youre getting. If you get quite a lot, they will probably wait because they want to see the major benefits of it. But if you dont, they will step up qe. Up,arie stocks are going no matter who gets into the white house, according to him. Coming up, ing disappoints, net income missing estimates. Were talking with the cfo. Stay with us. This is bloomberg. Annmarie good morning, this is bloomberg daybreak europe. Lets look at where we are on the electoral map. We still have votes being counted in america. In the next halfhour we should get results from erakovic county. The ap and fox news have projected arizona to widen. 64 on the lead to 214 we will get those final tallies coming in. We are waiting on ivana, pennsylvania, and georgia. Nevada. Ae dutch bank will introduce new distribution policy of a 50 payout ratio. Thanks for joining us. I want to stop start with the loanloss revisions. The estimates were for above 800 million. Much better. Do you expect this to be maintained, given the fact that europe is going into lockdown 2. 0 . Nice to be on your show. The first thing i wanted to say is that what we see is that the third quarter, the economic recovery has been better than we saw in q2, and we see that in for example the payment activities, returning to more normal levels. Havemmercial activities we acquired an additional 200,000 new primary customers, so things are normalizing in cutesy in q3. Nonperforming loans have not really gone up during the course of the quarter. Thats why the loanloss q2 toion has dropped from about 470 million as you mentioned during the course of q3. About theimistic ability to handle what is coming with the second lockdown, giving guidance in the previous quarter that we do not expect risky spence is in the second half of the year would be higher than the first. Clear that indicates that from what we see from q3, that seems to be the case. You say the distribution, dividend policy and 50 payout ratio is resilient. What we want to know is when will the ecb that you pay the dividend for this year, and is the 2020 dividend on schedule . Tanate what we have done today is announced two things. Weve given a new capital target at 13. 5 . We have lowered the level of capital that we believe we need to run the bank over the longterm to 12. 5, so thats the first announcement we make. We will take our time to get to that 12. 5 metoo make sure we see an exit view from the current corona crisis. The second thing we have two announces the change in our dividend policy, going from a progressive dividend policy to 50 of resilient profit. Thats the second plan that we have. Have reserved our profit for that dividend payment. As you mentioned, this is guided also by the recommendation of the ecb on Dividend Payments and we expect that before the end of this year we will get further guidance or further recommendations from the ecb about whether they will relax the dividend band that is currently there for a number of european banks. Annmarie if they dont relax the dividend band, if that does not happen, what is your message to investors . Well, what i think we need to do is that, clearly the ecb is being responsible to make sure that they see a clear line ofsight for corona in light what we discussed about the second lockdown. Having said that, our message to our shareholders and investors is the fact that today we sit at 15. 3 for tier one, significantly above our minimum requirement of 10. 5 , and we do reserve dividend for payment so whenever that happens, we have reserved those dividends, allowing us to continue our business while at the same time providing the right returns to our shareholders. Manus what kind of lending is the bank doing at the moment . We saw sharp declines in the Second Quarter. We just came off that aggressive lockdown. What does it mean for the three proof 3 4 lending . Growth target that you have . Are you going to make that number, and if not, where does it settle in that . Tanate if you look at our lending numbers, we still have that ambition target of 3 4 . As you would amend as you would imagine, given the lockdown we went through during the course of q2, that was not possible. What we do see now is resuming activities particularly in our asian franchise and a little bit in the u. S. The european long demand remains for the time being. As we get out of this rather deep economic recession in q2, we expect demand growth to start to rise in subsequent quarters. Wehave to keep in mind that may go into a second lockdown during the course of this quarter. So its a mixed picture about what will happen but were confident about resuming Economic Activity all the time. Manus thank you so much. Lets see what this second lockdown brings across the economies. The cfo of ing. Us. Ng up, socgen joins they have rebounded from the worst losses in 12 years. Third thirdquarter profit almost dusting almost doubled, beating estimates. We will talk to the ceo, he joins us in just a moment. Map . You got your election annmarie lets pull it up and show our viewers where we stand right now as america continues ,o count related biden 264 President Trump 214. We are waiting on pennsylvania, georgia, and nevada. Three key ones we want to hear from. Stay with us. This is bloomberg. Annmarie good morning from london. This is bloomberg daybreak europe. We continue our election coverage. Here are todays top stories. Millions and millions of people voted for us tonight, and a very sad group of people is trying to disenfranchise that group of people, and we wont stand for it. We are going to have to be patient until the hard work of tallying votes is finished. Brink,e biden on the michigan and wisconsin edging votes. To 270 electoral stocks push higher and treasuries the fed is set to poke us on the pandemic focus on the pandemic. Commerzbank with the full year net negative result. We speak with the group cfo in the next hour. You dont want to miss that conversation. Gone 6 30 a. M. In the city of london. We are waiting on the results coming from the United States. Our map does show that arizona was given to joe biden, the former Vice President. Arizona, in the next few minutes, we may get more votes coming. They are still tallying some of these votes even though the ap and fox news have projected it to joe biden. Arizona is a deep republican state, so this is one of the states that joe biden was able to flip from the 2016 map. This is the state of john mccain and barry goldwater. Republicann some protests around these election counting centers. Tally the electoral , where on thena kospi of nevada, pennsylvania, georgia, these are all the votes that need to come in and could swing. They are ground zero any political challenge or legal challenge could cause pennsylvania, thats where a lot of people are inferring could be the basis of a legal challenge. Its a whole other discussion. Sure,ing thats for everybody wants a little bit of america in terms of stocks tax,se less Capital Gains dansk bank wants to be long on everything. The overall index, volatility is imploding, but the ground zero, i would say of repricing comes in the bond market. 30 year bond yields imploding yesterday. This is about the lack of belief in stimulus coming at a size and scale the market believed it would come through before. Inflation is have been decried. Our guest host in the last 30 minutes had said tenure paper take it down 2. 65 . Thats the state of play on the markets. Lets get the rest of the news from the u. K. , england going into lockdown. The central bank set to announce a new round of stimulus. We will also hear from the chancellor addressing parliament. Good morning. Good morning, manus. Thats right, this is the first day of lockdown and the boe is expected to ramp up their Asset Purchase Program by about 10 billion pounds. That estimate set perhaps prior to the second lockdown announcement, so now estimates have moved higher for how much qe table and into the system.