Clearance. A grand reopening. Thee johnson will outline strategy today, expected to include an increase in Community Testing andriy incorrect reintroduction of tougher restrictions. Biden iselect joe said to have landed a longtime advisor as his secretary of state as the president reportedly moves closer to banning tech exports to dozens of chinese companies. 7 00 and in london, from first, and 10 00. In three weeks, there will be a vaccine for everybody and herd immunization. This is the standout note from fauci. We will vaccinate. 7 of the population. These are big ambitions. Annmarie they certainly are and the news over the weekend from the head of warp speed saying we could start in potentially three weeks, but it is only going to be december 10 when the fda looks at approval for the pfizer vaccine. You made a good point this morning, the fact this is the developed world. What remains in the developing world could be a difficult picture. Isus a question for markets if so risk on, the futures are trading, so lets see where the treasuries go. Are we closer to 1 . That is the question we will put to our guests. Yes, already citing the mliv question saying it is going to be closer than 1 . Trade thishere we monday morning. Risk on across Global Equity markets. Hasnt futures moving to the upside. The kospi is the standout in asia. China,ging trade data to but europe and the United States up nearly 1 and. 9 . Would have passed this morning 45 a barrel on brent. The oil markets is trading the vaccine news instead of the narrative of lockdowns. The pound this morning, 1. 33, encouraging news with some trade deals like china between the u. K. We will he or from Boris Johnson later today. 2. 0 inse, lockdown london, keen to hear what he has to say in terms of the winter strategy. Manus i can tell you it is probably the top of the pound because i went to the money changing machine last week. U. S. Officials, the first vaccinations could be administered in just three weeks. If given the green light for emergency use. Task forceouse operation warp speed says it is aspiring for herd immunity across the country by may. On the 11th or 12th of december, hopefully, the first people will be immunized across the United States, all states, in all the areas where the state departments of health will have told us where to deliver the vaccine. Multistrategy multiasset strategist at Societe Generale joins us. We are extolling the virtues of bullishness. How do you want to be positioned . A bit of a rumble and then yawn on credit, but you are still a buyer of equities. Theyrrently in markets, tugofwar between the covidterm outlook of new cases, how long it will take to vaccinate people, and the more mediumterm outlook, which is constructive, which the fact that at this point, the lshaped recovery from any scenario, we will be focused standpoint, one thing to keep in mind is compared to other cycles, you will have slightly more impetus versus previously because of the low Interest Rate environment but also the fact you are looking for bond proxies that could protect the portfolio. At this point, the equity space could continue to perform well, even if i think by the end of the year it is unlikely investors will move fully risk on. Divergencee see this between bonds and risk assets. Is that set to continue . We havent seen the vaccine news upend that at all . Casee it hasnt been the on the equity complex either, with nasdaq performing well, s p. Give have stop and go where investors have been short bonds. A smooth path toward the reflation trade. Techlating between long versus cyclical to more short duration with higher bond yield and cyclicals and value performing well versus growth, and it will continue to do so. Portfolios will be trending next year when investors would want to hedge themselves because we dont know who is going to lead the recovery basically. That is maybe where the barbell approach comes in. You say the two risks next year offdriven by the risk higher bond yields and that is a debate we are having in the question of the day. Inflation surprising on the upside. Where is that inflation surprise going to be pushed from and how do i prepare for it . On the commodity complex or on the bond and yield complex . The risk you mention is haverue risk investors been mentioning to us as the two premium risks for the portfolio. In terms of inflation surprising to the upside, i would say it is more from a portfolio standpoint where you want to hedge against it. Globalization into more localization, so at this point, what you want to gear to is how to gear your higher inflation expectations. Portfolio asn the a replacement for treasuries makes sense. Whatrie speaking of manuss question was, what do you make of our my question . Will the 10year treasury yield hit. 6 first, or the line in the sand 1 . Everyone mentions the 1 as the threshold, but we think it is going to be more 1. 20, 1. 30. Year ofe full expansion, normal liquidity injection from central banks, what is going to matter next year is going to have to be earnings. Earnings do not rise as you have on children rising above 1. 2 , then the equity complex will start to have a hard time. Given thel fine, current expectation of earnings for the next three years, especially for cyclical sectors that still have some leeway up, but when you start to have 10 year above 1. 2, earnings will have to deliver at this point. Sophie sophie, stay with us. The societe, generale analyst, our guest host. Lets get your first word headlines. President elect biden is planning to name his longterm aid and lincoln as secretary of state. That is according to several sources. Former Hillary Clinton aide Jake Sullivan is expected to be the National Security advisor. An announcement could come tomorrow. The u. K. And canada have reached a trade deal. Theyll keep the current terms the u. K. Has through e. U. Membership and begin talks on a broader pack. That will cover digital trade, the environment, and womens economic empowerment, a boost to Prime Minister johnson who is working on a variety of post brexit bridget trade deals. Moodys and fitch lowered south africas Credit Rating as the coronavirus is hitting the governments finances and pushing the economy into its longest recession in almost three decades. The downgrades will have an Immediate Impact on borrowing costs. Global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. Breaking news come through on credit agricole. One of the big things flagged is crossborder m a within banking. Credit agricole doing a deal in italy, they will pay 10. 5 euros for stocks. This is a deal, they will launch a cash deal. 20 more premium for the bank, 10. 5 euros per share. There is lots of speculation about m a in the banking world so this is one torchlight in that prism. Coming up, u. K. Prime minister announces post lockdown rules today in parliament. We take a look at what is expected. That is next. This is bloomberg. Manus its daybreak europe. Im manus cranny. Released in a few hours. The readings will see a reversal, will reveal how much theidence was hit as Monetary Union imposed new restrictions to control the pandemics spread. Dani burger has been looking at the expectations. Good morning. What can we expect . Pmis aret off, flash the most closely watched market event of these ratings because they are the most relevant for the market. It should be no surprise we are expecting a pretty sizable contraction through the eurozone u. K. He not as severe as the spring, but still, any contact intensive industry will likely show. Service pmis will be what dragged down the wider index of manufacturing. Manufacturing likely held up. Factories, mostly open and u. K. Instant construction was encouraged to continue. Germany should fare better because restrictions werent has harsh curbing activity. Break it up into two parts. The big two, germany and france, and then you get the rest of the eurozone pmis. This will be important because it really will show us the unevenness of the european economy, how the core is performing versus the periphery. Lookll be interesting to at the breakdown between the two eurozone pmi readings. Youve been looking into highfrequency data. What are they saying and showing for european economies . Dani the highfrequency data doesnt show this huge contraction during november. It started to recover a bit toward the end of this month. In the first couple of weeks, things like mobility, energy usage, transportation, it sharply fell at the start of november, as did most advanced economies because you had the spike in coronavirus cases. Weve seen over the past couple of weeks, it starts to move sideways. You start to get stabilization inactivity. Remarkable ones, friends in the pink jumps and overtakes the u. K. In terms of economic activity. These things might not show up exactly in the pmi, but looking through the highfrequency data, it does show a slightly more bright picture for the european economies. Manus thank you very much. Thes dani burger with great debate on what the data will show. This is going to be news for you, the u. K. Prime minister set to reintroduce tiered restrictions a little later today, the curbs will replace the nationwide lockdown on wednesday, december 2. The restrictions are set to be tougher than before and will include guidelines for family visits over christmas. Johnson will announce massive increases in Community Testing. Alongside usis this morning. If you look at europe, we are having this discussion about how you allocate. You got liquidity, you like cyclicals. Value in europe is pacing head of value in the u. S. Is that how you look at europe, through a value and cyclical lens . Sophie i think there are two things at this point. Value shiftnt into toward leverage. Investors will make the distinction within value between those who have strong balance sheets, enough cash to resume dividends on buybacks and on the other side, those that were value but have weak balance sheets. The story is going to come back next year i think is making investors think about it. At this point, what we call strong value would be more the laggards that could potentially benefit from the vshaped recovery investors expect in the mediumterm, but portfolio reshuffling is going to be done quite gradually. It is not going to be one go in the next month, where investors will be full risk on come along value and short growth. Does anything regarding the recovery fund, the fact we are not at the finish line, does that change your view on europe and your allocation . It is a question of timing at this point, but when you look at what investors are thinking, it is the first time in two or three years that u. K. And u. S. E investors are mentioning whether they should reallocate out of u. S. Equities into eurozone, and you see this change of mentality. I think the recovery fund, everything about the structural themes, infrastructure spending, green deal, all the longterm themes will continue to drive eurozone equities and investors will be happy to continue investing into it because they wheree in it and that is pockets of growth are going to be found next years. Euro is quite resplendent at the moment. That is more of a dollar weakness story. Does that stymie the flow of money into european equities or is it not a huge consideration . Iphie in the shortterm, dont think if you have eurodollar at 1. 30, it could be quite difficult for eurozone weight ofto bear the the strong euro. In the shortterm, what is going to matter is not the currency. It is going to be the growth themes and structural themes that benefit eurozone, but the view on dollar is going to be the most important one because if you have a big stimulus deal coming from the u. S. With the u. S. Leading the recovery, you are potentially less bearish on the u. S. Dollar done in an environment where it would be much more eurozone and e. M. , china leading the recovery so that would be something to take into account for u. S. Allocation because it will detriment your allocation among equities. Annmarie thank you so much for joining us this monday morning. At societeh generale. A bubble burst. Juliette saly wasnt supposed to be with us today because she was supposed to be on the flight from singapore to hong kong, but it was delayed due to a rise in cases. She will give us the latest next. This is bloomberg. Manus its daybreak europe. Im manus cranny in dubai. Annmarie hordern in london. This week, tomorrow, we will the daxthe results of 30, the owner of the benchmark says the index could become the dax 40. Carrie lam deliver sure annual policy address after postponing it last month. Thearie also wednesday, latest fomc minutes from the fed and an update on u. S. Gdp in the third quarter. Friday, annual shopping next za boostof extravagan online. I hope youll be spending something in the post. The first quarantined free travel bubble in weeks after a surge in new coronavirus in hong kong. Juliette saly was meant to be on the first flight to hong kong. Friday, you were telling us about the paperwork that went into this, but now, this just shows how tenuous these travel arrangements can be. Supposed to be a first flight and it got pushed to the sideline. Juliette and love to everyone watching this and hoping it would be a template for other air travel bubbles. We started to see a spike in coronavirus cases in hong kong last week. Saturday morning, i got a text from Singapore Airlines saying it is going ahead, but then another spike of cases in hong kong saturday and by 5 00 local time, they had called off the air travel bubble. Anyone who decided they would still travel from singapore to hong kong or vice versa would be facing quarantine. Initially, it was going to be an extra test henri arrival on rearrival due to the surge. It bodes the question of how we are going to get travel up and running into cities that seemingly had a strong handle on the coronavirus crisis, cant seem to get this off at the moment and we have seen a huge blow to Cathay Pacific shares in hong kong, Singapore Airlines under pressure too after both airlines have seen a little recovery on momentum when the air travel bubble was first announced. Manus i dont know how the passport took the news. About how hong kong is offering payments to those infected with coronavirus. People in a bid to get to get tested. Juliette youve seen this spike in hong kong over the last few days, the most since august and there is a worry with this travel bubble that if you saw the rolling average between hong kong or singapore hit five over seven days, they would call this off. It hit 3. 9, but the fact you have seen a spike in the last couple of days was worrying. Hong kong will pay 645 u. S. Dollars to anyone who tests positive that will help for the recovery, but it is a hope people will come forward to get tested. They will set up another five Community Testing centers, adding to the four in operation and hong kong, imposing new social restrictions. Hoping they can stamp out this new wave, this fourth wave in hong kong and the air travel will resume in a couple of weeks. Does, andwe hope it we know you will be on the next flight. To it. Ooking forward Juliette Saly in singapore, supposed to be on the flight, but waiting patiently. Coming up, planning a share buyback. Ceo. From bob vandyke, this is bloomberg. Are you frustrated with your weight and health . Its time for aerotrainer, a more effective total body fitness solution. announcer aerotrainers ergodynamic design and four patented air chambers create maximum muscle activation for better results in less time, all while maintaining safe, correct form and allows for over 20 exercises. Do the aerotrainer super crunch. The prestretch works your abs even harder, engaging the entire core. Then its the back extension, super rock, and lower back traction stretch to take the pressure off your spine and stretch muscles. Planks are the ultimate total body exercise. Build your upper body with pushups. Work your lower body with the aerosquat. The aerotrainer is tested to support over 500 pounds. It inflates and deflates in less than 30 seconds using the electric pump. Head to aerotrainer. Com now. Now its your turn to lose weight, look great, and be healthy. Get off the floor and get on the aerotrainer. Go to aerotrainer. Com, thats aerotrainer. Com. Annmarie 6 30 a. M. In london. Im Annmarie Hordern with manus cranny live from dubai. Optimistic, a risk on tone for equities as the u. S. Plans its first virus vaccinations within weeks as the nation sees a jump in hospitalizations. And reopening, Boris Johnson will outline the u. K. s winter strategy. The measurements to include an increasing Community Testing and reintroduction of tougher tiered restrictions. Team, president elect biden is said to have landed on blinken asvisor tony secretary of state. London, 10 30 in dubai. We have been talking up for weeks about this tugofwar, vaccine optimism versus restrictions. Today, here in the u k we will get fresh guidelines on what the winter has in store in the United Kingdom and in the United States, the fact we could potentially see inoculations within three weeks, which could be a game changer. Manus yes, and potentially Anthony Fauci talked about the possibility of herd immunity,. 7 of the population being done by may. Mr. Trump at the g20, remaining focused on america first, vaccine for americans, vaccine for those who live in america rather than the global solution. That is potentially a risk. Annmarie that is, and the likes ,f chancellor Angela Merkel this needs to be multinational approach, not a unilateral approach and potentially, a different change of tone. Likely that will come with the biden administration. You can see with this bloomberg scoop about tony blinken who wants to hold International Approaches and cooperation, but the lot markets, liking the vaccine news this morning. Manus we had another red headline, south korea makes a record high. Global equity market hitting record highs last week. Risk on, the vaccine is three weeks away, but are we ahead of ourselves . The market is ahe