Moneygram by alibaba in the buyingest deal to be stopped by Trumps Administration. And north korea is the first to dial in after the border hotline with south korea is reopened the day is here. After some seven years in the making, mifid ii regulations came into effect today the sweeping legislation will touch every part of the Financial Services system and is meant to make the eu more transparent and competitive. Now, the sprawling rules will radically change how assets are traded and how money is managed with investors focused on changes to Investment Research under the new model, banks will have to charge separately for research and Broker Services so someone will be on the hook for picking up the cost. According to the Cfa Institute survey, 53 of respondents expect their firm to absorb the expense. 15 expect clients to pay. 12 expect an equal balance. 21 are to the sure. You can see that behind me in terms of how Asset Managers are thinking about covering the cost of research. The legislation attempts to make stock markets more transparent by setting a cap on trading in dark pools as well the new rules allow only 8 of total volume in any stock to trade hands on on a private or unlit venue. Mifid ii will not yet be a global standard. Many questions remain on whether other regions will follow suit they were counting on as investors would see this transparency, this new amount of information, they would push for it globally. I think well start to see in the u. S. That some of the large state Pension Funds are looking and lobbying the s. E. C. To say what were getting from the european Asset Managers is actually really beneficial europe is at a disadvantage of course transparency is a positive thing, but the Playing Field has not been leveled you can see if you look at the outlook for u. S. Banks over european banks, the u. S. Banking sector is more positive. The spinning plates between the u. S. And europe are difficult to manage between the two regulatory bodies. We have not seen mifid ii come into Practical Application until january 3rd. Its difficult to say how it will go practically moving forward. The deregulation of the u. S. Financial system by some is seen as a benefit, by some seen as an advantage. So it is mifid day lets look at how european markets are looking. Trading on a lot of well, much better footing than things were looking yesterday Strong Performance in the tech sector and nasdaq in yesterdays session, and were seeing equal amounts of optimism and positivity in european markets lets look at financials financials are the major focus on this allimportant mifid ii day. The exceptions being Deutsche Bank and commerzbank but overall the picture for the Banking Sector does look positive lets switch to Asset Managers and see what the picture is like there. Interestingly and at odds with what we just saw from the banks, Asset Managers are struggling a bit. You can see a lot of the blue chip names there are down almost 1 or so old mutual down more than 1. 3 as people come to terms with mifid ii and what that means with businesses. Joining me on set is the managing director and portfolio director of Portfolio Management as an investor and managing director of your firm, how will mifid ii affect how youre doing business were complying with the regulation as a firm well absorb the cost for research it does affect us in how we Source Research and consume it as far as the mechanics of trading, we dont see a Significant Impact going forward. Theres going to be winners and losers some of the unintended negative side effects of deregulation is that it disadvantages smaller firms. Could lead to lower liquidity in trading of Smaller Companies, which i think is unfortunate hopefully it is something that can be resolved over time. Can i ask you when you started thinking about which Research Analyst you would stay with or not . Is this more like a last minute decision you took in november and december or have firms like yourself been thinking about this for a year or two its been a longerterm project that picked up steam towards the end of the year. The process of really evaluating the quality and value that is being delivered by different providers. Its something that picked up steam in the fourth quarter. Do you get a sense that the blue chip banks and larger banks will have a competitive advantage, say the smaller boutique firms, in the sense with the banks you can get skill, access not just to Research Analyst, but a couple Research Analysts that you follow as opposed to a single piece of research produced by a smaller firm youre likely to see a narrowing of research to areas that make commercial sense in that sense you will get probably better quality for the more mainstream areas. As i mentioned that may leave more niche areas where specialists could create a Business Model that makes sense for them then Asset Managers have the ability to look at both, to fill the spectrum as an equities guy, how are you thinking about the dark pool caps thats one of the more contentious issues to the mifid ii legislation up to certain limits investors will no longer be able to access the dark pools of liquidity and be forced to go back to the exchanges. How will that affect equity trading given that equity trading is a big part. We are a multi asset team and invest in equities it impacts more higher frequency type of strategies that will be impacted by day to day liquidity and how the mechanics of the execution work we tend to have a a more intermediate term focus. I dont see a Significant Impact on investors who have a longer term perspective, and more of a buy and hold mentality it will be more difficult for higher frequency hedge fundstrat Fund Strategies that will be impacted High Frequency traders are one of the beneficiaries of block trading when they do occur on the exchanges we have to see how that evolves. One last question on this topic. Broadly speaking, europe has been hit by a bunch of legislation over the last couple of years do you get the feeling that europe and europe Financial Services industry is becoming less competitive versus the likes of the u. S. Where you get president Trumps Administration saying theyre thinking of repealing some aspects of regulation thats a great question we finally have some regulatory certainty in europe after a decade of uncertainty for the sector that itself will be quite positive we think thats a potential driver for some rerating of the sector in europe but relative to the u. S. , it is falling behind we do think there is material deregulation in the works, in the u. S. , through different personnel that have been put in place in the agencies and some regulations like day one certainty and mortgages that are going to give the u. S. Banks even further advantage than they have already well talk about Market Opportunities in a second. Thats the managing director and Portfolio Manager of pine bridge investments. We have an exclusive interview latertoday with Steven Maijoor from 12 15 cet. Next shares are rallying after the british retailer raised its fullyear Profit Guidance the company attributed its stronger than expected performance to cold winter weather. Next also said it expects the retail environment in the uk to become less challenging over the next 12 months the profit upgrade is giving a boost to other uk retailers. Shares in mms are also higher. Other Retail Stocks are also getting a lift shares in ted baker and ab foods are also seeing gains. You can see in front of me, ab foods is up almost 3 . Marks spencer almost up 1. 5 following nexts positive results. Shares in altice are getting a boost as it signs an agreement with m6, one of the most profitable private Television Channels in france it produces the french equivalent of the x factor and britains got talent and holds the french license for a number of large u. S. Tv series. Weve discussed a lot of things if you have any mifid related questions or comments, feel free to email the show, streetsignseurope cnbc. Com as ever, you can follow us on twitter, streetsignseurope cnbc or tweed me cnbcjou. Coming up, shg, the ecb rate setter hints at the end of quantitative easing. More when we come backr your h so why wouldnt you take something for the most important part of you. Your brain. With an ingredient originally found in jellyfish, prevagen is now the number one selling brain Health Supplement in drug stores nationwide. Prevagen. The name to remember. Welcome back to street signs. Its the second trading day of the year and mifid ii day. Not a lot of focus just on mifid ii but on the u. S. Dollar which continues its downward trend weve seen that over the last couple of months in front of me, if you look at that, cable for example, many of them are trading at the highest crosses since last september, which tells you that the dollar transfer now appears to be intact and its in a downward trend in line of what we saw with q4 last year. So no respite for the u. S. Dollar here and raises a few questions about the direction of euro dollar from here. Another commodity that was taking a lot of the headlines recently was oil the price action weve seen there. And the interesting thing about oil is obviously it has been impacted by multiple but temporary supply disruptions, but boosted by the protests that are occurring in iran. I mentioned this a couple days ago, this is the first year that wti and brent start the year at higher than 60 since 2014 gold is also making some new highs. As you can see behind me, the gold has just come off the high of yesterday of about 1316, that would put it at its highest level since september. I guess theres no coincidence as the dollar price has gone down, gold has gone up its on pace for the eighth straight day of gains. Some are pointing to the strength in rsi, thats about 75 anything above 70 does indicate that the length in that asset class is getting a bit too much. Some tech analysts say we could see a pull dak in goback in gold ryanair carried 129 million passengers in 2017, a rise of 10 . The traffic grew 3 to over 9 million customers with the load factor rising to 95 the airline has applied for a uk license to protect routes ahead of brexit. The irish lowcost carrier said it filed applications to safeguard its three british domestic routes that could be at risk in the event of a hard brexit. The uk is in talks to join the Transpacific Partnership after the Brexit Britain has held informal discussions with tpp members as it looks to boost exports after it leaves the eu if included the uk would be the only member that does not border the Pacific Ocean or the south china sea, but the British Trade minister said there was no agree graphic geograph geographical membership question the european bond yields rose across the board after an interview from the ecb board member he said the ecbs 2 2. 5 trillio bond buying scheme will end in 2018 if the Europe Economy stays strong he also added that money is flooding into european stock markets and that heated u. S. Equities look more dangerous than european real estate. German jobless numbers dropped more than expected last month with unemployment at a record low of 5. 5 in december now, the managing director and Portfolio Manager of pine bridge investments is still with us its interesting that novotny is taking shots at u. S. Equities being overvalued here and not so much german real estate. Taking a step back from that theres a lot of momentum in the european economy will that present a good trading opportunity for 2018 we do, but on a selected basis. Youre seeing euro strength, maybe not today but an upward trend towards euro strength for this year as policy normalization proceeds, that can pressure earnings from more of the large caps that are more export oriented. So we think that domestically oriented stocks would be perhaps a better place to focus in europe where earnings can still grow and not be challenged by the currency i was reading in your note that you said that the capex cycle only recently started, and you expect that to persist why is that the case what indicators are you looking at to gauge whether or not the cycle will continue . Weve had a decade almost of lack of Corporate Investment lack of confidence on behalf of companies to invest. Thats changing. 2017 is the first year we saw that happen. Theres areas where Capacity Utilization is quite high. Europe is one of them. That triggers a need and a willingness on behalf of management to invest in their businesses whats different this time around is investment is not going towards capacitied ay ei a a additions but efficiency gains geared towards technology in areas within software and equipment upgrades thats positive for more of a disinflationary growth cycle to continue you expect that to happen in europe or globally this is a global phenomenon were seeing it across the whole pine Bridge Network from the bottom up. Analysts are hearing this across the board. An example is in japan where we see a flurry of investment activity taking hold its a global trend. In europe its coupled with mo e traditional capex and construction areas as well does that make you more positive on tech stocks . Theres been chatter about the performance of fa. A. N. G. S in 2017, but based on what you said you would still want exposure to tech stocks. Thats a good question. We do think technology is well placed to continue to benefit from the environment ahead however the names you named are more consumer focus. Mainstream. Theyve been benefiting from secular types of growth in earnings we think the next phase of growth is much more geared towards Technology Companies that are facing corporates where we see Corporate Investment accelerating, thats where the next leg of growth will be within technology. There the earnings on a go forward basis look attractive and valuations are actually much more reasonable. Can you give a couple of names . Names within Cloud Computing areas, software as a service, cybersecurity, areas which are much more geared towards corporate capex are much less pricing in the Earnings Growth still to come. Brilliant thank you very much for your thoughts now, north korea has made First Contact after reopening its border hotline with south korea. Kim jongun welcomed seouls willing tons hold peace talks. This hours after President Trump appeared to mock kim jongun on twitter chery kang has more on the story. Reporter north korea starts the year with a charm offensive. It revived the phone line at a village thats been cut off for nearly two years south korea is welcoming the development calling it a significant development. Quite a turnaround for the interkorean relations that seemed pretty much nonexistent for most of 2017 but washington is skeptical. The state department questioned the sincerity of kim jongun and u. S. Ambassador to the united nations, Nikki Haley Says north korea can talk with anyone it wants, but it still needs to go nuclearfree we wont take any of the talks seriously if they dont do something to ban all Nuclear Weapons in north korea we consider this to be a reckless regime. We dont think we need a bandaid we dont think we need to smile and take a picture we need to have them stop Nuclear Weapons. They need to stop it now north korea can talk with anyone they want. But the u. S. Will not recognize it or acknowledge it until they agree to ban the Nuclear Weapons that they have no word yet on whether north korea actually wants to hold highlevel talks next tuesday as south korea had suggested. The question in focus now is whether the regime makes nice with seoul without any Strings Attached back to you. U. S. Officials have urged Global Leaders to stand in defense of antigovernment protesters in iran demonstrations that began over irans economy and corruption have now swept over several iranian cities at least 20 people are dead with more than 450 protesters arrested iranian leaders accused enemies of the state of stirring up the protests the protests come as many are dissatisfied with the state of the countrys economy. This is not the first time Economic Conditions have driven demonstrations to the streets. Michelle carusocabrera has more reporter the ongoing protests in iran are the most violent since 2009 since students rose up in response to what they believed was a rigged election political observers say the current uprising which started