institutions were about after the second world war and with all of the problems, we have seen 70 years of more peace and more prosperity than humanity has ever known before. so the stakes in these different approaches over time are very large. yes, one can make calculations from some economic model, growth will be a few tenths of 1% higher with the right trade agreements than with the wrong trade agreements, but ultimately, this is about whether we live in a world that progress is together or a world that regresses and struggles a part. that: i am glad you raised because we had mark carney, the bank of england give a speech today in which he specifically referred to sweet holly and what happened with protectionism. one point he made was that countries like the u.s. and the u.k. which have gone more over to a services economy are disadvantaged compared to the germany and the japan because a lot of the trade wars happen in the goods area and not the service is one and the must we get the services to catch up in terms of the loosening of tariff barriers than we will always be at a disadvantage. is he right? mr. summers: i have not yet read his speech but i think it is a valuable point. some of the crucial steps in the tpp were things like the protection of intellectual were various aspects of access for service producers. yes, those are very important things in trade agreements going forward. what mark carney captured in that speech is a much broader truth. which is that the united states did not have important protection against other countries manufacturing goods 35 , beforeo before nafta any of the trade agreements. so the idea that somehow, we are doing something dangerous by entering into trade agreements that is going to threaten american workers is really nonsense. the truth is that our trade agreements are very disproportionate with other tradeies producing their barriers much more than the united states reduces its trade barriers. goldendoes this opportunity for progress with china? the trump administration is negotiating a series of agreements with china. they want to focus on services, particularly financial services. is there an opportunity there on financial services? sure it willi am be valuable to continue the discussions of opening. frankly, i think the prism through which we view trade agreements should be u.s. jobs in u.s. incomes. my sense is that much of what people talk about when they talk about financial services trade is basically businesses that may be headquartered in the united states doing more business in china, with chinese nationals, as their employees. i am not sure how much that really contributes to the u.s. economy. i am all for our succeeding but as i look for negotiating priorities, i would look for issues that are going to go to the bottom line for the american middle class. i would be skeptical that financial services would be at the top of the list. david: larry, thank you so much. that is larry summers, thank you for all of your time today. that does it for bloomberg daybreak. now over to vonnie quinn for bloomberg markets. this is bloomberg markets. >> i am vonnie quinn in new york. >> in london, i am nejra cehic. let's check oil trading. >> we got oil prices tumbling this morning along with other commodities. that is the big move we are seeing in markets today as nymex crude falls below $33 a barrel now. not quite at low for the session, but indeed, tumbling to its lowest. the lowest since the u.s. elections. gasoline is also lower. upper futures are taking a hit. a relatively broad selloff within commodities. we have an uptick in libyan production. that pumping the most prudent for years. that is putting pressure on oil as is the build we saw last week in gasoline and crude oil. here in the united states. over to stocks, we see declines there as well. relatively modest ones for the dow and the s&p and the nasdaq, falling a third and a quarter of a percent respectively. they closed at records yesterday. if you look at the groups on the move, energy is responsible for the declines in the s&p 500. down but00 group is telecom and material stocks are also falling. only health care and utilities are perking up today. the pain is wide with that complex, if you look at the stocks on the move. you have giants like exxon and chevron and smaller stocks like whiting petroleum and ensco falling by even more. >> we are about 90 minutes to the close of equity trading in europe but the big focus in the market today has been sterling. 1.2624, extending losses, down 9/10 of 1%. this is the lowest in more than a week after we heard from the bank of england governor earlier , signaling that he won't be rushing to raise interest rates anytime soon. the sterling has taken a pounding. we have been seeing guilt rally. the 10-year gilts yield has dropped in today's trading. we are at exactly 100 basis points, down two basis points intraday on that 10 year gilt yields. when you look at equities, we have seen two days of rallying but they have come off a little now with stoxx 600 a little weaker and the dax, speaking of u.s. stocks yesterday, the dax but it is offoo by roundabout 2/10 of 1%. the broader at european benchmark, the stoxx 600 really is oil and gas stocks underperforming. we are seeing wti down significantly in today's session so we are looking at oil and gas stocks here. intraday, down 2%, hitting their lowest since november. vonnie: a prosecutor is in the united kingdom, charging barclays executives with conspiracy to commit fraud. it cost investors in the trading capital. join us to explain our bloomberg enforcement and investigations reporter cindy ring and stephen morris, who covers investment bankers. it is ironic, they raise the money that would save the bank and face criminal charges for that. >> it was an unprecedented time and that is what a lot of the commentary has been around today. it is one of the few banks that avoided a state bailout. but obviously, since the charge, there are questions raised on some of the arrangements they entered into to pay that. nejra: stephen, i want to ask you what this means for berkeley. if you look at the stocks today, it went down some at 9/10 of 1% so a little bit of a reaction there. what does this mean? >> it adds to a litany of misconduct problems that have come to light since the financial crisis. it comes in a bad time personally for the ceo who is under investigation for his attempts to find out who in anonymous whistleblower was earlier. in the u.s. the bank is up to go to court against the doj to fighta multibillion pound so closing in on a decade after the financial crisis, the issues have still not been solved. nejra: so stephen pointed to some of the issues going forward now. what else is there to look ahead to, especially in terms of potential fines? >> there will be a court hearing in a few weeks time, and realistically, they will take backlogs and if it does go to trial we might be seeing it probably before 2019, which means we probably won't know the resolution for some time. vonnie: how likely is it that there is jail time for 1, 2, 3, or four of these? >> all of them have been charged encourageses that time. if they are convicted, that would result in jail time. suzi: hard to know without seeing the evidence. we have to see what the defense will come out with, we have to see if it will go to trial. along with ago. that's a long way to go. nejra: have we heard anything on this? stephen: with the bank considering its options, the tone is a lot less harsh than some of the previous penalties but under the new ceo, they have decided to strike a more conciliatory tone towards regulators to try to get lawmakers on their side and not be part of the group of banks which is saying they are going to leave london and abandon the country. maybe this will pay off, but ultimately, this doesn't look good. it is not what investors want to hear. vonnie: stephen morris and suzi ring, thank you so much to you both. question back to the markets. the dollar index rising for the second day in a row. it has been strengthening generally. trading at the highest level in nearly three weeks. early today, bloomberg spoke to the u.s. treasury secretary steven mnuchin and asked about how the ministration is doing a stronger dollar. >> the dollar is the reserve currency of the world. it is not our focus where the dollar is in the short-term. there is obviously a negative aspect of a strong dollar as it relates to our exports but on the other hand, it is a vote of confidence in the u.s. economy and the trump administration, similar to what is going on in this is onerket so of the most important investment weortunities in the u.s. and are seeing a lot of attractions here and that is what this conference is today. >> on the issue of investments, talking to a colleague of mine, do youested that -- still believe that or are you walking back from nafta? >> i am not walking back. it is something we are seriously considering. i do think it is a tool that the government should strongly consider. we are reaching out through the borrowing committee and investors to see what the demand is. what we don't want to do is create a program that is a completely one-off. it is an important part of our borrowing capabilities. have been advisers to the president on picking future chairs, has the president solicited your advice on who the next fed chair should he? positions,f these gary cohn and i are working closely to make recommendations to the president so he and i can meet all the people and make joint recommendations to the president. >> what do you think constitutes a good fed chair? >> what do you think the president should be looking for? >> we haven't made any decisions yet on the fed chair. whether we have a new one or not. it will work closely with the president as we consider all of the issues. >> what is your relationship like with mr. cohen? with hear about reports of division within the white house. what is your sense of how the economic team is working? > the economic team couldn't be working better together. that is a combination of myself, gary cohn, wilbur ross, bud light heiser on trade, and we meet constantly, and i think we couldn't be working better. gary and i have known each other for a long period of time and we have worked closely together in the past. vonnie: u.s. treasury secretary steven mnuchin speaking to bloomberg earlier today. coming up, oil trading at a seven-month low. under $44 a barrel on wti 42.19. you can see we will trade this case on oversupply in. that is next. this is bloomberg. ♪ >> live from new york, and london, i am vonnie quinn. nejra: i am nejra cehic. this is bloomberg markets. we are looking at oil. time for futures in focus. oil dropping to a seven-month low as libyan output climbs to a highest levels in four years. joining us to discuss the latest move in crude is todd horwitz, chief strategist at trading. to the program. are we in panic setting? we are seeing drops of 3% in this session. mr. horowitz: good afternoon for you. i think we are in some sort of an overcrowded trade. i think you are now seeing too many people on the short side of the trade. we are going lower but you will probably see some sort of balance or. we continue to push lower without any chance of a bid and that is an indication that too many treasuries are trying to push it down based on too much supply, based on the opec manipulation, the whole deal doesn't spell good to begin with but now we are seeing them paying the price for it. at some point, you will probably see some sort of a bounce but it is something that will overall get to 40 or below before it is said and done. nejra: is that because you are skeptical about rebalancing in the market? >> i think you have to look at we have no real growth. we are in the middle of driving season. goodill can't get really bits for oil so you have oversupply, two-minute people trying to neglect price and typically that pushes prices supply heresee no where we relieve the supply. until we get jobs back, we are not going to have a huge demand. we've got more fuel efficiency and everything is in favor of using last, plus we have no growth. nejra: talk a little bit about the frack log. that is another challenge. >> yes. those things -- everything is always a challenge but the real challenge of the matter is that money dictates what is going to happen and when you look at the markets you can see that right now, money is pushing down the markets very hard. at some point they will find themselves in a spot where there is no more sellers left and you will see them bounce so all of the challenges around the market are there but again, markets will figure out a way to trade and you will see some sort of a bid and you will see some of it charge up and i wouldn't be surprised if we see a 7% rally before we zoom down to the lower end of this. >> todd horwitz, chief trading.t at bubba thanks for joining us for our futures in focus segment. coming up in new york and london, alix steel will be speaking to goldman sachs global head of commodities research jeff perry, live from goldman's finance conference. vonnie: time for our latest business flash with a look at the biggest business stories in the news right now. private equity firm has agreed irm at drug research f $5 billion, and the company was under pressure from activist investor star board capital to sell itself. rio tinto has expected -- rejected a last-minute bid from -- tore to silicone line sell a cold line to a chinese company. rio says shareholders should vote for the offer, giving it rate with tory approval and funding. -- giving it regulatory approval. >> tech stocks have to the glib in the markets highest flying industry but lately, they have becomes a low volatility they could be considered smart beta. we will be having a look. this is bloomberg. ♪ nejra: this is bloomberg markets. i am there a change in london. vonnie: in new york, i am vonnie quinn. time for our tuesday smart beta segment. here is julie hyman. >> one of the most popular categories of etf has a stranger in their midst. technology stocks. here to discuss what is going on with low volatility etf's is dani burger. she is bloomberg markets and such reporter. lowball is definitely not something you usually associate with technology stocks. and yet, because of what is going on with technology, they have been going on into the low volatility. why does it matter? dani: when you think of low volatility etf's, you think of something cohen, something that is not going to move around a lot but what do you think of when you think of tech stocks? perhaps something that looks bubbly, something that moves around a lot. but when you look at how tech stocks have behaved over the past year which is typically what these low volatility etf use, they really have not move much. they have been growing and gaining, but those gains have been very important. you can see that now. this is the power share etf, now 11% tech stocks. it is a record in this history. julie: goldman sachs got a lot of attention recently, of with a note saying low volatility in tech was a reason for concern. if they are going into this as a signal for some investors? dani: you need to look at what .ech stocks are in there it is not like these are 100% things. that will be concerning. some of them have a little bit of apple and facebook but i think there is enough diversity in these etf's that it is not like tech is overwriting them. a lesson fore is investors. you should know what you are investing in. just because it is low volatility but you need to know what you are investing in. if you are concerned and you don't like tech and you think it looks bubbly, perhaps you should think twice about putting money in these. julie: for the low volatility etf's, what is in there. is it making diapers? >> the utility companies and stables are definitely heavily weight in their. financial interest is also a heavy rate in you -- in u.s. equity. there are companies like these a which would be successful to interest rate changes but they are not as heavily weighted to these. julie: because of this, has it affected the performance of the etf's? dani: they had outperform the market. dani:tech has actually helped. one thing i think is important to note is a lot of people freak out because they say, oh no, my low volatility etf's have become momentum and momentum is scary because it flips over a lot more quickly than low volatility. you can say, no momentum is going to selloff. but when we dig into the etf's -- it is great function for the bloomberg looking at this -- it is negatively exposed momentum. for those beating the drum and saying this is momentum, keep in mind it has tech but still, all of the other industries do not make the same momentum etf. julie: obviously, volatility has gone up in tech over the past week but you says it looks through the past year so that has not really affected it. step dani: -- we see tech with sustained volatility, it probably will take tech out. but a couple of days of volatility won't change how these etf's invest. julie: dani burger, think you much. dani burger covers markets for us at bloomberg. vonnie: julie, thank you for that. central banks are always looking for investors and today we are getting some comments from " oncials and a firm "no rate hikes. we have mark carney up next and how investors should play at all. this is bloomberg. ♪ [ noises inside can ] [ laughing ] it's driving me crazy come on. [ spitting from tongue ] time for my secret weapon. sports, movies, tv, ah, show me music to distract a minion. [ voice remote click ] oh! [ pharrell starts to play ] [ minion so happy to see screen ] ahh! i'm pretty smart. ahhh! [ lots of minions ] [ mooing sound ] show me unicorns. [ click noise for tv ] ahhh! that works too. find your awesome with the xfinity x1 voice remote. see despicable me 3. in theaters in june. vonnie: live from bloomberg world headquarters in new york, i am vonnie quinn. .ejra: i am nejra cehic this is "bloomberg markets." the growing of influence of president trump's family over foreign affairs. trumphas invited ivanka and jared kushner to visit the country later this year. ivanka is an assistant to the president. jared kushner is an advisor. angela merkel bowing to seek trade in the g-20. richie told german business leadership would not give up on a free trade deal between the u.s. and germany. this is amid widespread concern about the trump administration's america first approach to trade. the man accused in the london mosque attack is described by his mother as "disturbed." sun" he hasold "the been on medicine for mental health problems. according to "the wall street journal" he is likely to quit by his 90th birthday in july 2018. he is the richest person in hong .ong and number 2 in asia he is worth almost $33 billion. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. vonnie: markets, high-yield .redit, up 5% treasuries rallying. where to go from here? high-yield,al welcome. we had another rate increase since we saw you last. how is it impacting the bond market in terms of more high-yielding assets? market seemsield or shaken it off. . noted that we are up 5% for emerging-market appropriate credits up another 50 basis points, europe 50 basis points and back in terms of veterans. we have surpassed the returns most expected. five --you presented a you predicted a 5% increase. what do we do now that we are there? emi this is the time of friends who are strategists hate. they have to come out with their forecast for the second half of the year. many have then predicting 5% or 6%. if you go sideways, the high-yield market could return 8% for the year generating 50 basis points a month in income. nejra: which investors are reaching for yield? i we seeing any risk-taking that might be a concern? is a good question. i cannot tell you there is no complacency. the vix alone would tell you that. level of lbo debt taking place, companies issuing debt to pay dividends to shareholders is a low level. from a fundamental perspective we are constructive on the marketplace. we don't think valuations are cheap. they are on the rich and. from a fundamental perspective, we think markets are in good shape at the moment. nejra: can you predict when we might to get the next recession, and if you can, how might it differ from the last one? certainly, i don't think we will see recession this year. i would argue it is unlikely for 2018. 2019 is more likely. if we look at the strength of the banking system, that gives us comfort the next recession we will likely see is more likely to be a normal recession that companies andl retailers harder this time year given what is going on in that space rather than the banking sector, which is why it was so bad last time. we have seen this amazon deal proposed. like that, how does it impact the market you are looking at? ken: the new issue market in the investment-grade space, and that would be an investment-grade bond, is robust. not as robust as the year before, but still strong. the fundamentals are also good. vonnie: given supply in investment grade, increases like that, that would be a massive influx of investment-grade credit here it that impact high-yield return? ken: it would absorb that issuance well. i'm not saying that spreads might widen out modestly and you might get an effect widening out modestly and high-yield as well, but i don't think it will be dramatic. -- there was an interesting article on the bloomberg by one of our gadfly columnists talking about credit hedge funds have been missing out in the resurgence of hedge ands and private debt private equity of p are more attractive. is that something you have noticed, and is it something that concerns you? vonnie: is something i have noticed. i have friends in that space. for many that are below the high-yield market itself. less than 5%. i think that they have, because of where spreads have been, they have been tight, a lot of them have been playing this from the short side rather than having long exposure, which has cost them. their shorts, with a have made retailn some of the names, undoubtedly, and other fewes, but they have been and far between. the opportunities to make good money in shorts. that is what i think is hurting the credit hedge fund space. nejra: speaking of opportunities, if you look at europe, where do you see the opportunity in the credit space? that we are, we are seeing opportunities, not so much -- it has been issue are specific more than anything else. there are reasonable issuance going on in the auto parts arena. we have probably taken some of our bets off the table as it relates to the u.k., in particular on the resale side -- retail side. they seem to have weakened a bit recently and we have concerns about the ability of consumers to absorb the of visual -- the eventual brexit. vonnie: you have interesting on latin america including argentina. it might also of great argentina from frontier to emerging. have you been looking at argentina? we have a chart, 233 on investors getting more interested in argentina? ken: we have seen a flood of money going into argentina from two places. there has been a repatriation of capital, given a tax holiday that took place that allow the money from argentinian residents who have money parked offshore to bring it back in the country. will follow that is professional investors. we have made bets in argentina. vonnie: in what space, obviously the credit space, but where? utilities, real estate companies, a number of different places. vonnie: would you be interested in the 100 year bond? ken: i'm usually not a sovereign credit buyer. it doesn't fit what my clients get. about: venezuela, we talk hunger. have you bitten? ken: we have not been a buyer of the bonds of venezuela. we don't buy sovereign risk, but neither have we bought bonds in the venezuelan oil fields. fundamental reasons for a long time. it has been the primary driver of that. , thank you.monaghan head of global high-yield at a monte smith. will the fourth time be the charm for china? we look at where the mainland chinese shares will be included in the benchmark indices. this is bloomberg. ♪ vonnie: live from new york, i am vonnie quinn. nejra: in london, i am nejra cehic. this is "bloomberg markets." stories in business the news right now. apple's firing the latest shots in its long-running legal battle with fulcrum. they claim mounting evidence the chipmaker is operating an illegal business model designed to exact loyalty to every device sold. they want to argue that qualcomm has exhausted the right for loyalty. tesla is close to an agreement to make electric cars in china for the first time. a deal would allow tesla to build facilities in a in shanghai,one giving elon musk's company better access to the world's largest auto market. that is your business flash. vonnie: it is time now for our bloomberg quick take. background on issues of the day. the battle of the brazilian president michel temer who arrived in moscow to talk with vladimir putin. in 2009, brazil founded biggest oil discovery, calling it the task force to the future. also the 2015 olympics on top of the 2014 soccer world cup. the economy has suffered its worst recession on record. unemployment is near record high. government and business officials are in snare old in corruption. ensnarleds incorruption. testimony indicated that president michel temer approved hush money for a jailed ally. he has denied wrongdoing and said he will not step down. sentiment has taken a downturn. the ims cut for zell's outlook. some worry the economy could slip back into recession. brazil hashistory, been prone to bloom and bust cycles. it's prosperity is tied to its market. on paper brazil looks like a powerhouse with giant offshore reserves. its distribution remains unequal and falling commodity prices sent the country sputtering. michel temer working to put brazil back on solid footing. he wants to use a more business friendly environment. the president saying pension reform and legislators will be increasing. brazil draws closer to the 2018 elections. the government is still dealing with the fallout from the petrobras scandal that exposed institutionalized corruption connecting brazil's largest companies with a political party. you can learn more on our quick takes on the bloomberg. nejra: we'll have more on the global market leader today. i'm speaking exclusively with the south african finance minister at 12:30 pm eastern, 5:30 p.m. london time. let's turn to china. in less than six hours we will learn if domestic shares will be included. china has been rejected three times. joining us is mike mckee, the bloomberg international correspondent. this is almost becoming an annual event. what is different this time? it appears they're leaning in the direction of including them. chinese shares are listed in their emerging market index if shore intraded on foreign denominated currencies or in hong kong or adr. they represent 28% of the index. there wouldn't be that many a shares included, but they would raise the waiting to 40 3%, having portfolio managers with a new benchmark against the index having to increase portfolio allocations by $2 trillion. in the msci, there are others. vonnie: we have a chart showing the difference between the onshore and offshore. which ones would be included. the potential inclusions, and you can see the hang shining the green. the shanghai in the blue. i want to ask what changed. this is the for the fourth year this is being considered. the next couple of allocations have not been met. potentially they have been met, but this is definitely a judgment call. >> msci took the criticism to heart for the last three years. one thing, chinese stocks could go into trading halts easily. their roles are not the same as in the united states. the chinese have put new rules on when they can and cannot stop trading for her they are allowing investors to get into the shanghai and shenzhen markets. they say that gives better access to markets. there is concern if you can get your money in and out of when you want to. they say that will address that. the third reason they are moving towards this is that others are already including them. the london stock exchange has a sub index were emerging markets tracks chinese a shares. the vanguard uses for its epf's. if msci waits too long, they might lose out. they are suddenly included in my portfolio of emerging markets, my bond manager now has to buy some, what reason would there be for me to buy this basket of stocks when i can participate in china in a different way? some stocks have been highflyers in the past. over the past year to date, we are seeing the shanghai and .henzhen composite down 4% it hasn't performed as well as shares listed offshore like tencent and alibaba, which are included in the emerging market index. you get the high fliers now. if you are forrester rebalance -- against a portfolio, would you buy any of these now. vonnie: i want to mention for our viewers and terminal users, you can access all of the equity research from our bloomberg intelligence team go to bi and type in chi for china appeared you will get there. nejra: we hear from the facebook in an exclusive interview. where facebook is finding new opportunities to grow its ad business. this is bloomberg. ♪ vonnie: live from london and new york, i am nejra cehic. vonnie: i am vonnie quinn. this is "bloomberg markets." facebook shares have been writing the big tech wave and hovering around an all-time high. does advertising fit into facebook's strategy. sheryl sandberg spoke with caroline hyde in an exclusive conversation. sheryl: our biggest message is the small screen is big. people have moved to mobile. businesses are catching up. it is the case of the average u.s. consumer. these numbers are duplicated all over the world. four hours a day on tv and five and three quarters on digital, the majority of which is mobile. it is an exciting time to be a marketer. people are carrying in their pockets a device that allows you to reach them all the time. been part oflways our daily life. from our toothpaste to our shampoo, to the car services, the cars we drive. it is part of our daily lives. now marketers can reach us, hopefully with messages we want to hear as part of our daily experience. that is pretty amazing. the explosion of creativity is very much about the creative community. it is about how do we create messages that resonate with people and want them to be part of their daily life. caroline: it is playing into community building. how are brands able to play into that? sheryl: communities are important to me are very focused on how we build communities that provide support for people off-line and online. .rands are huge part airbnb have a great off-line experience where people can rent house from host. they have created facebook posts that create online experiences. you can be connected to the people who are part of it. what about various products? you talk about how airbnb is making a good run of it. what about messenger, whatsapp, instagram, how are these being adopted? are using these different platforms in facebook and instagram -- we have the two largest mobile ad platforms in the world. we are seeing people use that to build their businesses. there is a young woman in brazil who created a company. their idea was to sell fashion accessories. using facebook and instagram, she did all of her advertising herself on her phone. she was able to target ads in people interested in fashion accessories. had camee business she from instagram. that is the small, local example . we see the largest ad agencies, the largest clients in the world, figuring out how to reach people and create creative's that work. we're learning more about how businesses can interact on messenger as well. caroline: what about video? this is what facebook has driven forward here you are experimenting with ways that adverts can appear in videos. how much are you saying that add to your bottom line? sheryl: video is such a great way to tell a compelling story. community is increasingly understanding, and need to do better, you have to create the video for the platform. the first tv ads for people mics.g radio ads behind people could see. when tv evolved, video ads were created for tv and it wasn't someone sitting behind a mic. a lot of the first video ads were 30 second tv spots moved over to the social platform. those can work well. caroline: when you think of brands putting their money to says looking at data that 70 billion dollars currently spent on tv, how much of that will go to the digital space? sheryl: i don't think it is either or. marketers should reach people on tv, mobile, the digital space. go.c reach -- and they how they reach on the different to evolve.eeds we think we offer a unique value proposition for people. you can have the creativity of a video, of sound, late, pictures, but you can also do very specific targeting. you can target your current customers differently, and new customers per people in the market for a car. people who look like people in the market for a car. you can make sure the message gets to the right person. vonnie: sheryl sandberg visiting with caroline hyde. nejra: coming up, following stocks. less than 35 minutes until the end of trading. 5% stoxx 600 of 4% or share the dax at a record high yesterday. looking at current is and bonds, sterling down today extending the losses down .9%. we will talk more about that in a moment. we have seen money move into gilts as a result. it dropped below 1% earlier. this is bloomberg. ♪ nejra: 11:00 in new york, 11:00 p.m. in hong kong. .rom london, i am nejra cehic vonnie: from new york, i am vonnie quinn. this is "the european close" on "bloomberg markets." vonnie: here are the top stories we are covering from the bloomberg and around the world. the pound falling as mark carney warned about the unknown consequences of brexit. mark carney signaling he is not ready to raise rates anytime soon. how could the introduction of ultralong bonds shakeup treasury? we get reaction from goldman sachs' chief economist. forurope the next hot spot etf? i will speak to the wisdom treat head of europe. -- wisdom tree head of europe.