Will draghi spoil the party by turning the ecb toward exit . And trump says he will announce a tax reforms this week, but how much detail will he really be able to reveal, matt . Matt less than half an hour away from the european open, and it is going to be an exciting day. Lots of Movement Across a wide range of asset classes, but take a look at futures to start with. , you can see at the bottom of your screen, cac futures up 4. 5 . Were expecting to see big movement in french stocks today for once. We have already seen big movement in debt. I have bunds on the top of the screen, this is a threeday chart. If you look at this, election is here. This is where you see it coming down in yields, bunds shooting up as investors get out of the trades they had in place before. This is a longerterm look at the spread, and you can see here at the end of the screen that it has come down dramatically. That is what you would expect after we didnt get the kind of event that could have reared its ugly head. Markets are more complacent, and today will be more of a risk on day because of it. Guy complacent, comfortable, looking at a macron presidency with a smile. The Swedish Krona is bid this morning, danish krone bid. The euro really leading all of that. The euro is trading up 1. 1 . Remember, we have the tax story to get to from the other side of the pond, and we have the ecb to think about as well. Lets show you whats going on elsewhere around the markets. Matt has already walked in through the periphery trade we are seeing. The safety trade coming out, again, i work you back toward the ecb meeting coming up. Well, down offer as over 3 . The real trade is going to come through at 8 00, 9 00 in paris, when we see this big move on equities. We are expecting massive movement. Watch the french banks today, that will be the one trait that stands out. Lets get the first word news update with juliette saly. Juliette guy, thank you. The white house says it will offer up an outline of its tax reform plan this week, but the specifics may not be ready until june. Earlier President Trump told his twitter followers big tax reform and tax reduction will be announced on wednesday. Budget director Mick Mulvaney says they expect to lay out the principles, but admitted the full plan wouldnt be ready for a couple months. U. S. Treasury secretary Steven Mnuchin says the imf outlook for the American Economy is a little conservative, as he repeated the Trump Administration goal of 3 growth or more. Last week the fund reiterated its forecast of growing at 2. 3 , hin said they are wellpositioned to expand faster, which will help the wider global economy. Sustained u. S. Economic growth is good for Global Growth, so if we can grow the u. S. Economy, that is not just good for the u. S. Worker, that is good for International Growth as well and creates opportunities. Thats what we are focused on, it if we do a good job it will carry over, in the spillover. Takette mario draghi may a faster route to Monetary Policy normalization than previously thought. Well no policy changes are expected at thursdays meeting, most respondents in a survey now say the ecb president will revise Forward Guidance as early as june, six months sooner than an earlier poll. Economists also reduced their estimate for how long it would taper qe. Multitrillion dollar Wealth Management product industry is slowing for now. The China BankingRegulatory Commission says outstanding products rose 18. 6 from a year earlier. The growth rate slumped from 53 during the same period last year as the industry remains under scrutiny for regulation due to potential threats for financial stability. Global news, 24 hours a day, powered by over 2600 journalists and analysts in more than 120 countries. This is bloomberg. Guy . Guy thank you very much, indeed, juliette. The euro surging to the strongest in five months after the independent candidate Emmanuel Macron won the first round of the election with Marine Le Pen joining him in the runoff. The pollsters had a really solid night in france, a mcron win by a considerable margin. So what next for mr. Macron . Does he look at how to unite a divided country . Does he think about how he will deal with the parliamentary elections coming up so shortly . Lets go to paris, with Francine Lacqua, who has been up all night watching what has been going on. An extraordinary night, a 39yearold with very little political history, now the front runner. Francine, what next for mr. Macron . What does he have to do . Francine you are absolutely right. When you take pause about what happened last night, it is unprecedented. A 39yearold, unknown to the french people. Theer banker who became economy minister under francois hollande. He doesnt even have party banking. I would say whats crucial watch the polls. He has been pulling about 60 , 62 against Marine Le Pen in the second round. Lets see if there is any movement on the polls and lets see how he campaigns, whether he goes for a dirty campaign, or whether he plays more neutral. After all, so Many Political analysts are saying with Marine Le Pen there is a clear plateau. Its unlikely if not impossible that anyone will vote for her in the second round. And as you rightly point out, if he does become president , he needs to govern and talk about tax reform. That is what equity markets are so strong. He needs to talk about these reforms, which he can only do if he has some strong coalition, and at the moment he is not represente d. Thats the next hurdle if he becomes president. Matt how much of a done deal is that, fran . Is there any chance that fillon voters could turn to le pen . Is there any chance melenchon voters could turn to le pen . Francine this is something we were trying to explore yesterday. A few believe that the far right and the far left has more in common than any centrist party, like what happened with the u. S. Election and some Bernie Sanders voters going to donald trump. This could be a concern. What most political analysts are saying is that the gap in the polls is so strong that to go from 35 , 38 Marine Le Pen to win the French Election, something pretty drastically have to happen. We also point out that we have had many european officials coming out to congratulate Emmanuel Macron, which means that amongst World Leaders there seems to be an understanding when you look at the polls that hes the next president of france. But with a tiny bit of caution. Guy Francine Lacqua, in paris, great work, great coverage last night out of the french capital. What do you want to call it . You call it a relief rally, call it what you will. Markets, particularly french banks, are going to be pretty good at the getgo. Lets go to singapore and join mark cudmore to get his take. How sustainable is this move . I think there are two things to think about. First to put the context of where we came from. We are seeing a risk rally into the weekend. This started before the weekend. Obviously the French Election results have seen a massive shift in a positive direction, in equity markets are the euro. In asia, there is some shortterm retracement. I think we could see similar profittaking this week, and what that means is more shortterm and equity. It wont continue on a straight line. However the Bigger Picture is that this is a really big, positive confirmation of the move that was started last week. European risk was one of the big terrorists this year, whether the eurozone might be under threat based on the elections in holland, france, and germany. But even then the populist parties are falling behind. Suddenly one of the biggest terrorists is behind us and i think investors will gain increasing confidence that they can keep on playing this global reflation trade. Matt what is the next big thing mark, . What is the next catalyst that investors will watch . Good question. I think this week we shift back to the u. S. One of the things will be trumps tweeted about a proposed tax plan. Given that expectations are now so low, that if he delivered anything concrete it would be a positive surprise. The risk reward is skewed for a positive surprise. The other thing is the potential for a Government Shutdown. That would cause volatility, but is skewed to be more negative. Those events competing against each other could cause more volatility, but the backdrop is Global Growth picking up, we are getting through these risks, whether its european risks, syria, north korea, we keep on moving beyond them and the world continues to grow. It will be volatility in the shortterm. Guy lets talk about the ecb. Mario draghi is paying a great deal of attention to what happened last night. We saw pmi data comes through, strong at this point. Is that the next thing the european markets will price and, the fact that exit will be started to talk about . And as a result, this corporate spread comes back to the table . I think that is something markets will really focus on, but it is not as easy as that. One of the issues we are seeing, all global reflation trades Commodity Prices continued to sink. Last week they really clashed down. Oil prices, food prices, even Industrial Metals bottomed out last week. Now its looking dodgy again today. I think a monday prices are trading so poorly that it wont be easy for the ecb to remove stimulus. Certainly growth is strong, but inflation is still not on target, and it looks like Downside Risks may be creeping back in again. This is a big thing for markets but its not a clearcut answer. Matt mark cudmore, thanks very much. Our bloomberg macro strategist. You can follow Market Insights from the entire team on mliv. Highly recommend it. Guy and i follow this every morning. Coming up on the show, we are back in paris, where we speak to an advisor to melenchon. Who will his supporters now follow after this, if he does indeed concede, loss . Then, taxing talk. President trump promises a big tax announcement, but the finer details may not be ready until june. Find out why. This is bloomberg. The open is 16 minutes away. Matt welcome back. Im matt miller in berlin. Guy johnson alongside me in london. We have just about 13 minutes to go until the open of Equities Trading across the continent and on the island. Cac futures, gaining 4. 5 , a relief rally. It back to risk on, or at least is no longer risk off before the tightly fought French Election first round. Four candidates with the real claim on a runoff play. Fillon in Jeanluc Melenchon both missed out. The results trickling out at 8 00 p. M. Last night. Lets cross back to Francine Lacqua in paris, joined by a special guest. Francine . Francine thank you so much. Day to with us a bad be in paris, because it is gorgeous outside. This is an advisor to the far left candidate Jeanluc Melenchon. Thank you for joining us on bloomberg tv. What have you not heard from your candidate . Who will he tell his supporters to vote for . Well, you probably heard him yesterday, but we want to have a consultation first. Its over the time where you have a political leader what is the position of all these members . 440,000more than members now, so the time of having the political leaders saying whats best for its members is over. We have citizen involvement, and our priorities are what they want. Francine so if they wanted Marine Le Pen for president it what not happen, it simply would not happen. Jeanluc melenchon spent his entire life fighting against the extreme right. He thinks voters, the people who support us, are backing us francine but why not throw his weight behind because there are other options on the table. People might want to have a broad support for Emmanuel Macron, or thin support with conditions. There are a lot of options. Francine would that not be a vote for Marine Le Pen . I strongly believe that this country is fairly republican. Francine i want to talk about the u. S. When you look back at the election in november, some saide sanders supporters its very much like your candidate, and they ended up voting for donald trump. How can you be sure this will be the case . Because we learned from the u. S. I think also the situation is quite different as well. What we have seen in this election is the end of twoparty domination. It was not the case in the u. S. , it was all framed by this very traditional political even if hillarys an outsider, was the its very different here. Over the candidates from the primaries, its new people, new faces, new ideas, whether you like it or not. So give me a sense Jeanluc Melenchon had huge momentum in the last two weeks, he was very strong on social media, he gave great speeches. What will he do, and how much support do you think you will get . Broadhink we will have a support, because we are the u nique face of the left. I think we will have a big group in the assembly to come. Francine thank you so much for joining us. A key advisor to Jeanluc Melenchon, the far left candidate who wont be in the second round, but he is the only one among the top candidates that so far hasnt come out and said you should support this candidate and not the other. Guy Francine Lacqua, thank you. Another fantastic guest analysis of what will happen next in the second round of the French Election upcoming. As francine has indicated, how will mr. Melenchons voters go . Minutes away from the European Equity market open, and it is going to be a fascinating one. Clearly french stocks are going to be the big story. We will be watching and potentially looking at a near 5 rally in french equities. Watch the french banks in particular. We are also going to watching key stocks as well, the worlds biggest cement maker announcing its ceo will leave the company in july. The market open next. French futures pointing to a near 5 rally. Bloomberg bill the open is a minutes away. Bloomberg bill. The open is eight minutes away. Guy five minutes until the equity open. Keep an eye on whats happening with french futures, because as they transition into cash, or at least cash stocks trading, we will likely see a decent sized pop. At the moment, the fair value points to a their 5 rally, 4. 528 at the moment. I would argue that its probably going to be the french banks that really get a move on this morning. Probably something of a relief rally. I think you are going to see that really topping the agenda. Be aware that you do have an awful lot of european banks reporting numbers this week. That is something to bear in mind. When you look at what happens today, keep in mind we will see a lot of reports coming through. Those are the big names we will see. Matt we have some big names going to move today as well. The trade that opens in four minutes, the ceo says they are set for a good first quarter, Goldman Sachs agrees. The ceo is out amid a probe on his dealings in syria. Jimmy choo says he is ready to sell the company, looking at offers for a popular ladies shoemaker. Jimmy choo up for sale. Coming up, the market sale. Guy welcome. A minute away from the market open. Lets take a quick look at where we think we are going to go. Lenny get my futures up. This is the fair value calls, for. 51 to the upside. 4. 51 to the upside. French banks look like they will be well bid. Weve got these liquidity. Matt, over to you. Matt i was just going to point out a chart that Kathleen Hays highlighted to the earlier this morning. Gorgeous chart on the bloomberg terminal, you can access it as well by typing in the code on your screen. Is is a look at the euro over the last year. You can see the bullish gap up, the lowest end of the trading range since well above the 200 day moving average. Guy absolutely. We are going to see how these markets perform. The ftse is open. Remember, the french banks were already rallying friday, bnp up, socgen up. Thats the cac starting to open up, and as you can see, its a pretty decent rally. We are already up by 2. 7 . I would expect to see some of these french banks really getting a decent rally. We saw them moving pretty struggle yesterday. Lets see how they open. Equities bid in europe. Manus good day to you. Ui, thatch may say o the chinese say non. You are looking at an extension of the four weeks of losses, stocks dropping the most in three months. Ons is as the clampdown leverage continues with the chinese banking regulator ordering local units across the cross guarantee lows. This is trading collateral across the system for a variety of loans. The chinese want to take that whole momentum, the bullishness out of the market. Look at this, absolutely banging. Financials up 2 . Risk has absolutely been taken out of the sails. The great rotation . The great rotation was last week, spreads narrowed on the bonds, equity markets the biggest rotation since 1999 out of the u. S. Entity european markets. Financials up over 2 , industrials up. This relief rally is palpable in fx, in euroyen, dollaryen. This is the euroyen volatility. If you want to pick up this chart, 8013, bottom of your screen. The bonds are dropping, r