The slowing inflation that came in worse than expected. He factory gate deflation extending to a record 44 months. I will take you through some of the big stocks we have been watching. Starting with vodafone. One. 7 . This is after the secondbiggest mobile phone Company Reported secondquarter Service Revenue better than expected. It was growth. Boost. Down from a a market that has been a difficult for vodafone. What the company has done is reshuffled its management. The minute to desk committed billions. It looks like it could be paying off. Moving on to national grid, another u. K. Plc. The operator of the uks electricity and national gas todayk started a process for the potential sale of a majority stake in its domestic gas is to be should business. We are seeing that move higher. Julius baer, the third biggest wealth manager, that stock down. Its growth margin narrowed. Restrained client activity. I said stocks in europe were shrugging off the china data. You can see copper down just about. 5 . Lossess been leading the. Nickel has dropped to its lowest since 2008. Ask to you, manus. Manus lovely. Ejra cehic there what is happening later in the show . First up, chinese inflation data points to slowing demand in the worlds biggest economy. What is the contagion echo that is the question for us on the move today. I love this. No mission is impossible. That is according to the Prime Minister here, David Cameron. British membership of the eu. Would chinas consumer inflation slowed in october while factory e deflation extended listening to and the spent to speak to enda. The consumer simply underwhelmed. Enda good morning, manus. Has to be a big disappointment. Interest rate six times now to record lows. It is not just a china problem. Major economies around the world struggling to get inflation off the ground. In china, dont forget the factory gate has been in deflationary territory for 44 consecutive months. On the consumer side, were seeing a sliding prices for food prices and nonfood prices. There is a global angle on all of this. It is not really a great picture in china. It doesnt point to any quick turnaround in demand as we head toward yearend. Manus the great debate is this, it will continue in terms of the next steps from the pboc. Are we in a hiatus. Period we in a hiatus before we see any action from the pboc . There is a base effect in all of this. The big fall in the oil prices a year ago will eventually washed through the system. On the other side of that, were seeing some stabilization and data, such as lending and credit data. Data will pickr up further. It will self correct. If it doesnt, then yes, the is they hadproblem not been getting any traction. Take largest us to rev up demand. At the very least, i dont think pboc inan rollout the the nearterm just yet. Medical they are the manus and the current, numbers chief bloombergs chief. Without it slightly better reading. We got a slightly better reading. To break the they down, lets bring in david crawl. David, when we look at the they have to do a lot more structural reform. They are delivering better than estimated and manufacturing on the month. They be on industrial production. The month over month was better than expected. It did not contract. If you take a step back and look at relative to the previous quarter, reduction is still flat. Production is still flat. Manus the beginnings of the next move lower in the euro is going to help on this hard data for france. Give me some kind of perspective in terms of relevance of the euro and the ability to grow in france. David if you look the weakness of the euro, it has helped the euro recovery as a whole. Euro sees decline in the face of monetary easing, these listrs will probably get a in the months next year. Manus one less question. There were reports yesterday the ecb was going to get a deeper more negative rate. It is all about expanding. What is your perspective . David draghi that would expand the crunch the numbers. There are enough Assets Available to buy. That suggests the ecb is gearing up for an expansion of those monthly purchases. That is why they are doing that rate cut. Manus david, thank you very much. Lets bring in matthew beasley. He joins us now over the next half hour. He is the head of global equities, innocent investors. Data from france. I can i get excesses i can get excited about french data. The german data especially more in that it is the real contagion bellwether for me in terms of china. Am i misreading . Matthew about one third of the euro gdp is from germany. Germany is the most important data to watch for. The lack of growth is france. The french data has been mixed at best. Todays reading is a slightly positive as best desk positive at best. Positive atk to best. When we speak to companies, they tell us that france is a pretty soggy geography. The buildings and Materials Company warned, licking their shortfall linking their shortfall to a lack of traction. Manus you cannot bet your whole against on a euro being one dollar by christmas, according to goldman sachs. Forgive me, you cannot base a whole and you factoring Industrial Services industry on mariota draghi getting the currency lower. Absolutelym to be lacks to that. The longterm medicine has to be structural reform matthew the longterm medicine has to be structural reform. If you look across europe, there are some junkies are you have seen an improvement in regulation. Labor performed or revelatory seductions. In spain you have seen some pretty important labor reforms as well. This needs to happen in concert with shortterm benefits of ecb. Data, if you look at the april it was a record. Thatcovered 50 from nemesis. We recovered 15 from that nemesis. If you look in the dax chart, the momentum is clear. I want to pick up on one of the comments, the saltiness within france. With european abroad exposure. A interestinge is jack reed in terms of a global investor. The level of the dollar and euro. There is no question its at the move into the euro has had a dramatic impact on the dax. There ck to germany, nearly half of the German Economy is export driven. The dollar or the euro in this case and the underlying strength is crucially important for the dax. Manus you are very good guest. We are going to pick up on china quickly after a break. European equity markets are rising. Here is a moderate relief a little bit of a spring in the european market. Up next, bringing the changes at vodafone. It is the worlds secondlargest carrier. Manus i am at manus cranny in london. This is on the move. Volkswagen is to give u. S. Gesture of0 in a goodwill. The creditomes as rating was downgraded to triple b plus. Consumer prices in china rose by 1. 3 . Missing analysts estimates did the Producer Price index fell nearly 6 , marking the 44 consecutive month of decline. Data signals that policymakers may need to act under inflationary pressures. Coalition is poised to vote. The yield on the porch hes 10 year Government Bond remains close to a fouryear high. Concerns about spending cut tied to the international bailout may five it was a revenue beat for vodafone this morning. The second Largest Mobile Company said customers said Service Revenue rose for the second quarter. ,loomberg intelligence european air honduras is joins us now. The Liberty Global talks are behind them now. Vodafone, they are beginning to address the gaps in their operation. Some are saying they are focusing on the business. What is going to drive the growth . Theyve already seen the signs that 4g is driving growth. The growth rate would be the same. This quarter we saw axillary growth on the back of 4g. Planhave a projects bring which will be coming by march. Also have connections to 66 million households across europe. They do have this convergence capability to an extent. If they want to improve that further, they may be eyeing singular portions. Lest i forget they want to remain in a certain credit rating. They will be concerted about it as well. Manus thank you very much. Lets bring back in, matthew beasley. We have a lovely graphic which shows they are gaining 4g. We are all using more data. Y are losing less monday losing less money on 4g. Matthew across the whole eurozone hopes are based on a gentle eurozone recovery. Shows, you had a period of losses as a result of the investments needed to make 5. 5 int is rising from terms of 4g, the number. The volume of organic revenue. They are losing less money and they are taking up 4g customers. That is the driver, is that . Matthew it really is. Some severe consolidation across the eurozone. Companieswer for the that have the best networks. We are willing to differentiate in terms of quality. We are willing to pay for that. That is a new thing. My very first mobile phone and what i paid for my first monthly bill. Is it strong . Is that the right word in terms dish um eyes asian of ization. Of premium eyes asia matthew the broad telecoms arena. We would argue for a first time, and much more consolidated market as well. You have companies with Pricing Power willing to price accordingly. The backdrop of a very difficult margin environment. That is new news. Manus matthew, stay there. We got a little bit of breaking news. We got prudential confident theyre going to be up to deliver profitable growth. Nejra it gets half its revenue from asia. 1. 7business profit of billion euros today. That pound up 13 . Increasedness profit also prudential says it is confident on final solvency. Ensures and Insurance Companies are going to have to use. To quantify risk and determine capital requirements. Look the stock spiking on that 1. 2 up as much as 2 in london trading. Dropping back down to. 5 right now. Back to you. Matthew, wequickly, take value where we can get it. A good set of numbers from potential. They talk about their confident. That is darn tough. Matthew across the asian region, it has been incredible strong. We are in aia, the biggest competitive group. They are enjoying similar trends. Manus lets leave it there. Youre still with me. We have a little more to get through. Up next, chinas inflation under shoots, slowing Consumer Prices. Opening the way for the worlds secondlargest economy. A step off the monetary gas. We take a look at a global perspective. Manus welcome back. This is on the move. I am at manus cranny. ,atthew, the china data Consumer Prices missed. Epi down for the 44th month. U. S. Expectations are the lowest on record. 2. 70 . The new york fed. The bank of japan delayed because for another year. The bank of england does not see cpi getting up before the second half of next year. Asset manager huge folio to manage, global threat. It is very real. We are not going anywhere with inflation. Forhew we are seven years Central Banks to fight the inflation. This is the reason we should be concerned. We have had a lack of inflationary pressure. Driven by very low interest rates. We have equity markets and or fairly expensive value zone. That lack of growth surprise still missing. Hungry that weat are desperate searching for. It is hard to see how much it has moved from here. Are we turning back into a bull market . Matthew technically it is. Manus with that in mind, we have 40 seconds. How do you play that perspective for the numbers . Matthew i look at the eurozone there. I look at markets we do still have efforts to do more. I look at the eurozone. Where they has been positive surprise for certain countries undergoing restructuring. After dreadful years, the eurozone fits that bill. It is safe to favor the eurozone over the u. S. Again the equity market has done quite well. Manus matthew, thank you very much. Next, brexit. The only way to get better is to challenge yourself, and thats what were doing at xfinity. We are challenging ourselves to improve every aspect of your experience. And this includes our commitment to being on time. Every time. Thats why if were ever late for an appointment, well credit your account 20. Its our promise to you. Were doing everything we can to give you the best experience possible. Because we should fit into your life. Not the other way around. Manus welcome back. This is on the move. Lets give you a quick check on the European Equity market and how we are faring. European indices speculating that because of the china deflation story, that may add to the discussion that youre going to get more stimulus coming from china. We know the speculation is you would get more easing here from the ecb. Are theutilities leaders at the top of the board. Within that, youve got the telecoms. It is of course vodafone that leads that. On the Foreign Exchange act, lets have a look at that. We saw the euro dropped to a sixmonth low yesterday. Eurodollar, one of 7. 53. There are a couple of lovely lines out there. That is the view coming from a different houses. Bank of america, merrill lynch, but the flow. They hedge funds keep on buying the dollar. They are retesting a dip into the negative. Keep an eye on dollar brand. Brand dollar rand at a record low. Cehic. Et to nejra plc, im keeping it u. K. Starting with vodafone. The worlds secondbiggest mobilephone company. Europes debts europe has been a bit of a challenging market. It looks like that could be turning around. Today, the Company Reported a secondquarter Service Revenue. That is the money he gets from customers. That rose 1. 2 . Better than expected. Third consecutive quarter of Revenue Growth for vodafone. It was because of a boost from rebounding markets in europe over the past few years. We have seen changes in the management team. The ceo committing billions in new network spending. It looks like it is making a difference and it pushed the shares higher today. It is the will it is one of the best performers on the stoxx 600. Moving onto national grid. One of the best performers announced today it started a process for the potential sale of a majority stake in a domestic gap distribution. Business is the operator of the u. K. Electricity and natural gas network. Starting in the second half of , it will bel year completed in early 2017. The stock higher as well. Company distributes plumbing supplies and Building Materials to customers in the. K. , europe and the u. S. A lot of focus on its u. S. Business. It achieved good growth. The president ial market offset. Back to you. And copperery full into manus a very full and conference of kit juckes. I look at this story, cameron is getting ready to tell us. What is he going to try and get from europe . The oddses are saying of a brexit are rising. Give me your perspective. This is going to be a long race, is that . Kit at some point, were going to see the terms. , in we get a date for this think that is the zynga most important event. When we have a date, a target, a campaign, and when that feeds through to opinion polls, that is when i am certainly nervous that the opinion polls at that point show in missouri once show a majority once to leave. Debate. Cotland real risk. Six to eight weeks before the event. Scotland is a decent blooper into how this can go. Financially, most people tend to be worse off if the u. K. Leaves. Says only when you actually people are seriously considering voting for the financially worse decision that suits their emotional decision. Then we will get scared. Lose halfobably percent of gdps growth per annum for five to 10 years. When we start to think that could really happen, that is when we have a problem. Manus lets have a look at the dollar sterling and the euro sterling. We are touching some of these lower levels, retesting a bit of a move lower. We got a note saying the volume of dollar sterling trading is almost twice the average. The market is starting to build on the dovish comments from carney. With a bitr wages, of a boost like it did in the u. S. Last friday . Is i think the consensus for them to take up to 3. 3. The u. K. Has got more weight growth than the united states. It is headed for some time. Yet the mpc is much more dovish than the fed. I dont understand that. I would say we have the dovish bias, what if the unemployment total increases and people start saying we are seeing the peak of the upcoming cycle. It is a bit behind us. We are on the downside. I think tomorrows numbers are in that sense going to be a major factor in driving the mood. I would say the market is not very engaged. There are long since sterling. There are shorts and sterling. Longs in sterling. There are shorts in sterling. Manus there is the pound against the dollar. Lets bring up the graphic we had before. There you go. This is like the dollar. The dollar is on a bit of a tear. I think that is a fair reflection. The fed referred to Dollar Strength 24 times in the last meeting. I know the whole world is convinced that the fed is going to go in december. Give me your perspective. When you reflect back on this, these are the moments in time when the Federal Reserve actually comment on the dollar. Are we over egging the putting . The pudding . G the market is gone as far as it can go. Go, i amr as it can paraphrasing. He more or less said the market has priced in. Kit the feds hope is that they can raise and the ecb can cut and nothing will happen in the world. They are going to give us the message that we priced in enough times in the hopes that we dont overreact. Dimension of the dollar in the last meeting the mention of the dollar in the last meeting, the fed saying the rates should not be at zero. Those who say you do not need to raise interest rates. Arguments dont meet in the middle much. What you get is you can talk a lot about other things. Look us on the dollar is. Look at how weak china is. That is the middle ground debate. If i am a dove on the fed and we get a weaker payroll number next month just before it and the dollar index is up. I might say something. The u. S. Economy struggled with a bit of snow last winter. You think we can come up with a dollar index above 100. We should wait. The governor saying youll need 60 200,000 jobs. Thats 62 100,000 jobs. 60 to 100,000 jobs. Everything is already packed we are not precise here. Kit if you think youre going to get eurodollar significantly lower, you need a fed rate hike and some new additional impetus to help us along our way, because weve got a lot of news that we are baked indicate. In the cake. Manus what does it take . Never mind goldman sachs. What would it take to get to parity . To go i think you need for example 10 year yields in the u. S. Of two three quarters of a percent. The bond market needs to stop pricing in. Something to say we are moving on. In is to go back to taking on thinking about could the funds be three. Manus that would be a van glorious recovery. Tell me about the rand. In themake a recovery rand. South africa would have to raise rates at some juncture. The betting is improving to 60 that they will have to do it. Kit Metals Prices are low. The weakness in chinas inflation does not help. Asianriorating move and and latin american currencies that comes through. Ringgit, thed, the korean bond. Manus the beginning of a bigger move. Kit if this turns into a move, if we develop momentum, i think we are back to that. Where poised in the e. M. I would be costly bearish thinking this could go wrong. Manus matters of global importance. T is kit juckes up next, power in portugal. Poised to unseat the government. Will austerity in europe lose its valuable ally . Manus i am manus cranny in london. This is on the move. These are your top stories. Bb says these top oil prices in the 60 range for about the next three years. The companys regional president for the middle east says that is because demand is increasing. Justirm that runs in Biggest Airline that runs indias Biggest Airline, indigo. And globe rate into globe the first ipo for an Indian Airline since 2006. As koreas it comes janjuah surged. Offering thatlic raised euros. That as the dust government begins to unveil its the bank would be valued at 18. 8 billion euros. Standard chartered has cut jobs in the by, including for managing director roles. Bank hasement, the reduced management layers at a global level. Fewer senior staff. Spain heads to the polls next month. One person hoping to become the countrys next Prime Minister. He is the leader of the promarket. Once a rank outsider. Surging in the national polls. In an interview, rivera stress the need for a political and institutional reform. Years of we have eight this president. [inaudible] i know that it is not easy. I know in catalonia the situation is very difficult. , thesure in the future situation with our market. Sure [indiscernible] the solution is not great. The solution is reform spain. Manus albert rivera. Portugal andross alliance of opposition parties lets speak to giles lima. He joins us on the phone. Great to have you with me. The bond market is critically nervous about the prospect of socialist with communists support. Today, there will be a debate in parliament about the centerright Coalition Government program. Aat is set to be rejected in motion later in the day. Once that happens, the government automatically falls. It becomes the time of the president. The parties president deportees president has enormous discretion. The power to follow other options. In the meantime, the centerright government remains in a caretaker role until the new president new Prime Minister is sworn in. Manus the whole angst of europe is if this is a succession of power by a socialist led government with commonest backing who has been very with communist backing what wey understand now from portugal and the prospect in terms of this new and session. What are the biggest issues . Party, they are arguing for a swift a rollback of the austerity measures that were implemented over the past cointreau years. The centerright government was rolling some of these austerity measures back, although at a slower pace. They want to accelerate that. They want to increase spending in terms of salaries. They also want to add some taxes. They want to increase the minimum wage. Generally, socialists are arguing for a for an economic recovery. There are differences. The socialists argue that they will build keep the debt below the commission. Heir target is slowly higher the we still have to see their detailed budget to see how that is possible. That is their plan for the next four years. Manus the president of portugal has a great deal to tackle with if that vote goes through. Lima. S updated on joe of next, is it Mission Impossible . That is the question. Will the eu conceded to camerons come camerons commands. Mann welcome back. This is on the move. I am manus cranny. He is due to speak in 10 minutes time. U. K. Prime minister is sending a letter to the eu resident asking for changes to four key areas. The toughest, tightening welfare roots. Will get reaction from our reaction. We will get our two bring in our political correspondent. Ofe us perspective in terms it is not Mission Impossible. That is what he wants us to believe. Of course and David Cameron is back up to send out a list of objectives he cannot achieve. However, when you look at the first three, theyre not quite a done deal. Theyre going to be pretty easy to manage. This idea of rejecting brilliant rejecting the union has raised eyebrows in brussels. Welfare. This really hits to the core of European Union. This idea that if you move to another European Union country, you cannot claim on the same basis as a u. K. Citizen. This has caused a lot of with easternady european members such as poland, hungary. Manus that is the rub of it. That is what the British Press is going to focus on. Lets bring in james bevan. When we think of the european perspective, what kind of reaction do you we think we are going to get from eu leaders. In the runup. The press, a lot of it is about you can ask david, but a lot of what youre asking for your not going to get. The other leaders are anxiously awaiting on this letter from mr. Cameron. What they are really interested in are the details on how he is going to go about these demands. How he is going to frame these proposals. They want to get down to the nittygritty of negotiating, how to do this. In the broader sense, they want. He u. K. To stay in the eu it is a matter of getting this referendum set up. Getting the negotiations done anyway that lets that happened. That lets that. Appene manus what effectively happens next . That is not to say negotiations have not been underway. The problem was until now, we do not really know what britain wanted. David cameron was very careful not to set out until he had to. The problem here is not so much new members. The fact that he is that spell this out means there will be an anti us and the with pulse team. It is camerons speech for europe. Ministere u. K. Prime is to announce details of his plan to renegotiate e. U. Membership. Vodafones picks up. Shares rise as the company sees recovery. China risk. More evidence emerges as inflation continues to ease. The is the pulse live in city of london. Im manus cranny. Prime and
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