economy minister ahead of vladimir putin's speech. good morning. where less than half hour away from the european open. let mac -- let mac talk about what is happening. what we are seeing is a equity market recovering. we are going to see it here in europe as well. markets are extrapolating events in the u.k. and what we are seeing is we are going to see a very positive start to the session. the general market, the euro stoxx, up by 1%. the london market up by .1%. the dax looks like it is going to open up about 1% higher. matt: we saw every cover in the u.s. equities yesterday. the s&p 500 has been down for the last five sessions in a row. then recovered at the end of the session. what started in the u.s. carried through the asia -- carried through to asia. the dollar down for a third day in a row. here you see the bloomberg dollar index only a little bit of weakness. dollar index, only a little bit of weakness. it is enough to save brent. the third time we have seen brent rising in six sessions at 1% gain. 47.73. the pound adding a little strength. let's get the bloomberg first word news with haslinda amin. haslinda: both sides of the referendum debate has suspended the campaign for a second day after the killing of an mp. jo cox died after being shot and stabbed as she met voters in the west yorkshire constituency. if you did to your old man has been arrested. cox was a committed member of the remain camp. a witness said the killer shouted "british first." they have denied any involvement in the killing. david cameron has led tributes. >> this is tragic and dreadful news. my thoughts are with her husband, brendan, and the two children. we lost a great star. she was an mp, great campaigning mp, with a big heart. people are going to be very, very sad. dreadful news. haslinda: pimco is cutting jobs. the company is losing 60 workforce.3% of the the firm has seen assets under management fall by 25% in the last three years. pimco's --er build before leaving abruptly in 2014. japan's finance minister has escalated his concern about a surge in, calling for coordination with his g7 counterparts to address disorderly moves in the currency market. he spoke just before government in boj officials met in tokyo's exchange information. comments saw the yen slipped from a 22 month high, but it is still in 104 territory. global news, 24 hours a day, powered by 2400 journalists in more than 150 news bureaus around the world. can find more stories on the bloomberg at top . guy: thank you very much. .aslinda with the latest let's talk about how the markets are responding to the news of the last 24 hours. we are seeing a positive response. you can call it cold or warmhearted. nevertheless, events in the u.k. are shaping what we are seeing globally at the moment. i am not going to ask you to make the kind of extrapolation that some people are making. we are seeing a positive response -- positive maybe the wrong word to use. we are seeing people buying back assets that they have been selling. i am going to leave that one side. i'm going to ask you, is that what we can expect if britain remains guy: give us a sense of what will happen the day after if britain were to remain -- remains? give us a sense of what will happen the day after, if britain were to remain? to whatu listen investors in asia were saying, everybody was coming to the view -- i'm leaving out the guys in the u.k. -- the exit from the eu would lead to a lot of turmoil in the markets. i think people are quite complacent until the league side of the campaign looked in the polls. extrapolate what the rest of the market has attitude ,olatility, coldhearted are not -- coldhearted or not, with the murder of jo cox, people are .xtrapolating the pitcher alex ling which that is been used in the campaign -- the vitriolic language that is been used in the campaign. that has been the cold-blooded way. the markets are beginning to worry that if there isn't an exit, it may lead to a lot of volatility. guy: how extreme has market volatility become? i want to exhibit this, which is the move index which is treasury volatility. it has spiked quite sharply as the markets have been buying uses treasury, it has also been buying -- buying u.s. treasury, it is also been buying assets. we continue to look at a market that still believes it needs to buy downside protection on the treasury market. i am wondering as the curves flatten in japan and we see what is happening in the u.s. treasury, how extreme are we? saker: people are getting very worried. days, last three or four people think this might be true it if so, the markets might be in for a shock. some time ago, i said there was always a small possibility that in a said by the u.k. would have a domino effect. possibility.l at the possibility -- as the possibility of a brexit became more evident, they worried that it might be more tail risk. matt: i think it is important -- we can divorce ourselves any discussion of why and look at the facts that if you take a look at the odds chapter -- odds checker leave index, the probability of britain he leaving the eu -- britain leaving the eu has declined. you can see initially a spike. the possibility that the eu -- that the u.k. would leave the eu. 3.5%.e down at a rate of it looks less likely today that britain will leave the eu. because of that risk assets, starting in the u.s. and winding their way around the world, has risen. do you think a trend that is going to gain momentum, that is the important question? saker: it is the beginning of trends. as you are right to say, we saw the spike that is quite strong. the spike in the betting that we are going to leave, with that people were taking the risk off. the indication that the markets be aaying that there will positive reaction for the remain campaign to the tragedy of yesterday. let's wait and see you i hope that is true. if that looks to be -- let's wait and see. i hope that is true. i hope the remain campaign become stronger. if there is a reaction in the market, there will be a record action -- there will be a record reaction in the marketplace. if you look at the leave campaign, the leave campaign was winning for the last few days. if you see whether that reverses, we have to look at the popular press and the u.k. which has become quite pitcher alec and was -- has become quite vitriolic. if we see the polls showing that remain has gone further ahead again, then i think you will see risk being taking off the table -- being taken off the table. yesterdaymb president -- the s in be president yesterday and the finance governor overnight talk down the yen. walk me through where you think we are going to see central-bank action over the next few weeks. it depends on what the brexit story looks like. is the market prepared to listen to somebody finance ministers at this stage. do they believe what they say. have we gotten to the point where axis speak louder to -- speak louder than words. -- where actions speak louder than words. people are waiting to see what happens here. saker: the japanese are in a difficult place. [indiscernible] the fact that yellen says [indiscernible] we have seen the same happening year after year. draghi was holding until after the 23rd. even if he is going to pump money, he is lacking to say anything until he sees how the brexit pans out. that makes sense. the person that is in trouble is in japan does japan is -- the end is rising -- the yen is rising. what else can they do besides talk about it? they are hoping that as things get better in europe, as the possibility for budget proceeds, the end will proceed as well. -- the yen will proceed as well. guy: brexit coverage. more on that story after the break. ♪ matt: welcome back to "on the move." although it is a dark and rainy day, we are seeing dax futures rally, indicating a positive -- you see futures on the german index up by .66%. haslinda: a former goldman sachs banker pleaded guilty to receiving documents that have been misappropriated from the federal reserve bank of new york has been banned from the financial industry. sec from anyby the association with a broker or municipal securities dealer. salesforce.com once -- was a rival for linked in. people --cording for that is going to people familiar with the matter. salesforce was advised by microsoft but microsoft one out. out.crosoft won -- has agreed to sell for 200 37 million pounds. -- 237 million pounds. they continue to offload peripheral assets. offers stores will be bought by investor groups. that is your bloomberg business flash. guy: let's get back to our top story tribute. jo cox was shot and stabbed yesterday >> we lost a wonderful -- yesterday. we lost a wonderful woman. her work will go on. as we mourn the memory, we work to achieve that better world she spent her life trying to achieve . >> people are free in this country to live their lives as they choose and express themselves without fear. society will protect their right to do so and hold to account those who disregard our rules. today's horrible events are an assault on all of these values. guy: the horrible events and yorkshire changing the markets minds after the trajectory of what is going to happen next. a black swan events. you could describe this as one of those. it is going to be interesting to -- in thee opponent run-up to this, this terrible event, we saw the markets beginning to become very nervous. he talked about that. talk me through how you yourselves have been petitioning your mutt -- have been positioning your money when you look at the risk you now face. have you positioned it? -- how have you positioned it? saker: we are on separate strategies for our client. -- for our clients. as a business, we have a lot of earnings from overseas. [indiscernible] brexit, were to be a would see a dollar fall and that is not a bad thing -- sterling fall against currencies and that is not a bad thing for our business. as far as our portfolios are are waiting to see what exposure to factors would like. -- would look like. like everybody else, our some should was leave was likely to lose until a few days ago when they surged in the polls. guy: did you change things and then? saker: we looked at opposition from the other side and what happens if we stay? .t was remarkable until two or three days ago, very few people took the possibility of it happening seriously. they say things like there is a lot of feeling of the country. just the realization that might not, it triggered this reversal of markets. [indiscernible] for clients who have exposure to see where they invest directly, we saw not committing moneys to new markets. we saw client portfolios [indiscernible] investors will be very careful about the position in the u.k.. .'m sorry go ahead matt: we see the ftse really outperforming the euro stoxx and the stoxx 600 index. u.k. and smart doing better than a broader european benchmark. where getting headlines from morgan stanley -- we are getting headlines from morgan stanley that analysts there are predicting that the ftse could rise 14% if the u.k. votes to remain in the eu. seewondering if you incredible moneymaking opportunities here and are placing your bets? i think there will be a brief rally if the u.k. remains. i have said that the u.k. voting to leave would have a negative effect on not only the u.k. but also the eu markets. fund so wea hedge don't bet on market movements, but it is something we look at very carefully to ensure we are in a position long-term. i think there are mainstays, long-term, this is good for u.k. [indiscernible] think that will lead to headwinds in europe. that might spillover into a domino for -- a domino affect around the world. does that mean that europe goes down? i am not so sure. guy: we will talk but the ftse when we come back. andink that is interesting maybe the pound would also rally which you would've thought would lower the value. some companies would benefit actually from a weaker sterling at this point. we are called up around .5% on the ftse. we are not getting back to that 6000 level. getting close to it. minutes away from the european open. we've got around eight minutes to go. it potential corporate mover today -- coming up, a potential corporate mover today. ♪ >> welcome back to on the move. a couple of stocks to keep your eye on as you enter the open. on the upside is going to be tesco. it could rise to 2%. w garden center, about 35 spread across the united kingdom, earning 217 million pounds. this is a strategy. it focused on becoming a better growth center, squeezing off a number of its assets overall. they have been selling off those peripheral assets as of late. it offsets and gets rid of w garden center. another one is ericsson. could this fall of two per desk at this fall to 2% -- could this fall to 2%. u.s. department of justice and the sec are investigating ericsson. suspicion of corruption is what is being cited my unidentified sources. they respond and say it is cooperating with authorities. since 2013 -- maybe not that much of a shock market reaction. this is a chart that takes you back to 2013 when perhaps this was first announced by ericsson. indeed.nk you so much caroline giving you the stocks we need to be paying attention to. under performance and the london market. european stocks look like they're going to open around 1% higher at the opened. -- at the open. that is next. ♪ guy: you are watching "on the move." i am guy johnson in the city of london. i'm alongside matt miller over in berlin. we are moments away from the start of european trading. good morning. the killing of labor mp jo cox silences both sides of the brexit debate. markets stabilize as campaigning is suspended. verbal intervention. the japanese finance minister escalates government rhetoric about the strength of the yen. the currency is slightly lower, but how long before markets demand action? is russia recovering? we speak to the country's economy minister ahead of vladimir putin's speech in st. petersburg. guy: thanks very much. that is what you need to know. this is what we are expecting, a positive open in europe. let's show you the european open. this is the cac, the dax, and the ftse. how are they going to react? there goes the footsie. the footsie is starting to climb climb. is starting to we saw a rally into the close yesterday, and it's opening to the upside, as well. we are expecting it to open up at 0.5%. we are expecting the cac and the docs to follow on. we will wait a couple of minutes to see exactly what the dax does. we are generally expecting a 1% open. the gain on the cac is around 1%. the gain on the ftse, a little bit less than that. the white line is the ftse and the blue line is the cac, both opening to the upside. let's show you what is happening in terms of the details. here is caroline hyde. caroline: amid these tragic events in the united kingdom, the market pushes higher as it seems to assume the leaning towards the u.k. exiting the european union, the probability dampened. european stocks opened higher. we have a about one third of one trillion euros off the market cap of the stoxx 600 in the last four days, but today, we push higher. we have financials, the most beaten up sector, currently the out performers, 1.25%. oil stocks get a push higher as the oil market seems to recover. industrials, the only one in the red is the i.t., currently trading flat. there has been a move out of the havens as we get more risk appetite. this is the yield on the u.k. treasury. we are starting to see 10-year bonds falling. we hit record low after record low on the yields for u.k. debt, but today, we saw japanese bonds doing the same, selling off. let's have a look at the function, which shows you where the moves are across assets. we can see belgium pushing up across the indices, as is the swedish market. the british pound, outperforming after that tragic news about the np being murdered in the united kingdom. jo cox, thoughts with her and her family. brent crude, up 1.4%. this is a selloff happening in sovereign bonds, yields up six basis points. two-year,japan on the yields suddenly spiking. let's have a look at some of the stock markets on the move. erickson, we understand it is u.s.,investigated by the the department of justice, the sec. it said, we have been answering questions since 2013. tesco on the upside, up 1/10 of 1%. interestingly, it had been called a somewhat higher, 2%. national grid, 0.7% to the downside. should it be split up? lawmakers are saying it should be, it should lose its role powering the energy grid. see how investors digest that. guy: banks on the front foot this morning. it does seem they are reasonably well bid. this is the open here. as you can see, the dax, galloping higher. that's the purple line, and it's now outperforming the cac and the ftse 100. the ftse 100 is up, but it doesn't seem -- it does seem the continental markets are doing a bit better. the ceo ofon set, homely's investment management. i want to take us back to this call by morgan stanley. it's predicting morgan stanley we see ae should remain vote and when tumbled to around 5000 were we to see a leave vote. i want to examine that a little bit. effectively as global index for love minors, former companies, the kinds of companies that have a great deal of foreign earnings. a weaker pound, from the share price point of view, you would have thought, as the pound gets weaker, would benefit those share prices. i'm wondering if these huge swings we are going to see are necessarily going to be the case and whether they are good for companies. >> the main swing i think was always going to be in currency ,nd sterling, and my fear was or fear remains, that the leave vote means there is a massive fall in the value of sterling. guy: what do you mean? >> more than 15%. translated into higher earnings for a lot of companies that make up the composition of the ftse 100. i think the reason people think see footsie would fall -- ft would fall if we exited is because it would not be localized in the u.k. it would spread. the fear i have is a small one, that there would be a massive contagion. guy: then global risk off. wet: in a very big way, and are talking about a more than 20% fall in markets. the best case scenario to me, we have a brexit vote, we go down 10%, 15%. scenario, -- jo coxse, the murder of tells you the world market was getting jittery about what was happening in the u.k. in the long-term, the devaluation the u.k. currency does help those businesses, which have business overseas. that is true. matt: i wonder what you think about the volatility we have seen and to what extent that holds investors out of not only currency markets -- they are going to be high risk, only for extremely involved investors. this shows probability distribution for the pound's trades. you canook down here, see a number of historical data going back to 2006. the point is, how much of these trades fall outside of the bell curve of normality? an incredibly volatile current see. does that hold investors out of the currency? >> its importance is for local investors much more. you have to put it in the context of there has been a general move away from equities for investors based in the u.k.. keep that in mind. for foreign investors, the currency does matter. i said on this program we are entering a time where the currency effect on investment becomes very important again. when i started some 28 years ago, the currency calculation was based on if you put your money into a country or not. it still is the case for developing countries. is volatility of sterling making people nervous, because it brings back the old days of expertise and understanding, and the currency volatility is not as deep as it used to be in the past with this is not economics. the economic situation in the was recovering better than europe. if you want to talk about blacks ones, you can't predict -- black swans, you can't predict this. one hates to say relief, but the relief you have seen in the market reflects the fact that they don't know how to calculate the risk. matt: it's got to be the currency volatility, important for domestic investors, as well, indirectly, right? it's an index so heavily dependent on fx revenue. >> if you look at how much the large institution of investors that has been exposed to u.k. equities, which has been in decline, the investors who remain within the ftse a retail investors, and some are institutional investors. you are right. the volatility mix is more difficult to protect what is going on, and there will be a translation and earnings. the move has to do with other investors come into the u.k. guy: one final question -- matt: i just wanted to point out , you saw the morgan stanley prediction. ,e also saw bank of america merrill lynch making the prediction stocks will move other way. french automakers will be susceptible to a vote because they are not hedged as much. the fx is an important part of the trade. guy: yeah, fair enough. they don't have the global footprint many of the others do. is one exception to that. you talked about the asset management industry. how concerned are you about passporting? you talked about bringing money in for my outside. >> this is why i never understood people thought or think things would change if we vote to leave. becauseing happens are in luxenberg, which would remain in the eu. the euins on how harsh would be in dealing with u.k. after an exit. as it managers might have to have shadow operations on eu shoulder -- soil. the problem is much more for investment banks. without mentioning the bank, a major american bank i was talking to yesterday was saying, we are preparing to move 1000 bodies, which is a lot, out of the city onto the mainland europe if there's an exit. euro clearing is based in the u.k. how the european union would allow the clearing of its currency to happen offshore. that doesn't make sense. guy: i think we have seen the case taken by the ecb, which was lost by the ecb and won by the u.k. it's been great to see you. up next, wti crude has pared its biggest weekly decline more than two months as the dollar extended its retreat. we are going to check in on oil, next. ♪ guy: 15 minutes past the hour. let's check in on the markets to show you what is happening around the world. in europe, a risk on sentiment is being generated. we are actually up a little bit more than the futures earlier indicated. we are up around 53 points. the dax is still below 10,000, but we are seeing banks on the front foot. writ large across europe, banks are well bid. here's the bloomberg first word news with haslinda on an. haslinda: both sides of the u.k.'s eu referendum debate have suspended campaigns for a second day after the killing of an mp. died politician jo cox after being shot and stabbed as she met voters in her west yorkshire constituency. a 52-year-old man has been arrested. she was a committed member of the remain camp, and a witness said the killer shouted "britain first" as he killed her. put a group britain first has denied any involvement in the killing. prime minister david cameron has led a tribute. >> this is absolutely tragic and dreadful news. usbandughts are with her h and children. we have lost a great star. she was an mp, great campaigning , a big huge compassion heart, and people are going to be very sad about what has happened. dreadful news. japan's finance minister has escalated his concern about a surge in the yen, calling for coronation with his g7 counterparts to address what he describes as bizarre moves in the currency market. he spoke before the government and boj officials met in tokyo to exchange information. the yen slipped from 22-month highs, but it is still in 104 territory. bernie sanders has told supporters he will take on a new role in the effort to defeat donald trump in a presidential presidentialhe election as he comes closer to conceding that hillary clinton will clinch the nomination at the party's convention next month. >> i look forward in the coming weeks to continued discussion between the two campaigns to make certain that your voices are heard and that the democratic party passes the most progressive platform in its history and that democrats actually fight for that agenda. news 24 hours a day powered by 12 400 journalists in more than 150 news bureaus run the world. you can find more stories on the bloomberg at top . guy: thank you very much indeed. matt, go. matt: no, please, you go ahead. [laughter] guy: i will do that. your functions on what is going on with the commodity market. oil is trading higher. we've got the brent contract up around 1.5%. joining us in the studio, the new anchor for bloomberg markets middle east. this is a dollar trade. >> it is. what a roller coaster ride it has been. this week has been packed with data, but for oil, it's been a downtrend, 9.8% lower in the last six sessions. it appears to turn the corner off the back of the weaker dollar. total volumes, 15%. reports, thehose eia and iea and opec coming out with reports. none of them delivered any market moving information, so this is, from the looks of it, a weaker dollar trade. matt: what are you hearing from people in the middle east about how they are positioned with oil at $45? is it comfortable for them as we see people in the shale industry coming back on? >> they are adjusting to it gradually, and they are taking it into consideration in the budget. what we do need to point towards our comments we are from policymakers around the world that give us a better sense of where oil could be headed and whether this rebound is going to last. you had comments from the russian oil minister alex novak, he told bloomberg television interview that low prices may years, and 10-15 there was no need to cooperate with saudi arabia. few hours ago, the venezuelan president nicolas maduro said venezuela has to learn to live with a price of $40 $45 a barrel, and just to wrap this up from the chief analyst at cmc markets, saying prices have risen so far and that any correction will be shallower than the one we saw earlier in the year. guy: we will wrap it up there. we look forward to seeing you out in dubai with great coverage coming from that part of the world. up next, we are going to go to st. petersburg and speak exclusively to russia's economy minister. later today, we hear from vladimir putin. russia in focus. it's an oil story. what does russia's economy minister predict for the price of crude that will have a meaningful impact on his budget? ♪ guy: welcome back. you are watching "on the move." i am guy alongside matt miller over in berlin.a quick check on where we stand in the markets. across the story inequities. the ftse 100, back above the 6000 line. it is north of growth -- that l ine. we do seem to have something of a more positive tone to global equities right now. this is the chart on the one-month risk reversal. this is the market buying protection on big moves on sterling, and as you can see, buying a lot of downside protection, looking for that asymmetric risk. you can see this morning a continuation of this. there's a little bit of a move on that skew to the upside. maybe the market is just taking off more of the extreme betting it has been putting on downside risk for sterling. the market may be a little more comfortable with what is going to happen with sterling. big volatility still priced in. matt: i just want to take a look at the currency story but over the past three days, because we see a weaker dollar today. if you look at the story over the past three days, you see the breadth of these moves, the yen gaining almost 2% on the dollar, the pound gaining 1% on the dollar. this is wcrs. in case you fxip, are one of those terminal nerds looking for more information. it stayed two of the saint petersburg international economic forum, russia's biggest investment event. president clinton or putin is due to speak at midday u.k. time. isomberg's ryan chilcote there talking with the finance minister. we've got the russian president addressing investors in about two hours time. he is there to woo them. it's not going to be an easy job. russia is in the second year of a recession. this is the longest recession russia has seen in decades. in addition, you have the sanctions which are not helping. we understand he will be appearing on stage next to the tying prime minister matteo renzi, and he's going to say that relations with the european union should return to business as usual. what we also understand is he is not going to offer any concessions. he's not going to yield to the west's demands when it comes to ukraine. how far that takes things, i'm not sure. what investors are watching is the russian economy. when is it going to rebound? the has a lot to do with russian budget, about half oil and gas. presumably the biggest factor affecting the economy right now for the economy minister is what happens with the price of crude. ryan: that's a right. $50 a barrel is ok for russia. we have seen over the last three or four months, the russian economy heading towards positive growth. it is still a negative territory. it needs to consecutive quarters of that to break the recession $50 ismove on, but really not enough to deliver in russia.owth everything is relative. three or four years ago, the russian economy was growing at 6% or 7%. great stuff, looking forward to your coverage out of st. petersburg. up next, it's time for our brexit debate. we will be covering the latest news, the market reaction, and the politics around britain's upcoming referendum. that story, next. ♪ get ready for the rio olympic games by switching to xfinity x1. show me gymnastics. x1 lets you search by sport, watch nbc's highlights and catch every live event on your tv with nbc sports live extra. i'm getting ready. are you? x1 will change the way you experience nbcuniversal's coverage of the rio olympic games. call or go online today to switch to x1. guy: welcome to the bloomberg brexit debate. i'm guy johnson alongside matt miller. for the next 30 minutes, we are going to be covering the latest news, the market action, and the politics around britain's eu referendum. let's talk about the top stories. the last 20 for hours has certainly changed events. here's caroline hyde. caroline: let's look back. the polls shifted towards a brexit this week with several surveys putting the leave campaign ahead of remain. the uk's biggest newspaper "the behind theits weight brexit on its front page. the tabloid said britain must free itself from "dictatorial brussels." phuket chancellor warned that leaving the eu could spark a fiscal crisis. said reducede trade and investment would leave a 30 billion pound black hole that would have to be plugged by increased taxes and spending cuts. the justice secretary said such an austerity budget would not be needed. the u.s. federal reserve help fire on a rate hike. chair janet yellen cited their eu referendum as one of the uncertainties discussed at the fmoc's today meeting. >> brexit, the upcoming u.k. decision on whether or not to leave the european union, is something we discussed, and i think it's fair to say it was one of the factors that factored into today's decision. tragice: events took a trend -- turn when labour mp jo cox was killed in her west yorkshire constituency. arrested.old man was she was a committed member of the remain camp him and a witness said her keller shouted "britain first." the anti-immigration political group britain first has denied any involvement. both sides of the eu debate have suspended their campaigns. prime minister david cameron has led the tribute. >> this is absolutely tragic and dreadful news, and my thoughts are with her husband brendan and the two children and their wider family. we have lost a great star. mp, a great campaigning and with huge heart, and a big people are going to be very sad with what has happened. dreadful news. guy: let's talk about how the markets have been reacting to the news that caroline has been running us through. it has been a turbulent week for global markets. today, this is the picture we find ourselves with, a positive pop on most european markets. the ftse 100 is 20 points to the .ood, north of the 6000 line it's moved up 1.3 percent. european markets broadly are up by around 1.5%. this may be a calculating view of what is happening in the u.k. right now, and the market does appear to believe the events of the last 24 hours may make it less likely that the u.k. leaves. a relief rally is a poor choice of words, but it seems that is being priced into what is happening in the u.k. morgan stanley saying that if the u.k. were to leave, the ftse as 5000. fall as low that would be a substantial move to the downside. a quick look at what is happening with the one-month risk reversal. this is an interesting point further where the market is. we are seeing a little move to the upside. this is the skew on the markets, the put options, the put call ratio. that is beginning to unwind a little bit. let's talk about how european business views the u.k. brexit referendum. europe would be without the u.k., and it would be weaker and less prosperous as a result. cir is the view of the chairman. he and other european business leaders have appealed for britain to remain in the eu. he joins us exclusively from a long. -- from milan. when i look at how european business is perceiving the referendum story, has it been a rather rude awakening of the last few days that there is the possibility this may come true, that the u.k. may decide to leave? good morning. thank you for having me. perception of a european businessman has changed over the past few months. a few months ago, the possibility of a brexit was considered a remote risk. i think it has changed over the last few months and weeks. concerning andre preoccupying marketplaces and companies. i think that this would be a negative development, not only for the u.k. but for the whole of europe and risks creating a circle of instabilities. matt: speaking of instabilities, how do you feel the economy is doing right now anyway, in europe, in italy specifically? how does it feel to you? beenthink europe has economically week for a long time, for many years. it looks to me in the last couple years it has started to pick up. in certain countries. i think the u.k. was one of the first countries to really start to grow again. then you had positive developments in countries like spain. been a laggard, but i months, in the last 12 the economy has marginally gotten better. this is the result of what is happening in the rest of europe but also structural reforms that the italian government has taken. they are a beginning. they are not enough. more needs to be done. i think we are in the right direction, and i think one of the big issues of the brexit derailing aisks better economic climate we've seen in the last few quarters. i've seen a study made by the u.k. treasury that was forecasting the short-term and medium-term shock to the british with more than 4000 pounds of lower gdp per capita in the next two years, which is worrying. with rising unemployment, devaluation of the currency. more importantly, this could have an adverse effect on the rest of europe and give room and and too other countries populist intentions and other countries to imitate what is going on in the u.k.. guy: would you expect the five-star movement to gain a great deal of traction were a brexit to happen? if you look at the momentum the party has in italy, that would certainly be an easy conclusion to draw. .ust give us your sense when you have your year to the ground, is that what you hear? >> yes. is on aately, populism global market share trend globally. the debate about the u.s. elections, what is going on with the u.k. referendum. i think the local elections that and willgoing through have a vote of this coming , extreme right parties in france and austria, i think you are seeing that all over the place. there is basically major discontent, which is focusing on issues like immigration and growing inequalities in our societies. there are a lot of societal issues, which are real, which are important. population doesn't feel represented and doesn't feel they are addressed and tackled. this opens up room for protest votes. why i am really saddened, often times, those votes, people go to those votes to express something totally different as opposed to an objection to the vote. how do you see this playing out? what is your take on what we are going to see next thursday? does the u.k. actually vote to leave, or do you think they are still in the clear to stay in the eu? >> it is difficult and risky to make those productions, but i would put my money on remain. guy: let's pick up and ask it from a commercial point of view. what a u.k. business be more competitive if it were to be outside the eu? i asked this for a couple reasons. first of all, maybe it wouldn't have to deal with some of the regulations that have come out of brussels, and that is the argument made by many in the leave campaign. i suspect there is going to be a more clouded picture. a substantially weaker sterling could give british businesses and export advantage. >> i don't buy this argument. i believe if britain were to leave the eu, it would suffer enormously. more than 50% of trades, of the u.k. trade, goes to the rest of europe. if the u.k. were to leave, i think this would open up a very long time of uncertainty. britain would have to renegotiate all of its trade agreements with europe first but also with the rest of the world, because today that is covered by the eu trade agreements, and i think this would be a huge challenge from an execution point of view, to renegotiate those trade agreements. it would be very long. uncertainty, up and i think the effect on the economy would be negative. guy: we are going to have to leave it there. a fantastic conversation. thank you very much indeed for your time. the reason i jump in is because ryan chilcote is standing by in st. petersburg with the economy minister. let me hand you over to him. ryan: thanks a lot. we want to give you the russian perspective on what brags it would mean for this country. thank you for joining us for this international broadcast. june 24, we wake up -- let's imagine we learn that britain has voted to exit the european union. how big of a deal is this for russia? >> it has already influenced markets. all,dity markets, first of it impacts the russian economy and russian budget. the oil price goes with the rumors and discussions about brexit. at the end of the day, if there london as a, financial center is important. --panies issue bonds [indiscernible] of course, it will influence capital markets. it will influence of the company's on the financial markets. for us, it means bigger volatility and additional problems. let's ryan: go back to the commodity markets in a second. i want to continue with what it means for financial markets. you said it would influence financial markets. it would influence russia's ability to use london. how? >> because the confidence is important now. means thedence volatility of the price of capital. let's take the oil price, for instance. over the last several days, it's going back down, after five months of rising gradually. it has nothing to do with supply and demand. ryan: some people would say that is a short-term thing ryan: -- ryan: some people would say that is a short-term thing, investors trading. >> you never know. during 5-7 years, there would be instability and less confidence in the market. ryan: i know this isn't an easy question, never easy to forecast something like this, but what would it cost russian gdp, a percentage point or two? the impact give you of that. it will influence, but how deep, no one knows. ryan: thank you very much for .oining us it's an international broadcast exclusive, the russian economy minister sharing his thoughts on what brags it might mean -- brex it might mean for his country. this is already influencing the commodity markets. he has seen some influence on the oil market, very concerned what it would mean if we do get a boot on -- a vote on june 24, that that could influence ahmadi prices down the road, which would have a direct influence on the russian economy or that is always got. we've got a lot more interviews to bring you throw today. guy: thank you very much indeed, ryan chilcote out of st. petersburg. up next, we are going to speak in russia with a nobel prize-winning economist christopher's or read us. he's going to give us his view on the brexit. ♪ matt: let's take you back to russia's biggest investment event in st. petersburg. ryan chilcote is standing by and is joined by a guess. -- guest. ryan: i'm joined by a noble prize winner and a big thinker when it comes to european global economics. thank you for joining us, professor. i want to start by something you woulde, which is a brexit be something like britain hitting the self-destruct button. that,eally believe because there is going to be a lot of uncertainty. i believe there will be a temporary recession. pound, everyone knows it will depreciate. we don't know to what extent. it is a complete unknown at least in the short term, i which i mean about five years. it would be like a self-destruct button on the economy. are those the greatest risks, recession and depreciation of the pound when it comes to the u.k.? >> those of the greatest immediate ones, but the one that is an even bigger worry is what happens to exports. morehe last 40 years, british exporters have been directing themselves to the european union market, conforming with all of the rules, regulations of free trade within the european union. any international agreement they are making with other countries are made in collaboration with the european union, which is a much stronger unit when there are many countries going together, including big exporters like germany. if the vote were for a leave, there would be so much uncertainty about the export market that it would affect production within the u.k.. it would affect investment, and that is going to have a much longer term impact on the economy than any immediate impacts that would come. many people argue that, as you said, a further depreciation of the pound would help u.k. exporters possibly more than whatever access they lose to the single market. that is completely crazy. >> that is nonsense. what exporters care about is certainty that they are going to have markets and the rules they have to operate. what products they are going to produce, what standards. if they don't know that, it changes the relative price of goods, which might be temporary. to know what your market is like. you want to know if it's worth investing in products that will yield a return in the next five or 10 years. you don't care about what happens in exchange rates over the next two or three months. ryan: you said a recession would follow. describe what we would see. is, whaty i see it brought us out of the great recession was investment, job creation. it's the confidence that the economy is now back on track. export markets are not doing very well because of china, but they are doing well. we know where we stand. it is what is driving the economy forward. does aenly the country brexit, you don't know where the economy goes. when there is uncertainty, you don't invest, you don't create new jobs. you wait until you get more information. that might take you two or three years, because the information you are going to need is what will bearrangements with european markets, what kind of treaties will be signed. in the meantime, you don't invest. you wait. ryan: you don't invest for two or three years, and you get a recession that lasts for two or three years? >> once you stop investing, production goes down. , and eveny goes down if you start investing, you need some time. ryan: it sounds like you are describing a recession that could be greater than what we saw during the financial crisis. >> to be more correct, i don't think it is going to be as deep. think the rest of europe and united states and all of that are going to go deep into recession. this is a reddish-generated one. that's why i say self-destruct. it could be as long. it could be five years, which is about the time it takes for an economy. what it depends on is how long it takes for britain outside the eu to find its place the severe europe and in the global economy vis-a-vis europe and in the global economy. once we know what treaties will be signed, then we can look forward, but we don't know when that time is going to be. ryan: i hear what you are saying. you see no advantages whatsoever of britain exiting the european union? there is no silverlight in? >> i really don't. is a bighink migration issue, especially migration from .urope it really isn't when you look at the economy. up yourave to give sovereignty and her discretion of how you make decision when you sign treaties, whoever you sign them with. ryan: thank you very much for joining us. you just heard his opinion, guy. clearly, he's very concerned about what a brexit might mean for the u.k. economy. guy: thank you very much indeed. ryan chilcote, joining us out of .t. petersburg a quick look at where the markets rp ftse 100 has been back above 6000 this morning. we are also seeing a little bit .f risk reversal this is the pound one-month risk reversal. that is just beginning to reverse ever so slightly. a little bit of a reversal here as far as money flows into and out of etf's. you can see them broken down regionally. day --nto over the last flows into the japan, flows into the u.k. -- it's actually coupled with the eurozone. you are seeing interesting action over the last day. if you click on this history button, you can compare that to outflows from the u.k. over the last three months. a really interesting function. it tells you the story, a risk on trade in equities around the eu.d, u.k., japan, and the guy: this is interesting. it flows -- the flows out of the u.k. have been quite impressive. despite that, you have seen a slight outperformance of the ftse 100. i suspect if you take it into other currencies and denominate the ftse into other currencies, it might look different. we've wrapped up another week. it's been incredibly volatile week. next week is going to be one in which we focus on the impact that the eu referendum will have. .he ftse 100 is up by 1.27% we are north of 6000. ♪ francine: the killing of labor mp jo cox silences both sides of the brexit argument. markets stabilize as campaigning is suspended. talks, not action. the yen.rength of the current is weakening. his russia recovering you go we speak to the world's -- is russia recovering? we speak to the world's largest -- at noon. ♪ welcome to "the e.