>> good morning, this is

"bloomberg daybreak: europe." i am tom mackenzie. treasuries fall is the future purchase back in hopes of imminent easing. jay powell saying it remains unlikely the central bank will cut next month. >> i think it is not likely that this committee will reach that level of confidence in time for the march meeting, which is in seven weeks. tom: china's latest place to stabilize markets fails to calm investors with another volatile session process. shares plummet as much as a percent before paring losses. the u.s. vows more strikes against iranian link groups in the middle east after hitting dozens of targets across iraq and syria over the weekend. a breaking story across the bloomberg terminal. this involves samsung and a key

executive at that conglomerate. this broke just in the last few minutes. this is around the acquittal of samsung's j lee acquitted in a succession case. he had been charged with driving a friend of the former president with the government favor of a good deal that was widely seen as a key to the succession planning at the conglomerate. he has been cleared in that case. that is the red headline across the terminal. we will keep across that story and bring you more details. you can see live pictures from that case in seoul, south korea. let's check in on markets as we brace for downside coming through for european futures currently pointing lower by .1 of 1%. the s&p notched a fresh record on friday. you had a blowout jobs number, nonfarm payrolls coming in it 350 feet thousand -- 353,000.

jay powell speaking to cbs. you have had a repricing, markets expecting, betting on a 20% chance of a cut in march down from 40%. if it's 100 futures pointing to a gains of about 41 of a percent. iron ore is high in the session, so miners could get a boost. s&p futures pointing lower by .2 of 1%. nasdaq futures up by a similar amount pointing lower by around 38 points. let's flip the board and have a look at the cross asset board as we think about stronger dollar and what that will do to sentiment in the session. bloomberg dollar index up, euro-dollar at 107. yields a begin five basis points after the 14 basis point move on the back of the stronger than expected jobs data and expectations that the fed will start its cutting cycle later than many had expected.

the pound at 126 down .2 of 1% and brent, not a huge amount of movement. given the action in the middle east over the weekend, $77 per barrel as the houthis threatened to retaliate against those strikes over the weekend. let's bring it the earnings story when it comes to the second largest italian bank, a bellwether and a marker in terms of polity around banks across europe and the euro zone. fourth-quarter quarter net income coming in with a big beat, 2.8 billion euros coming through. the estimates have been a little shy of one billion euros. this is important for investors, full year 2023 investor distribution, 8.6 billion euros, that is 100% of net profit. a really solid beat for

unicredit. continuing to look at more detail in terms of the redistribution to shareholders. the outlook will be key as is the focus on net interest income. the line coming through on that front, 3.6 billion euros also beating estimates of 3.4 6 billion. a massive beat for unicredit in the fourth quarter when it comes to net income well above the estimates. we will get more throughout the salary. it let's get back to the monetary policy focus and what we've been hearing from jerome powell saying the federal reserve will probably wait be on watch before cutting rates. speaking with 60 minutes he said the fed needs more assurance that the inflation is on a sustainable path with 2% goal. i am joined by daniel moss for reaction to that. good morning. have you heard anything that changes were if you want to where the fed lands? has he closed the door firmly

shut on march, and does that mean they will have to do more if they start later? what is your assessment? >> it is pretty shut for march, but it ws -- was shut for march wednesday afternoon. the overall narrative remains intact. march was an investor construct, because at the march meeting the fed gets more dot plots and projections. what the fed has been saying consistently since late last year our interest rate cuts are likely to happen this year. you just need a little bit of patience. if it is may or june instead of march, does the earth's axis stop spending? i do not think so. the message is broadly intact. 60 minutes is a different audience from the cognizant that

usually tune in on wednesday afternoon. tom: thank you very much for the reaction. let's set out the view, the market reaction across asia and get the details in terms of how things are shaping up this monday with avril hong in singapore. what is standing up to you? -- standing out to you? avril: it is still china equities. let's take a look at the cross asset futures in the region. it is the reaction to this elephant treasuries and higher yields. we are seeing korean won as well as malaysian ringit on the back foot. it singapore stocks among the worst performance. shares of property trust among those declining, but let's take you to china where we are seeing security regulars over the weekend talking about pledges to stabilize the market, and then today also talking about measures to guard against the risk. let's take you to the cross asset picture in china if we can

the csi 300 and the hang seng had managed to pare losses from earlier in the session. it is what our colleagues call a remarkable rebound, and it is interesting how this is coinciding with the northbound inflows, basically overseas investors are onshore chinese equities. the got short yuan stabilizing after a strong fix from the pboc. let's take a look at csi 300, because we are seeing as i mentioned there was a level that is taken out the 2018, 2016 lows, and now it is set for taking out the 2014 lows, but overall it is $1 trillion of a market rout and 13 trading sessions despite the bounce we are seeing today. it remains to be seen how sustainable this is going forward. tom: thank you very much with

the check on the asian market session this monday. another volatile session as she was discussing for chinese stocks following last week's rout as investors this the latest prized by policymakers to stabilize the slumping market. a gauge of small-cap shares tumbled as much as a percent earlier today, broadly chinese stocks at a five-year low. live to hong kong, and let's bring in rebecca wilkins for her take. a promise over the last few days, the last 24 hours or so to stabilize the markets, but not much detail. how are markets at least taking this news? what is the pickup from this line coming through? >> details few and far between, and investors just want to have more meat on the bone when it comes to figure out what support china is planning to offer its market. we saw while trading, brutal

solids earlier today. it came out that the regulator over the weekend is going to guard against abnormal fluctuations. they will bring in medium or long-term funds, but we do not really have a figure. sent out an academic over the weekend also reaffirmed the need for this one point or trillion -- 1.4 trillion stabilization fund, but when we look at the selloff over 13 trading sessions, it sorta puts a sense of the skillet supported is really needed to try to reverse the sentiment that we have seen. also worth remembering the context here that we are approaching when it comes for onshore markets the lunar new year holiday, so only to a more trading sessions before the holidays break, so there is some sense of not wanting to go into the holiday with all of this and this fixed window of time to try to the best. there has been pressure too by

technical selling to we have seen. tom: what is the latest economic data out of china telling us about whether or not there are any green shoots at all in this economy? >> this is interesting, because a little brief moment of optimism with services pmi they came in for last month. certainly in expansionary territory, 52.7. the expectation it was 53. albeit modest growth, but we are still seeing growth really off the back of stimulus. the focus there is this continuation of a trend that people attending to spend on services rather than buying more expensive goods, and the think we will really be watching next is what kind of data we see as a result of the lunar year holiday. we know typically, beijing is actually overestimated the benefit over the boost we were expecting to see from the golden week holiday. that came in october.

the number was quite disappointing compared to the projection that we were expecting, so forward-looking, that is the number to look at. let's see whether people are opening their wallets as they get to chinese new year. tom: we will look ahead to that response as well. thank you for the context in terms of data and the pledge once again to support these equity markets in china. the u.s. as it has conducted additional strikes in yemen targeting a houthi christmas preparing to launch against ships of the red sea has the by the ministry should warns of more strikes against iran about its biggest forces or forces that are aligned with iran. at some of its alleged proxies of the middle east after three straight days of punishing attacks. let's get to our correspondent live in dubai. however these strikes unfolded in the last couple of days? any sign they are effective? >> the u.s. struck three different countries over this

weekend actually, and the impact of that remains to be seen in terms of retaliatory strikes from the iran backed groups. we saw a report from syria that a base in there was struck by several drones by an iran-backed group. the u.s. is not confirmed. those who these -- houthis said this will not deter their strategy when it comes to disrupting shipping and say they will continue to attack ships linked to the u.s., u.k., and israel and say these strikes by the u.s. did not even impact their military capability, and they're going to build more on that. the effect also is the u.s. is sitting a very strong message targeting 58 strikes, 58 targets in iraq and syria and the houthis as well, so this is a strong message saying we will not stand idle when there are casualties as a result of any strikes on our troops. tom: from the u.s. side, and

officials reiterating they do not want to be pulled into a prolonged conflict in the region. at where to the risks of that stand right now? >> the risk is the u.s. getting pulled into this wider conflict in the region as iran tries to play out this asymmetrical warfare everywhere else, so they are striking iraq, syria, the houthis, that is yemen, so the risk remains of the u.s. is going to get pulled into this despite the fact that u.s. officials are saying this is not the game and nothing target -- aim and not the target. the market seems relaxed as long as the u.s. does not target anything inside iran that drags iran into a direct conflict the u.s. there is a robust supply in the market for oil, and the dominant impact would definitely be a potential or possible cease-fire

between israel and hamas. tom: thank you very much. coming up, we will be hearing from the founder of women in mining in kenya. a major conference on africa mining kicks off in cape town, south africa. it is a big week for earnings as major european banks including ubs and another report this week. we will get more on what to expect from their earnings picture from energy, banks, and oil this week. stay with us. this is bloomberg. ♪

tom: welcome back to "bloomberg daybreak: europe." bankers, executives, and government officials are gathering in keep down for

african mining. one of the hot button issues as equity and how local communities can benefit from the trade. for more i am joined by the founder of women in mining kenya. thank you for joining us. talk to us about the role of women in the mining sector and how important it is the livelihoods across kenya, but other parts of africa is well. >> ok, good morning, and thank you so much for having me. my name is grace, and i am the founder of women in mining, and gender is a really critical part of the mining industry. from what we know, mining landscape is changing. these factors are a big thinker the and determining the standards under which a money -- mining occurs.

a lot of women make big contributions when it comes to big economic contributions. the inequality gaps still exist in a big way in that area, and largely one of the biggest factors that are really exacerbating the situation is the scarcity in data and lack of the right it investments to be able to sort of improve this sector. and what we are currently looking at is how can we be able to increase sustainability in the sectors, looking at different key actors and how we can march in our collaborative effort to sort of be able to grow the sector. tom: ok, so you were talking

about sustainability, investment, and the lack of data or the need for better validity data. are those the main blockages in terms of getting greater equity within this sector? how much progress are you seeing ? how much appetite are you seeing from investors to invest alongside some of those aims? >> well, there is a lot of effort going on. a lot of people are currently seeing the need and the importance of having a more equitable minng -- mining society, and there was a lot of focus on developments with regard to the community level, so there are a lot of positive improvements, i must say, but that does not take away the fact that we still need to do a lot more in order to be able to get to that goal to where we can say we are having equitable mining across the system. tom: is regulation an answer as

well? you talk about artisanal mining? environmental challenges can you be there. is regulation important? do you want to see more focused regulation on artisanal mining? >> for sure, that is one of the main ways that we are looking into in order to put in structures that can enable us to be able to have a goal of how best this sector can function. a big part of artisanal mining in african countries, it puts it at a risk, because we are clearly not able to determine what is the stasis -- status.

the economic contribution is unclear based on the informal nature of asm, so regulation. let me use the word formalization is a critical step that most countries are currently looking into, and there are success stories in countries such as tanzania, which i put in incredible measures in order to be able to -- the sector, and the economic impact is already being realized. tom: thank you very much indeed. with that perspective on the changes that are needed within that sector and how to bring more equitable investment into the mining sector in kenya and other nations in africa. plenty more coming from jennifer who will be at that on wednesday. we will be hearing from the ceo of de beers at 8:30 u.k. time.

stability continues to elude turkish monetary policy as well as the lira as the central bank sees an abrupt leadership change. more on that next. this is bloomberg. ♪

tom: the lira softens after turkey names and new central bank governor after the previous step down citing a smear campaign. joining us now is our guest. what led to the change in the garden once again at the central bank? >> turkey has a new central bank governor. his name is karahan. he has previously been working at the turkish central bank as a deputy governor since july, and

this is the sixth new central bank governors since 2019. it is worth underlining that previously when we had a change at the turkish central bank, that normally means a policy change. this time around it is different. the former central bank governor step down due to personal reasons rather than differences with turkish president erdogan on the policy path. erkan lasted just eight months in the job. she stepped down due to criticism of nepotism. allegedly, there was criticism of her for allowing her father to get involved in the central bank's affairs even though he had no role there. we expect karahan to stick to

the type path. tom: broaden that out in terms of expectations, market expectations, investor expectations around turkish monetary policy in the months and quarters ahead. >> in his first statements yesterday, he revealed he is willing to act further if the inflation outlook worsens. while he was the deputy central bank governor, turkey has raised rates to 45% from 8.5% since june. he is known as an orthodox economist. at the likes of j.p. morgan morgan stanley have said they expect karahan to be more hawkish than his predecessor. deutsche bank revealed that a

report on sunday they expect karahan could hike rates further. turkey's finance minister says karahan has his full support and thinks he is an excellent fit for the new job. tom: thank you very much, the latest on the new central bank governor in turkey and potential implications for monetary policy. plenty more coming up as european futures are pointing to modest gains. s&p e-minis down after hitting a fresh record on friday. we will get a deep dive around

tom: good monday morning.

this is "bloomberg daybreak: europe." these are the stories that will set your agenda. the fed chair pushes back in hopes of easing. jay powell says it is unlikely the federal bank will not cut before april. tom: china's latest pledge to stabilize markets fails to quiet investors with another volatile session. . a gauge of small-cap shares -- 8% before pairing losses. fourth-quarter profit almost triples. let's check in on the markets. another big we for earnings. we will dive deeper into the prospects for the european banking space. european futures pointing to gains at .1%.

ftse looking for a lift from unicredit. a massive jobs print crossing the wire on friday. ftse 100 futures in the u.k. pointing to gains of slightly over .1%. we are looking at the nasdaq futures, down point 2%. let's look at cross assets. jay powell came out in the cbs interview and seemed to close the door on march as a possible month for cutting rates. markets repricing to about 20% chance. you are seeing the 10 year yields up four basis points building on the 14 basis point higher in yields on friday. euro-dollar at 1.07.

we continue to keep an eye on the energy space and the oil given the geopolitics and the continued attacks in and around the middle east. 77.67 on brent. let's get to the interview with jerome powell on cbs saying the federal reserve will probably wait jan to march before cutting rates -- will probably wait beyond march before cutting rates. the interview echoed much of what we heard from him at the fomc. explain to us the treasury reaction on the back of that interview. garfield: there is simply the fact that powell wanted to go out there to a wider forum and a home the point that they don't see a case for march and are

unlikely to see a case for march. the other thing that resonated were his comments about the idea that they really do not want to risk cutting rates too soon, letting inflation go higher and given also of course the backdrop of the stunning friday payrolls number which he did not know at the time that they recorded this. it helps to explain why bonds experienced more pain today. tom: and indeed the pain is being seen in the front-end. a five basis point move on the two-year. what is your take on how much further the slide in treasuries has to go?

and the dangers that flags for other assets? garfield: a lot of that will depend on the data especially the inflation numbers. the other fed speak that may come. we have people saying 4.2, 4.5 for the 10-year would be the limit. even that might be a little optimistic given that we still have got a 20% chance for a march cut. we have a 70% chance or more for a may cut though powell is saying maybe the middle of the year. again, data-dependent. you look at the numbers and think it could go higher still. asia particular is giving you an advanced warning of what might happen for risk assets more generally. asia is very sensitive to the

rate outlook for the u.s. we saw currencies here drop. let's set china aside because that is not particularly sensitive to u.s. rates but even after u.s. equities hang tough on friday, you had issues in australia and south korean stocks. if you get further increases in yields especially past 4.2 level, you could start to get some damage done to u.s. equities, european equities. tom: really interesting. watching for the 4.2 level. always appreciate the insights, garfield reynolds. back to the earnings picture in europe. blowout numbers coming from unicredit. profit across the board when it comes to italy's second largest lender. in terms of net income. coming in at 2.8 one billion

euros, almost triple analysts' estimates. they have benefited from the higher interest rate environment. net interest income coming in the above estimates as well. the ceo has been pushing. questions continue, is the bank still well-positioned if rates edge lower? they were turned a significant contribution back to shareholders in terms of shareholder returns on 2023 profit. 8.6 billion euros. a similar profit picture this year versus last year. the dynamics around the net interest income will be interesting as the months evolve. let's get more on the earnings

week. we have the likes of ubs and bp. you have energy, luxury and more across the banking space. let's bring in bloomberg's chloe . what can we expect from tuesday's report with ubs? >> it is overshadowed by the three year strategic plan. the focus will be on restructuring plans and capital plans. they need to show they are on track or improving profitability. there has also been and will continue to be the issue of retaining top talent with the integration with credit suisse. tom: when it comes to other lenders and the european space including socgen and credit agricole? >> u.s. peers reported earlier than european banks and we could see lower fixed income trading

revenue but also slightly better than expected equities trading. we will have to see if that is replicated in the european space. four french lenders -- bnp paribas reported last week and had a 50% net income slump. and unicredit did well so we have had a mixed bag. tom: a mixed bag on banks and the implications from that. when it comes to the oil sector, geopolitics is central. where will your focus be when it comes to oil next? >> oil earnings is focused on buybacks. they -- there are still resilient buybacks but it is a slowing pace. refining is under pressure from softer demand and more mild winter weather. the focus will be on the geopolitical developments. tom: you talked about the

divergence we are seeing across the banking space but there is also divergence when it comes to the luxury space and demand from china will be central. >> we have a 50-50-50 split in terms of luxury. there are some on the winning side. but it is unsure. gucci is undergoing a transition. tom: a tale of two luxury stories. thank you for the preview of what will be another major week for european earnings. also making the news and let's get back to more on the geopolitics but switch focus on what is evolving in ukraine. zelenskyy says he is considering

broad leadership changes in ukraine that go beyond the military. the first time he has publicly responded to questions about the fate of ukraine's top army general. u.s. senators have released a bipartisan deal proposing new immigration restrictions. senate democratic leader chuck schumer and mitch mcconnell both backing the compromise. however, the measure faces the house of representatives. former u.s. president donald trump says he could impose a tariff on chinese goods of more than 60% if reelected. he was asked about a washington post report and he said i would say maybe it will be more than that. the front runner for the republican nomination says he is not looking to hurt china but beijing has taken advantage of the u.s.

and lionel messi. his appearance ended in jeers as his team sat out of a friendly with another team. some fans chanted for refunds. hong kong said they were extremely disappointed with the organizers of the match. the world cup final. the title match will be played at new jersey's metlife stadium across the hudson river from new york city. the final match of the world cup finals. german companies test out a four day work week. we will check in on that experiment and see if it is proving positive for companies and employees. stay with us. this is bloomberg. ♪

tom: welcome back to "bloomberg daybreak: europe." germany is attempting to revive its sluggish economy by cutting hours. dozens of companies are taking part in the trial of a four week -- four day work week. let's get more from all over on the ground in berlin standing by with a guest. good morning. >> john boehner kings predicted that we would only be working 15 hours a week. that was in 1930. if you are in germany and you are one of 45 companies across

various industries, hundreds of employees will now be working four days and it part of a global labor experiment already taking place in a number of countries including the u.k. where 92% of the firms continued the experiment after six months of trials the claim is particularly attractive in germany where are is a chronic labor shortage. here we have carsten meier, managing director of intraprenör , the consulting group spearheading this operation. our people working the same hours? carsten: we already had a four day week 47 years so we were excited to bring this passion to other companies. and like in the other countries we will focus on six months. however, they will focus on less

work time so a reduction in work time. at the same time with the same performance on the same pay for the workers. >> this is the headline. how did you choose these companies? >> in september we started the education process and we had a lot of applications from different companies. we were focused on who could be a part of the trial. changes had to be issued and talked about. but also can everyone get involved and feel like they are a part of the company? 45 companies said they would be a part of this. >> what are they getting out of this? carsten: there is a shortage of workers so they are trying to figure out if they can do a four day week so that they will be more attractive. >> i want to talk about ai. technology has been telling us

that we won't work for many years. how does that fit into this? carsten: we are looking at digitization and ai to reduce the stress and processes. so people can have -- >> your finance ministers said never in history has a society increased its prosperity by working less. germany has a massive labor shortage. carsten: in general, we need an increase of digitization and innovation to get more prosperity. we are focused on more of a macro economic perspective. our test is focused on differences. if companies want to outperform the market by saying we are better in terms of being an employer. >> is this a particular challenge in germany? i've spoken to people in

business or politicians that have said the problem with germany today is that people don't want to work anymore. carsten: that is something we have all over the world. it different perspective on work. it is not that people don't want to work. they are just time to fit it in with all the other things they are doing in their life. i think after six months we will have a better understanding. >> i don't doubt that better work will get done but does more work get done in a four day work week? carsten: we will see. the trials in other countries have not had this amount of data to look at. we have a lot more data points to see if productivity has increased. in six months we will see a lot more. >> germany is one of the countries where people work at the least number of hours in the eu, second to denmark i think.

one of the arguments is that this will attract more people into full-time work if the full-time work is four days a week. carsten: that is the perspective of a lot of companies. we need more workers but we have not been attractive. that is the perspective that a lot of people are looking at. >> another thing to look at is are we in a moment where there is a bit of a luxury where the power is tilted towards the worker particularly enjoyment -- in germany? as gdp slows and unemployment rises, we have seen a lot of job cuts across the u.s., does the power balance shift? does this project come into jeopardy? carsten: we will see that there is more demand but especially in the trial, it is the entrepreneurs and business owners that say they want to make this happen for all the reasons we have discussed.

i would not focus on the trial. >> carsten meier, thank you so much for joining us and we will have to get you back in in six months to see the fruit of this. we keep hearing that we will work less and there will be the technology and robots will be taking over but i'm not sure that is happening. tom: i take you as case in point. 15 hours a week? that is on one end of the perspective and then there is oliver crook on the other end. your productivity has not dropped. >> that is kind of you but i would also say, here is the big question --do you take monday or friday off? there is a lot of different theories. friday everyone is happy and don't mind working. what would you do? tom: it is tempting to take a friday off and have an extended

friday through sunday but friday is a day that you can power through. i would probably take monday off. >> i think that is probably wise. tom: it is remarkable statistics in this. some companies recruiting from columbia in germany to make up for that shortage in workers. all of her on the ground for us in berlin. coming up, we take a dig -- a deep dive into what is happening with the fed and chinese equities. stay with us, this is bloomberg. ♪

>> look, the economy is really strong. >> what an amazing talking point. >> this is an exceptional labor markets. >> we have to squint to see the

cracks in the system. >> the fed does not have to normalize policy as quick. >> march is off the table. >> you are more likely to get the sweep cuts that the fed has signaled rather than the higher number the market has been advancing. >> june is what i think should happen and what i think is likely to happen. tom: hearing the reaction to that blowout jobs number in the u.s., 353,000 workers added. an jay powell speaking in a cbs interview closing the door for good on march as a potential month for cutting rates. have the markets repricing

around that betting on a 20% chance reducing the number of cuts. the other story is what is happening in china and the volatility across the major markets. what you are seeing is the national team, the states funds coming in on etf's. chinese stocks are at a five-year low. will it lead to sustained support? 150 billion yuan of flow coming. this is the chart that shows the inflows. putting a floor under the cratering chinese stock market. you have close ties to the government coming out with a support plan. a trillion dollar support plan for chinese stocks. coming out over the weekend saying we are going to do more to contain the damage but did not give details.

another issue in focus for us as we think about the continued volatility and tensions around the red sea with the attacks on the houthi positions in yemen. as you see, some of the measures are starting to edge lower. these lines representing different trade routes. part of the reason is despite the fact that they have to divert away from the suez canal extending the time, you are getting more shipping in terms of the actual carriers coming in and expected this year but also the softer demand. interesting dynamics. plenty more coming up including markets today, this is bloomberg. ♪

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