start. we are not expecting a lot. we could get a statement. the big one is the inflation report next week. we have forward guidance. that is something that everyone is looking for. the ecb sometimes surprises. a couple of banks could have a rate cut. theirre way off of mandate. >> it happened before and it could be done again. every economist we spoke to. goings is a company through huge restructuring. >> dramatic announcements today. spinning off their tv business effort 10 years. they are going to put into a second unit. makers and have had some successes. many analysts say they need more content. there's one out there saying, "i

told you so. -- so." need to restructure the pcs. >> finally getting his way. thank you. we'll go through the massive restructuring changes at sony. >> baby expectations. they beat expectations with an increase of 40%. be better thano they originally let onto and they're going to increase the dividend more than investors anticipated. watch the stocks. it should be interesting stuff. it is really outperforming the rivals. >> thank you so much. anyill have it opened at second. cranny.t to manus you spoke to the ceo after the disappointing figures. >> yeah. the fourth quarter missed and the net income was 200 city 7

million swiss francs. it all has to do with provisions. issues with the irs. money in wealth management in switzerland and europe. if you're adend, shareholder. it is cash and not paper. we will talk about wealth management and emerging markets. >> thank you so much. we have a lot of earnings. we also have out yourself. l. -- alcate >> here's a company trying to shed assets. --y are getting would getting rid of one billion euros. a quarter billion euros midi coming their way from the chinese.

a smile for the cfo. >> we have plenty to talk about and we will have earnings to watch. tomorrow is jobs day. what are we watching? >> i am excited that i'm excited about central banks. -- i am excited about central bank. that is what we have. we have the ftse 100 up and do not pop the champagne. let me show you with the stoxx 600 looks like. they are down three percent. you see it trending lower. it is central bank day. i want to look at the ecb and the euro for you. this one is off of the low for the year. we have invisible -- a miserable inflation print. even a conservative would have to admit that they are way off. the consensus view is nothing. viewis the consensus

worth? not a lot. cut. call it a salami we are both italian. >> thank you very much. we have a check on the euro-dollar i had of the ecb later on. joining us is the woman instrumental in leading pimco. deputy chief investment officer and this is her first interview since joining pimco. welcome. thank you for joining us. in terms of the risk in the markets, one of the things you are concerned about? , "mind the gap." that arelobal markets up 140%. that is very nice.

we are in a transition phase. that is why i call it, "mind the gap." growthe trying to lead three form and not absolute investment. the emerging markets are dealing with tapering and rising rates. do we need more quantitative easing? that is the opposite of the united states. they are trying to taper in a way that is orderly. it is difficult for investors to judge and it is a time when we see the growth getting subdued. what is important is the idea of fragmentation. the fragmentation comes from the long-term themes that you have heard me talk about and from the fact that the world is in a de-synchronization mode with tapering on one side.

i think that is what is creating volatility and we guess. >> mind the gap, i love the name. perfect. talk to me a little but not the suggestion -- talked me a little bit about your suggestion in equities. anything, youin would have lost money. where would you put your money now? you want to do in this environment is to have a balanced and anchored portfolio with some decent defenses and use the weekend -- use the weakness to pick up cheap cyclicals. that have companies large discounts or markets coming below the cost curve on a selective basis, i would look into that.

same with emerging markets. we have beautiful consumer franchises that will be sold off. the long-term trend is still there and it is on a patchy and less absolute growth path. you really want to use that and pick in areas where you see distressed selling. volatilew, it will be for the next few months. >> thank you so much. it needs we will have to be more discerning. especially with some of the technology stocks. stay with us. we have plenty more to talk about. here is a look at what is coming up on the move. legal provisions take a big bite out of the bank's bottom line. they slashed thousands of job. central bank watch.

stay with us. we are on the move and we are just getting started.

>> in london, this is on the move on bloomberg television, and and streaming.

this is a stock. we have a lot of earnings. this is one that we are watching for the most. gained six point nine percent and the company came out with figures earlier on that were better than what analysts were expecting with forward guidance. they pretty much delivered. they are the company that had a lot of issues. they have worked on their margins and the profit margins have whitened. posted profits and we sat down with the ceo in surrogate and we are joined from zürich. what did he have to say? justify why he missed the numbers. three words stick out to me. provisions over 500 million.

that is stating things out -- sorting things out. so, we are seeing the step forward to resolve that. money came out of wealth management and over 2 million. if you are a shareholder, you are no longer holding pieces of paper and cash is king. it is more than the markets had estimated. this is significant. $780 million. when it comes to the other half of the bank, it is not insignificant. there were like flows and i asked how concerned they were about the movement of capital. know, we areou making tremendous progress on actually continuing to shift into high areas. assets under into

management being in that area that is lower gross margins and stronger net margins. our net margins being stable and the outlook for those is good. in terms of asset lows, we have had strong parts of the world. there's no doubt that, we have -- there's no doubt that we've seen outflows and we are making a approach to regularize client approach. we have had that and that is the best place to be to get to a wemalized business where have been very proactive work -- about working towards. >> let's hope that normalizing is not catching and there is a competitor. they are going after the same people and you have to have better products and better presentation to stay ahead

there. >> they certainly do. i know you grill them on the market news in the last couple of weeks. what did he have to say? >> there is a word that sticks in my mind, inevitability. it is important to them. emerging markets and fixed incomes are important. you look at the 20% of the investment banks that you have here. they started the year ok and it will have a bit of an impact. the inevitability word was the one that stood out in the conversation. back to you. >> manus cranny is there and the stock is down two percent. let's talk banks. thank you for sticking around

without the growth outlook. talk to me about the earnings division. his is a story about banks struggling? >> i think it is a bit of both. that they are not very expensive. they're not cheap. they are not expensive. you are seeing negative earnings and that is what you are seeing. the market has gotten ahead of itself. in the banking industry, there are challenges. i think that you have had the big rebound from the near-death experience and we had consolidation. helps andkets that with the volatility that we are seeing, it is going to be tougher.

in the long-term, the question is how the new world of finance and banking will react when we have a normalization of rates with all the new regulations that we have put into place. this is an interesting question that we have to keep at the back of our minds. >> maybe they are more wealth management based. you want to bet on quality franchises. the long-term demographic trends of saving and pensions and increased life expectancy means will do wellple and you want to have areas with protected a margins or margins in general. that is really key. certain emerging market banks

are used as proxies for growth. >> it is interesting. i'm not sure it is time yet. they are cheap, versus the market counterparts. clearly, it does not mean much in the expected basis. >> thank you so much. 70% after thes company posted earnings. hans nichols is in berlin with the latest. there's too much expectation on twitter. expectationtoo much and too little knowledge.

the stock is up. we see it come down. new users9 million internationally. it is a growth rate that is causing people concern. it is 3.8% growth and you compare that to what facebook has done. take a look at the graphic that shows the sales. yahoo!.tter and they need to have exponential

growth. maybe one day, google. >> start commercializing things. hans nichols from berlin with the latest on twitter. this is very symptomatic. you call them fashion stocks. >> we have seen that. it is in the tech space where the concepts start. people get excited about the new digital age. it is to the benefit of the consumer, in terms of increasing productivity of communications. in terms of making money and monetizing? we have seen this with facebook and it does not mean it is a bad product. as an investor, i want to get earnings out of it. i think this is designing a model. >> you want to be in stocks.

i'm talking about retail. there we have the next 12 months. but you have to wait until you have a valuation gap. stocks wee consumer see in emerging markets are quite interesting and technology is also very interesting. you have to take your points. we're thinking about notuctivity enhancement and traditional technology. this technology with climate change issues and energy efficiency. is permeating the industrial world. >> thank you so much. the deputy investment officer and head of equities.

>> coming up, we will look at the sony profit warning.

let's welcome back. we are in london. here are some companies on the move or you. daimlerchrysler a surge in profits. carmaker had a

significant increase. there is profit and shares are gaining. went down five percent in the third quarter. they are struggling with declining sales in italy and spain. they have invested billions to bulk of the network. >> the first quarter profit in two years. the loss ared to year earlier. received an offer for enterprise decisions. another company we are watching is sony. they are going through massive restructuring plans. here is caroline high. clearly, investors want to see it and it is not yet working. endfull year comes for an

destined to an end in march. is the bright spot. your playstation that is having good news. the big revenue winners are still losing. they are losing market share and they are not winning out on apple and samsung. it is dramatic changes they need. >> what are they doing to try to tackle situations. >> dramatic announcements that we saw today. >> this is a company that has cut. they are selling the pc unit. the are going to spin off

tv business into a separate business to visit -- division. be enough for her and was. they say that they need more content and look at how good you are at games and movies. sony made captain phillips and american hustle. how should they boost the money for sony? should they focus on production and content. internet-based pay-tv service. they're looking to try that out. they're also looking at videogame services for playstation and there is one person out there who is pretty smug. so.aid, i told you i told you to spin on sony entertainment. that is what they are doing. >> thank you.

up next, it is a volatile week for the market. investors are adjusting to life with less quantitative easing. .

>> welcome back to "on the move." i'm francine lacqua here in london at bloomberg's european headquarters. this is the picture. we're 30 minutes into the trading day. this is the picture for the indices. you can see the cac and the dax up. little change. gaining 0.2%. we hear from the e.c.b. and the bank of england but we have a lot of figures from a lot of companies as well 378 alcatel-lucent one of the biggest gainers in france and

volvo also one that we're watching. this is the picture for the urrencies. this is what mark carney has to do. reflect the strength of the u.k. economy without suggesting that interest rates are about to go up. will he do that today? euro/dollar 1.3526. these are the top headlines. japan's prime minister abe is considering the biggest change to his country's military engagement rules since world war ii. he said japan needs to be able to come to the aid of its llies.

u.s. law enforcement officials are warning russia-bound airlines to beware of bombs packed in toothpaste tubes. officials did not say what sparked the warning. security at sochi is tight in response to threats of terrorist strikes. rouha ninch accused iran tv of trying to plock his message to the nation. he said they were obstructing his discussion with the people. who ispute centered on would put countries to the president. we're watching the central bank policy decisions. we'll have announcements from the e.c.b. and the bank of england later this morning. joining us now to discuss this

s the head of research and our own jonathan ferro. jon, let's kick off with you. analysts are not expecting a change but draghi -- >> the last quarter of last year, that is what it really smells like. we have a weak inflation number. the e.c.b. has got to do something. maybe they wait another month. that's what they have to think about, inflation. that is where the story really starts. will they just put this down to falling energy prices? are they going act and what are they going to do? a lot of people talking about a rate cut. remember, we're at record lows already. coming down to .1. will it make a big difference? the securities market program. now back in the financial risis, the e.c.b. went out and

bought the debt of itly and spain. -- italy and spain. they take 175 billion euros and take that money to absorb that liquidity so they are not increasing the money supply. the bundesbank has given them -- od to stop stair sterilizing the bond purchases. it could open the door for q.e. down the road as well. >> let's take a step back. do you think the e.c.b. will have to do something significant within the next quarter? >> yes. there are three different elements. first, interest rates. and liquidity has been drying up in the banking

ystem in europe. we know that as we approach 1407, short-term, we start with show liquidity. deflation is clearly looming. >> do you think they will do something today ob can they wait? >> frankly, i would bb surprised. -- be surprised. they want governments to continue to act. spain, portugal, greece, italy and france have a lot to do. on the other side, the leading

indicator is liquidity in the banking system. last, let's keep in mind, there is the asset review. refinancing. >> talk to me about the politics of this then. if they stop sterilizing the s&p purchases, does that solve the liquidity problem for you and two, is it conceivable that the germans would allow them to do that? --what is interesting is the it was impossible -- in my view, ermany -- but the timing and once again, liquidity will be 135, 136.g --

>> just a quick point on what you don't think is happening today. i understand the mechanics that you just went through. draghi was in davos and speeches here in london as well saying further action is possible. will it not be more effective if if you do it today? >> it depends on what you mean by happening. maybe they will do it. second part. are we goinging into a real -- maybe, but frankly i think they are a little bit early. >> should we talk about the bank of england? >> yeah, very quick lism it is a completely different story. we were talking about rate hikes. the closer we get, the more the bank of england needs to act. what gets me about this story is that rates are at record lows and it has almost been a

throwaway comment. can this country really not absorb rates approaching 1%? that would concern me more than anything now. i don't know what you think, patrick. i'm not qualified to say. if you can't have rates at 1%, then u.k. recovery is really not that strong, is it? >> it is about consumption, isn't it? >> yes, you're right, the trend is -- that is clear. two months ago maybe -- yes, it could do something. frankly , we have a -- it is very likely it will remain quite cautious waiting to see what will happen. they will go higher. that is a concern, isn't it? guys, thank you so much. we'll be talking about market

implications next. be sure and watch the e.c.b.'s rate decision on bloomberg tv this afternoon. coming up on "on the move," daimler speeds ahead. stay with us. e're just getting started. ♪

>> i'm francine lacqua in london. this is "on the move" on bloomberg television and streaming live on bloomberg.com, your tablet, phone and any windows phone as well. the c 4 cactus to help spark a sales rebound. they unveiled the cactus last night and said it would go on sale in june. we asked how this model would help win over european buyers. >> it is the future positioning of our range. with the same characteristics. more design. more comfort. more ease with technology. >> staying on autoos, volvo trucks delivered a fourth quarter profit. joining me with details is ryan chilcote. what is behind this?

>> the shares in volvo trucks up the most since the summer of 2012. why? tough to say. could it be enya? the muscles from brussels? the two volvo trucks going in reverse there. we do know trucks last quarter rose by 12%. earnings for the quarter beat estimates. the company said it would maintain the dividend and they are going to cut 4400 jobs, white collar jobs in senior management at double the number the couple said earlier despite the fact that the earnings year-on-year have fallen basically, volvo trucks here coming out with better managing that downturn than investors had anticipated. >> we also had some good news from daimler this morning. they are scoring on three fronts.

first the fourth quarter profit coming in better than expected. the forecast for 2014 also better than they originally led on to it being and finally, daimler saying they are going to give shareholders better than most of them were expecting. they have been doing well against audi, outselling them in the last three months of the year. the s class is also doing pretty well. the take a look at the stock. it is up about 50%. outperforming b.m.w., who is still the number one carmaker in the world. and audi has been a dime in their side for a while. up the most since last summer in percentage interprets. francine? > what about aston martin? is james bond going to have to give back his car? nearly all of the left-hand

drive cars since 2008 that they have made and a good number of the cars that they have made with the right-hand drive since last year. unusual to see such a large recall from a premium carmaker. i guess 007, it is not like he takes his foot off the accelerator, the accelerator itself could snap and he could lose all momentum and that means general wayne could catch up with him and that would be very bad for 007. >> still with us to discuss car makers is our guest, patrick. thank you so much for sticking around. we talked about growth and central banks. carmake ears proxy of consumer demand in europe. tame, they were so unfloved 2013. is there any value to be made in 2014?

>> frappingly, we would be very careful. liberate. d way to first, the -- markets. more most car manufacturers, 1/3 -- firstly, the second thing is that when we see energy markets -- 20% to 40%, there is a big risk that -- the next quarterly results will be very, very painful for car manufacturers and last, but not least, companies which have been making acquisition could have to make ome -- on the acquisition. far, far, far too risky. >> patrick, when you stay worst is still to come for the emerging markets, is this because of china? is china a big concern for 2014? catalyst.just the

ina is -- but on the other side, most energy markets, brazil, taiwan, turkey, india, they have not made the reforms just because liquidity was massive. one thing that is worrying is with the election in 2014 for a lot of these countries, we don't see -- being made. s it equity value? they are slightly above where they were two years ago. the worst is still to come in emerging markets. note.est ofs take we'll get back to you in a couple of minutes. "the pulse" is coming up.

we're joined by my co-worker, guy johnson. we'll be talking emerging markets and corporates request a big focus on carmake rs, we speak to two executive officers. >> yeah, the story surrounding the emerging markets, pat vick not wrong about that. we're going -- pat vick not wrong on that. the man who a year ago was having real problems with his car company. the latest numbers a significant improvement. where are we in the product life sych until this company? -- cycle in this company? we have carney's call. what is that going to be? how is he going to manage expectations at the bank of england? and of course, we have another big press conference from

draghi. will we see a rate cut today? how on earth does this central bank deal with a situation where we have inflation significantly below target. enormously below target. it happened a few years ago. we'll talk about that. back to you. guy johnson will be here with "the pulse" in about 10 minutes. sony forecast an unexpected loss for the year and said it would cut another 5,000 jobs worldwide. the company confirmed that it is selling its japanese p.c. unit which includes the vio brand. mcdonald's is opening a new tore in vietnam. they have dairy queend carls jr.

-- coca-cola is buying a 10% stake in green mountain coffee roasters for about $1.25 billion. green mountain is behind coffee brewers and will help introduce a system for making single serve cold drinks. let's get some time thoughts from the head of research. a very stark warning on emerging markets that the worst is yet to ome. a lot of structural reforms not in place. talk to me about earnings. will they be revise further? is this going to be the big story for the next couple of quarters? >> unfortunately, yes. the correction in emerging market was not -- we're no focused still. if we have any kind of recovery, it will be very, very slow.

s there recovery -- plus the fact that china is slowing down as well. frankly all of this was not ctors in, and on a daily basis, we will -- and frankly, yes, there is a risk of further downside and as i mentioned q 1 and qe risk of -- 2 ings. >> does it mean that investors have to be much, much smarter in 2014 and what is your favorite pick for the next two quarters? >> it is a big picture is that if i am right, you have absolutely to concentrate and be selective. frankly, we rehappy quite positive. within emerging markets,

you have some interesting country like mexico but it is far, far too easy. d the u.s. -- variations are very, very high and we might have a correction there. >> some pretty bullish calls. ust ahead, it is like google glass for skiers. ♪

>> welcome back to "on the move." i'm francine lacqua here in london. let's show you some of the bigger stories that we're watching. of course it is all about central banks. jon and caroline are here to discuss earnings and central banks. he said the worst is yet to come. the worst is yet to come for emerging markets. today let's see if central banks, the bank of england and the e.c.b. give us an indication of what's to come. >> we may get a statement. the big one is the e.c.b.. a couple of people think they might do something. will they cut rates? the element of surprise sometimes can be the most powerful weapon the central banks have this where will they cut to? they are already at record lows. >> he must be saying i told you

so. he has always wanted sony to spin off their entertainment unit. they are not doing that. he said we structure your tv, p.c.. they are selling the p.c. unit and are spinning it off after 10 straight years, declining profitability. they are going to be another loss. >> this goes back to the point where we were talking about -- earnings are o -- there is a lot more pressure on these companies to restructure at a time when central bank action can't be there forever. >> absolutely. that is the big challenge here in the bank of england. yes, rates will stay low for longer. they are going to go up. >> vodafone coming out with numbers. it was hit by the emerging market weaknesses. a lot of demearns very exposed. that is going to continue thank you so much care lined jon. stay with bloomberg tv.

guy johnson and i are back with "the pulse" coming up next. be sure to watch for e.c.b.'s rate decision and mario draghi's press conference on bloomberg this afternoon.

>> a big miss for credit suisse. legal costs hit the bank. the boss tells us he is cutting back on the riskier areas of the business. >> daimler's c.e.o. joins us live. >> hashtag fails. twitter shares tumble. are the days of easy growth over for this business? >> good morning, everybody. welcome. you're watching "the pulse". i'm guy johnson. >> i'm