>> countdown to the crimea vote. john kerry meets his russian counterpart in london as more violent clashes break out in ukraine. mario draghi defense forward guidance. >> is the missing malaysia jet at the bottom of the indian ocean? the u.s. navy joins the search planedence finds the continued long after it lost contact. bp competes for new contracts and releases in mexico.

>> hello, welcome to "countdown." i'm mark martin. >> bloomberg reporters are standing by across the world, ready to deliver the stories. caroline hyde is watching altice . ryan chilcote is looking ahead to the talks this week. is looking at the business stories related to any sanctions against russia. the ban against bp has been in place since the spill at the gulf in 2010. >> an exclusive interview with the ceo of the company behind the vision effects for the hit film gravity.

oscar-winner william sergeant will join us later on. earnings withd our reporter caroline hyde. >> remember, this is a telecom giant, really. holding company that owns assets across the board in europe. and have assets in israel the caribbean. they only sold shares back in january. they are at about 3.2 billion euros. that has seenany their earnings start to climb. their profitability was up some six percent. many analysts have been liking this stock. credit suisse have been saying they have really managed to show

an ongoing performance in terms of margins. they can take assets they buy up and improve them. the question is, will they be able to do that to assess our? war,ey are in a bidding aren't they? >> they are. more.ernment likes buig we want to see how much of a. they will put in for sfr. meeting,of that secretary kerry will meet with british prime minister david cameron. ryan chilcote has details for us. >> 20 of 11th hour talks as western leaders seek to find some kind of way to pressure

president putin from going ahead with that referendum on sunday .n crimea those talks begin here at 10 where the british prime minister david cameron will meet the u.s. secretary of state john kerry. they will have breakfast here early this morning. the main event of the day, secretary kerry will meet with , foreignan counterpart minister sergei lover of. lavrov. the united states is saying they were not convinced that russia was taking diplomatic efforts seriously. those talks going forward today. really an 11th hour attempt to try to get president putin to change his mind ahead of this

referendum. lots of conferences scheduled for after it. they want to try to convince russia to step down. we have seenwhile, tensions on the street overnight in ukraine. >> yes, we have, in the eastern onetsk, we have seen pro-russian and pro-ukrainian demonstrators clashed. the interesting thing is that russia has expressed its concern about the situation in the east of the country. it is predominantly russian speaking. russia has says it reserves the right to intervene in the east of the country should things get out of control there. russia has thousands of troops carrying out exercises just on the other side of the border in russia. that has the west, the united states, the u.k. and the ukraine concerned that russia may

intervene there as well. >> ryan chilcote live in downing street. >> jonathan ferro is here. >> it morning. you heard ryan talking about potential sanctions. i think it is still quite speculative. a lot of talk about visa bans and asset freezes. the question is will this escalate to where people start getting trigger-happy with sanctions and not let's. that is going to hurt is this just as much. if you go down the sanctions hurt. it will right now, russian equities and anyone with exposure to the stocks is getting hurt heard we're down 3.5% on the day and 10% on the week. as the biggest selloff since 2011. that will be hurting a lot of $30 billion was shaved off one particular investors

'wealth. felt that pain is not evenly across european companies -- >> really it is not. have one quarter of their revenue coming from russia. the problem here is twofold for any company with exposure to russia, particularly on the consumer side of things. can the russian consumer hold up the echo what does that due to the consumer and growth? last year, the danish krone was up 12% against the russian ruble. carlsberg said that it shaved $84 million off its profit last year, not just the ruble, but mainly the ruble and emerging her and see markets as well. this year the danish krone has moved to that high against the ruble. in simple terms, you get less bang for your ruble when you conserve those russian -- when you convert those rubles back to whatever currency it might be.

you're going to get hurt over the coming quarters. the question is whether that evens out over the coming years. right now, record low for the ruble's again. >> john kerry is just arriving in london today for crisis talks very at mario draghi -- for crisis talks. ands get over to berlin bring in our international correspondent hans nichols. good morning, hans. >> what we saw for last week from drug he was a hint about what the euro could mean -- from mario draghi was a hint from what the euro could be doing. the quiz later on how many basis points it actually dropped. what this is is an attempt by mario draghi to lower the

strength of the euro. here is what he said. of inflationrisk expectations becoming an anchored will be counted with additional monetary policy measures. it is countered. that is the key verb there. that suggests action from the central bank. >> yesterday, you spent some with the bundesbank president. would he have to say about the strength of the euro? >> he is talking once again about when you look at the euro and what impact it has on inflation. we have clearly seen that inflation has not moved as fast as many economists predicted and hoped. yet again, another influencing factor. the question is, is it the influencing factor? we will see that coming out over the course of the next couple of days. >> thanks, hans. >> this comes just two years

placed inban was response to the worst spill in manas, can you explain? >> we weren't really expecting this. it is progressive. , pp are reputation doing well. we are only two years on from when the ban was enacted, anna. the u.s. chamber of commerce lobbied on behalf of bp and the british government as well. there is a lot of interest to get this across the line. from a business point of view, bp has some pretty big contracts with u.s. government departments .ith almost $2.5 billion they practically vanished when this was implemented. those comp -- those contracts

come up for renegotiation. not thatle say it is much of an impact. it is important. the most critical part of the equation for dudley is this. the government of mexico is very important to this. be whereof mexico will they really want to focus, -- they haveyear 10 rigs out there and they hope to produce 300,000 barrels. the litigation continues. it has been ongoing. the criminal litigation comes in at $4.5 billion. the clean water act, this is what the judge is still considering. act, whatclean water are you liable for if you are bp? >> how much oil did this bill? -- did they still?

-- did they spill? new evidence has pushed the search for the malaysian flight 370. the flight path of mh 370. the plane went west over malaysia and way beyond the radar limits. familiar with it say that more -- that there's more evidence that the plane continued to fly even after the information came from the transmitter. it continued to fly for up to five hours. that says it was operational even though the transponder was off. news conference

yesterday, malaysian authorities said that it is possible to continued the plane comms werer the last received. they denied reports that boeing and rolls-royce continue to receive data after the last contact at 1:07 a.m.. and new reports it say the plane did not fly through the borders. >> coming up, as we continue to see the developments in the ukraine on the market, we will be talking about investment opportunities online which it -- with hsbc. ♪

>> welcome back to "countdown," i'm anna edwards. stephen, good morning. thanks for joining us. has it all been priced in? last six months, everybody knows that they're going to slow this down. it is in the price, really. the current level of yield on

the u.s. treasury curve reflects that. we have transitioned towards the optimal control theory of forward guidance. the yields are priced in line with what the fed is telling us they're going to do with those funds. we need the data to be stronger than everyone expects for the yields to go up. >> the whole tapering experience -- youfred -- by the fed are suggesting that was all done last year. --t story is not is what is that story is not what is driving things. >> it was a year ago that mr. bernanke told us that long-term yields were too low. for a long time there were two percent and then they went up to three percent. the fed is influencing expectations, either deliberately or inadvertently, by telling us what it thinks about the future. >> where do we invest along the u.s. curve? >> there are other factors

driving the yield. actually, the front and going up to the five-year is relatively cheap because the market has built in its expectations. geopolitical risks are another factor for the u.s. market. as is the relationship of the equity market, what china and japan are doing with their reserves. these are all critical factors. it is not as simple as just looking at the payrolls data. >> how much has weather impacted u.s. data? >> looking through all the noise, we believe that monetary conditions were actually tight, repeat tight at the start of the year, based on where the forward yields were. incoming data is starting to reflect the tightening of conditions. in other words, the data is coming in weaker. it is not just about the weather. there has been some distortion, but when you look through the noise, the trend is not good. the u.s. economy is not growing that powerfully. >> how about this weekend's

crimea vote, stephen? if things go down the worst-case >> this is a difficult one for analysts to take on board. we had the experience with syria recently, but it was not as bad as this. around theios built risk of greece leaving europe. this is very difficult to fathom. it is bad for consumer confidence longer-term. clearly, one of the earlier desks is talking about that. the data will be revised downwards. it probably means that monetary policy is looser for even longer than we came to expect. it is difficult to imagine a scenario where everyone kisses and makes up. on monday it is not going to be a case of everything is fine, is it? it is you going to be very very bad or very bad. emerging-market bonds, you have

the hard currency bonds. emerging market economies deal in dollars. they are a lot safer than the local currency. because of the selloff in places like brazil and mexico, india, it has been very aggressive. you're getting double-figure yields in brazil, for example. you do have some protection of some of these em companies. what are the safe assets when you have this kind of risk developing? people will go to treasuries first and then they will go to the short end of the markets. going to stayors with us from hsbc. ♪

stephen majors is here. give me two reasons, stephen, why i should continue to buy peripheral government debt and two reasons why should not? >> well, depends where you come from. if you have been bullish for the

periphery since the summer of numbersitt of speeding go from six percent to almost 0.6%. the people who have earned those funds have gotten plenty of up the curb higher you get 200 basis more points than germany. for them it is good value. monthst is taken them 12 to get permission to buy the bonds from their bosses. maybe you can't buy anything else. maybe you can't buy brazil. the second reason you would buy -- you the periphery would make the switch from the corporate's into the periphery. is that ityou don't is come a long way. the spread could go out. the second reason you don't is

that something could really go wrong. we haven't had a credit event for a long time and the eurozone. i am not capable of predicting what the next one will be. i know it has been a long time. [laughter] series shocklast we had, was it cyprus? >> yes, about a year ago. btp has moved many basis points this morning. maybe that is because everything is fine and all the problems have gone away. what you are paid to take risks and you have to think about what the risk reward is there it may be the spreads come too far. for the periphery we are still comfortable with the levels, but we have come a long way. we may be chasing the last 10%. we have had 90% of the move. >> mario draghi has been a little on thecal than normally

euro. what are you expecting him to say or do? >> if you look at yesterday's comments and at last weeks comments, he is basically told you what they will do. he gave numbers last week about the impact of the euro move on inflation. he exquisitely mentioned the impact of energy on inflation. if the worry is about the disinflation and deflation, we know two potential sources of that deflation. for example, if the euro-dollar keeps going up -- i have not been a number in mind, imagine 1.45. that will imply lower inflation and maybe challenge the assumption. >> it might not be a specific target for the ecb, that they have all range. >> they have given us some clues as to what might happen. >> thank you for joining us. stephen major of hsbc. we will speak to the chief

executive of the company behind the special effects for the oscar-winning movie "gravity." will the talking to him next. ♪

>> these are the bloomberg top headlines. u.s. secretary of state john kerry has just touched on in london. he is meeting with russian foreign minister sergei lavrov. crimea is set to vote on joining russia. the crisis talks come after nights of violence in the do netsk region of the ukraine. deposede home city of president viktor yanukovych. says his forward

guidance may help to weaken the euro and lower interest rates. bank presidentl says it may ease the risk that inflation will not meet the goals set by policymakers. >> welcome back, this is "countdown." i'm mark orton. the lead visual effects company managed to make this film look like he was filmed in outer space. our next guest is the founder of the company, william sergeant, chief executive officer of the british company frame store. william, congratulations. -- your company's second oscar.

>> gravity was very much setting a new bar in our industry. >> just give us an idea, william, of the bar that you set . there are techniques involved in this film that took three years to complete third it was some undertaking. >> this was like a feature animation film. as and the film is just george's faces, everything else is digital. the problem was to re-create zero g, because in space people are upside down and sideways. the achievement was to make something in terms of sheer processing power, sure animation. for that we had to innovate all sorts of technologies. >> tell us about the role of visual effects and how you see that changing in the nearly 30 years that it has been in existence. have you seen it move from thought inf a second

the director's mind, how can we add visual effects into something that is very integral to the concept and story that is .reated from that you >> a second thought is how it used to be. now it is a big part of the budget. it is fundamentally digital now. to 1000ll be maybe up artists on a major blockbuster for maybe a year versus maybe 150 people on the set for four months. you're talking about 90% plus of the actual man-hours being done by digital artists. >> a lot of that is being done in london right now. >> it is incredible. number of oscars collectively as a community. we are probably the center of excellence in the world for what we do. >> tell me how it works with technology advancing. when it takes three years to put together a film like "gravity." are you constantly having to

reinvent yourself as technology reinvents itself? how does that work? example, we were finding solutions to the story. that leads you to technological solutions. the fact that processing power is now incredibly fast, it means you can do stuff of unbelievable quality which you could not have done three years ago, never mind five years ago. technology is enabling us to be more ambitious. >> what can't you do? this is incredible. >> the answer is nothing. ,t is only a matter of time money and talent. phone callst angry from location scouts? >> we did a film called the beach. we create locations that do not exist. >> amazing. >> was a island called off thailand? i know i went there.

>> your achievements are attracting investment from foreign wise. spoke -- you have spoken positively about that and how you like having what you consider to be a long-term investor involved in your business. >> indeed. the core of the entertainment business is that. the growth economies are in the east. i am pleased to be looking east. in my first 90 days i'm artie doing business in that part of the world as a result of this investment. >> how does that work? are you getting calls from chinese filmmakers and ball he would? are they looking for your skills? >> we do advertising as well as film. we deal with large corporations. people know who we are. now it is a matter of finding out how we can do business with them. >> what is the cost structure of

this work, of the film like this? we hear it costs a hundred million to make. you're behind more than 80% of what was actually seen on the screen. how does it all work? >> we get paid and we make our profit on the job, so to speak. it is basically a bunch of guys sitting in front of computers. obviously -- we have 30 million pounds of hardware and software in our building. it is a very simple equation. >> are you ever part of the profits and profit sharing? is your company ever involved in that or not? >> occasionally. given that we work on up to four or five major blockbusters and not all of them are hit, we make

our profit on a project on the success or failure. >> what preoccupies you or people in positions like yours about the future? is a technology? is it about mobile and platforms? how does that fit in with what you do? >> we are one of the few companies it does things on every platform. we operate on all the screens. it is quite a messy business model because technologies and ways of applying images. andshould not take gravity on an iphone. you need to repurpose it. that is what i find very exciting. my kids will consume the same film on every thing from an iphone to a playstation four, as well as watching it on television and in cinema. we are all consuming the same materials in different formats. i like that. we are at the beginning of new

ways of telling stories. in the future, film -- a film like gravity you will have been introduced to other forms. we could render the universe and make it available to you in real-time on your ipad. like a bignds pledge, to render the universe. >> is the british film industry in a good spot right now, william? some say the number of films last year of independent british films went down. funding for those films declined, as well. how would you characterize the british film industry, encapsulating the indie scene right now? the bigger world is a hollywood studios and the major releases, but british independent cinema is quite vibrant. people who were in this year's draft as an oscars where

british quite often had their first experiences in an independent movie. from where i see it, it is pretty vibrant. #very good guidance. this year, hollywood only made 95 movies. >> william, thank you. >> what is the next film you have to look forward to when it comes to visual effects? delivering the largest marvel budgeted project in the summer. >> all right, william, thank you very much. >> i don't know if i can say who it is. i'm enough it has been released yet. quite a well-known actor. >> i think he won an oscar for the king's speech, i think i'm right in saying that very colin

firth, anyway. next we will speak to cater him caterham.e wheel -- to >> i'm going to show you how we build our 2014 car. the first thing we start with this design. clearly with the big will change we have to work with the regulations as best we can. we come up with a bunch of concepts, layouts, ideas come as to how we can get the most performance out of the 2014 rules. that will move into the r&d area. ideas will get tested and evaluated to see whether they are performing as well as he wanted to or not. then we go into our manufacturing with our chosen solution, where we then have to

do a series of crash tests, evaluations and so on. then we moved back into the r&d area again. 80% of the car made from carbon fiber. the reason for that is the strength to weight ratio. >> caterham chairman tony fernandez likes a challenge. links hisnything that company's? -- his companies? -- askedamous people's how i became a millionaire.

start with a billion and then run airlines. within their lives opportunities. we have taken an airline, we started with two planes and now we have 150. we carry 45 million people. it is a very profitable business. the car business is something you can't run away from. it is what people want. it is sexy, people like it. world in a part of the where the middle class is growing every day. goes intodle class higher middle-class to be a huge amount of people who want to buy it. we live in a world where people talk about cars and planes. foot all is a fantastic ranting tool. it is bigger than formula one. when i walk around the streets of london, they're not asking me about f1, there asking me about queens park rangers. they're all linked around opportunities that have a lot of attention, which

gives you the ability to build scale and drive more product. >> does that say something about you? >> i like to create, i like to sell. i like to do things different. i am notecessarily -- richard who wants to go to the moon. he keeps asking me when i will join him on the moon. i keep saying yes and then i pull out. i keep thinking what the hell do you want on the moon. there are plenty of things to do on earth. but i have taken businesses that are high-profile, not because it profiles me in a different way, but it gives me the ability to build business is much quicker. we are from a little country, malaysia. in london you have a sense of the world meeting here. it is much easier to develop and build things. in a little country, we have built a global brand in our region. hopefully we will be able to do

do inthings with what we q p.r. from a business aspect. >> that was tony fernandez. >> we will show you who's leading the race from the streets of paris. that is next on "countdown." ♪

>> its time for hotshots to look at some of the most compelling images of the day. when competitive skiing game to a close in switzerland, the final downhill of the season was no woman hast. gut. stageces than paris-nice cycling race. it is at the halfway stage of the competition. the race continues tomorrow.

is the girls zookeeper who finally got a look at the newborn tree kangaroo after nine years of waiting. it is the first tree kangaroo to be born in missouri more than 20 years. -- to be born in the zoo in more than 20 years. >> is this the same rule about pandas that applies to small marsupials as well? any small baby ones just make great television? it is true, isn't it? >> and the stories always feature on tv on our television. >> you tell us about features, i will tell you a name for the kangaroo. >> we had a huge correction. on friday we lost about $1.2

trillion. that was wiped off global stock markets. signing central bank to -- deciding on monetary policy. 1.2 6 billion dollars of earnings in 12 months. we will look at the chinese markets and banks more generally. >> how about bp? >> that is definitely a focus. to gain access to compete for u.s. contracts in the gulf of mexico, where of course it had its massive 2010 oil spill. we expect them to at least be able to win some lucrative contracts. we will see the price on opening. well -- ono as well. >> we now understand it may hold off on the ipo because it wants

to negotiate. >> is the best i could come up with. >> i like scarlett, after scarlett johansson. >> that is going way too far. that is weird. >> she is our film of the week. there's nothing too deep. only skin deep at my desk. run.timates following a we will have more coming up next. ♪

>> welcome back to "countdown." >> 7:53 here in london. jonathan ferro joins us. >> eight minutes until the market opens in london. one country really in focus and it is not russia or the ukraine, it is china. a flurry of downgrades for 2014 gdp by whole host of banks. america lower their estimate from seven point six to 7.2%.- from 7.6%

there is significant exposure to emerging markets, copper as well from a july 10 low. no data out of china for another week. thet certainly has been topic of the week, hasn't jon? it has been left unknown who's going to be taking over at nokia. they are disposing of the phones unit. , surprise, it is the ceo of the network who is taking over. he's been at the helm of the network area since 2009. stock is coming in at one percent higher. of thejust because numbers, but because of their ambitions.

they are more into mobile. the big mobile player in france, the second-biggest in the whole country. altice today put out numbers. it is over will -- it is the overall owner of numericable. it did make some rather bullish comments about the firepower it has because they came to market and the shoulder -- and they sold shares. ofy have availability capital. they're really trying to say to the market, don't underestimate us. we can raise our bit higher. we do have the money to put to work here. we can see where they go with heir bid for sfr. a host of eye on

smaller companies coming to market in initial public offerings this week. >> these two gentlemen are meeting in london today. we are at downing street to talk about that. "on the move" next. have a good weekend. ♪ . .

>> welcome to "on the move." i am francine lacqua at bloomberg european headquarters in london. we are moments away from the start of trading and our markets team has everything covered. there with me now, jonathan ferro, manus cranny, hans nichols, and ryan chilcote is standing by. a big correction in terms of market sentiment. futures pointing to a lower start. >> lower across the board and in asia as well.

geopolitics really back in focus. that vote in crimea, a meeting over potentially more sanctions to come down the road. country, a whole host of banks downgrading their forecast for growth this year. a big concern for a lot of people. some would say that is what has really been driving the dax over the last couple of days as well. >> that is one thing we are watching. hans, you have spoken to jens have also heard from mario draghi and the euro. >> when central bankers want to move the euro, they can do it as easily as the bead on an abacus. mario draghi talking about the strength of the euro and what steps they can do to counter it erie -- to counter it. what we will see is another factoral