quarks are galaxy s5 hits stores later today. >> a little demo here. it is gorgeous. many people are feeling it is not a revolution, just another step in the direction. packed with $600 worth of freebies, never mind the price war. here's the free the war when it comes to smart phones. paypal vouchers, linked in premium. they're trying to lure you in. onone is trying to remain top. >> interesting strategy. david, chancellor merkel is set to visit greece today. she is expecting a little different reception that you got last time. >> could be a little bit at her. -- she'sare a lot more

going to meet some smaller start up companies and some medium-size enterprises. handle blatt is reporting she's going to announce the formation of a greek-german development bank. we will be hearing more from david throughout the morning. we'll watch the asian markets as well. stocks fell from a nearly three-month high following the renewed tech selloff in the united states. we also saw chinese inflation stay below the government's 3.5% target. that could be interesting heading into next week. we get gdp numbers from china next week for the first quarter. could that be the weakest quarter of growth for china since 2009? that is something that markets are watching right now. what also they watching? >> selloff in asia and the u.s.. isa going to carry through to europe? we will find out now. we are expect in a lower open here in europe. 3, 2, 1, here it is. , right across the board.

all equity markets down. we're are still talking about that greek want auction yesterday. 2012, nor faulk was at 50%. is it optimism, is a desperation? are they starting to price in qe? lower bond yields in spain. tell you where qe is not priced in right now, it is the euro dollar. 1.3 894. the euro headed for its best weeks in september last year. the main reason for that is the dollar having its worst week in eight months. >> john, thank you so much. joining us for more perspective is losing mcdonald. chief investment officer at alianza global investment. the nervousness surrounding tech

stocks at the moment, what, for you, looks to be behind the current nervousness we are seeing from investors? thet is a big rotation from best-performing of last year to the worst-performing of this year. there are clearly, that is what is happening. you're seeing a d rating of some of the most highly varied areas of the market. being one ofks them. that rotation going into the value and, either of the markets are going into emerging markets. there's a slight back up towards bonds, as well. you have a strange leadership of the market this year. , plusike investments commodities, which is normally something you don't see in the best bucket. with all his rotations, you never know how quite they will -- how long they will go on.

>> has it come from a are people place, or just being nervous about valuations is running technology stocks? is about slowdown in china or whether the u.s. growth story continues, or is it simply whether these tech stocks of gone too far? >> the trigger seems to be the fed. that looked to be what the catalyst was. the stretch in valuations that you have had over the last year looked as if you just waiting for some catalyst. i think we are still going through that phase at the moment. in all of these phases, you begin to see opportunities coming up. as you get into the earnings season now, it would be clearer where the opportunities are. >> i was listening with interest . it seems like a good time to write about banks. it would seem to be the story of the decade. looking at the various central

banks, you mention what the fed is doing, do you look at what japan did this week, was a disappointing to you that they didn't offer more qe? are we going to see more qe for japan, for the ecb? >> we aren't really expecting them to do anything, but from the reaction of the market there clearly was some expectation, that they would move earlier. they're looking to see in japan what is going to happen after the consumption tax hike. that could lead into the summer before they think of doing anything. that is the timescale we are expecting their. somecb we think has political constraints around elections and is not likely to move too much before the summer. more constrained about what they can actually do. those of the areas where you will have to expect liquidity, because you're not going to get it from the u.s.. it fromot going to see the u.k. or anyone else.

it really has to be from japan and europe. >> what will that du jour to investment strategy if we start to see more qe in europe and japan this year and lessen the united states? >> from the standpoint of valuations, we have been saying for sometime we think there's more value outside of the u.s. than in the u.s.. that still seems to be the case. fore we are looking interesting opportunities and upsides, they're tending to be going east towards those areas that have lagged. be -- it makes sense when you look at what the potential is for liquidity that is coming to the market. that is whether we are going. a bit more europe and looking to asia as well. >> whereabouts in asia? we have china gdp numbers out next week. >> we are nervous about the chinese financial system, and

that theyult path have to tread there between liberalization of the system and cleansing of credit. that is a very difficult path. the nervous about how that develops and the impact that will have on growth, however, it look like a lot of that is priced into the assets. we are not interested in going to close to the financial sector, but elsewhere, we think there is potential. >> lucy mcdonald from ali on zcoble investing -- from allian global investing. the s five hits the shelves. samsung's fight to hold onto its lead in a crowded smartphone market, and a shoe in for the billionaires club. stay with us. we were going to bring you those

stories after the break. eightseven minutes past -- seven minutes past 8:00 here in london. ♪

>> i'manna edwards in london. we are streaming on your phone, your tablet and bloomberg.com.

here is a stock is on the move this morning. it is a chip designer based in the u.k.. the stock is down by 3.7% in this morning's trading. and carolinethon about the weakness we have seen in tech stocks. technology stocks in the u.s. down by more than six percent since early in march following the very strong session running up to that point very let's stay with that top technology game. jonathan ferro has been digging deeper into it. >> thanks,anna. wall street taking an absolute eating yesterday. nasdaq down over three percent. the biggest fall since 2011. the index is not tell the whole story. check out these three stocks over the last two months. netflix, google. they are all-time highs. eventually, everything has to

meet gravity. this is the correction that many were looking for. >> what does this mean for ipos gekko missing a lot of tech ,ompanies coming to the market is this a sign of what is next to come? >> this is a window of opportunity we were told. the market was buoyant, valuations were strong, it is a good time to float, they told us. you saw what happened to king digital on its first day of trading areas of legitimate percentage decline. many would say that stock was priced at a discount. is the cell of a natural correction or is something bigger and more aggressive just around the corner? >> good question. how to avoid a candy crush. for more on the markets, lucy mcdonald, chief investment executive for allianz global. you mention the reason why we are seeing this selloff in technology. you like technology, but only some parts of it.

that is our position in the dollar and of technology. microsoft, which we like because ,t has valuation, 12 times pe and it has a turnaround story with the new ceo, and it has a business in asia, which if it were stand-alone business would be valued fairly highly. it is quite a good corporate change story there, plus a yield. inyou have quite a belief satya nadella. that is one where we have a good conviction. fixed bland,more we have microchip, which is an analog manufacturer. that goes into a very broad spectrum of industries. we are beginning to see some better news come out on the demand side.

those areas we feel relatively comfortable with and we're not really positioned in the high-value and because we have been expecting some selloffs there. >> something like the u.k. chip m. you don't like the caricature. >> no. we have seen huge valuation upward in some sophisticated internet names. they could still come down some white. -- some way before they become more attractive. to the earnings season, you get a much better picture of the companies that are making earnings. we feel, as we get to the next month or two, we will have better clarity. >> she like any of the hardware manufacturers? samsung releasing new products worldwide at the moment, obviously facing more competition from the cheaper

manufacturers of china and then from apple. is that the space we are playing in? >> we feel there is more potential for downside on margin in that area, generally. there certainly volume, but there is margin pressure. is highly competitive. >> interesting stuff. stays with us. let's pick up on that theme. hits the latest device shelf this morning. thiswere lost earlier year, they hit stores today. caroline hyde has the details. caroline, his samsung doing enough to remain number one in smartphones? >> they're certainly trying to woo people over with the new design. it has a bigger screen. a better battery, a heart rate sensor, a fingerprint sensor. but, as you are saying, the competition is rife. there are the cheaper new kids

on the block. sub $100? apple with its iphone 5 s, what do they do? they bring another war, not just a price war, but it freed the war. they're packing this new phone with $600 worth of free applications and vouchers. a paypal voucher, linkedin premium, at least for fitness apps. clearly, they're feeling the turf wars are in. they're desperate to remain top dog. it is worth remembering that last year they shipped war than 300 million phones. that is double what apple shipped. they're still very much for out in front. they're terrified that they're losing market share amid the saturation in the high end of smartphones. aboutalso seems to be wearables this year. with the samsung has to offer -- have to opt for in that department? how do they stack against the

competition? >> this is one of the newbies that they brought out. this is the gear to, the neo, the cheaper version. they have a more expensive version, did cure too generic. remember, galaxy gear, basically one person some but up -- summed it up earlier. samsung likes to do its r&d in public. feel it is not up to the top specification. you have to use a samsung tablet or smartphone with it. it sold 800,000 galaxy gears in the first two months, but check out ebay, anna. there are lots of secondhand watches on offer. abel did not use them or want them. if come up with an updated version, the galaxy gear too. it is going down far better in terms of design. haveestingly, they unveiled their own fitness one as well. the samsung gear fit.

that is really liked by many because they feel it connects with the phone, you can access your messages, you can use generic ways of responding to phone calls on it. it does look a lot better. they feel this is the way to go. for $200, it has a lot of competition. it is very expensive area does it only teams up with your samsung smartphone. when have the likes of fit it on offer, job own, yet the nike fuel band. i quite like the lg life band which allows you to monitor your messages, link into your applications heard not just your samsung device. it links into any android or ios device. this is the competition they're up against her 2014 is going to be the year of the fitness device. what everyone now is waiting for has been named the samsung gear solo. when it can operate on its own without the phones that you have to connect it to, that is what we're all waiting for. i can't show you the gear fit because a colleague has taken

it. he is currently counting his calorie intake as we speak. >> is making him do a little bit more walking around the office. >> running around the block area >> i don't know about checking my messages while doing physical activity. that sounds like a recipe for falling off the treadmill. we'll continue our conversation on samsung. we will talk about the sales strategy on "the pulse." that will be a little bit later on on bloomberg. week looking ahead to next when we get the start of the earnings season here in europe. any clues as to how it is going to go? how do you think it is going to head? were stopping in the u.s. tonight. it its not meant to be too exciting because trading has been very weak in the first quarter. i think they are not going to be

that exciting, but no one is expecting it to be. as for europe, we are expecting to see some topline growth, as we have had some recovery in europe. however slow. that should help. we have also seen a bit more on cost control. >> will currency play a big part? will, whether it will play such a large part going forward as it has, i think it is unlikely because of the moves we have just had. i think we may have seen the worst of that very that was the biggest legatee of -- negative in the last quarter. >> looking at the industrials, any reason for optimism? the german success story that we saw in recent years link to the china growth story, now china is -- coming off the boiler little bit. does it make you german -- does it make you nervous for german industrialists?

>> in the last couple of months, the meetings we have had with globally, they seem to be making more positive noises for outlook. that is related to the slow recovery that we have been seeing on top line. we are a bit more encouraged about that. >> lucy, thank you for joining us this morning. we had to break, we leave you with an historic change to the tv lineup. not here, comedian and satirical news anchor stephen colbert or will replace david letterman on after 20 years. >> nation, it has been three weeks since vladimir putin annexed crimea. president obama still refuses to intervene. folks, we have got to invade in's slave army

advances. say putin has dragons. ♪

>> i would say, come on, mohammed. tell us why.

the furor over the last couple months in terms of the headlines are exaggerated. it is not indicative of what this company is, what it was, and what it will be in terms of our future structure. >> that was pimco's founder bill .ross we will bring you more on that interview in the next hour on "the pulse." we have nearly 2000 stores across 82 countries, chances are you have come across and aldo shop. the shoe and handbag retailer has made their executive chairman the newest bloomberg billionaire. his sole fortune. a terrible pun. tell us about this guy and the strategy that aldo employs. >> one of the reasons they're so successful is they are ubiquitous. they are everywhere.

almost every mall in america, almost every high street in the u.k., you're going to bump into and aldo. the great brand presence. they make their own shoes and sell their own shoes. they're very efficient. it is a canadian business. >> in london we're so used to italianwedish, spanish, fashion retailers on the high street. maybe not so many canadians. how did he get a start out in the shoe business? >> you don't think of canada when you think of fashion retail. he was born in morocco, raised in france and came to the u.s. to study at university. he didn't like it, dropped out. his father cut them off, so he ended up selling encyclopedias door to door. he didn't have a lot of money, but it taught him a lot about retail and product presentation. he really took that and went to choose, which was a family business for him. he started selling wooden clogs. not very fashion conscious. ringll get more on that

"the pulse." thank you very much. will be back later on during "the pulse." stay with us. rupee back in a few minutes. -- we will be back in a few minutes.

>> welcome back to "on the move." i'm anna edwards at bloomberg's european headquarters in london. let's see how things are shaping up. here's the picture across the european equity market. we have the ftse 100 down by 0.73% heard many of these indices feeling the pressure from the negative moves we have seen from technology stocks in the last 24 hours. here's a european correspondent caroline hyde at the touch with three stocks to examine.

jpmorgan is saying they're going to do more m&a. if they get bigger, if they are larger acquisitions, they're not so happy. they will reduce it to a neutral. arm holdings, this is the text pane. a fascinating company, basically designed the chips that go into everything you own whether will be a smartphone are wearable device or television. the tech selloff is hitting arm holdings raised in cambridge. off by 3.6% this morning. is a concern about u.s. stimulus reining in, is a concern about two big evaluation? overall, tech stocks tend to be higher risk in terms of how they are viewed by the market. bmw, off by 8/10 of a percent because of a recall in the united states. engines. six-cylinder

the search goes on, no injuries, no accidents. so much.ne, thank you these are bloomberg's top headlines. chinese inflation remains below estimations. mass economists estimate a 2.4% rise from a year ago. inflation below the government's 3.5% target, indicating room for the premiere to boost the economy with stimulus. international monetary fund's christine lagarde is urging the u.s. to adopt and over call -- an overhaul of the structure that has been stalled in congress. she spoke to greenberg's tom keene -- to bloomberg's tom keene. >> i would hope that that the end of this calendar year we would see the reform of the imf. we would make it more credible, ofter resourced and capable jumping on urgent issues like ukraine, for instance, with adequate financing.

>> u.k. chancellor george osborne is also in washington. he will renews commitment to fiscal austerity. give a speech today to say that britain's biggest budget increase since world war ii economy stronger, not weaker. let's turn now to u.s. banks. first-quarter earnings season gets underway today for the biggest lenders. some key themes in play. lower trading, increased regulation and legal woes. managing director at iu our capitol. thank you for coming to talk to us now. the earlier season from the u.s. bank might -- from u.s. banks might be a bit dull. what is going to catch us off guard? >> first quarter bank earnings are generally not the most exciting thing for investors. with jpmorgan starting earnings

today, we're looking for margins as lucy mentioned, looking for margins to continue to be under pressure for both ppm and the other two major banks. fixed income trading is always difficult. we're looking for other parts of the business that will prove to be profitable over the longer run. in eps.e how things go we are in line at $1.40. >> lower-cost areas of investment banking are the focus. such as jpmorgan or other banks as well? >> we would like to see other banks, not just in the u.s., but in europe, continue to focus on the more traditional parts of banking. wealth management, asset management. requires less capital and it should be easy to make money. >> something ubs has been talking about. changing rate

environment and the united states? if we look forward from this earnings season do the rest of the year, how is that going to rateout? is changing environment, the improving u.s. economy, as well. presents risk opportunities for everyone in the banking business, not just those with fixed income. it will require refocusing of words make money, both as corporate side of retail site, not just for gpm, but other than dr.. >> doozy operating costs and capital markets businesses increasing, what are those costs? >> employees in the banking business are expensive. not just that, but jpmorgan has a series of legacy issues that they have to deal with. most of them originating from capital markets businesses over the last two years. is that regulation around libel? >> these legal issues. there they have spent a lot of that money selling these legal

issues. >> are there any banks that have not put aside enough to face him and these issues? how far through this dealing with legacy legation issue from the financial crisis, how far away through that story? is one ofr scandalous many things. the fx trading issue that appears to be on the headlines in the last few months as reported by bloomberg last year is something we will keep an eye on. i could be even more significant than anything else. >> there is some expectation that the bank is going to exit unprofitable businesses. in fact, that is what the company has been talking about, jpmorgan specifically. which businesses doozy them getting out of? >> anything that doesn't make money, anything that is not profitable for the longer run our that is to capital intensive for them to consistently make a margin on. >> such as? >> anything trading related where they're not performing. acid management is an area where

we would like to focus on. that is what traditional acid management is all about. -- asset management is all about. >> the german chancellor doubles down as the bond market is joined by greece.

an edwards in london. this is "on the move. co were streaming on mobile devices, apple tv and new fire tv. gas may be in jeopardy as russia threatens to cut off supplies to ukraine eric moscow ifs the halls can be avoided ukraine pays her bills. can the u.s. and eu do to onid a cut off and the gas russia. ? >> they may agree on an aid package of $18 billion over two

years, which in turn would unlock international financial of $27nce, a total billion. that is a significant step. it is the first time that western countries would actually put money on the table. the problem is that the russians are continually upping the ante. president putin, yesterday threatened to cut off ukraine's gas supplies if they didn't pay their gas bills, said that ukraine owes a total of $40 billion to russia. nearly all of that is owing to gas supplies. >> how serious do see the threat of more sanctions against russia right now? the u.s. saying they would increase sanctions if russia and tunisia to escalate the situation in the ukraine. interesting to see how that would be defined. >> it u.s. and the eu have said that if russia moves militarily into the east of the ukraine they would respond with new sanctions.

i believe that is the strategy that they are keeping that is a kind of firewall to try and prevent the russians from taking that step. president putin did not seem to be ready to actually go and do that. not only because of the threat of sanctions, militarily it would be a risky move, much more crimea,s than taking which was achieved basically bloodlessly. >> what to expect from metrics talks between russia, ukraine, eu and u.s.? there are talks taking place, at least. to take place june the end of next week in a european capital, probably geneva. it is obviously good to have diplomacy in action, but frankly expectations are not for a high. the eu and the u.s. have a position which is very different to the russian one. russians are insisting on changes to the constitution of the ukraine, making it a federal

structure to give more powers to the eastern regions which are where there is a lot of pro-russian sentiment. those demands have been rejected by the government in kiev. have seen many people reevaluating the impact that the current diplomatic tensions are having on the russian economy. when other consequences for the russian economy so far? it isrld bank saying seeing the russian economy shrinking by 1.8% in 2014. >> the consequences have already been significant. you've had increased capital flight in the first quarter of the year. it was around $51 billion, which is the highest quarterly capital outflow since the end of 2008. some government officials have said it could reach 150 billion over the course of the year, which would take rush into recession. if a situation were to deteriorate further, if there was a military incursion into diseased, then it would be looking at far worse

consequences, because at that point sanctions would come into play, further sanctions which would hit russia very hard area >> henry, thank you for joining us. chancellor merkel is in athens today just one day after investors snapped up over $4 billion in bonds. that marks an end to greece's four-year excel from international bond markets. our reporter david tweed is in berlin with more. david, what a difference 18 months makes. last time she visited she was greeted with images of herself in an ss uniform. it is likely to be a little different from that this time, isn't it? >> i was there this week. i certainly didn't hear the same sort of hate messages i heard when i was there 19 months ago. our member one particular taxi driver in a taxi driver and hearing this dj blasting her as a nazi. though still be quite a few and raises a lot better

at managing the crowds. all. in front of the square and the parliament will be cordoned off. to seemerkel not likely any effort as a result being burned this time. time she was there, she said look, this is knit problem that can be solved in one go, but we will soon see light at the end of the tunnel. this time around, maybe she will say we're beginning to see the light. we saw that rather successful bonsall going on yesterday. schedule today, she arrived at 3:00. she will be meeting with some small and medium-sized enterprises, some start up enterprises. she's going to also be -germaning a greek development bank. i've been inundated with people saying that is just a drop in the ocean. yes, they are absolutely right, but it is something psychological which is going on. august the there's a lot of work to be done in greece. yet appointment rate is way too high. the youth unemployment rate is

too high. they need to get that economy growing. >> indeed, the bond sale seems to have reverberated all around europe. most,has it been felt then, david? >> it has been felt in the periphery. if he have a look at what is happened in portugal, look at the 5-year note in portugal, ireland, spain. also in italy. italy's 5-year note now lower than the u.k. note. i was taken with stephen mager from hsbc this morning who was saying that the price action you validates what he is expecting to see in terms of the fundamentals. some people might argue that what we are seeing in terms of these yields is coming because we are seeing too much exuberance over the possibility of the european central bank earning up to play some kind of qe. there are other good sites out there. for example, today, portugal raised its outlook on the debt. financing conditions are better. thing is, portugal really needs

to get back into investment grade, otherwise, even if the central bank were to do some quantitative easing, its bonds might not be eligible. something to think about, anna. >> david tweed in berlin. "the pulse" is coming up at the hour. guy johnson will be continuing this conversation on greece. today's show is appropriately named "the pulse." that is what we're talking about. my pulse, more particularly. i'm wearing this new samsung fit , which effectively syncs up globale new phone, the as five, launched today. let me get a quick shot of that. i must say, have been wearing it 6:45 i got in just before this morning. caroline hyde is tracking my progress. a number of things we're going to talk to samsung about. big concern that my heart rate

is running at around 150 beats per minute. i don't think it is. -- television is exciting, but not that exciting. we have this big tech selloff taking place. we will be talking to samsung about the new device it comes out today. it is really that much of an evolution? is this as far as we're going to go when it comes to the smartphone and the peripherals we're not talking about. is that the future or will we be looking at something significantly different? we will be talking to this guy. he will be coming up a little bit later. we have some great guests as well. we will be talking about the greek story. it is impossible to ignore what is happening in the markets right now. from the european bond market point of view as well as the tech selloff. that qe as david suggests? is it simply money flowing back in from emerging markets back into countries like portugal, spain, italy. lots to debate.

it will be a great show and we will monitor my heart rate route very >> we'll see if "the pulse" will keep your pulse going, guy. >> walking to get my morning toast was probably the most calories i have burned. that was slightly superseded by the toast itself. >> the eating of the toast heard guy, thank you very much. we'll see if guy remains alive throughout the pulse. we'll bring you up to speed with some companies that are on the move this morning. quarter light sales. company reiterated its midterm growth target area the world's largest producer of organic milk is planning to expand in africa. the company is trying to find enough customers for expected surge in volume after the eu removes production year. let's see if the regulatory

change per -- raises its production of milk by a billion kilograms. the co-op bank does not expect to turn a profit in 2014 or 2015. the bank, which is been taken over by creditors, has experienced a four-year loss of over 500 million pounds. coming up on the program, taking luxuries to a whole new level. we will take a tour of israel's hotel indorf astoria jerusalem. stay with "on the move."

>> welcome back to "on the move." i'm an edwards in london. edwards in london. as of yesterday, it has been rebooted, restored and rebranded as the waldorf astoria's latest luxury location. our middle east editor elliott gotkine takes a look. >> the palace hotel of the 1930's lavished luxury on his visiting shakes and diplomats. things like phones, hot water and elevators. now, the waldorf astoria, costing up to $5,000 a night, guests can expect even more. the finest italian furnishings, a magnificent atrium with stunningn windows, czech chandeliers. >>, stood the cost?

much did they cost? >> about $500,000 each. >> for light? >> a very special light. >> you can watch bloomberg tv while you are having a shaved. says making this hotel a reality was even tougher than expected. >> the main challenge was to restore the original facade from 1929 while we were digging 20 meters underground to add additional meeting rooms. the top of that, the famous had to be rebuilt the same way as it was before. and oneok six years hundred $50 million to restore and rebuild the hotel which had become home to the trade ministry and tax office. >> the original plan was

published in 1981. >> overcoming israel's is an team planning laws since this architect turned author took even longer. >> i started dealing with this project 35 years ago in 1979. i am very happy with the result. is high-class, prestigious business hotel. it is not a recreation hotel. it is not for a large. proximity to good the old city. the interior is very lavish. similar more or less to the waldorf astoria in new york. >> amanda peet to the taste of the original architect, but the waldorf astoria should last longer than the original hotel. elliott gotkine, bloomberg, jerusalem. >> tv in the mirror. why did i never think of that? >> we have about an hour of the trading session in new york, of course.

we're joined now by jonathan ferro is because been covering the tech selloff as it has developed in the u.s. and to some extent flowed through into asia and into europe. worst daysaving its since 2011. stocks down across the board. when i look at the stoxx 600 are pretty down by industry group, guess which is the bigger decliner? it is tech. you see this playing out not just in the u.s., in asia. it is playing out in europe this morning quite clearly. >> we have the gdp number out of china. dother this has anything to with fundamental concerns about the growth story across the world we don't know, but we will be focusing on that next week. >> are a terrible -- pretty terrible.

an eye on these tech stocks as we go through the day. thank you, guy johnson and i will be back in just a minute or two with "the pulse." cia just a few minutes. -- see you in just a few minutes. ♪

>> tech troubles. selloff in the sector intensifies. >> will the marquis device protect its lace as the world's largest smartphone maker? we speak with one of its top execs. >> a victory lap? maybe. greece comes back into favor with international investors. good morning, everybody. you're watching "the pulse."