from a year earlier. just under 1.6 billion pounds. we will bring you the full breakdown of the numbers. there is plenty of corporate earnings. u.s. gdp, german unemployment, german cpi. i will bring you all of those numbers as they come in. let's get the open with caroline. >> i think we are going to see an uptick in equities as well. all eyes on the united states, on the federal reserve. no more bond buying. will see interest rates low for a considerable amount of time. barclays says that is going to the june 2015 until we see any sort of rate hike from the federal reserve. it is all about strong employment. unemployment just 5.9% in the u.s. that is why we are seeing a continuation -- they are going to the reigning back on the bond buying but they will keep

interest rates low. we are seeing equities trade higher. the ftse 100 also trading higher. a little risk appetite still on the table. what else is it moving? the u.s. dollar. let's look at that. up 4/10 of a percent. we are looking at it against the tradingro currently 0.3% lower versus the dollar. plenty of data as jon was talking about. you get a little more insight into u.s. growth. 3% is what we expect to see for gdp for the third quarter. it is consumption that is looking good. exports, equipment investment. eurozone consumer confidence or lack thereof, we are expecting it to come in at -11.1. it did improve versus october.

a little more cash in the wallet. we see disinflation starting potentially to intensify. still a little more flush with cash. meanwhile, german unemployment is one to look out for. let's look at some of these stocks that are potentially on the move. up 1.7%. currently profits went up 15%. many thought profit would fall. the powerhouse that is personal and corporate banking and barclaycard, those areas of business helping offset what anthony jenkins called a disappointing quarter for investment banking. if you are looking at investment banking numbers, less advisory, less debt underwriting. even though we saw so many initial share sales across the board. investment banking is ugly at barclays.

but remember, they are transforming the business. it is all about other areas of growth. we will dig deep on what it means for their leverage ratio. will barclays pass the test? lufthansa off by almost 2%. profit warning, 2015 not going to be as improved as they hoped. that means they have to rein in hike specific prices. sharp increase in pension cost as well. look out for alcatel lucent. the big winner on the stoxx 600. up almost 10%. telecoms equipment makers seeing earnings beat analyst estimates. a narrower loss than had been thought. good development where it matters says bernstein. the ceo still managing to cut costs as he turned around this business. >> great work, caroline. we are up 22 points. in the last couple of minutes,

we had breaking news. it was spanish gdp. spanish gdp comes in bang in line with surveys. this is the preliminary reading. 0.5% was the survey reading. that is 1.6%, also bang in line. the eu harmonized year on year figure, negative 0.2%. bang in line with survey, less worse than the previous month. let's get back to the big story of the last 24 hours. the fed has brought their historic qe to an end with no suggestion a sequel is coming anytime soon. if you look at the central bank statement yesterday, you notice other he dod -- you notice a very dovish. let's bring in richard jeffrey. he is chief executive officer at calf in capital. great to have you with us.

is that the takeaway? the dove isine, if not happy it means the hawks are? >> i'm not sure whether you balance it that way. the message out of the fed minutes was pretty clear this time around. they wanted it to be clear. they are focusing attention on the labor market. they are saying there is not as much slack in the labor market as previously thought. andslack is diminishing growth is robust, which they are also pointing to. then we start to think about wage inflation. the underlying message from the fed is that their reaction might be quite short. if they start to see an initial shines of wage inflation picking up, they might respond to that quickly. that is the sort of thinking they are trying to tune the market into. >> is this setting us up for a significant december meeting? significantt is a

december meeting or the first meeting or the first meaning next year, we don't know. i think the fed is on the edge of its seat and it will press the button quite quickly. it has been the case for quite some while that the fed has been saying if it expects interest rates to rise more quickly than the market anticipated, i think last night's minutes reinforced that point. >> treasury yields higher especially on the two-year. the dollar surges. i asked myself whether they will tolerate a stronger dollar. it didn't look like things were heading that way. do we look forward to the minutes on the 19th and start thinking maybe that is where we get the color? those concerns over growth in europe. some people said they are not in the statement but maybe they will be in the minutes. >> i don't think the federal reserve will be particularly responsive to the dollar. i don't think it is trying to achieve a dollar objective. it has done that in the past. it has proven unsuccessful. it will use the domestic economy

to determine what it needs to do in terms of interest rates. i'm not surprised by market reaction. the market saw the ending of qe. that was flagged from a long distance. slightly more aggressive in terms of interest rates. maybe people are already beginning to suspect that might be the case. the one thing i would be worried about the moment is not volatility in the equity market. it is the lack of volatility in bond markets. i would be concerned about the adjustment process from exceptionally low government bond yields to more normal levels. whether we can make that an orderly adjustment process. >> you and i will talk about this after the break. richard jeffrey stays with us. stay with "countdown." -- stay with "on the move." the german pharma company beat estimates and raised their forecast. plenty to discuss.

the ftse higher by 0.3%. we will be back. the end of qe. plenty to debate. ♪

>> welcome back. i am jonathan ferro live from london. this is "on the move." a busy day for economic data

coming out later today. we had spanish gdp. we will get a read on eurozone consumer confidence. 12, the u.s. releases its third-quarter gdp data. we get germany's latest inflation reading. still with me is richard jeffrey , a chief investment officer. very busy day for data. i'm going to get back to the federal reserve. qe is finished. it was well flagged, i know, but when you have a balance sheet that shot up to over $4 trillion, all of this easy money incentivizing buybacks, engineering of bull markets, are we really to believe that it just finishes and the happy times continue? >> it hasn't finished and that is the whole point. what they have stopped doing is putting more money into qe. the money that has already been added remains there. as those bonds mature, that

money will be reinvested. there is enormous liquidity in the system. one of the big unknowns is what impact that money will have. to date, it hasn't improved the inflation rate. growth is too weak, commodity prices have been falling. there has been no inflationary impact. which that time in liquidity starts to have an inflationary effect? that will be a whole different policy environment. >> basically, qe3 is dead, long live qe. at the point where they start talking about an exit, you just roll off the balance sheet theout reinvesting, or even possibility of trying to sell some of those securities. is that when the game really changes? >> the game would change if the fed were to announce it was going to start selling securities back to the markets.

i think that is extremely unlikely. happen at some stage and it will happen if the fed believes the provisional credit within the economy is growing too rapidly and that is having an inflationary impact. it will still be nerve-racking for the markets but that is a possibility. before that, we are going to see interest rates rising. that is something else markets have to accommodate. interest rates have to rise. we have to start normalizing monetary policy as growth rates pick up. the longer we leave that process, the faster it will be and the higher rates will have to rise. there is a risk that too much credit is taken out at interest rate levels that are normally -- abnormally low. >> and they raise interest rates without being backed into a corner by the market? >> they will raise interest rates and they are giving us clear circumstances in which they will do that. further tightening in the labor market leading to a pickup in wage inflation will lead us to

react quite quickly. they told us they are not troubled about volatility in financial markets. i'm sure they welcome the return of volatility. >> wendy you expect the first rate hike? what does this mean for u.s. equities? >> in terms of the first rate hike, it looks as if it may be in the first half of next year. that cannot be guaranteed but that is a probability. we should be preparing for it whenever it actually happens. in terms of u.s. equities, i'm sure the first rate hike will cause some volatility. u.s. equities look quite expensive at the moment. it has a very heavy technology bias. it gives the market a focus in the world economy. i'm not surprised. yes, there will be some volatility. >> we talk about the rest being an isolated economy and how they

-- they may not be as significantly impacted as a u.k. the debate has been that the bank of england would be the first to raise interest rates. now, whethert home they are savers, what is the outlook for interest rate and a u.k. now? that's fighting interest rate in the u.k. are also going to go up and put it lightly on a slightly delayed. the u.k. economy has lost momentum. think the for growth are too high. that is to leave interest rates on hold for longer. improves,and momentum we need to start normalizing monetary policy. if we don't do that, we operate a group of lenders who are vulnerable, a group of borrowers who are vulnerable to interest

rates rising. that is not good for the economy. the sooner we start to normalize, the better it will be. >> that may have already happened. maybe there are a group of vulnerable investors, lenders, or people that have borrowed money. if we get tightening, does that lead to a recession? >> it won't lead to a recession but the reaction is going to be greater the longer the time between now and when that takes place. in other words, it is better to start the process early then have to respond to adverse data and raise interest rates in a rut. that is the history of interest rates. it still seems to be that the bank of england is looking over its shoulder and saying, let's look for excuses not to raise interest rates. that is the wrong way to be thinking. cio, thankjefferies, you very much for joining us. as we head to the break, check out shares of bayer.

an optimistic close to the year. they are raising the sales forecast by a billion euros. the stock up by 2.6%. the bayer ceo joins us with more on their latest results. he will join us after this short break. ♪

>> welcome back to "on the move ." we are going to get straight back to pharma.

bayer shares are higher after the company beat estimates for the third quarter and raised their forecast for the year. joining us now from the company's headquarters is the bayer chief executive, marijin dekkers great to have you joining us this morning. i am set of numbers looking at. the market likes it as well. i'm sure you are a happy man. if you were to pick out one thing, what are you happiest about? >> i like the fact that we grew our business organically in all three of our subgroups. the performance is really broad-based. give allays nice to the employees of the company good news about performance. >> you just completed a very big acquisition. viewers know it for the allergy tablet, claritin. give me an update on that.

ofwe closed on the first october. this month. it is going well. the teams are together. interestingly, our headquarters in new jersey is very close to the headquarters of mark. -- ioof merck. the proof is in the pudding. we need to execute on this integration. particularly important as that we drive the revenue synergies. >> this was a big deal for you. are you ready to make another big deal? >> as i said, you have to be very aware of how difficult integrations are. it is a lot of work for the whole organization. we announced that we are going materialst our

science business and float it as a separate company. that is also a lot of work. i am responsible not just for strategic moves but also for the execution of these moves in the company over the next years. therefore, i think you should not try to bite off too many big pieces all at once. >> let's talk about the spin off of the material science unit. how far along are we here? what sort of timeline are you expecting? >> we are just getting started. we hired the banks this week. we expect this process to take months,10 to 16 somewhere early or middle of 2016. we think we can bring material science as an independent company to the market. >> is that somewhere in 2016 or 2015?

>> 2016. >> so some way off. since you made the announcement of the listing, i would ask you whether anyone has made an approach for that business. nobody has made an approach. our goal is clearly stated. independenthat an floating of material science is the best for all stakeholders. material science is competitively a very strong business. mass, over critical 11 billion euro of sales. it is very global. we have invested significantly in it. this can be a really good independent company. >> would you be open to an approach before an ipo? is that something you would be open to?

>> our clear preference is to do an independent floating, but of course we have a fiduciary responsibility when people approach us to take that seriously. and we would. is at the moment not in the cards. >> mr. dekkers, sales are growing nicely. what is next for the pharma business? what are you excited about in the pipeline right now? >> we have some very nice new projects in the pipeline. three,wo, entering phase some in oncology, some in cardiology, one very tiny one in women's health care. we are actually quite confident in our early-stage pipeline and also middle stage pipeline. i would say we have some time to

bring this to fruition. we just introduced in the last few years five new products that are being absorbed in the market very well. patients, are really being served well by this product. potential sale of these products of 7.5 billion euros. we have some time to develop. question, you got just under 40% of your revenue from europe last year. a lot of people talk about prospects for a recession in the eurozone. how concerned are you about that? with these numbers, we also had growth in europe across the board. beste is not our geography, that is clear. the u.s. is really quite strong

at the moment. situation with our new products in the life sciences. these products are so relevant changes inomers that the profile of growth do not affect us to the same extent as companies that are more dependent on economic swings. >> mr. dekkers, we have to leave it there. privilege to have you on the show. thank you for joining us. that is marijin dekkers of bayer. break, here ise a picture of the markets. the ftse open 0.3% higher. we are pretty much dead flat on the morning. euro-dollar at 1.2567. the next stop for this one, about 30 minutes time. german unemployment, i will bring you that as it breaks. check out barclays.

the bank posted better-than-expected earnings. they crushed estimates. stock is up almost 2%. plenty to discuss on twitter as well. i will be back in two. ♪

>> welcome back to "on the move ." i am jonathan ferro from london. 30 minutes into the trading day. this is how things are shaping up. the ftse up by 0.1%. the dax up by 45 points. some big data coming out of germany in about 25 minutes time. german unemployment. i will bring you that live. let's get some stocks to watch with mark barton. >> let's start with alcatel lucent. biggest increase in its shares for a year. shares up by 13% today. france's biggest network

equipment maker reported a narrower loss in the third quarter. the chief executive continuing to cut costs. its loss excluding some items narrowing to 9 million euros. analysts had predicted a profit of the loss narrowed and shares are up by 13%. lufthansa, little bit lower. it cut its forecast for operating profit next year. weaker economic growth weighing on ticket prices. competition increasing as well. riseting income won't despite an earlier forecast of about 2 billion euros. earnings will still be significantly higher than last its, and it reiterated target of operating profits to increase to about one billion euros this year. shares down about 1%. volkswagen up almost 4%. earlier it was up by 4.8%. third-quarter profit beat estimates.

audi, earnings before interest up by 16%. sales up by 4% as well. by 3.7%. big day for earnings. >> big day for earnings. they are three of the biggest movers. here are three of the top headlines. the u.s. federal reserve has concluded its third round of bond buying, bringing quantitative easing to an end. thestors now turn to when fed will begin its first interest rate hike. since the beginning of qe in 2008, the central bank has bought more than $3 trillion in assets. risen 120%.has spanish economic growth slowed. with the0.5%, in line estimate released last week by the bank of spain.

officials also released a report showing that consumer prices fell 0.2% in october. brazil's central bank increased interest rates sooner than pretty much everyone had anticipated yesterday, raising the benchmark by a quarter point to 11.25 percent. the move comes after dilma rousseff's narrow reelection which triggered a selloff in assets. soaring inflation has reached 6.5%. let's turn our attention to the middle east. by a propertyhed crashed during the global financial crisis, with house prices plunging more than 60%. construction has returned and the dubai financial market is up more than 35% year to date. is dubai back? what opportunities are there for making money? joining us now is a partner who

billionmore than $7.5 in assets. great to have you with us this morning. some people will be watching this program and asking the same question, do we face another property bubble in this region? what are you seeing? answer that to question, you have to look at the fundamentals. has served asbai a hub for a much broader region. there are some booms and busts that happened. there is a reality that long-term, dubai is providing an access point to a broader region. historically, the gulf, the middle east, but increasingly, south asia. lately, a lot of people are looking at it as a platform to africa. if you look at the dynamics, there is fundamental reasons for the long-term growth of dubai and it is increasingly a logistics trading hub for a

number of businesses. sometimes you have capacity constraints. we have seen that historically. it has been a learning experience and i feel that some corrections may come and go. we saw in recent years hopefully won't be seen again. >> here at bloomberg, we have run a piece about investment in dubai. real estate only makes 8% of dubai's gdp. it was 14% before the crisis. it seems like the foundations of growth right now comparatively are a little bit firmer. >> correct. that is why i was illustrating the point about why dubai is an access point. historically, some of the buying was speculative. people are basing themselves in dubai to access a very exciting market within a reasonable radius of dubai. >> i want to talk about

construction and the scale of construction. there is an airport being billed with the capacity for 160 million passengers a year. the first three months, 18 million passengers handled. expect optimistic, to 160 million passengers to go through that airport in a year? >> looking at how dubai has ,volved as a transportation hub and a lot of businesses, one of the biggest reasons is the excellent transportation infrastructure. over the years, we have seen continued growth even during the toughest time of the crisis. traffic growth has continued to grow. this is the core of what dubai stands for. it may achieve it ahead of time. it may achieve it behind time.

-- the reality is that this is a growing segment for dubai. global investment banks want to access growth markets or emerging markets as you like to call them. they often choose dubai as their hub. a global growth markets focused firm. by using dubai as one of our , we are able to use that airport infrastructure. what i am trying to explain is the fundamental of why air traffic has been growing. by building that capacity, it makes dubai more attractive for people to base their business in. there are very deliberate plans

to take these expansion plans forward. >> let's talk about your business. you manage $7.5 billion. where are you putting that money to work? what are the hot spots? >> when you say region, i guess you are referring to the middle east. that is just one of the regions we invest in. we have a presence in operations across most of the growth markets. like i mentioned, dubai is a strong hub for us. if you are speaking about the middle east specifically, it helps to think of it as one region. but the market opportunity around this part of the world is around 350 million consumers. 1.5 billion to 2 billion if you expand it. are deploying capital actively in all of these geographies. we are seeing some opportunities in some very defensive sectors.

when you look at the gulf specifically, it is a growing consumer market. africa as well. we have been extremely active in the past few years. common across all these markets and the other markets we invest in is the growing populations and the increasing middle class providing an investment opportunity. that is what we focus on. >> a big part of what some of these countries in the region, the middle east, what they rely on is oil. when you see brent in aggressive decline over the last couple of months, you are on the ground, you have investments, how important is a higher oil price to the region? can they withstand the drop we have seen over the past few months? region isly, this resource-dependent, but here we are talking about the gulf specifically. if we talk about the broader middle east, there are varying

degrees of dependency on natural resources. bringsces where they are people back to the drawing board in terms of what the plans are. there is a reality as well and a deliberate plan from these economists to diversify away from oil. some have been more successful than others but it is a deliberate path. if we take dubai as an example, it is a single digit percentage of dubai's gdp. today it is a services-based economy to a large extent. if you look at other markets, , there is also other segments of the economy. it is a fairly large population. again, with a young and growing middle class. sectors, retail, logistics, financial services, and we see the growth of these

sectors over that period of time. and somel be an impact of the budgets balance at high numbers today but if you take a long-term view, there is opportunity in other sectors as well. >> thank you very much for joining us. let me know when you are in london. we will get you in the studio. coming up, headwinds for lufthansa as the carrier expects the global economic outlook to drag on earnings in 2015. pilot strikes took a bite out of that outlook as well. the full story after the break. stay with us. ♪

>> welcome back. i'm jonathan ferro in london. this is "countdown -- "on the move." lufthansa lowered their 2015 outlook. they say uighur growth will weigh on ticket prices. joining us from berlin is hans nichols. to doeems to have more with the downturn than labor problems. at least that is what they are telling the markets. >> that is there clear signal. however, we do have a hard figure for how much the strikes over the last couple weeks have cost. 170 million euros. they won't say whether or not they will have additional costs if there are additional strikes. they haven't gotten out of their labor strike yet. here's what we have on 2015.

mostly due to economic outlook, slowing global conditions. before, the profit target was to billion euros. now they are saying it will be significantly higher than the one billion euros they expect for 2014. you have economic headwinds, also some labor costs, some pension costs that are higher than expected. the interesting thing, one thing that is going down, fuel cost. i am quite surprised they are issuing this. given what they are doing with fuel. just quickly, let's move on from the depressing news and move to a big thing this morning. volkswagen, third-quarter numbers are out. solid beat. what did you look at? >> the number itself is quite eye-popping. 3.23 billion, i believe. or 2.8.mate was 2.9

you have to look at the costs of their profit margins. their goal for the volkswagen brand is 6%. this year they are coming in at about 2.3%. they need to improve efficiency. when you look at the cost a germans they have, auto worker versus a japanese or american, you see a radical difference. it is 48 euros for germany. for japan it is below 30. for the u.s., it is in the 26 range. the challenge for a volkswagen is to have its mass-market brand become more profitable. they print money with porsche but they need brands like the golf to be run more efficiently. >> thanks for joining us this morning. here is another big beat. barclays. third-quarter profit crushed analyst estimates. comes in almost half a billion pounds more than expected.

caroline hyde. impressive profit here. higher. many thought the profit was going to fall. the transition does seem to be working. we heard in may, anthony jenkins , the man from retail background is refocusing barclays. they are slimming down the investment banking side and trying to step into where the corporate action is. the positives are, mainly the u.k. of economy. that was a big factor here. they talk about a powerhouse of corporate and personal banking. profit up 11%. barclaycard up 16%. there are some negatives. investment banking, they call disappointing, i call ugly. less debt underwriting. provisions took the hit in investment banking when you are

looking at that. profit was down 40% in that unit. is there potentially a settlement coming forward in the u.k.? sca is investigating a number of banks. also, ppi, the ongoing saga of mis-sold loans and insurance. they did get a nice tidy gain from lehman assets they inherited. the culture change that is bying to go on, not helped the fiasco of their private trading unit earlier this year, but the risk-taking change is working. 7000 jobs going into investment banking -- going from investment banking. >> the stock has taken a beating this year. down almost 18% year to date. everybody starts talking about leverage ratios. >> this is significant. tomorrow, we get an update from the bank of england.

they are probably going to be harsher, more stringent than europe. barclays sailed through the european stress test. they might not sail through the stress test of the bank of england. they want a tougher leverage ratio. if you are looking at barclays numbers, their leverage ratio at the moment is 3.5%. that is slightly better than the first half. they are improving. they have this bad bank they set up with assets they are trying to sell off. they are trying to work towards this affect. if bank of england comes in with a 5% leverage ratio, morgan stanley says that is 24 billion pounds. where are you going to get it from? many say they have enough action points in place to meet that. they can sell off assets they already have. they have already been slimming down in terms of risk-weighted assets. they are not going to cut the dividend.

but it will be a question of how they do meet any such capital shortfall. will there be a capital shortfall? what either a doing about continuing to enhance leverage ratios? jenkins comingy in to take the ceo reins, his transition plan seems to be improved this morning. >> investors looking on the bright side of life this morning. barclays stock up by 1.6% as we speak. let's check on european equities. stocks higher across most of europe. on the ftse, we dip between gains and losses. the big number comes out in about four minutes. expected toloyment come in at 6.7%. look for changes in the thousands. we will bring you the number as it breaks. stay with us. ♪

>> welcome back to "on the move ." hours, it was all about the federal reserve. qe3 coming to an end. we saw it coming, didn't we? investors are still digesting yesterday's policy statement. david powell joins us for more. the federal reserve dissented. he wanted qe to continue.

it has been the hawks that were unhappy the last few months. what does that tell you? with the outcome having been more hawkish than people expected, that was on two fronts. one was on the characterization of the labor market. we saw this phrase, significant underutilization of labor resources being changed to, gradually diminishing. also, inflation. it is very balanced as opposed to expressing concern. >> german unemployment comes out in 40 seconds. maybe we have to wait for the minutes for that. >> there was no mention. the fed focused on the domestic labor market because the u.s. is a large closed economy. >> of course, david, we saw the slowdown in europe and the

threat of another recession here in europe firmly in the minutes. you ask yourself whether it is going to be in the minutes again. i am waiting for data, german unemployment. right now, euro-dollar trading at 1.25. we are looking for unemployment at 6.7%. in at 6.7%ployment but unemployment in germany for october fell by 22,000 versus an estimate of a 4000 increase. clearly, this is better than expected for german unemployment. euro-dollar stays still. down by 0.4%. when you look at that number, david, maybe things aren't as bad as they thought they were in germany. >> the labor market is one of the strongest on the continent. the key here is that strength

has failed to translate into higher inflationary pressures in germany. despite being the strongest economy, inflation is still low. >> a lot of things we are talking about, a change in course for german policy, look, angela merkel approval rating is still high. labor market is strong, why would germany change course? so goes the economy, goes the election. from the point of view of heard a mistake voters, everything is going rather well. there is no need for a change in strategy. >> david powell, thank you for joining us this morning. unemployment in germany, 6.7%. the unemployment change, a decrease in 22,000 versus an estimated increase of 4000. that sets the news for the german economy. what does that mean for the german policy approach?

the ftse 100 right now lower by 0.1%. the dax in germany up by over 50 points. point in the big data the next couple of hours. that is it for "on the move." if you want to talk markets, you know where i am. ♪

>> rate hike on the horizon. the fed ends its massive bond buying program. profit unexpectedly rose. 500 million pounds set aside to settle a probe for barclays. bloomberg spent a day on the floor of volkswagen's biggest plant. pulse." to "the