policy voting for a rate hike. voiced hisrney has concerns about headwinds to economic growth. we get minutes from the central bank's latest meeting. that is what we are watching this morning. one futures market, ftse 100 up. tax futures in positive territory as well. we may get a higher open. flowing,his money money flowing into the dollar, we know that. money is also flowing into u.s. long-term investment. $164 billion went into europe. takegan had a note saying, your money into europe. that depends on whether you believe the next step will be delivered in terms of quantitative easing. is that enough to drive the european map? equities higher, oil is lower. kuroda has japan,

more support in terms of his policy. let's have a little check in. rio and billiton coming lower along with anglo american. a little commodities complex shifting with a downward bias. three companies are on the move. i know that you are going to play some of that interview a little later on. theyali, they are saying are on target to deliver cost cuts of 750 million euros next year, one billion euros in 2016. they had a cap of 40%. they are free to do what they like. trying tothey are sell $2 billion worth of assets in the north sea. five people that we are familiar with say that deal is potentially under pressure. icap.a profit fall at

you are dealing with is one month with colossal volume, the next month, things changing. you have a couple of individual stocks that are worth focusing on in today's trade. having a look at the broader complexion of where we are, i think this really says it all. the dollar generally reversing. you can see the population. it is a crowded trade, some people say. life insurance companies and institutions in japan create a reference point at which they think the dollar-yen trade is going to be. it is atain extent, very crowded trade. everybody is long dollar, short yen. will they go all the way to the 1998 level? of 145. one call >> great work. let's keep the focus on japan.

the bank of japan voted in favor of keeping its record stimulus measures in place and support for governor kuroda and his monetary policy is increasing. let's get out to bloomberg's asia managing editor. the bank of japan board seemingly willing to get behind corona this time around -- kuroda this time around. anything to do with that recession? >> i think the recession might have had something to do with it. it is hard to defend fiscal austerity. this was a big development today in tokyo. in a of good news for abe week that was full of bad news. the economy went into recession. very dramatic the and politically risky step of calling a snap election. credibility has been taking some hits. >> brian, going forward, how does this play out?

we know a lot about the federal reserve and the ecb. we don't know much about policy makers on the bank of japan. does kuroda lead the pack? >> i think so. i think there is an awareness within the bank of japan that they need to get in sync with what the government is trying to do. kuroda is an abe appointee. fairly sympathetic to what he is trying to do. i think the fiscal austerity talk that you saw is going to be muted for a bit. the debt work is going to come someday. can't put it off too far into the future. >> great work, we have to leave it there. our guest for a discussion on the top story is a global market strategist at j.p. morgan asset management where he helps oversee $1.7 trillion in assets. dollar-yen through 117. let's bring this back to the u.k. and europe.

what does this mean for the businesses? >> it depends where you come from and your philosophy. the academic studies are clear. and companies that come from countries where they are focused on return on equity and shareholder values, they want to defend their margins. they will accept a loss of market share. for other countries like continental europe where they have a relationship to labor and capital is a bit more consensual, they will try to defend market share by reducing prices. >> as an investor, do you continue to look at this as some clear, blank trade? dollar-yen higher, nikkei higher, is it that simple? >> it might be that simple over year one and two. client asked me how it ends in japan. i tell them, i don't know. i don't think at the moment you need to know.

now, i think you know some certain things. there is going to be a huge amount of monetary stimulus. the stock market is going to love it. japan,see the bank of more bonds purchasing, more yields going lower. where'd you get income from? japan, like most countries in the world, you have people who are struggling to get income. you have to go outside of fixed income. you have to look at dividend yielding equities. if you look around the world, over half of all the equities with a dividend yield above 4% are in western europe. you may not like the macro story in europe more than japan, but you can get a much more diversified portfolio in that part of the world. >> is that strong enough to keep

european equities underpinned? a two or three year horizon, i can see a case for european equities. u.s. is going to go lower thanks to ecb action. i have seen competitive valuations and more sources for income. people looking for income should look to europe. >> stay with us. we will be back in two minutes time. here is a look at one stock on the move. areva, the nuclear company cuts its forecast for the year. the year after as well. the stock plunging 20%. up next, we will talk you cap as well. they lose some of their rhetoric. as we dig into the independent party's attempts to define the debate ahead of the 2015 general election, you can follow me on twitter. "on the move" is back in two.

♪

>> no sugar coating can hide it. britain's political parties have

fallen out of favor. >> the tories at the moment, we have them on 23%. we have around 32%. >> the sweet shop owner's customer paul echoes official forecasts, and overwhelming win for the united kingdom independence party, or ukip. the surge has turned a by election that would have been a mere blip on the calendar into a major political fight in a castle town not unfamiliar with epic battles. triggered by mark the localhen politician defected from the conservative party. we need to reform our political system. >> the ruling conservatives have banked on a growing economy and falling unemployment to keep

voters on board. anti-immigration and anti-eu policies are finding support with an electorate that is disillusioned with the establishment. avictory here could take ukip step closer to roll of power broker in the next year -- general election, raising the odds of a british exit from the eu. scenario many leaders say would be a disaster of ends economy and the eu. ukipre hoping the reason felt i 2015. mckenzie, bloomberg. flax -- >> let's keep it on politics. the real test will come next year. we have seen a change in

rhetoric as they try to define the debate. david stubbs,is global market strategist at j.p. morgan. part of this is that we know who mark reckless is but if i go to a pub with an educated audience and say, who is the conservative candidate, they would go, i don't know. it and they would be like, o wright, who is that? it is about cameron, isn't it? >> it is an early indication of what we are going to see as ukip focuses on the discontent we see throughout the country. the people have seen living standards compress in recent years, have struggled to get a job in many cases. at some of the policies that have been political consensus. >> what does this mean for markets? how do i trade this? >> i think the election presents

to sterling investors next year. in one sense, it doesn't matter who wins. the budget deficit is going up, not down. whoever gets in power is going to have to run tight fiscal policy. that will slow the economy and reduce the need for interest rate hikes. it mattersr hand, very much who wins this election. ,f it is the tories and ukip you start to question, do we have a future in europe? ultimately, a weaker currency. looking across europe, i see the antiestablishment vote playing out across europe whether it is france or greece. as you and i have discussed, in the u.k., i know what to punish. what on earth do i do in europe? >> you can sell the french stock market, so that would be an area

where you would see volatility if the far right were to move forward. ultimately, i think it is quite hard to play the eu exit trade in the euro zone. it is easier in some ways to play the u.k., which is outside of the eurozone. whenever you get that threat about the future of the u.k., look what happened with the scottish referendum. people say it doesn't matter to markets. in the what sterling did two weeks before the scottish referendum. it dropped. you are questioning what you are buying. to a certain extent, that is also going to happen in the run-up to the referendum. >> bank of england minutes at 9:30 u.k. time. this has been the hardest central-bank in the developing world to read over the last six months. one minute it is rate hikes, get ready, next minute, forget about it.

typically i wait for the minutes. they are rather redundant because governor carney has spoken. is that the case? >> the minutes always provide some color. let's not forget, this is one of monetarydemocratic policy committees in the global central-bank. other ones, you can point to the real dominance of the governor. in the past, the governor has been outvoted. hehad to defend a decision didn't vote for. i think the npc is in a situation similar to the fed where they need to see concrete proof the labor market has tightened to the point where wage growth will come through. until they see that, i don't see the case for interest rates. >> i've attended the last few quarterly inflation reports. the line you are given is that rates will stay below historical

averages. if you ask what to do, you have to move early, they theoretically, yes, that might be the case. if they are going to wait to the last minute, do you do away with that pledge? >> you can in one way. firstly, i think the risk of tightening too early is greater than tightening too late given what we have been through. waiting for clearer signals of sustainable domestic inflation through the labor market is the way to go. then i think you can be gradual. central-bank on both sides of the atlantic are going to be tolerant of inflation for a few quarters in order to get the economy hot and get us away from the zero balance. i don't see that as a big risk. this rapid acceleration in tightening. in fact, a gradual acceleration when they are more certain of where we are, it would be a good sign. >> final question, two policy

makers still voting for a hike. do they back down? probably not. should they back down? >> i certainly wouldn't be voting to increase interest rates in this environment. the budget deficit, the current-account deficit, the worries about europe. , still very weak domestic inflation. it is too soon. >> david stubbs, thank you very much for joining us this morning. here is a picture of the markets across europe. the ftse is lower, down by 12 points. the dax is up eight points. here is a move for you, profit now down at areva, the nuclear reactor maker getting crushed, down by over 22%. losing almost a quarter of its market value in just 20 minutes. the biggest drop since 1999.

more on the outlook for that company after the break. ♪

>> welcome back. time to bring you up to speed with some companies on the move this morning. royal mail once said increased competition from amazon woodhead parcel delivery operations. amazon is currently royal mail's

biggest client. royal mail also posted a decline in profits for the first half of the year but they still see performance in line with their full year for class -- forecast. targeting single-digit sales growth in the coming years, a german clothing retailer which is known for its men's suits says womenswear will make up at least 16% of sales by 2020. boss is focused on expanding in asia, eastern europe and the middle east. 's financial prosecutor opened a probe into possible insider trading at b.n.p. paribas. the investigation started this month but it is too soon to say which individual may be involved. prosecutors could still drop the probe if they don't find any wrongdoing. bank asia-pacific sales could expand more than 10% in the next three to five years. the ceo for the region told largeerg they have made

tires and are adding people in investment and transaction banking. it is a bright spot for germany's biggest bank. it posted a loss last quarter after setting aside funds to cover legal settlements. are sinkingeva after the company abandoned targets. caroline hyde is here to explain the challenges. look at that move, 1/5 of its value, gone. >> just four months after they saw a significant slump in their share price after they slashed their 2014 forecast. they now say 2015, 2016, l galindo too. , theys, profitability can't commit to that anymore. it is the ongoing fallout of the fukushima disaster. the nuclear disaster back in 2011 made everyone reassess how much they wanted nuclear energy. germany started putting off reactors as did japan.

making, areva has been its own rod to beat itself with. it has delayed projects. it has projects delayed in finland. they had disputes with a customer over there. they have investments in an african uranium mine souring. all of this is building into a crescendo of a company that is hurting right now. really interesting thing about this is, the political headwind to one side, but then you see the developments in russia. a threat to gas supplies perhaps. you would think this was great for areva, then oil prices do this. no incentive to push back. >> entirely. u.s. shale gas becoming very cheap makes nuclear not quite the demand side. you have worries about future

disasters. what is adding to the problems , luke, he came in in 2011 in reaction to the japanese disaster and said, we will sell assets, we will slash our costs. they have exceeded that target. but he has had to step down. in october, he had to step down for health reasons. the company is in an environment that is very difficult with a management that is very difficult as well. facingthe only company challenges in this . >> you are right. .t is knocking on edf france is meant to be singing or dancing about nuclear. it is meant to be shining a light to showcase french nuclear tow-how with edf and areva build a plant in normandy. this plant is 10 years in the making, five years delayed,

double the cost originally targeted. euros.ow 8.5 billion it is not going to be finished until 2015. why, difficulties encountered by the atomic supplier, areva. this has been a vicious circle. >> areva stock still down 19.6%, the biggest drop since 1999. >> the big issue, 87% owned by the public sector. >> thank you very much, caroline hyde. coming up, reckless in rochester. the implications of tomorrow's by election and what it means for the u.k.'s place in the european union. here is a picture of the markets. the ftse 100 opened lower. the dax also turned lower. in the meantime, if you want to talk markets, you can follow me on twitter. we will be back after this short break. ♪

>> welcome back. i'm jonathan ferro at bloomberg's european headquarters in london. this is how things are shaping up for you right now. ftse 100 down about 0.2%. the dax down 0.1% as well. we are looking ahead to 9:30 u.k. time. the minutes from the bank of england. voted for a rate hike. will they back down? we will talk about that shortly. for now, let's get some stocks on the move this morning. >> it is a sea of red. i'm going to kick off with the french story. you cannot ignore this slump in areva.

what you have to remember is it is only the biggest slump in the stock since august. that was when they slashed their 2014 outlook as well. off by 18%. they were down more than that back in august. it is all about japan, the fukushima disaster. less appetite for nuclear reactors. also, they are seeing problems with project delays. in normandy, that is knocking on to edf, 1.2% decline there. is says its nuclear reactor also delayed by another year. now five years behind schedule. double the cost originally intended. keep an i on icap as well. it works between the banks on anything from stocks, energy, derivatives, it would seem that profit is down 10% in the first half of the year. lower trading activity.

that is why they are seeing money down. continue to cooperate, they say, with authorities in europe and the intersectings libor as well as u.s. investigations. keep your eyes open for any sort of news in terms of ongoing investigations. icap down by 5%. >> nice work, caroline. here are the bloomberg top stories. to bank of japan agreed maintain its record easing this morning. the board voted 8-1 in favor of continuing to expand its monetary base. that compares to the 5-4 decision for expanding easing last month and follows japan's slip into recession this week. economist says the boe is unlikely to raise its key benchmark rate until after the u.k. general election. saidf economists surveyed the rate would remain at a record low until after the vote.

the bank will release the minutes of its november meeting later this morning. u.k., the last full day of campaigning in a by election that could give the u.k. independence party it second member of parliament. 's mark reckless defected from the conservative party and currently leads in opinion polls. joining us now for more is u.k. government reporter rob hutton. so much?this matter if you are watching from germany, france, what does it mean for them? >> it is all about instability. the u.k. independence party two years ago never had a member of parliament. -- thehas got one and bliss carl's well who was elected last month. it looks like it is going to get a second in the form of mark reckless. this is difficult for the conservatives. mark reckless was a conservative

mp. , sayingefected to ukip you can't trust the conservatives to get britain out of europe, which is what he and other tory mps think is really important. someone who the conservative candidate is, no one really knows. between to be a contest for raj and cameron. >> they are working very hard locally to deal with that. the tories had a primary so that anyone could select their candidate, who is kelly told hearst. number.e done a large if you ask people in rochester, i think they may well be sick to death of this campaign. leaste had leaflets, at three visits from every other tory mp, but it is a real

problem for cameron. uikp onoes to yo thursday, we don't know how many other tory mps will follow. maybe none, but the bookies are saying two. >> if it is a problem for cameron, is it good news for ed miliband? does he finally get a bit of good news? >> normally in british politics it is straightforward. bad news for the government is good news for the leader of the opposition. we are now in this strange time in british politics which is why this is such a big story. ed miliband has not seen any gains from this. the gains have gone to ukip. this is one reason labour mps have jitters about ed miliband. opularvernment is unp but the opposition doesn't seem to be popular.

rochester is a seat that labor held until 2010. not even labor are predicting that labor will win the seat back. it is not good for ed miliband. >> rob kadant -- rob hutton of bloomberg news. you can see a full list of candidates in the rochester by election on screen right now. e andll about farag cameron. results expected on the early hours of friday. let's keep the conversation going on this. david, thanks for joining us this morning. big question for you guys coming into this, noise or news? >> i think the by election itself is noise. with byis replete elections with results that lead to nothing in general elections. this highlights the fact that heading into the general polls aren may, the

very split, three or four ways in terms of party. there are shades of the scotland referendum here and the markets are not really focusing that hard on the uncertainty around the general election. it is very significant. >> we have the easyjet ceo saying yesterday, we want to remain in the eu. does this have real obvious implications ahead of the elections for the economy or is it something that only happens once we get closer to a vote? goodthink that is a question. it does have implications. outcomes, an eu referendum is likely. it is nuanced. the u.k. leaving the eu is probably not so high as 50%. you are not seeing it in terms intentions and business

investment looks pretty healthy. businesses are concerned but it doesn't seem to be a major constraint. >> when i look at the market, do i get to a situation where if the polls show me that a referendum is more likely, do i really see, referendum on, sterling off? >> if that is the way one wants to play it, it depends on the government and how that plays into issues of fiscal credibility. ,he outcome could be so messy it is not obvious what the good scenario is in terms of sterling. >> for the markets, for the bank of england as well, the minutes at 9:30 u.k. time. are they starting to look a little bit silly? >> i wouldn't go quite that far. i don't think we'll or are diehard hawks as

some have been in the past. these are the sensible people. if they't be surprised come back. >> for you guys, august 2015 is the call for the first rate hike. three months ago, people talked about 2014. later, back out the next year. has that pendulum swung too far? >> all of this is ground talk. we have been here before. rate hikes start to get priced in and the economy doesn't have the legs to support them. that take up in average earnings growth we saw last weekend does suggest that you can't be too relaxed about rate hikes not being needed until later in 2015. >> the interesting thing is that

you have a very small sign of wage growth starting to pick up but you also have this pledge of keeping rate rises gradual. i asked a guest the same question. going forward, if you were that concerned about growth, do you have to get rid of that pledge? go, notnk the later you taking risks with growth is taking risks with something else. if you leave it later, the hard.s are you have to go >> what is the view at ubs right now? all of this happy talk about it represents a policy a little bit of tightening. now everyone is saying, don't worry about it. >> i have been quite surprised how quickly the activity indicators have cooled off.

certainly, that is no longer a reason for the bank to go early. that is one less concern. i wouldn't be overly concerned pru point of view. >> bank of england minutes, redundant or not? >> we get a little bit of shade and light out of them. >> do you think we should brace for the flip-flop? >> perhaps. >> david tinsley, thank you very much for joining us. next, a continuing crisis in europe. we bring you an exclusive interview with the ceo of italy's biggest insurer. why he says europe could stay in crisis for several more years. ♪

>> welcome back. this is "on the move." here are some companies on the move. areva abandoned its financial forecast for 2015-16. that is nearly four months after dropping the targets for 2014. the company has been racking up after the 2011 nuclear reaction in fukushima prompted closures in japan and germany. shares are down more than 18%. bg group plans to sell its largest operation in the north sea have stalled.

bg was seeking as much as $2 billion for the assets. itscom italia is finalizing plans to expand in brazil according to the company's chief executive. telecom italia already controls brazil's second-largest wireless carrier. the ceo told bloomberg he expects the board will confirm that brazil is key to its growth plans when they meet this friday. >> you have to suspect that the board will confirm that brazil is core and we are willing to invest in infrastructure as well. >> another company we are watching is generally. francine lacqua caught up with the ceo in an escrow ziv conversation. exclusive conversation. >> we are -- when the crisis started, we wondered when this crisis would finish. we guessed that the crisis

could finish somewhere between 2015 and 2018. now we start thinking that it could be later than that. europe needs growth. we all agree on that. it is back to politicians to find ways to restore growth in europe. what we are seeing is that all of europe is suffering. growth and lack of political initiatives to spur growth. that is the issue. we cannot solve it. it, andry to go through hopefully we will find a way to move europe outside of this corner where it is today. >> do you worry about deflation? -- i guess, should be the ultimate worry. >> it is. on the other side, i think it is important to remind each other that europe is the biggest insurance market in the world.

of, is ittandpoint worth being in europe, i'm absolutely sure that it is. , if is the biggest economy we consider europe as one economy. it is the biggest economy for insurance companies in the world. it is the most relevant, most accessible, and very stable. i hope that deflation won't be such a scary thing as it is today. i hope that the government movingntion will help us the european a connolly. >> we spoke about this before. -- do you see an italian discount? >> we are opening our business we gladlyuropeans and saw americans coming into our basis.

other nationalities are represented in our shareholder basis. 90% of our business is europe. hope that the perception in europe will change. that in terms of where we are, it is much better. we are developing trust and confidence. >> what is your take on russia? last time we spoke, it was a long time ago. possibly a year ago. -- now the world has completely changed. >> russia is a big issue. risk to theher deflation of europe, because the energy crisis and energy availability depends on supplies from russia.

it doesn't help in this scenario to have this situation. we are not exposed to russia unless for financial investment. russia is potentially a big market for financial services, insurance included. but it is not a very open market these days. with this situation, it is not available at all. also said this morning it reached its 2015 targets ahead of schedule. they will present a new strategy in may. the ceo also told bloomberg the next plan will be focused on business and the customer. here is a picture of the markets for you 50 minutes into the trading session. ftse 100 down by 17 points. the dax barely moving, down 0.1%. it is a day for central-bank minutes.

9:30, bank of england minutes. we will bring you that and more. ♪

will come back. i'm jonathan ferro live in the city of london. footie 100 down. i want to bring you some big movers. punch taverns down almost 10%. down almost 12%.

i johnson shot me an e-mail. he said, check this out. this is on the back of a vote in the u.k. parliament yesterday. them are required to buy their beer from the landlord, which of course is the brewer. of law went through last night to allow pub tenants to buy beer from any supplier they want to. this is hitting the brewers hard. punch taverns down by almost 10%. enterprise inn down by 12%. that is brought to you by guy johnson. i bring him to you now. >> it is an interesting link between what is happening with the brewers and what is happening with nigel farage. this by election taking place. we shouldn't be this up too much. a by election of ahead of a general election. distinctionake the

between the two. nevertheless, fringe parties are gaining traction. the examples of that. it is changing the policy of the incumbent government and the conservatives are rattled by them. as we start to build up to next year, what happens with ukip is important. we are going to take the business case. we will get both sides for being in the eu are out of the eu. the story.ate which is best for britain, membership are going it alone? the politics is interesting as well. we will get rob hutton's take on the politics. is a broader this story and business is affected. >> it is very much a business agenda. what is interesting to me is that we come into this and nobody knows who the conservative candidate is. who she is, what she stands for. this is turning into presidential politics.

bus. has always been increasingly, the u.k. has been dominated by leadership. you look at the problems in the labour party and their struggles with ed miliband and whether he is the right man, and whether you can have a party leader that people are not in favor of and still see your self forming a government. leadership is very important. we know who mark reckless is but nigel farage is the figurehead when it comes to ukip as well. the interesting thing about this by election is if reckless wins, you could see further defection from the conservative party. i think it is going to be friday , if thewhen conservative party do lose this seat, what david cameron says to his party -- the next three or four days are going to be fascinating and brutal when it comes to the british political story.

>> the u.k. at the top of the agenda. 9:30 u.k. time, bank of england minutes. to seeill be a surprise a change. the tone of the conversation is becoming more dovish. the press conference we were showing -- you didn't get down there. you will get there next time. very dovish tone. the commentary coming from kearny in australia, very dovish. if you look at short sterling, it is pushing that rate rise further out. today's minutes and maybe the commentary will clarify that further. >> wouldn't be the first time the minutes didn't match the inflation report. " is coming next. a strong u.k. threat running through that show. here is a picture of the markets. ftse 100 down by 0.3%. the dax off eight points, that is nothing. that may show you a big mover this morning. ,he prophet meltdown at areva

the reactor maker getting crushed, down by over 18%. that is it for me. if you want to talk markets, you can follow me on twitter. enjoy your day. ♪

>> reckless in rochester. we get the takes on the futures in europe. how low can the? ? swings behind the policy and the currency flies to a low. o end in sight. we will bring you these exclusive interview here on the pulse.