the chairman of the euro zone group of finance ministers heads to the greek capital. the first reading of consumer prices for january is due in just under two hours time. that would be the lowest reading since the summer of 2009. a busy friday morning. here are stocks 50 futures up 20 points. menace cranny has your market open. >> equity markets are going to count the best month since 2000 and nine. the best start since 2009. if you went long equities you missed a 3.7% rally in the london market. you missed a 9% rally in the paris market, and you walked

straight past and near 10% rally. quantitative easing was announced. volatility is rising. there are people paying less for downside protection. sovereign government bonds are yielding the lowest level since 1996. you are looking at global bond yields. these are ticking ever so slightly higher. the momentum continues with the

noflation story. you can imagine any world leader would be begging for 3%. let's have a look at some of the airlines and a touch of luxury because it is friday. the cost cutter extraordinaire. something the average man has a plum for. he is getting a new shareholder at the table. he owns everything from saint very to a huge swathe of the most expensive part of london. now they have a telephone call right to the heart of iag. no breaking news on the dealmaking. rose came in at 6.5%

-- growth came in at six point 5%. this is an expensive shop. i can't afford to go into it. europe is doing well. but america is what disappointed. the big issue is this. japan beat 3.8%. do i have time for a little foreign exchange? these russians are going to tell us where they are with interest rates. we had that conversation this morning. russia doesn't have the ability to move on. you are going to find out what is in the vaults. the swiss franc against the euro since the tumultuous day when they moved away.

>> iag is the big story in the stock market. we are looking at gdp out of spain. apparently the relation is not the end of the world. -1.4%. prices forecast to drop by half of 1% last year. the greek prime minister guarantees stability. investors are reassured.

yesterday a racing some of the losses earlier in the week. you have the president of the euro group today. what is on the agenda? >> he is going to meet the greek prime minister this afternoon. the two of them are taking a joint statement afterwards. this is the official negotiations. they will be joined by the president of the euro working

group. >> as i look at the new administration, it is going to be a busy week for him. >> you will start a tour of -- he will start a tour of capitals. he will meet mr. osborne on monday morning. then he will meet the french finance minister. the government builds alliances ahead of a difficult negotiation. yesterday the prime minister met mr. schultz. he is a social democrat a critic of austerity, but it didn't go very well.

he said afterwards he set up security. more still to come today. greece needs to speak to its commitments. that's a starting >> fascinating stuff, these negotiations. athens bureau chief joining us live this morning. the fascinating part of this is not just what's going on with greece and the finance minister. the greek story goes into russia. some strong words from the greek foreign minister this week. we had a little bit of a backtrack from him this week from brussels. ryan what happened? has there been some huge

misunderstanding that apparently the media just got wrong? >> well rg you know, i don't know the answer to that. they came out really swinging pretty hard, didn't they? in the beginning there saying they were against the e.u.'s position on russia issuing that statement on tuesday. everyone expected them to come here to brussels on thursday for the foreign ministers meeting. derailing the whole sanctions regime throwing everything into chaos. as it turned out as one foreign minister told me, the greeks has a new answered and more constructive than people had expected position. have a listen to the greek foreign minister. >> we are not against every kind of sanctions. we have been against to put new sanctions today. >> if you had been reading the press for the last few days, you would have thought that he was a pro russian emissary in

the european union that the russians have there to defend their interest and sabotage the sanctions. what he did last night in the press conference and it was last press conference of the evening and most of the reporters that cared about their jobs were there because it was going to be fascinating and he didn't disappoint. he did everything he could really to distance himself from that perception. he has been telling his colleagues and reading the press reports. he doesn't recognize himself. somebody has done character assassination on him. he has only been to russia twice. he was aggressive in his rhetoric towards ukraine. that was just accidental. some students asked to get their picture taken with him. he said he is going to go to key yeff. he is concerned about the crisis there. i asked if he was offered any money.

he said russia hand offered any money yet but they didn't ask for any money. he said he didn't think they were in a position to help out that much financially. i think what we saw was a foreign minister that was going to have an outsized role in the new e.u.. it might not be a pro russian spoiler kind of role of say, the sanctions regime, but clearly, he said in his own words, they are -- he is representing a small country that is on its back, but that doesn't mean they are going to be quiet. the greeks want a say in everything in the e.u. and they won't be ignored. john? >> fascinating stuff. thank you very much, of course. the big headline that came out of yesterday's meeting, there wasn't really a headline. these guys did not agree on new sanctions. i want to get the investors'

take on this. andy, great to have you with us. >> good morning. >> we used the word fascinating a lot this morning. we find greece at the center of everything, whether it is the euro-zone crisis. sanctions on russia. when i look at the equity market, how small it is. as an investor why should i care? >> the reason to care is that the terrible word of precedent. if we have debt forgiveness and relief for the greeks, other countries, for example, ireland, who really did take one for the european team at the start of the financial crisis by guaranteeing their banks, taking all of that bad debt on to the sovereign books. saying we have been the good kids in the class.

we would like a bit of a reward as well. i think that is really the big issue. greece in itself, we can deal with this and move on. it is when if you take that, and then say what about italy and spain and ireland? then suddenly we start talking very significant amounts of money and that is where the contagion comes from. >> greek equities greek banks. you need to look at the history. talking about the nationalizeation of companies. how in hindsight, they look back. why are we buying equities back then. all of that fear. it is just not going to happen. greek banks. have you taken a look at them if you haven't bought any? >> we have had a brief look. the uncertainties are so extreme and their dependence on the funding from the e.c.b. is so high. we feel the risk still

outweighs the potential reward. if we get more stability stocks from for leaving greece so banks have a potential self-sustaining -- then it might be time to have a look. but at the moment it is so high, the risk of policy mistake leading to serious financial loss is too high for us. that's greek banks. i want to talk italian banks. falling almost 5%. some reports circulating that maybe they are going to have another capital raise. italian banks. talk to me about italian banks. >> i think the biggest news has been the decision by the italian government to effectively neutralize it going

from one vote per shareholder to one vote per share. now that transformation will allow a huge amount of consolidation to happen. as you know, when you walk down main street of a small italian town, you'll have five bank branches, all from different banks. compare that to the netherlands, the u.k. there is a huge amount of consolidation. that should be very good news for the italian economy, that they can start lending more. >> in a word one word, have you been a buyer? >> of italian banks? >> yes. >> yes. >> it was announced this morning a nearly 10% stake. you can't see the move there. there it is. up 2.3%. we'll talk about this more after the break.

euro-zone inflation data due out later on. euro dollar. a little bit stronger this morning. a lot to discuss. join us next. ♪

>> welcome back to "on the move." consumer prices for the euro-zone expected to come in at negative 0.5%. what are the investors' take?

i have andy schroeder with me. forget what it is going to do for the markets. is this going to work? >> it will -- i think more relevant news this can have on the consumer psychology and investment psychology. if people think that something is being done, that then gets people away from the here, we're in a crisis. we just need to hunker down. panic. when politicians are not panicking, everyone else can stop panicking. >> in the innation/deflation world, why do you like gold? >> one of the big arguments against gold is it doesn't pay you a return. it actually costs you money to

keep it in storage. well now we have got negative interest in the euro-zone switzerland, government bonds across a whole variety of countries out two to three years. the argument against holding gold now holds a lot less water. gold is the one kind of asset that governments really can't manipulate. it is an insurance policy. if something goes very badly wrong, gold is going to be there and you'll have it a stable asset through the crisis. would i put all of my assets into gold? no. absolutely not. but a little portion, a tail risk insurance against very rapid inflation. we are in unchartered territory. we have never really tried this before. we can have a good expectation of what might happen but as humans, we need to admit our

expectations can go wrong. >> 3.6%. at what point will is inflation coming? at what point does that develop? >> impossible to say. i think it has got to start happening soon. if we think that 26 basis points for over 10 years is a good place -- compared to for example, unilever. that pays you a 3.5% dividend in euros in year one. it has to have a negative view on where the world economy is going over the next 10 years if you think that owning german bundes versus owning stock in unilever is a good risk/reward. i think geerting close. >> thank you very much. we're going to have a

fascinating discussion later on bonds. mike from pimco joins me later on the show. you do not want to miss that. after the break, though we're going to look at i.a.g. shares. we'll discuss that just after the break. a lot to discuss after the break. ♪

>> with all due respect >> big corporate news in the last half-hour. qatar air ways bought a 10%

stake in british air ways. owner i.a.g. the details of this first and secondly, why a 10% stake in i.a.g.? >> we have a pretty minimal statement from qatar air ways. they said we bought 9.9%. they have not ruled out buying more but that is the stake that they have. and then they said to boost their relationship and boost their allegiance. in terms of why, that is the question this morning. it is very surprising. all this week, i've been focusing on i.a.g. and their future in ireland and now you the big middle eastern question. but in terms -- the middle east -- qatar specifically has

worked with i.a.g. the c.e.o. of i.a.g. was a big proponent of them joining the one world alliance in 2013. so this is obviously a tightening of -- >> if you look at the middle east -- >> it is about yesterday's quote, a little over 1 billion euros. in term turnovers partnership and where that will be going -- it makes sense. all the different european airlines. there haven't been many choices in terms of who they tie up with. if you can't beat them join them. in the casor qatar. he developed that relationship. in terms of get category tar into one world. so this will help them expand in asia. put more passengers through the

middle east. you won't see necessarily a dumbing down of either. i think it is about strategy and getting passengers about where they need to go. >> 9.9%. any limits how much these guys can buy? >> yeah. 49%. that is according to europeian union rules. a foreign owner can't have more than 49%. qatar hasn't ruled out buying more but that is the top end until european regulators change the rules. >> be joining us throughout the morning, in "the pulse" as well. talking about the big stake they have taken in i.a.g. we'll speak to the c.e.o. after the break of novo. the ftse got a little bit stronger. up .25%. the big story in london is the

airline story. the dax up almost 14 points this morning. russian rate decision a little bit later today. euro-zone inflation data, the big piece of data of the day. join us after the break. we're back in two. ♪

>> welcome back to "on the move ." i'm jonathan ferro in londonderry get 30 minutes into your trading day. these is how things are shaping up in europe. the ftse 100, that little bit higher. the dax, also stronger, up by 0.3%. athens up. getting a little bit back after 0.25%. one stock on the move is novo nordisk. fourth-quarter net income beat analyst estimates. the company expects operating

profit to rise 29% this year. posted by favorable exchange rates. joining us now from copenhagen is the novo nordisk ceo, lars sorensen. lars, great to have you with us. i've got to start by talking about foreign exchange. people that watch the fx market we've seen denmark struggling to keep that peg with the euro. how important is that for you? >> it is, of course, important. you can say, the economic outlook in europe is weakening the euro. the surplus of liquidity. if we can be pegged to that euro, it benefits our competitiveness especially our overseas markets like the u.s. our biggest growth engine.

we are benefiting from the paid to the euro. we hope that our central bank can keep up. >> lars, i look at the experience of swiss exporters and what happened to the swiss franc. what would it mean if the danish central bank couldn't maintain that? we've seen three rate cuts in 10 days. what affects exchange rate are you assuming for the rest of the year? >> in the currency racket right now, danish krone-u.s. dollars any move like we've seen with switzerland would be not very advantageous. we would have to adjust our outlook. also this was companies have stated that it would force us to look at productivity and the like. it would be a replay of the swiss situation. >> one of the big benefits is outside of the euro, the dollar much stronger.

that is very good for your business. talk to me about the u.s. business. competition on prices seems to be increasing. can you give me a picture of how that is developing for you? >> you are absolutely right. it is about 60% of our growth which comes from the u.s., which is unusual for a pharmaceutical company. we are coming very competitive. we are gaining market share in the u.s.. the market is quite competitive. on the buy side, there has been concentration in terms of ppm's that by drugs to distribute a pharmacy companies. that competition has increased. this leads to a higher rebate the and demanded. our information for u.s. price picture in 2015 is that we will have positive pricing. >> lars, does it also lead to

consolidation in your mind? >> well, it certainly seems so in terms of the major pharmaceutical companies. we are not at all interested in consolidation. we are very focused company in an area that is almost exploding. diabetes and obesity. we believe there are growth opportunities. if you look at the provider side, there is consolidation taking place. there's consolidation taking place at the ppm, the insurance level, so the u.s. market is becoming more and more concentrated. >> within that u.s. market obesity a plus for you. how big an opportunity is that for you? >> if you just look at the number of obese individuals in

the united states, using the definition it is 100 million people that are obese. when we look at the pharmaceutical market, for obesity, it is very small. we are entering this market in the beginning of this year. it is a very potent hormone that leads people to lose weight. we hope that this will be an offering which is attractive to some individuals, but we are cautious. it is going to take time to build this market. it is not something which is going to revolutionize our p&l in the first few years. >> russia is a big topic for a lot of people. despite the political tension, the dire economic environment, you are pushing ahead with investment. a big question on everyone's lips is, why? >> well, we think that we have

competitive products that should be used far more than they do for the benefit of the patients. but also for the benefit of society. we create a lot of jobs and value. not just financial value, but country viewed to the danish society. we created one of every four jobs created in the private sector in denmark in 2014. based on technology we think this is a formula which is good for denmark. >> speaking of jobs, we have to talk about your job at the top. the board is looking for a new ceo. when do you expect them to find a new one? >> i have another four years of my contract and i feel reasonably energized and excited about leading the company. it would be strange if the board was not discussing this topic. this is one of their main responsibilities.

i think it is just basic rumors. there is no news on that front. i look forward to the exciting years ahead. when a decision has been made i'm sure it is going to be a good decision. i will be ready to go off into the sunset. >> as far as you are concerned, you are going to complete that contract? >> absolutely. >> lars sorensen, thank you very much for joining us. fantastic insight to the pharma industry. up next, bonds. a little bit of a switch up. another one bites the dust. u.k. bond yields, a fresh record low. it is now the best annual start for bonds on record. we will have more on fixed income with pimco after the break. ♪

>> this is "on the move." paying for the privilege. bond prices are so high, the yields are more than -- to negative. americans are paying countries like france and germany to borrow from them. here to join us is mike amey, portfolio manager at pimco. i'm excited to have you here. why on earth would you want to pay anyone for the privilege of lending the money?

what is that about? >> clearly, paying someone to look after your money is not a great experience. the reason people do it is because they have tight restrictions on what they are allowed to buy. a lot of central banking mandates will say, i want to buy euros. so they give restrictions on what they can do. in a world in which the central bank has 0.2%. >> in the start of this huge move that started around the middle of last year, when yields started to collapse, people said spain, italy, 2%, this is ridiculous. then, we started to rationalize it. low inflation, low growth, low rates, makes sense. tell me what a bond bubble looks like. >> bond bubble looks like, when the nominal yield looks low relative to your expectations

for future inflation. that is the challenge you've got. at the moment, expectations of future inflation keep coming down. to my mind, that is why the 10-year bond yield keeps going down in some places. it is positive on the ecb deposit rate. but i think the core reason why 10-year rates keep going down globally is because people's long-term inflation expectations have been ratcheted down. real yields on the 10-year bond have moved by nothing quite as much as nominal yields have. >> [indiscernible] >> we have accounts where we have to hold them. when given the option, we don't want to do that. if you've got the flexibility then either you extend your maturity or you go down the credit curve. for example, if you extend out maturity to five-year bonds and agencies in core europe or you

can go and buy t-bills out of spain or italy, that will get you to a positive yield. some clients will say, i don't want to take those risks. on occasion, we do have to. it is not a good experience. >> how much pressure does it put you under to take risks that you otherwise wouldn't take? >> clearly, part of the deal is to get every one of us to buy something riskier than we owned before. there's a degree of discomfort in going down in taking more risk. in the context of the credit conditions or one's expectations for rates are you comfortable taking that? i think there is, broadly speaking, at the moment there isn't a lot of inflationary pressure for the next few years. we will do it when we have to. >> when you look at sovereign debt indexes one of them telling us this is the best

start to any year on record, yet every year we say this is the beginning of that great rotation. where is this going? what is your outlook? >> if you look at where bond yields are now, it is pretty tough to see a big rally in rates just because of where we are. 10-year bond, 35 basis point 10-year italy, 1.5, 30 years at one, 10-year treasuries at 1.5 so it is pretty hard to see a big rally. conversely, it is pretty tough to see -- when you look at the year as a whole, bond returns will probably be mid to low single digits. obviously, you had that already. >> when i look at the spread tighter, tighter, tighter.

typically, used to tell us something about the economy. is that dead now? >> what the 10-year yield is telling you is two things. one, there is a grab for anything that is a hard duration asset that yields more than 50 basis points. the 10-year is getting dragged down by what is going on in europe. the yield curve is flattening because the fed still intends to hike rates before the year is out. if i'm at the fed, headline inflation is probably going to go negative. i've set my stall out to hike rates. the economy is doing well, and yet they are the only part of the global economy that is anything close to a decent number. >> let's say they hike. what does it mean for the treasury market? >> i think it probably means the curve flattens further. you got this poll from everybody else and i think you will see the yield curve flatten. if you are the fed, you could

say, the 10 year stays low monetary conditions are where i want them to be. the other side of that, is the 10-year rate telling you something that you should pay attention to? that there is a positive the demand. >> do you think the federal reserve could start selling treasuries on the balance sheet? >> i think they will hike rates before the year is out. we think they will be pretty cautious about it. you've got this pretty weak global economic backdrop and the reason they will do rates is because, at least you got a fighting chance of understanding the mechanism. qe, we think we know what the transition mechanism is. raise assets and lower the cost of capital. what you don't know is the speed with which that would turn around. i don't think they are selling assets.

>> from a flattening yield curve in the u.s. to an inverted one in greece, i was looking at the greek debt market this week. i saw a blowout of 280 basis points. you can start writing headline greece about to fall off the cliff. here's my question to you. you go back to your desk, sit at your trading desk and say, i want to buy some greek debt. how difficult is it? >> it is very difficult to buy greek debt. as you know, the vast majority of the market is held by official institutions. to get a liquid market, you need to get a price at which buyer and seller are winning to trade. you are not going to be in a mad rush to sell it. you think greece will stay in, which we think greece will stay in, then the numbers are going

to be one million or 2 million. >> just to give the viewers an idea, if i wanted to sell my holdings in greek debt, what would i have to do to get some of these moves we have seen? >> a handful of million euros. >> it could move 100 basis point? >> 10 million or 20 million would probably do it. at the moment, the market is very liquid for the reason that most of us, ourselves included believe there will be a resolution between the greek government and the european authorities. at the moment, what you've got is words going in that direction, but the actions don't back it up. until we see words and actions going in the same direction, that market will remain volatile. >> mike amey stays with us. up next noflation has dissented on europe. we will discuss the market

impact with mike after the break. euro-dollar trading a little bit higher. ♪

>> welcome back to "on the move ." i'm jonathan ferro live from london. we have to talk about inflation. we've got a read on prices of

the eurozone. at 10:00 this morning, a drop expected. mike amey is joining us. also joining us is guy johnson. he will bring you that data in just over an hour. let's start with you, mike. the ecb is going to come into the market in march. what is going to make them make you rather, sell your bombs? >> two things. if you got a big compression in european yields to the point at which i think this is below where my medium-term inflation expectations are, that would be one reason. the other would bf global growth were to stabilize. if you take yields in europe -- it is all about ax inflation expectations. the thing they are looking at is forward inflation rates. >> you look at the situation in greece, can i extract the late

-- extrapolate greece? is there credit risk elsewhere? does that play a part in the argument? >> if greece were to deteriorate badly, it is likely that you would see a wobble in peripheral european spreads. most people don't expect greece to actually leave. as you look at levels, there is a risk in there, but an exec risk is something that most people don't expect. >> because the ecb is buying. >> and if you think about the way the policymakers framed it i think they probably have. >> talk to me about supply and demand for a dwindling supply. it is not only the ecb. you've got the swiss national bank, the danes they are likely going to have to buy some european bonds. the supply, is it going to be an issue? >> to give you a sense, the ecb

is going to buy 60 billion euros worth of bonds a month. the vast majority is going to be in government securities. supply is about 75 a month. net supply is low 20's. that is one of the reasons why we would expect rates to compress. >> denmark, really on the radar. on the break, we've been talking about the balance sheet at the danish central bank. it is not that big. >> denmark has held the peg for over 10 years. they have credibility in this one. they maintain that peg under various circumstances. when the swiss broke the peg their reserves were 80% of gdp. on the calculations we have, the last numbers we saw, their fx reserves are about 1.5% of gdp. that is not to say they can't

come under severe pressure but they're starting point is very different. >> a number of rate cuts in the last 10 days. do you think the talk that the peg will break is over done? >> our suspicion is that it will hold. >> if they stay off the radar screen, and i'm still slightly amazed that they've been able to do that, but they have -- now that they are not, how quickly does the balance sheet get big? >> that is the question. if you see the balance sheet accelerate quickly, that will cool that impression. the other thing which one shouldn't lose sight of is the fact that danish cpi is 0.1%. there is incentive to hold that peg to avoid getting caught in deflation. on their side, this is not a one-way deal. there are good reasons and incentives to hold that peg and try hard to do so. >> when i look at the experience

of switzerland, the trade that you could have made on swiss government bonds, is there a trade to be made in denmark? >> there may be. the danes look like they are taking a different approach. they are going to lower interest rates. if they lower interest rates a lot, that kills you for an investor. >> mike amey, thank you. guy johnson, inflation in your show today? >> we are going to be talking about this, our deal. we have athens today. interesting to see how that conversation goes. a lot going on this morning. >> thank you very much, gentlemen. in about an hour, that eurozone inflation rate. euro-dollar trading stronger this morning. the euro higher by 0.25 are sent. that is it for "on the move." if you want to talk markets, you can follow me on twitter. good luck for the rest of your

day. ♪

>> face-to-face in athens. the head of the eurogroup meets with greece's new government. landing a deal. qatar buys a nearly 10% stake in iag. touchdown. not only for the american football teams. advertisers aim to steal the show at this weekend's super bowl. good morning. welcome. you are watching "the pulse." we are here in london. i'm guy johnson. francine lacqua off today but