mark: japanese deals rights to their highest level since march ahead of a u.s. treasury auction today. anna: in a bloomberg interview the ceo of tesla tells us why he is not making contingency plans for a grexit. >> i do not want a plan b. there is no other need. in the end they will remain within the eurozone. they have no other possibility. they are not in a position to consider from a strategic point of view. it is a tactical approach. manus: telecom thursday.

after a wave of consolidation we break down the results from two of the key players. mark: will the drama pay? itv reports. we see if the numbers are as big a hit with investors as "downton abbey" is with global viewers. welcome to countdown, i am mark barton. anna: i am an edwards. -- on a edwards -- anna edwards. stay with us for the bloomberg exclusive with megaupload founder. mark: the markets moving in asia and stocks under pressure as the global selloff continues.

we've seen $400 billion over the past three weeks. let's start off with the stock market. >> let's start off with the stock market. we're basically seeing a decline across the regional benchmark. in japan we are down 1% and the yen is a little bit stronger down 7/10 of 1%. one of the stories right now is asia with a very weak retail sales number in the u.s.. to some extent, investors started to book those profits in japan. australia was down because of the banks and the big mining stocks. that is up .5%.

that market hasn't really done anything this week. the downtrend, maybe you could make up a little bit of a downtrend. let me show you what is happening in the for ex markets. they have been on a bit of a run. two days of sharp gains. we are up three days. just above these keep moving averages. look at the aussie-dollar. the rally we have seen from both of them headed for the r.b.i.. mark: let's is happening. is this selloff still occurring in your part of the world? >> what happened here -- the day

started with yields fairly high. since then they have actually come down. yes to some extent, but when it comes to japan for example, this just happened. yields have started to come back down. that is how the 10 year yield looks. that is the change in the yield for the day. that being said, there was an auction today in japan. 30 year gigi b -- jgb. that was the lowest in three months as far as demand. here is a quick look at what is happening across asia. i showed you that 10 year jgb.

we are still north above 3% in australia. currencies are still holding up despite equity taking a hit and bonds to some extent. they are paring back some of their positions. back to you. mark: david in hong kong some breaking news out of honda about recalls crossing the bloomberg terminal. anna: just this morning. honda to recall 1.7 million vehicles in japan. they're adding 4.8 million vehicles in their global airbag recall. a small statement announcing figures fight region. one crash reported. the braking system could apply brakes unexpectedly so they are recalling them in the u.s. on the brakes system.

one is around the airbag, 4.8 million vehicles in the global recall. yesterday about the extensive recalls that have been running for a number of years. let's go, the largest commercial broadcaster, itv set to release results later today. here is caroline hyde. good morning. it has been a strong start to the year, what can we expect? caroline: we are expecting a very good sell off the blocks for itv. you watch "downton abbey" itv has been showing that and bear grills's latest one.

think of all the extra things helping them this first quarter. think of the early easter boost they got. suddenly, companies wanted to get the name seen and heard around that time. we are likely to see that ease off a little bit. many an analyst upped their expectations for the rest of the year. in the full year we will be anything up to 5.5%. they are calling it a bumper year overall for itv. they will outperform the market because global is seeing advertising revenue picking up 4.5%. clearly we knew that they were

confident because their last results that came out in march -- they said here is a special dividend. what about the future? what about diversification? do you really want all your bigs in the -- all your eggs in the advertising revenue basket? you want to bet on the fact that audiences are starting to reduce when it comes to itv? acquisition spree is on to boost production. they want to make their own hits. they don't make "downton abbey." they want to start making their own lock busters. -- blockbusters. the weinstein brothers recently bought their tv unit for $950 million. they recently bought a dutch

company. it was founded by the man who made "big brother." one of the biggest hits in the sentry. -- in the century. "pawn stars," and the real housewives of new jersey. this is dead yet to become more diversified and cut your exposure to the advertising market. in the last year we saw a non-advertising sales up 10%. they are trying to broaden their remit and it is working. where will they sell it? there were reports of liberty global, a big shareholder in itv, they were saying they might

like to buy content from itv. let's check out the share price. this is the ongoing speculation. yes they are doing very well on their own and yes they managed to do source -- diversify, they are also an m&a target. this is where we saw shares hit a record high. back in april pay are just coming down ever so slightly. they are managing to woo the investor base. interestingly, just today we know that a few workers are on strike for itv. anna: thank you very much. that conversation on itv prompting all kinds of trash tv present -- conversations around the presenters desk. manus: telefonica reports their earnings us morning.

there is a lot more at play here. we will get a boost from fx and let's get to bloomberg's rodrigo. talk us through what we can expect. what will the numbers deliver today? >> we are expecting several things. as you said latin america is a big factor. the fx is slightly up for them. they published a few weaker numbers. their revenue per user is up in brazil and that is the key driver that will be very important in spain.

better benefits in their income. manus: let's talk about spain and the domestic market. there has been slow recovery. is that going to continue? is that transferring down to the reality on the ground? >> it definitely is. we have seen a week spanish market. the fact that it has been keeping them down in a a lot of cases. last year they started to stabilize their declines. their drops were smaller and smaller. in november, the coo said this year they expect to see the unit totally stabilized. he didn't clarify in which quarter they were expecting it. one of the biggest expectations, this quarter orton's quarter

when spain goes back to not being the big loser. that has a lot to do with the economic recovery. manus: telefonica -- it has been quite active in m&a. we covered the deals recently they bought gdt in brazil. -- where are we in the complexion of that changing shape? >> that is an interesting point. they have started to do some changes that aim to make more of a consolidated market. in the u.k. they had that problem where they were not able to do that. they were going in that direction.

the sale of 02 had a lot to do with lowering their debt. it will be almost 15 billion euros left by their own estimates. the rest of the markets seem to be settled. we don't expect anything unless they are able to pull some thing off in mexico. regarding that market. manus: thank you for rounding up all of that for us. mark: greece under pressure. the country needs to raise at least 3 billion euros for additional budget cuts by the end of the year. that is according to people familiar. the german finance minister wolfgang schaeuble recommends it as a way to break down the month-long stalemate.

the greek minister says the chances of a breakdown between greece and its creditors are small. as the ecb grows concerned about a deteriorating relationship between the greek government and the country's central-bank. francine lacqua asked carlo in an interview. he told her the contagion risk can be contained but the crisis has been mishandled. >> greece is a point that it is a point of mismanagement. francine: not talking to each other. >> yes but starting four years ago, the european leaders transforming a financial problem of 2%, in the starting point of massive and employment problems. such a politician not able to

manage a situation like this is a problem. you can add also that the situation in three months they transformed all the benefits. in the last two years to something. one year ago they can top the market. now they are completing the painting of the ecb. they are in a difficult position. no convenience going out in the eurozone because there is no industrial production. this is the point. the quantitative easing program [indiscernible] this remaining point, people are not able to manage. it is the reality. mark: you can see more of that interview on bloomberg

throughout the morning and online. later this morning, the greek finance minister yana's varoufakis speaks to the finance minister and we will bring you that speech live. now, some of the top stories on bloomberg. the u.s. dollar dropped to its lowest level in four months after retail sales changed in april. just rate the federal -- suggesting the federal reserve may hold off on interest rates. a rate hike. the london market rebounded in april according to the royal institution. in a report, ricks said that gauge increased to 28 from minus six in march. that is the strip -- that is the strongest reading since june in

the first time it has been above zero since august. the new york bound amtrak train was traveling at a speed of 106 miles per hour for the accident. u.s. regulators have said that was more than double the speed limit. seven were killed and more than 200 were injured. go to bloomberg.com to get up-to-date with all of those stories here in europe. anna: you can join the conversation with us on twitter. mark: greece officials insist there will be no grexit. our next guest says it might not be so catastrophic. we will talk a lot the greek dilemma when we return. ♪

mark: the ecb's qe program sent stocks higher and government body else in the same direction. we sat down with one executive who said mario draghi got it right. carlo messina. >> i think that quantitative easing is in the right amount to defend from any negative situation. mark: let's bring in gabriel stein.

the asset management director. you have done this report and you have examined lots of currency in your breakup from 1945. the findings are quite astonishing. most currency exits have been relatively painless. >> the work on this report was done by my colleague. he has looked at the 70 breakups of monetary unions. some of them have been painful but equally some have been painless. who noticed when the 60-year-old anglo-irish union dissolved in 1979. the checklist low back -- ch ecloslovak union. unless you have civil war or a breakup of a country or a wrenching change.

you may have a loss but you recover quickly. the idea that grexit is a disaster for everyone economically is unlikely to be true. anna: a lot depends on how this is managed, what do we learn about how we manage this to make sure we have a smooth process and civil unrest is kept to a minimum. guest: there must be contingency plans made for things like how to recapitalize ranks and introduce a new currency. you probably need additional capital controls but a program plan for how to lift them and in the case of greece, what happens with that debt. the esoteric but smart option is

to say we are not defaulting but we are putting forth the moratorium. more than likely greece would default but take a leaf from the russian book and continue to serve the debt held by private institutions. in general, i'd say present a picture that we are sorry it has come to this but we are doing it as easy as we can for everyone. that is the good outcome. the bad outcome is if you don't do any of those. manus: in america the retail sales disappointed yesterday. favorite line, there is no way you get lipstick on a pig. it was disappointing. guest: more to the point, it was puzzling. you have known me for many years and i look at monetary and credit. credit from commercial banks is on a six-month annualized basis

growing faster than average. we know that was a credit boom. the average is the average. what is happening? unless households and companies are borrowing and look at their money, than they are spending it on something. why isn't that showing up? it is puzzling. our view is the u.s. economy will pick up strength in the remainder of the year. why it isn't showing through now is is a link. it needs more work. mark: what it did mean for rate expectations they have been pushed back to at least december. could it be next year? guest: obviously -- janet yellen has said that the fed is data dependent. if the economy continues to

disappoint, that would be the case. our forecast is september and i must say looking at various leading indicators, i believe that it will recover in the fed will do the first hike in september followed by one in october. if everything continues to disappoint and we get repeated numbers for everything. car sales and durable goods -- yes. anna: we will see what the bond markets due. what about the u.k.? where are you expecting interest rates to head? guest: slowly and beginning early next year. anna: you share the bank of england's concerns about productivity? guest: productivity is dreadfully difficult to measure. there has been a problem post great recession. on the other hand i wouldn't think of looking at it without

looking at 20 year trends. anna: gabriel stein, the management director at -- we will bring you the latest on the oil market. ♪

manus: welcome back. let's check in on the foreign exchange markets. mark carney yesterday was a bit unsure about growth or he lowered the growth target. that set the marker back but it did very little to stop the overall resurgence. it is the economy, stupid. that is what standard life are saying when it comes to trading the currency. what you have are analysts

scaling back. they are still sure that the dollar will rise and sterling will fall. before the election, the market thought sterling would fall to 1.46 by the end of the year. the cost of acquiring put options or sell options. relative to the bullish call options, that is narrowing. that premium for selling sterling is dissipating. the different story when it comes to sterling against the euro. the markets still say that they will continue to rally through the 70 level. the aussie's and the kiwis cannot win for fighting. aussie dollar up at a four month high. glenn stevens, a tortured man. how much speech can he put into

getting his currency down. i love what the national australia bank said. both he and graham wheeler in new zealand must be crying in their cornflakes. i thought they had shredded wheat. the new zealand dollar is trading higher. my favorite of the day is optimism. if you thought this rally was running out of steam it is a bit like -- mark: top stories this hour, the u.s. dollar lingering near the lowest level in almost four months. a report showed retail sales have changed in april. according to data from citigroup, suggesting that the fed may hold off raising interest rates. the u.s. currency has climbed nine straight months.

investors anticipated a rate hike. ralph lauren is said to have increased prices in japan, australia and europe over the next year. the move comes as the company comes -- aims to mitigate losses from a stronger u.s. dollar. this carmaker will pay an average of $458,000 to 14 directors in the fiscal year. toyota rewarding executives after net income jumped to 19%. honda is said to have added 4.9 million vehicles to its recall. the automaker was affected i the safety crisis involving 40 air banks. 19.2 million vehicles according to figures from the company and you can find more on that story

at bloomberg.com. some breaking news from telefonica. beating net profits in the first quarter. analysts estimating $716.89 million. the core metric is operating income before depreciation. analysts estimating 3.5 9 million. those are the figures and it is a busy day. anna: the message from the ceo of the second-largest bank in san paolo. he spoke to francine lacqua about why he is not worried about european on market selloffs and why he is optimistic on italy. >> it is a gang related -- the

first action to quantitative easing was a lovely over expecting the real results. the reductions red. -- reduction spread. the market is considering the right level of medium and short term arriving from quantitative easing. it is more correlated with fundamentals of these countries. it is typical in this phase of the market. francine: we just a to stabilize to get to a level that is more sustainable. we talked about migration problems and russia. what is the one thing that we haven't talked about that you don't know how to deal with? is inflation something? >> i think -- it is the first

time of italian positive growth in gdp. italy is back. it is something very important. italy is back for the first time in five years. there is a positive sign, a could be 0.8 or 1% -- but it is the clear evidence that there is a complete turnaround within the country. anna: in terms of san paolo, the bank heard more from trading and fees and satisfied less bad loans. carla mussina has a four-year plan of targeting cash dividends. he talked about his

international plan and did a progress report on that 10 billion euro target. >> if you want to tap the asian market you need to organize. that is the reason why i am looking for a possible acquisition of an international brand. i am growing in such a way that i don't need to have on young extra -- an extra engine for my growth. francine: basically your brand name more than operations. how big does it have to be? something that everyone recognizes? >> there is a point on the total amount of market cap. in the reality you can have a well recognized brand that has a market cap that would be higher

in this case the manager will not have the control. i wanted to add the control of these entities. my proper banking division could make a valuation between 10 billion euros and 50 billion euros. so if you want to maintain control should be in that range of valuation of low or lower. i have nothing on the table today. at each point of view this could be the second step of growth. this is another kind of discussion that we can have at management. francine: are you concerned about valuations? >> if you look at the wealth management you want to have on young asset that you can change. we want the same -- an asset that you can change.

we want the same currency. if you use europe's own shares because they have a discount to every wealth management company, you will dilute your shareholders. my first commitment is to create value for my shareholders. francine: you're hitting targets above what you have promised. is there a chance that dividends go up? >> right now i am confirming the 2 billion dividends because it is a high level of evidence. you have to consider above 13% of common equity. we are in a unique position to give dividends to our shareholders. the promises 2 billion euros one billion euros in a order and we are in a good position to confirm 2 billion and we will kiev the end of the year what

will be the final results so we can see the real dividend policy. for today i am confirming it to be the commitment. anna: you can see more of that interview throughout the morning and on our website. manus: oil fell for a second day as the u.s. government issued that u.s. refineries reduced crude productions by the most in four months. they might hit $70 a barrel. >> our view for two dozen 16, we can stay at about a $60 average. mostly the price now is that 67 or exterior eight. in any case there is a positive trend.

that is not the main fact. there is a positive trend because demand is increasing. supply is reducing. anna: you can join in the conversation on twitter and let us know what you think of the show. manus: why the days of receipt and cyber terrorism are two of the key risks facing the global telecom industry. ♪

mark: a telco report published today that analyzed the six leading telecom companies. we are speaking exclusively to the leader of the global telco team. thank you for joining us. there are 30 risks identified by telecom companies and you divided them into five categories. the first one is competition and technology risk. what is driving increased competition in the telecom market? >> we see a lot of new entrants

in this sector. the traditional telco companies are facing competition from social media companies like facebook and google. other companies entering their traditional business field. some new entrance increases competition. mark: how are telecom companies dealing with the rising popularity of those social media text and e-mail usage? >> what we see is they also start investing in new companies. for example, budget telecom has started a new venture capital fund investing 500 million in startup companies and firms just to be there in the right time with those new technologies and to be will to compete with them. mark: the second rescue site are

finance risks. we will move on to the regulatory risk. a heavily regulated industry. what are the biggest risks toward regulation right now? >> the most difficult part for global telecom companies. regulators operating locally and if you are global you are operating as a telecom company. you have to change your market approach in every areas where your operating. in the u.s. you of different regulation then the u.k. or in germany. you have to deal with all those markets which makes it difficult to have a unique strategy with all the markets. mark: how do you counter that? >> i think the best strategy is

that you have to adopt a flexible market strategy, so to be able to change your strategy from the u.s. market and from european markets -- otherwise you are facing multiple problems in those markets. mark: data and cyber security risks are the fourth category areas when it comes to data hacking and cyber terrorism, our telecoms companies doing a good job at coping with those threats? >> i think the last year or something we have seen some spectacular cases where you can see the impact of incidents. i think they are not quite prepared for that so they need to invest more in that and it is expensive for them to invest.

there are a lot of things they will need to do to taste this risk and they are not yet where they should be. mark: are they in they should be when comes to maintaining data privacy? >> i think it is the same. they have not been prepared by the amount of problems they were facing. public attention is now they're where it should be and for that reason i believe they will change that attitude and invest more in data tennessee and to make sure that data is secure. mark: clearly it is on young industry going through widespread disruptive change. what do you think the industry will look like in five or 10 years? >> i think we will have much

more players in the market. or we will see a lot of technological innovation coming up and especially the speed of technology changes will increase. it was quite a demanding industry because we will see a lot of new entrants in the market and the internet of things and all of these things are changing the technology landscape and the telecom industry plays a large part in that. mark: [inaudible] >> all the operators are in a direct mode to see where they should invest for future growth is not their traditional business model. they invest in new technologies and want to be there in time so

they got the message. mark: thank you for joining us today. the leader of the global telco team at bdo international. anna: the man at the center of the biggest copyright case in history is speaking to bloomberg. he spoke to bloomberg west anchor emily chan about content sharing. emily: do you believe in copyright? >> i believe in copyrights but not copyright extremism. extremism is if you are a hollywood studio and you release your content in one country first, in the united states and then roll it out over a couple of months, in other countries around the world and expect the internet community in all of these different countries to wait for the release. they just launched netflix here in new zealand.

the catalog of content that you can download here is 10% of what they offer in the united states. that is completely unfair and because people don't get that access, they are looking for the stuff elsewhere. it is a problem created by the content creators. i am not responsible for that. if they would have on young offering that is globally -- an offering that is globally available, piracy which rank but they are not doing it -- piracy would shrink, but they are not doing it. emily: if it is illegal and you're not trying to take it down, doesn't that mean what you are doing is illegal? >> i have tried everything. we didn't catch up with the latest technologies and we were not even given the opportunity to do that anna:. emily: do you think the artists

deserve to be paid? >> absolutely. emily: so if those people deserve to be paid, yet people are accessing that content illegally how do you find a balance? >> where is the problem? i don't see artists starting. emily: just because they are making money is at mean it is fair to access their content illegally? >> no, i don't think that is what i am trying to say. everyone should look at it a bit more realistically. all of these hollywood moguls are living in mansions that are bigger than mine. it is the greed fomenting this debate. the movie industry makes more money year after year after year. society that once access to this content but hollywood doesn't make it available. i am a tiny piece in the middle of that.

emily: do you think the president is trying to make an example? >> absolutely. emily: president obama saying that the innovation and things that americans create is our biggest asset. why should we allow it to be stolen? >> that argument doesn't include the catch -- question, why don't we make this great product available to everyone in an easy format? if hollywood had some smart people working for them, they would probably have the biggest internet company on the planet. emily: explain to me how this company would work. >> it is quite simple. if you have a content platform that is owned by all of the different studios combined and they would make their product available, the entire catalog. at a fixed monthly fee, for everyone to access, they would

have the biggest internet success in history. i can't -- can understand the dilemma. to make me responsible for that is outrageous. manus: just over on young hour until european trading starts. it is a bit fishy. anna: that is manus's breakfast. a private jet company cuts production. this is the president of the business aircraft. concerning the comments. they will have to cut back in montreal and northern island because russian oligarchs are not buying as many private jets as they were. these aircraft typically sell for $50 million apiece and seat only 12. that sector recovered much

quicker than the small to medium-sized aircraft sector. we are seeing weaknesses in western europe as well because of the strength of the dollar has made some of them a little bit more expensive. manus: ironic is that are not talking about the ruble's strength going to go far. i'm talking about a habit i have kicked -- smoking. phillip morris cannot kick a 20 year habit called hacking ferreri. one of the biggest sponsorship deals with ferreri. they can put their logo but they can put the color the red and white really works. or could it be, if you go further that the league -- links go deeper. the chief executive of the parent company gets $320,000 he year from phillip morris and

hold $5.2 million from the stock and he folks -- smokes another phillip morris brand. mark: a week ago i predicted it would be on young all spanish champions league final. -- it would be an all spanish champions league final. i said it would be barcelona versus realm of dread. in the first leg the italian champions 12-one in their home city and yesterday they went back to madrid and it was a two-to draw. -- 2-2 draw. juventus has been the champion twice. barcelona has won three of its four titles in 2006 -- since 2006. no team has successfully

retained the title since 1990. manus: he is always right. anna: in the next hour, the telecom media are very much in focus. stay with us.

mark: the global bond route deepens ahead of the u.s. treasury auction today. anna: in a bloomberg interview, the ceo tells us why he is not making contingency lance for a grexit. >> i don't want to have a plan b. i think plan b is quantitative easing. i think in the end they will remain within the eurozone, they have no other possibility. they are not in a position to consider from a strategic point of view, it is a tactical approach. manus: telecom's thursday after

a wave. key european players. mark: we will see if the numbers are as big a hit with investors as downton abbey with global viewers. welcome to "countdown." we have figures now from the u.k. television network. caroline hyde is here. downton abbey up to the hilt. caroline: not that you ever watched it. they are pacing better than expected net advertising growth. we had on young early easter and all of that meant companies were to have the grand seen on itv.

also, the diversification is playing into this. they need to start making their own great content. they have been buying into and making their own content and itv revenue now accounting for .2 5 billion pounds worth. if they broadcast the revenue is up 10%, just over half a billion pounds. that is taking into account the net advertising revenue. overall this is a company making acquisitions. itv studios businesses are remaining on track. the company that makes the voice -- nearly this is a company on the acquisition hunt. the itv chief executive with a

strong start to the year. the studios returned to organic growth and this is selling on content and they remain focused on building a global scripted business. the rising aquarius and clearly -- their content is looking very strong indeed. looking forward, their net advertising revenue will be up 5% in the first half and the quarterly phasing will be different in 2014. -- than 2014. anna: in the telecom space full-year revenue for this business up by 4.2%. this is reflecting a dynamic approach to trading.

anything coming through from the business they are upgrading revenue targets. their 25% margin target in the full-year. sticking with some targets and upgrading others. they're commenting on the level of capitation. this is selling at the baroness also talked about many times before and saying in this statement today, we believe firmly that the competition will drive investment that we need urging respective regulatory bodies merging to put strong competition at the heart of their decisions. perhaps talking about open reach controls. plenty taking place within the sector. this is all because many of these players are trying to get

more into tv talk talk already does quadplay and they have been regulating for some kind of action. interesting to talk about whether they have any interest in the tesco mobile business. that looks as if it could be on the block. we will be speaking to the ceo in her first interview of the day coming up on this program. manus: let's go now to markets in asia where he has yet another recall. expanding its global recall to 4.8 9 million cars. let's get straight to david england. this goes on yesterday's news run us through it. >> yesterday we had that two other carmakers. today it is honda. we knew it was coming and they

are ready flagged us and said they were working on the details and it just came out about an hour ago. you mentioned 4.9 million cars. if you look across all the carmakers that have been affected by these global airbag issues. what is different about this time, this round of recalls, they have said they will be paying for this round themselves because it is more proactive and preventive in measure. something to watch closely. we did not react and we knew this was coming. a smaller round here of recalls. because of problems with the brakes. fairly new ones. we are north of 20 million cars

that have been recalled over the past years because of the same issue with the airbag. manus: obviously the bond market route continues and we are looking at treasuries rising and late yesterday we got a big auction, talk us through the jgb scenario because there is one big owner of bonds of japan which is the bank of japan. >> you have an talking about this as well but the bank of japan has sort of been skewing this to some extent. we woke up and yields were higher and from that time early in the morning it is 2:00 p.m. in hong kong in the yields have come down for that 10 year jgb. that is what the chart looks like all throughout the session we are still at 45 aces points. with the selloff continuing here, it is not continuing but

not rallying as well. at 45 basis points let me get you to the chart to see if you understand this. there is a clearer picture of this. in mid january it was at 20 basis points. when her up 2.5 times that level back then. if you look back further, it is only a partial retracing. we were north of 70 basis points than. that is the selloff that we have been following here and i'm sure you guys as well in europe. manus: thank you for putting that in context. mark: just getting some information from sharp. the debt saddled display it has received financial support from its main lenders and reported a net loss. that is roughly $1.9 billion

that is in the year ending march 31 and that compares with a 30.7 billion and average loss estimate. it was once synonymous with cutting-edge television that home electronics struggled under its desk to keep up with rivals. it went into the brink of bankruptcy in 2012 and now it has received a lifeline -- plants and reducing capital. big news from sharp and big losses as well, much wider than analysts anticipated. let's focus on telefonica the spanish company beating results earlier today with business picking up. let's get to bloomberg's rodrigo in madrid. good morning, first of all, how did the business perform? >> spanish business is the one

big issue they seem to be celebrating. for the first time since the second quarter of 2011 it actually grew. it grew as far as their actual access points go which we know is a key measure. it only group 1% but admits that their guidance -- at the start of the euro which is great for them. mark: what can we expect for the future of all the m&a activity back of -- activity? >> we can expect to things. one that they can integrate these companies and finish the ot deal which isn't done yet and then we would expect them mostly to be a bit calm her and wait and see, except for mexico which is a huge market going through a transformation and telefonica is probably in its weakest position when you compare it to places

like brazil and argentina. anna: greece under pressure. the finance minister favors a greek referendum as a way to break down the month-long stalemate with the greek government. the greek minister says the chances of a breakdown is small, putting them at about 10%. that has the ecb growth concerned about a deteriorating relationship. so how great is the grexit risk? francine lacqua asked carl mussina in a bloomberg first interview that the contagion risk can be contained but that the crisis has been mishandled from the start. >> it is a point of mismanagement of crisis. starting from four years ago, the european leaders

transforming a financial problem of 2% of total debt in the starting point of the massive unemployment problem. when you have such a politician that is not able to manage a situation like this, then you can add also the situation with this new government in greece. in three months they transformed all the benefit and in the last two years it was something. one year ago they can top the market and have an accessible market and they are completely depending on the ecb. the point is that they have no convenience and going out in the eurozone. this is the point. the quantitative easing program is really the mitigation from what

you can have as a contagion on the other areas. but people are not so able to manage crisis. it is incredible but it is a reality. >> you can see more of the interview throughout the morning and online and later this morning at 7:45. the greek finance minister speaks at a conference in athens. manus: let's get you up to speed with on the top stories at this hour. almost four months after a report showed retail sales haven't changed. they have missed expectations since january according to data from citigroup. the u.s. currency had klein for knives rate month through to march as investors anticipated a rate hike. in a report, written said the

u.k. capital increase that 28 -68 march. that is the first time it has been above zero cents 2015. is the new york bound amtrak train traveling at a speed of 106 miles per hour before the accident. u.s. regulators said that was more than double the speed limit. seven people were killed and more than 200 were injured in the accident. let's go straight to bloomberg.com if you want to pick up on any of those stories or any other main market is. mark: just about to tweet up this story, the koch brothers lost more than $1 billion yesterday, each.

which equates to all of us losing $3400. anna: after the company's net income, they reported their numbers the top of our. commentary around competition in the telecom industry. ♪

anna: welcome back to "countdown." talk talk reported earnings earlier today. joining us now is that ceo. thank you for coming in to talk to us. so let's talk about the talktalk numbers. you must have some confidence in the performance to upgrade those forecast numbers? >> we expect the business to

grow by at least 5% beyond 2017 as we become a fully integrated value for money quadplay provider. anna: you reported your lowest ever value of turn, is that people becoming more loyal? >> i cannot speak to the rest of the industry but for talktalk, as customers take more from us they're happier and as we do our best at improving the service they stay with us longer. anna: is that the idea of quadplay but it makes it less likely people will leave? >> it is not just the number of services, customers tell us if they take tv, mobile and fiber from us they are happier and appreciate the services more. people don't leave talktalk to get a better deal, they have less in the past -- left in the past because we have done horrible things but they are getting better. anna: lots of m&a in various parts of the sector and you had been buying up visit -- businesses yourself.

if tesco mobile is available is that something you will be interested in buying? >> no it isn't. we don't see the need to buy an existing mobile base. we can oscar -- offer our customers much better value. anna: what is going wrong? >> they are already paying too much. talktalk companies can save -- customers can save money. we are growing it organically. anna: you bought blank box from tesco which he said at the time that it would provide some very clever people in east london. have they added a different dimension to the business? this tech community? >> we are delighted to have them. we have integrated in the last three months and today we're announcing the very first small step of where our blink box

people are having their value. we will be able to show game of thrones. we decided deal with hbo. anna: is it the case now -- do these headline products these headline shows, is that proving so attractive that it ask as something that brings people to the network? >> we don't like to force you to take a bundle of content you don't want to watch. you will not have to buy a bundle of channels come you can just watch game of thrones and watch it on talktalk tv. we want to be more like the amazon marketplace of tv content rather than playing the macho content of buying content providers themselves. anna: you talked about the level of competition in the u.k., are

you more worried at the moment about bt edits ownership of open reach or are you more worried about consolidation? where is the concern at the moment? >> we are firm believers that competition will try the investment and innovation that the u.k. industry needs. i find it hard to distinguish between the two. we will have fewer competitors if these mergers go through and that will be bad for consumers. we urge all of the regulators to make sure they put competition at the heart of the recommendation. anna: bt says they think it needs to be owned to an sure that investment takes place. >> we think that is completely wrong. we think competition drives investment. we are making great progress. bt would not be deciding whether open reach invested. if open reach were independent.

it is a thin threat they are making. anna: so what would you be happy with. if you saw a little bit more regulation or a tougher regulatory start would that satisfy you beautiful separation? >> open reach is the single largest supplier owned by our single largest competitor. unashamedly we think it would be a better business if it was completely independent. starting from a blank sheet of paper that is how you do it. we think this is the right time to have the industry restructured. anna: bloomberg industries makes an interesting point around your share of ownership. bloomberg intelligence says there is a lot of short interest around your stocks. people owning options to sell it. your second only to telecom i tally a -- italian is there a

reason they are holding onto that option to sell your stock? >> we are a value money provider we are a disruptor and not an incumbent. we polarize opinion. over the past few years the people buying our shares are the ones making money. anna: what about the electoral environment. delivering a surprise majority to the conservative party. what are the priorities for governments as we head to five more years of the conservatives? >> i am married to a politician but fundamentally today i am the ceo of the business and like many chief executives we pleased to see a pro-business government and that has to be good for business and the economy and our customers. anna: staying in europe? does that matter? >> we are an and entirely

customer based business so that does not matter. manus: let's talk italy. a message from the ceo of the italian second-largest bank. he spoke to francine lacqua about why he is not worried about the european bond selloff and told her he is optimistic about the italian economy. >> it is again related with quantitative easing. the first action was probably over expecting the real results. so the reduction in the spread -- now the market is considering the right level of medium and short term rising from quantitative easing. i consider this more correlating

with fundamentals of different countries. i am not worried at all it is typical in this phase of the market that you have correction related to the fundamental. francine: this is like what janet yellen was saying. we talked about migration problems and russia and a very broad branch of where you were and what is the one thing we haven't talked about that you don't -- >> i don't know [indiscernible] it is the first time of italian positive growth in gdp because i can tell you that italy is back so it is something very important. italy is back for the first time in the last five years.

it is the clear evidence that there is a complete turnaround within our country. manus: i have to ask her what the italian is for -- i'm not quite sure, join us on twitter. anna: we are going all around europe. manus: we have to get europe in. join us on twitter. you didn't realize i was bilingual? trilingual? mark: quad lingual. [laughter] we will bring you these top stories ahead of the market open.

we speak to one of the leaders of cisco. back in two minutes. ♪

[baseball crowd noise] ♪ ♪ [x1 chime] ♪ ♪ [crowd cheers] oh! i can't believe it!

[cheering] hi, grandma! ♪ manus: try as he might to temper the expectations for the british economy, mark carney did little. sterling did dip when the growth outlook was down. but very little can stop this currency at the moment. it is the economy, stupid. that is according to standard in life. the economy will trump the bank of england so you will see the sterling trade higher because

the bank of england may be left with no other alternative than to raise rates more quickly despite the rhetoric that mr. carney delivered to the premium to buy sell options or put options on sterling, diminishing. the propensity for the market to sell sterling is diminishing. by the middle of the year forecasters have cut their view. that is up from a dollar 46 before the election. they say 143 is where you will end. let's have a look at sterling against the euro. there is something a little bit different which is very much of the view that they will be up there. the poor ozzie's and the kiwis are having a terrible time. nothing they can do will bring the currency down.

weaker retail sales could took the dollar lower and the commodity currencies higher. the laggards of 2015 are the vanguard's of 2016. glenn stevens at the rba is crying in his cornflakes. you can be sure that graham wheeler must be grinding his teeth in pain. these currencies are running full steam ahead and that is not what they want for their economies. investor optimism on the aussie dollar is at a high that we have not seen since february of this year. anna: the u.s. dollar dropped to the lowest level when little changed in april in the u.s.. u.s. economic indicators have missed expectations according to

data from citigroup suggesting the federal reserve may hold off on raising interest rates. as investors anticipated a rate hike. honda is set to add 4.8 million vehicles to its global vehicle recall and they make everything most effective by the safety crisis involving faulty airbags. today it brings the total recall 1019.2 million vehicles. sharp posted a full year that was wider than expected. the display maker for apple cut jobs and received financial support from maine lenders. they reported a net loss that ended march 21st. more on all of those stories on bloomberg.com/euro. manus: one of the key companies that make the internet work. the largest manufacturer of

networking equipment cisco reported net earnings last night slightly ahead of expectations. joining us now is cisco's president of europe am a the middle east, africa and russia. are you as optimistic that europe has turned a corner? >> we saw this five quarters ago so we have seen five quarters of consistent growth. 2% across but that was because without russia it was over 4%. we see that optimism and the focus that companies have in generating new revenue streams and focus on growth. manus: is it fair to say it is a battle against software developers? the traditional products you sell are the ones that really shown through last night.

is that pattern repeating? >> there is no question. it is all about the speeds of conductivity and particularly because of video. whether you are in business, it is all video. your increasing the networks at exponential rights to handle this proliferation of video so you are seeing a 10 gig move to 40 gig and constant increases in speeds. next generation is gigabit wireless so you see upgrades of networks to provide the capacity. that is really what is driving it. video is at the heart of it. manus: i have internet all over the house. using more bandwidth than i ever thought i would need. that is at the tiny end of the spectrum. six months ago you said you saw this wave of demand. keep me inside the coo's mind.

in terms of their capex are we at the peak are beginning to step back? >> i think that every single company is focused on how do i digitize my company and how do i plan to take advantage of the internet and everything where everything goal thing is connected around the globe? as a consequence of that every company is preparing themselves to be competitive to take advantage of that opportunity. what that means is there looking at i.t. from the perspective of how do i create i.t. capabilities that differentiate me. it is not just a focus on cost, it is also about how do i move myj opex and spent more of it toward i.t.? underlying all of that is the network. one thing that is really key is

security. as you provide more from a digital perspective you have to be more conscious about security. security threats are just burgeoning. manus: before we move on to the broader context, are you spending more insecurity now? >> we saw our revenues grow 14%. very organic from organic development and the acquisition and security. in the acquisition of talent there is a 12 times demand around the world. manus: getting more expensive to hire those boys? >> yes. manus: $50 million of cash to come with mom and pop, do you get to spend any? >> around $3 billion of that is in the u.s. and the rest of it predominately is in europe. so we are very focused on making

sure that we make the right acquisition but clearly acquisitions -- we think that is an attractive market because there is a lot of innovation. manus: i am conscious of time. will that disrupt your business? >> no. a year ago we said the market would consolidate. it was very easy to predict. they were always going to lose something. and i think that tie up is one of the top that's that we had. manus: are they going to make it any harder for you? what is the net effect? you must sit down and talk strategy and say what does this mean for our business? >> we know the part of the marketplaces they will focus on.

some consolidation will continue to take place as companies try to create much richer capabilities. we spent a little over $6 billion on research and development. so we have to make sure that we spend that money in the areas that deliver value and profitability. manus: do you think that you get more bang for your buck in acquisitions in the software space? you cannot do away with the $6 billion. the return on equity from acquisition versus direct spending -- how does that balance out? >> we tend to focus on next generation innovation. we require -- acquire and invest. one of the acquisitions that we bought grew 92% this quarter.

that is in the cloud-based delivery of land environments. selective acquisition we continue to do. we think it is a good return for us and the shareholders. manus: thank you for coming in and giving us your time. great to get your thoughts. the president of europe in middle east africa. anna: you can join our conversations on twitter. we have been tweeting out some of the highlights with those conversations. it is becoming more expensive to hire tech security experts. 7:40 in london. mark: harding said to you people don't leave us to get a better deal. they left in the past because we did horrible things to them. very open. coming up, the bart chart. as the -- ♪

mark: as the bond market route contaminated all assets. in the last 3.5 weeks more than $400 billion has been white from the value of global bond markets -- wiped from the value of global bond markets. on monday, april 20, 10 year yields reached a record low of .049%. a whisker -- whisper away from turning negative. you might not believe it but during that period, the starting point being the white circle right here, the value of global equities, as measured either bloomberg market capitalization

has risen by almost $1.9 trillion. the best-performing stock market through wednesday was the sea index with a gain of 20%. the worst was thailand's sdt index. in the foreign exchange space the dollar in that period has fallen by 2.6% according to the spot index which tracks its performance. my second chart shows the currency which has risen the most against the dollar since april 20. that is the dollar decline. the currency that has risen the most is from kurt extend with 8 -- kryrzakstan. the bloomberg commodity index is

not the bottom chart but the commodity on it is represented within the index which is a gauge of 22 commodities that has itself risen by 32%. the green circle is april 20 and the best performing commodity is not one we talk about every day. the worst is corn which has fallen 6%. it is clear that the bond market route hasn't contaminated all asset classes and there is even a part of the eurozone bond market that is untouched. it registered the biggest global stock gain over the period from april 20 to now. it is greece. anna: have we suddenly dipped into trading places? i'm feeling like eddie murphy.

the euro stocks 50 is down 6.5% over the past month. let's speak to a man who knows. johnson stubbs is that european and global equities specialist. we have built you up there, are you concerned by the moves lower we have seen? >> disclaimer, i do not think that i know. we see the pullback as an opportunity as we did in august and october of last year. the pullback for us is an opportunity to reload and refocus. fundamentally about what has happened does not disrupt the key reasons why you should want to earn equities at this point in the cycle. in europe we still have qe is a

very important backstop areas we will still have interest rates or yields for longer even if that means they will be slightly higher than they are now. importantly we have an economic recovery in europe which in our view has very strong underpinnings. we should not ignore that. the impact will be positive. investors should own equities. anna: that doesn't mean a premature and quantitative easing? >> the view from our economist is very clear. the risk of the early taper is very unlikely unless there is a clear global or regional pickup in inflation expectations. that is not what we think that recent moves suggest. a 40% pickup in oil prices for

recent lows. there are a lot of moves across markets right now what we have not seen is a clear or aggressive take up in inflation expectations in the euro area for sure or globally. that is what is needed to take the bond market into territory that has threatened this market. manus: we will go into more detail shortly but i like what you said that european equities have gone from delta to delivery. what does that mean. give me a reflection of how a position from delta and some of those core markets, try to place those banner headlines for me. >> everyone likes a delta or trade change story. people make their living out of that and that is what we do. europe has been a big change story. you have seen an

improvement in gdp expectations and earnings expectations and liquidity and qe the mentation. it takes away any uncertainty. we have seen all of the deltas and that is why europe has been one of the best performing asset classes in the past six months. it moves into a delivery phase so that gdp improvement is a recovery story. the eps improvement comes on young earnings -- becomes an earnings story. that comes from an extended program. corporate re-leveraging. and owning -- that is the delta delivery story. briefly on the gray sky scenario we have a 40% upside on our

return targets which sounds super aggressive. it is based on a simple premise that if we get growth in europe we continue what we normally get which is a really rating. you get this double up return. if you get 15% dividend growth and it goes from a 25 year average down to 2.5, you get a 40% return. it is not an aggressive view. mark: what is the alternative? >> there are three things investors have to have in their portfolios. in a world where growth is generally disappointing, you have to align with fundamentals. you have to own companies that are likely to deliver. in a world of excess liquidity you have to align with liquidity.

i would argue that liquidity is reasonably predictable. we also know where it is likely to come from. fundamental liquidity and the third aspect which we cannot ignore and what recent events remind everyone about is that the biggest risk is inflation and significantly higher interest rates. we need strategies that combine all three of those. one is centered on financials. financials have decent to high yield. manus: the bmp and the ubs? >> i cannot go into specific stocks. but very broadly financials across europe have very high du

ig score. that factor helps protect. our biggest strategy is about companies who are willing and able to exploit. in europe there is a world record funding gap. between the cost of debt funding and equity funding. the companies that will exploit that have strong balance sheets and cash flow. releveraging. anna: the global equity strategist at citi. manus: some of the bloomberg top stories at this hour. after two years of scaling back holdings, the sale would value the investments at $1.5 billion. u.k. bankshares have slumped. slower profit growth in asia. the u.s. dropped to its lowest level in four months after a report showed that retail sales

were little changed. they have missed expectations since january. according to the federal reserve, they may hold off on raising interest rates. the u.s. currency had climbed nine straight months through to march. sharp posted a full year loss wider than expected. they cut jobs and received a natural support from its mainlanders. the company -- main lenders. the company reported a net loss through the end of march. anna: itv posted strong advertising revenue for the start of the year. this is a company reorienting itself to be less dependent on spending. here to look at the numbers is caroline hyde. caroline: if you are looking across the board they are coming in and had of us.

up -- coming in ahead of us. in the first quarter you had the six nations rugby and easter a little bit earlier. suddenly companies wanted to get faces in front of a television. we will see that case fall off. for the itv family it will be at 5%. all in all, analysts have known that this good first quarter was coming. morgan stanley upped their growth forecast for the whole year. the area of concern is in fact the shares of audience. suddenly we are starting to see viewers ticking down a bit. the itv main channel -- shares and viewing figures were down 3%. they say this is a key focus.

the focus is the main channel and they want an improvement. mark you will know that the rugby world cup is coming up. and they are saying we are going to seat more people tuning in so they see on young improvement but i think what is interesting is the orientation of this business. because -- it is taken out of your hands when you are dependent on whether the economy is getting spending a whether it will suddenly have a rugby world cup. so diversification is number one in his mind and already we are seeing the dividends being reaped by this company. online pay and interactive up 31%. itv studios is the interesting one up 17%. look at "downton abbey." they didn't make it. content is king for the new head.

mark: "on the move" is next. stock market futures indicating we will see more decline. ♪

jonathan: good morning and welcome to "on the move." in just a few minutes from the start of european trading. what a session yesterday was, stocks higher and higher. u.s. retail sales happened stocks in the red. what a story. what is in store for today? futures low. dax futures down. the euro getting stronger. bonds and needy -- continue to shake off the qe euphoria. mario draghi speaks in washington later.

ceo tells us why he is not making contingency plans for a grexit. the rebound from a six-year low in oil prices causes the recent rally to almost be done. futures turning lower into the session. futures are down by 46 points. let's get the market open with manus cranny. manus: the bond market as you say were just coming off those highs in the german government bond market. again this contagion is right. it is going into the equity markets. let's look at the bar charts. today we get a slightly longer day.