and 32 years after rising for nine straight weeks. we will look at the crude price in the morning. futures higher. ftse futures up by 19 points. bond yields coming down just a little bit. manus cranny, over to you. manus: those equity markets are linked to the move in the bond markets we saw. the motion movement between the rest bite is released in the equity rally. the u.k. had been down this week. the cac is down 9/10 of 1%. it is options expiry day. that is the feet ahead of us.

that will be pretty interesting to see. to that end, to the traders have an interest in taking these indices slightly higher? we have drugs on the move. and it is up 1.1%. the u.k. housebuilder raising the dividend. the stoxx up. -- stocks up. and they have a lung cancer drug . it is a lung cancer drug with a survival rate exceptionally well.

syngenta up. reuters says the deal depends on the sale of the business. bloomberg intelligence gives a little more depth to china, europe, and the u.s. antitrust suggestions to do the deal with monsanto. is it a reprieve at the moment? would you be tempted in .72%? we are seeing substantial foreign buying in the bond market, in the u.s. bond market we haven't seen for quite some time.

it is one of those moods out there. is it an attractive yield relative to an equity yield? that is the debate for investors. jonathan: if you asked me this time last year is 72 basis points attractive on the german yield, i might have said no, but given where it is i might say yes. the shake i comp as it is down for most of the trading day. -- the shanghai composite down for most of the trading day. >> we are seeing chinese stocks at the lowest level in nearly a week. utility and telephone stocks led the losses. the property companies in shanghai drag down financial companies. shanghai comp is it index topped

1.8 percent this afternoon. it is currently down 1.5% just ahead of the close. investors are spooked by news it will tie up funds amidst midweek growth. the liquidity knockout for the descriptions will start next week. manus: -- jonathan: we talk so much about the index. when you talk about the shanghai index, just look at the last 3, 4, five months. what is the small cap in china right now? >> the chinese small-cap companies are trading near record highs after the government pledged to support developing industries. that was to shift away from manufacturing and property development.

to put it in perspective, it's surged this year versus a 35% gain for the benchmark shanghai comp is it index. it even led the development of the etf the first exchange weighted trade in hong kong. also, the regulatory commission meets next week. we will wait to see about the risk of high valuations on the index. jonathan: i want to bring in bob parker. that attend i am a client of yours, and i said, i missed out on this big china rally but i hear there is an index trading at 100 times earnings. what do you say if i want to get in?

bob: i think the important thing is what is going to happen with the shanghai comp is it. we have had this rally since june. if he went into the market this time last year, the key question is do you take profits or do you hang in there. you certainly stay with the rally at the moment. one thing is interesting. we clearly see a switch in domestic capital out of cash and real estate into the chinese equity market. i think foreign investors are still under invested in china. interesting capital movement over the next six months is going to be an increase in foreign capital i can to china and possibly taking profits on some of the more expensive southeast asian markets. >> which one is smart money? the domestic money that is there or what is going out? >> the domestic money has been driven out of cash by this

easing of monetary policy. i think the main feature of the chinese economy for the rest of the year is going to be the monetary policy stays super easy. that will mean domestic savings of more oriented to the market. jonathan: we have the nick a rising just a little bit. several companies are announcing share buybacks. is this the u.s. versus the share buyback story, or is this the change of culture we have been waiting for? >> i think it is a fascinating change in culture. that is one reason you had to stay long in japanese equity markets. corporate culture is changing. i think there are two things. corporate governance is changing. there is intense pressure on japanese companies to reduce the large amount of surface liquidity they have been running over the last year or so. the share buyback increased dividends and real investment. all of those factors i think

support the japanese equity market for the foreseeable future. jonathan: could that change in culture be more of a driving force in the equity market at some point than the bank of japan has been even though the bank of japan has monetary policy on steroids? >> we cannot ignore the bank of japan. if they stick to the policy, it will be 85% of japanese gdp. last october when the fed finished qe, that was 35 percent of u.s. gdp. what the bank of japan is doing relative to what the states did under qe is double the volume of relative qe, so you cannot ignore the bank of japan qe program. i think the improvement and corporate governance a reduction in liquidity those are all positive factors for the japanese market, which is not

that expensive anywhere. -- anyway. jonathan: compared to europe or the u.s. they have huge holdings as well. when we talk about asset managers pimco coming back from stocks. it is the third attempt they try to diversify away from their core bond fold -- holdings. is it a pimco story? bob: you have to look at the structure. what this tells us is if you are a specialist, as pimco has been, it has been one of the world's leaders in global and domestic fixed income i think the messages it is difficult to reinvent yourself from being a specialist to a more diversified asset manager. lets aim a large fund. i go to pimco for a fixed income mandate.

pimco is not a natural home for an equity mandate. i think the messages diversifying when you are known as a specialist is essentially difficult. this is another example of that. there have been previous examples. jonathan: what about what we seem to have given up on. is that part of the move at pimco as well? bob: you could question whether pimco are doing this since we have had a rally for over six years. you have to ask where are equity markets going. is the rally over? i would argue the six-year rally is not over. the very large returns since the rally started in march, 2009. i think if you asked what are the projected returns for the next two years, three years, we are going to be looking at 3% to

5% annually. the returns are going to be significantly mediocre. jonathan: this is an asset management story rather than an asset class story. after the break mario draghi praises his qe program. what could go wrong? and then more on the outspoken greek finance ministers latest drivers it. embed that flicks. those stories and more coming up through the show. the euro is back from one dollar 14. ♪

>> the ecb president mario draghi praising the early success of his qe program and washington, d.c., but he also highlighted the unconventional monetary policy could cause a potential threat. here is all you need to know in just two minutes. >> over the first year, the ecb has taken a series of major monetary policy measures, culminating in our decision this year to expand our asset purchases to public securities. while low interest rates will inevitably result in reallocation of resources, it

does not threaten stability. structural reforms and economic confidence will help capitalize on the extremely -- on the conditions and make the policy more powerful. while we have seen an impact on economic confidence, what ultimately matters is we see an effect on investment consumption, and inflation. through this we will implement in full our purchase program as announced and until we see a sustained adjustment and the path of inflation. it is ultimately a combination of policies that are complementary and fully consistent that would allow our policy to bring about lasting return of both prosperity and

stability for the whole area. exiting from abundant liquidity policies has to be done very carefully, because the expectations are rooted more and more because of the length of time liquidity has been abundant. jonathan: that was mario draghi. let's bring in the senior advisor. at the erratic go question for the 12 -- a theoretic question. mario draghi and the institution hasn't really been challenged by the markets in a number of years. at what point does the rebound in the euro start to become a problem for these guys and they need to fight back? certainly not at one dollar 14, but there must be a threshold. quest with the setback in the bond market, and i may argue it

is a setback. it is much more interesting than another program. another interesting point is what happens if i am carrying out a qe program. you get into a difficult technical situation. the fact we have had this setback does not threaten the program at all. it is 60 billion a month until december 2016. i think the interesting question is what happens if the recovery in the eurozone economy proceeds, as we think it will. german growth comes in at two and a half percent.

later in the year the ecb may turn around and say, they qe works very well. we have got the economic recovery where we wanted. credit spreads have narrowed. we are going to stop qe. they have to manage the exit very carefully indeed because expectations are entrenched that they are going to continue this for the next year and a half. if they actually slow down or announce they are going to exit that process. jonathan: can they push them into the corner and say, i don't think so? >> it depends where they stand. i think the critical aspects are what is happening to the data. italy and france we are seeing better economic data.

consideration number two is what is happening to bank lending. what is happening to credit spreads. can they borrow at the same kind of level? they couldn't two years ago. all the factors that suggest qe is working are very much there. the next question i think we are going to be talking about in november and december is how are you going to stop qe. that is going to be a challenge. jonathan: when i look at the exchange rate, things have stabilized somewhat. in a way can we say that is bullish for equities? >> i think all we have seen is very interesting and european equity markets. european investors clearly carried out a major switch. what is interesting is the

capital flows from american and asian investors have been very low indeed. they have been very concerned about foreign exchange rates. now that the euro has stabilized i think volatility has fallen in a range for the rest of this year. i think it is the range we have got. we encourage capital flows into the european market. i think the next stage is going to be foreigners buying europe. jonathan: we are going to talk greece after the break. yanis for a caucus and his latest twitter stats. back into. -- in two. ♪

jonathan: let's get to greece. greek officials holding talks yesterday. talks continued. the pressure continues to build on the greek administration to present a plan for more aid. yesterday dennis varoufakis -- yanis varoufakis mourn the loss. >> this is not a statement i want to make.

i wish we had the drachma. i think deep down all member states of the eurozone would agree now. it was very badly constructed. once you are in you don't get out. >> bob parker is next to me. he made some comments that were in his words reported as astonishing propaganda by some members of the press. the bureau chief is joining us now. what a moment yesterday. talk about the controversy if there is any at all. >> it is clear he is paying the price of his overexposure in the media. let's remind you what has been

happening over the past few years. greece has been borrowing from the monetary fund with superlow interest rates and super long maturities. he uses these funds to pay short-term debt obligations. this is called a bailout. mr. varoufakis try to explain this in a complicated manner yesterday. instead of saying greece will need to borrow more to repay obligations including the bonds held by the ecb he said the funds should by these bonds and then oh this money. -- owe this money. some miss him. mr. varoufakis complain. it is clear this is the price he

has been paying for his frequent public comments. greece's government spokesman has said yesterday in his regular briefing to reporters the ministers should stop talking so much. jonathan: they have done a lot of talking. time for a couple of thoughts with bob parker. you comment for me. bob: let's cut through the noise. there are three pressure points. watch outflows from the banks. if the outflows continue, the question is will they have to do what cyprus did and introduce capital controls. the end of this month, have they got adequate funds to pay pensions and welfare etc. pressure point number three is

the repayment coming up this month and next month to the imf the ecb, and the european union. i think the next few weeks are critical. >> we will talk assets after the break. ♪

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♪we're having a party happy birthday, grandma! ♪we'll be swinging ♪dancing and singing ♪baby come on over tonight jonathan: welcome back to "on the move." i'm jonathan ferro. let's get caught up on the trading day. equities green across the board. ftse 100 up by 0.25%. that dax up 0.3%. the dax still headed for a week of losses. over the week, performance down by 1%. the ftse mib in italy off by 0.1%. let's check in on bonds, currencies, and crude. the 10-year in germany down. hitting a fresh 2015 high

yesterday at 0.75%. the 10-year in japan down by six basis points. a weaker euro over the last 15 minutes, down by 0.2% against the dollar. wti, the rally. crude this week heading for a record ninth straight week of gains. let's lift the lid on the indexes, the equity markets. let's get the mark barton. mark: sab miller is buying brewing in the u.k. to offset stagnant sales of mass-market beverage. sab up by almost 1%. here's the great stat. sales by volume rose by 58% last year. u.k. beer sales overall increased 1%. bovis homes up by 0.2% today the highest level since june

2007. it is the u.k. homebuilder on track for its target this year. production is currently 9% ahead on year. k average sales prices 2% ahead of expectations. shares are up 250% in the last three years. coca-cola, one of the biggest bottlers of the coca-cola company, one of the big gainers in europe today. shares at their highest since november last year. first-quarter trading conditions developing broadly as the company expected. total group volume up by 2%. revenue narrowly ahead of estimates. 3% higher. all three today trading up. jonathan: nice work, mark barton. those homebuilders will not retreat. the top performers on the ftse 100, three of them

homebuilders. those companies just not going away. time to talk affects now. the dollar heading for a fifth straight week of gains its longest week of declines -- the dollar heading for a fifth week of declines, the longest slump since october 2013. in about of risk aversion. the question is, where is the safe haven? let's get the view from unicredit. long week. big questions still. safe haven currencies where are the safe haven bonds? in fx, where is it? >> i don't think you can say that it is somewhere specific. the traditional safe havens like the yen and swiss franc don't seem that way to me. as far as japan is concerned,

the structural problems are ongoing. as far as greece is concerned i'm at a loss at the snb's actions. the currency seems heavily overvalued. they don't seem to be taking a proper stance in that. it does seem like a safe haven but i don't know what these guys are going to do. i would like to stay on the side. jonathan: the snb, the currency is heavily overvalued. what can the snb do? vasileios: they can bring interest rates up. they can also start intervening more heavily in the fx market which would send a message to the market that they are watching the situation very closely, so that the market can start stepping back from beating

the swiss franc higher, or maintaining overvalued levels. jonathan: the dollar, three months ago, some might have said it was overvalued. i look at the performance against sterling and the euro then i look at the median analyst calls. yen 1.25. count 1.49. the dollar strength story still baked into some of these forecasts. does that mean this is tempering, that we still expect this dollar rebound? vasileios: let's put analyst forecasts in perspective. analysts will always follow the market. it is difficult to actually try and forecast very sharp changes. i think, broad picture we had a massive rally in the dollar. it went up until a point in line

with fundamentals, then momentum took over. now, then momentum has evaporated. i think, from a fundamental point of view, the correction in dollar will still be ongoing. jonathan: story of 2015. we came into the year short the euro. then came the big parity call. then came the unexpected rebound. what do you look at to call it? vasileios: you look at a whole host of various indicators. you have short-term evaluation models as well as long-term models, which include a host of other long-term variables. right now, from a purely fair valuation perspective the fundamental value of the euro is around 1.20. jonathan: at the end of last

year, it was short anything that had anything to do with oil. we've had this rebound in wti. you've seen this performance in some of the commodities. you were on the show a month ago talking up the norwegian krone. we had a bounce back. do you think there is more upside? vasileios: if i was to relate that back to your question about safe havens, the norwegian krone is my most preferred currency. on the fundamental front, the norwegian economy is doing very well. inflation is running close to target. at the same time, we have a central bank which has taken preemptive action. it is not falling behind the curve in any way, shape, or warm. -- or form. and you have the support from energy prices. i'm not saying we are going to see 80 or 90, but you are

trading in the 60-70 range. jonathan: i've got the wcrs function on the bloomberg terminal. i'm looking at the best-performing currencies against the dollar. norwegian krone is number four. the aussie dollar is number seven. the canadian dollar seems to be lacking. what is the story? vasileios: i think that makes sense. on one hand, people tend to relate the canadian dollar's performance to oil, but we have to bear in mind that canada is very much linked to what is happening in the u.s. to the extent that over the past 2-3 months, there's been a very large amount of disappointing u.s. data, this also translates into some downside pressures in the canadian economy. i think that's why you don't get so much of an outperformance. jonathan: you would have heard those comments from yanis their attack is about 10 minutes ago.

bob parker said we are going into a critical few minutes in greece. this might be critical for greece greek banks, greek bonds, greek politicians, and citizens as well. it hasn't been critical for the euro at all. when does it become a currency situation? it is a question that goes back and forth. does it ever become a currency question again? vasileios: let me first say the following, if the unthinkable happens, greece exits the euro -- which is i don't think the central scenario -- it will be uncharted territory. it is very difficult to have a very strong view on that thing. from a fundamental perspective, it hasn't been a euro story and i don't think will be a euros lori. -- a euro story. it will induce some activity, but the bank is -- the market is going to be very insulated.

the biggest challenge of greece's debt is in the hands of the market. you have -- that is a big picture perspective. draghi has really proven that he can actually he has proven to be very good and that increases confidence. jonathan: ecb policy doing more damage the euro than greece. vasileios: sure. second half of 2014, i don't think that euro weakness was the story. i think it was dollar strength. first quarter of 2015, it has been a qe-related story for the euro. everything has a price. i think at the 1.05 1.10, too much was in the price of the

euro. jonathan: vasileios gkionakis a world tour of the g 10. thank you very much for joining us this morning. coming up, we are going to switch gears from fx to netflix. the company reportedly in talks to take its content to china. ♪

jonathan: welcome back.

this is "on the move." time to talk netflix. the company said to be in talks with a chinese media group backed by jack ma as it seeks to enter the country's online video market. manus cranny joins us now for more. a to use netflix, and v, what is the potential of netflix going to china? manus: yes, i use netflix. i've absorbed the "house of cards." maybe china will wonder why democracy is overrated. they too want more. they want more devices, more content, and the chinese video market is 1.4 billion people potentially with a market worth $6 billion. it could be worth up to 20 billion yuan by 2018. "aren't is the new black." "house of cards" is what the chinese want to look at.

netflix is said to be in discussions with one of the countries -- the company that jack ma had a holding in. he's got 20% of that company. back in april, they did that deal. they know how to navigate the chinese market. they are familiar with the chinese idiosyncrasies. and of course, this goes back to the chief content officer, who said, we intend to try out china and we intend to try to figure out china. who better to do that with then jack ma? jonathan: is that the point? is the point that netflix doesn't go in alone and teams up with a local partner to circumvent some of the challenges? manus: absolutely. they don't just want to be on tv. they want to be multi platform on mobile, online, etc.

they don't want to go without a partner. the chinese government has stripped controls over licensing of online content. trying to overcome those issues in terms of navigating that market, why not have a partner to take away the burden of the workload? jonathan: manus cranny, i'm going to let you go. get back home. manus: no, i'm not gone yet. i have a lot more to do. jonathan: what have you got to do? manus: i have to do the week ahead. everybody is going to know what is big at bloomberg next week. jonathan: i look forward to the pdf arriving in my e-mail. thank you very much, manus cranny. let's go from films to beer. that works for our next guest. brewing giant sab miller acquiring craft brewer meantime.

matt joins us now. we talk about sab miller needing to go somewhere else. soft drinks, low margins. big story in the u.s. big story for sab miller? matt: it is already a big story. there are now more breweries in the u.k. per person than any other country in the world. the craft has exploded. sab miller once 80's of this. sales volumes grew 58% last year. this is a time when sab's volumes across europe were flat. now they are looking at the craft. we are wondering, is this going to set off a land grab? a lot of what the craft brewers have learned, they learned from the americans. jonathan: sab miller, you and i talk about a slowdown some softness in america. is this acquisition a europe story or are we going to see more of this in america as well?

matt: we already are seeing it in america. it is difficult for u.k. craft brewers to get a foothold in the u.s. we already export the 40 countries. that will be added to sab's distribution. when you buy into craft breweries, you also buy into retail. they do this thing where they bring unpasteurized tank beer right from the rumor he to the pub. sab miller has been testing this as well. they opened up a new restaurant in london this year. jonathan: you are making me want a pint of beer. and leave work early. i'm going to wrap it up for one last question. we haven't got a price for this acquisition. do we expect them to make more of these acquisitions? matt: i expect them to. i think this one is going to integrate very well. the ceo of meantime used to work at sab miller.

jonathan: there you go. matt boyle, thank you for joining us. coming up, obama's promise. the u.s. president sues gulf leaders as they are put on edge by a possible iran deal. ♪

jonathan: good morning and welcome back. 51 minutes into the session. stocks in london a little higher.

marginally higher across much of europe. the cac 40 up by 0.2%. let's get you up to speed with the top stories at bloomberg. pimco said it will close three active stock mutual funds. the chief investment officer for activities will leave the firm -- for equities will leave the firm next month. the company has no plans for a replacement. a reported buyout of avon sent the company's share price surging, then we discovered it was a hoax. it came from something called ptt capital partners which said it was offering to buy avon for about three times what the company was trading at the day before. then you saw the retracement and for some reason, it again. sometimes, i just don't understand markets. barclays facing a fine for violating a settlement over interest rate rigging.

people familiar with the metal say the fine could add up to about $60 million. president obama promised leaders of persian gulf states the u.s. would come to their defense in the case of any external attack. he stops short of offering a formal pact. that was at a meeting at his retreat of camp david. elliott gotkine has more. gulf leaders, have their concerns been eased after this shall we call it a summit? elliott: this meeting was all about president obama and america reassuring its allies in the gulf. it can negotiate a nuclear deal with iran which may result in sanctions against iran being lifted, while at the same time honoring america's alliance with its allies in the gulf. not only have we got your back but we will ensure that you are

better able to deal with iran. elliott: -- jonathan: congress passed legislation that will now let it review any final nuclear deal with iran. how do you equate the two things? elliott: i suppose it was coincidence more than anything else. i don't think it is going to go any way to reassuring the leaders from the gulf area. they are very concerned about the deal the u.s. is negotiating with iran. the world powers are concerned that it will result in sanctions against iran being lifted and iran being better able to meddle in the affairs of its neighbors, and also worried that it will set off a nuclear arms race which is the opposite of what president obama is trying to do. the iran nuclear agreement review act was passed by an overwhelming majority in both the senate and the house. it will now go to obama to sign

it into law. it means that if and when they agree on a deal with iran then congress will have the ability to review it. it will have fewer than 30 days to say yea or nay and could presumably reject the deal. jonathan: elliott gotkine, busy week for him. let's get the wrap with guy johnson for "the pulse." guy: i'm happy to wrap it up. we've got an interesting market set up at the moment. we are going to talk a lot about what is going on with the dollar , what that means for other asset classes, how you invest through this, and what is happening in equities. the pimco story is fascinating. they've really struggled on the active side. it tells you what is happening. jonathan: i spoke to bob parker about whether it is an asset class story or whether it is an asset management story.

when you are so geared up to invest in one particular class. guy: i also think there's an element of active struggles at the moment. i think trying to gain a footprint in an active space that is having a tough time of things is a tough ask of anybody. money is pouring into asset funds right now. you see it with these big funds that are driving the industry and making it harder for the active guys to outperform. it is a cost that maybe wasn't worth bearing. jonathan: talking fashion in "the pulse?" guy: we are. i'm obviously qualified to talk about that. we have a stylist coming on. we are going to ask her to give the fashion leaders of the world a few hints, angela merkel, yanis varoufakis. jonathan: "the pulse that is how "the pulse "the pulse" handles their guests. that is it for me and that is it for the week. here's a picture

of your markets. the equity map in europe painted green. the dax is still headed for a week of losses. good luck for the rest of your day. ♪

guy: the rally continues. as the s&p rises to a record, we look at the impact on europe. francine: netflix may partner with a media company backed by jack ma. guy: and, we look at the billion pound scans taking place in london's landmark building. 9:00. you are watching "the pulse." we are here in london. i'm guy johnson. guy: and i'm french -- francine: