. and going to the polls, looking at the reform agenda of prime minister renzi, and that is the way that things are going. we'll be talking about this over the next 60 minutes, that futures are up by 27 points, dax up by 66 points, and the stocks are going a little bit higher. in is cranny has your market open. manus: it was the op-ed over the weekend, talking about hemingway, talking about the potential cataclysmic impact. look at that. that was the dax on friday. it actually wiped out the entire gains made in may. that gives you a sense of what was going on. this week it is about inflation data, and germany will be first up to give their inflation data and we are expecting the first rise in seven months. on friday, jobs data and

standard chartered. opec, they are meeting. that would be a little bit later in the week. hsbc, the purchasing managers index, the official data showing that with the hsbc market. stabilization seems to be the consensus view in china. we just at a conversation. they love the chinese stock market. i think they can say that about mortgage backed securities. and lloyds at half of a percent. 30.6. they are going to have a retail offering. that is going to come a little bit later. they have recouped 10.5 billion for investors. and the drugs are in focus today.

one of their drugs for breast cancer showing good signs at constructive test data. astrazeneca has a lung cancer drug which is showing positive sentiment. really, the drugs that are driving both the smi and the modern market. the reserve bank of australia, and the dollar itself has gotten a little bit of relief. we have got fisher speaking today and others. up and eight. the dollar is a little bit higher. there is the euro. it is a decidedly in a new zone. as you say, we have got the manufacturing numbers for countries, german inflation. the acrimony, you can almost see the apple money coming off the page from prime minister suppress -- the greek prime minister.

we will see if greece actually delays their payment to the end of the month. who will they possibly get some support from in these negotiations? will it be angela merkel and françois hollande that comes to his rescue? but there is that terrible issue of the devil in the details. jonathan, back to you. jonathan: thank you. a rebound from that ugly session on friday the dax also rebounding by about 4/10 of 1% and that is the market in europe. let's head over to china, ready official numbers rose last month, suggesting the government of austria's monetary easing could be cushioning the situation. stephen engle joins us. some small reason for optimism, perhaps? stephen: yes, finally some signs of optimism, sure, and the stock market took it to heart. up nearly 5% area hong kong is

up 1%. the h shares index up nearly 2%, so really getting a boost of a couple of pieces of news. i will get to the on swap local issue in a minute, but the pmi manufacturing index was also up today better than expected, perhaps, and the easing we have seen has started to work into the real economy, but do not be fooled. the pmi at 50.2, not necessarily a robust recovery, but it was the highest reading so far this year. still in expansion but above the last couple of months. the first two months of the year, it was in contraction. what is encouraging though, jonathan, within that pmi reading for may, we saw output new orders, and new jobs advancing, and that gave the market a bit of a shot in the arm, if you may. jonathan? jonathan: hardly setting the

world on fire. let's talk about the big one overnight. what are we hearing about the expansion of the china local bond swap program? stephen: yes, the policy makers, people familiar with the situation, are telling us that policymakers are considering plans to double the local bond swap program at the municipal level. phase two could be increased up to 2 trillion you want -- 2 trillion yuan. what was set up after two thousand nine, that cap a lot of the local borrowing off down the sheet and hidden. they will be swapped into municipal bonds, adding legitimacy. what happened is the local governments, of course, took on a record amount of borrowing the last couple of years, jonathan, to find a glut of investment projects that have had very little cash flow, and their debt servicing burden has been huge.

they are considering already expanding, almost doubling the bond swaps, indicating that perhaps they are happy that they perhaps found the right template to clean up the debt problem at the local level, so another government is trying to entice the local banks to buy these longer maturity, lower rate municipal bonds. we will see. jonathan: stephen engle, we will see. that is the chinese pmi data. and we will get manufacturing -- pmi all out this hour, and we will bring them live on on the move. we are joined by a global asset strategist at ubs, and also joining us is a head at bnp paribas. the pmi. i guess the bigger question is whether the fate of this economy is in the hands of an index, like the shanghai composite.

guest: it probably isn't. it probably suggests that the stimulus is working. we think it is not immediate. we think it is quite political. there are some state visits coming up into two. but to see is when we think the next will come. it is very much aimed at what we are seeing today, to get that economy running again. jonathan: when a client calls you up and says look at the shanghai composite and the massive rally it has had, what do you say? guests: i would tell them that we like it. and i still think there is value to be found in china.

jonathan: you have got a lot of stocks in china. and then you had real estate last week. and then you have got a series of ipo's coming up this month as well. ramin: the buyout the something to watch in the future. and then it killed the rally in 2007 and 2011, and it could kill this one also. it is on the rise at the moment. be aware. jonathan: taking you to your world, stephen, if you look at the shanghai composite, it is hard to know how that translates because of the global equity market selloff. it's a market like china him close, the equity market, that is, what does that mean to the world of fx? where is the safe haven? steven: at the moment, i would

say it is the swiss franc, and japan as a traditional safe avon is less a current account surplus country than it has been in the past. the swiss is a key say favorite at the moment, and we are seeing that in correlation with greek government bond yields. as they increase, the swiss franc tends to appreciate. the second point i would make here however is positioning. what we tend to get when there is a risk off event in the market is the extreme positioning, and at the moment the big short out there is actually the euro, and remember, because of qe in the eurozone, it is trading -- the second thing is a risk off event in the world. it will probably lead to a euro increase as we should say, carry trade. jonathan: you look at the world and we talk about risk aversion. it is hard to know because last

month, this really plays with your head. i go back to the conversation. your clients call you up and say, i want a safe haven. apart from the swiss franc where do they go? ramin: we have seen the opposite, money pouring out of the mutual funds. so money has actually been going into places like japan, where we see very aggressive quantitative easing. and i think there are other places where there is still value. the equity in europe is still strategic. it is cautious. we still think there is a value in equity in certain places. jonathan: steve, it is a complex place. equity strategist would come to you. a stop coming to you so much?

steve: during times of qe, and remap or, the very last period of qe, it was similar to the fed qe but what also happens is that the currency weekends, and what you have at the moment is a very significant negative correlation between equity markets and the currencies in japan and the eurozone, so as european equities do well, japanese equities do well. i think those will largely be currency hedged. jonathan: stay with us. sit tight. after the show. in fact, coming up on the show the greek prime minister, and meanwhile, the nationsbank faces billions. and russia with scorn, the eu publishing a list of 89 officials who cannot step foot in russia and according to the u.s. government, there are more arrests to come. that and more coming up this

morning and this hour on bloomberg tv. good morning. ♪

jonathan: welcome back to"on the move" 14 minutes into trading, the ftse up the tax pushing back after a week of losses, the eight points. we travel north. if you check out the fx market

three days of gain for the euro, coming back. and plenty to talk about, particularly in the oil market a little bit later but for now though, let's each up to speed with some of bloomberg's top stories. the u.k. government says it will sell shares to investors over the next year. this comes less than a month after david cameron's reelection and about taking boyds to the private sector. casino revenue in macau continues to plunge for another straight month. revenue dropped 37%, which believe it or not, is that are. the year-long losing streak,'s amid an economic slowdown and a government crackdown on corruption. pimco more than $18 billion. italy and russia. $110 billion in assets.

and three u.s. five programs with a standoff in the senate. this is another time since the intelligence attacks that they cannot initiate these items to monitor. the senate is expected to vote on wednesday on passing the bill. and back to europe another month passes on, and this week begins with perhaps a slightly different tone. the french newspaper le monde the greek prime minister came out swinging, talking about an unreasonable solution that ignores recent democratic choice. they oh billion this month to the imf. let's get the latest from our international correspondent hans nichols. i was expecting a bit of a compromise. hans: what we know now is how

far apart they are. there has been some optimism especially with all of the negativity out there. it was mr. sippers who was the logical one. -- mr. tsipras who was the logical one. looking at proposals and displaying a total indifference to the recent democratic choice of the greek people. jonathan, that is a long way of saying back off. we are very can third, and do not make us leave the eurozone. now, when thing we have now is a number, and that is 3 billion and that is a number of that creditors want greece to that. one other note on this is the european union president said in

an interview just moments ago that he could not possibly foresee a plan going forward without the imf. now, privately, you have heard from the greeks a lot of complaining. they are driving a hard bargain. every time you run that by those institutions, anyone of that route that we used to call the troika, they say we are united, we are on the same page, and that is bolstered by the history that was given a few moments ago. jonathan: all of this continues to go with pretty much a zero progress, and with the financial sector, it is pretty clear that the banks are still suffering. what are the signs now? hans: 5 billion over the last months. that is how much the households have dropped. there is the bundesbank central banker who says we are five minutes to midnight. in many ways, the central bankers are more concerned about an immediate deal, because they are the ones you can impose at

least encourage capital controls. the capital controls would have to come from the greek government. when you look at ways this thing can really turn south in the coming days, it seems like we have had enough give on that imf deadline. getting pushed back to the end of june. mr. tsipras would not say they would bundle the payments. more easily though, the banking concern is an issue. i heard a lot of that on the sidelines and just how much longer can the banks withstand this pressure, and if you do look at the capitol, and jonathan, i think this is something you would be interested in, it is harder to impose capital controls. cyprus was an island. it is easier to control money going in and out, so capital controls may not be the easy solution that some people think it could be. that is almost a solution to a crisis situation.

jonathan: we are in a crisis now, aren't we? let's get that, shall we? greek deposit withdrawals accelerated last month in april that is. by more than 100 billion euros. that chart is not pretty. that's bring back in the global head of strategy at bnp paribas and a strategist from ubs. ramin the bank deposits, at what point does that become critical? ramin: keeping the greek banks solvent, i think that is a concern. once to force the greeks to the table. they can always say we would change collaterals. so that is a sign. jonathan: over the weekend i am sure many people expected the

prime minister to come out over the next several weeks and give up some things, look at a few of those red lines. steve: we have to wonder why he chose le monde. the amount due in june is relatively small. it is july when you get the really big payments. we are still in sort of that soft deadline moment, and i would argue that this is the first time this payment was due at the end of this week. there is a chance they could be lumped together at the end of this month, so i would say this friday is not going to be that critical. it is more what happens by the end of june and particularly going into july. jonathan: ramin, steven says a deal needs to be done by july.

it is an easy way of putting blame on the other side. trying to convince depositors that things are ok, and we are about to get a deal. does it seem like that line of strategy has worked at all? what do they do next? ramin: where they have to give in to the demands of the institutions, july and august. the big redemptions are in july and august. if they default with the imf, it is not so bad, because it does not necessarily lead to an effective devault, but if they default on the ecb, that would be a default. that would be over $3 billion. and if you look at the short-term debt, effectively for those two months, you have got about $7 billion in repayments so that would be the point at which they have to capitulate. jonathan: your strategy is short-term pessimism, long-term optimism, and you have expressed

that. that expires pretty much the day they are due to pay the imf the hole. what if they do not change the strategy? ramin: that is always a possibility, so that is what we are watching. which path are the going to take? it could be a situation for a while, and if they go down the capitulation road, it probably leads to the collapse of the syriza party. jonathan: the world of fx, i find it fascinating the number of people who look at these markets and the rallies and then you do not really get the reversal. how do you play the euro in this kind of environment? steven: particularly against the dollar, the key driver is the qe, and the euro/dollar is currently driven by data. and the reason for that is the

market has a view that greece may go down to the line, but there will be a deal at the end of it, and i think that is the key point here. or is, however, going back to what we spoke about earlier, a relationship with the strength -- swiss bank. there is a strong relationship with the swiss franc. this is a concern about greece. jonathan: you have to follow this kind of thing. there is a meeting later this week. are they going to have to move again? ramin: they lost credibility with what happened previously so i think people take guidance with result. whenever the meeting, whatever the outcome of the meeting seems to be, i think people will not take them seriously. jonathan: just pick that up. they thought that, and then it wasn't, and now people sit here taking the other view.

steven: well, we are quite bearish the swiss franc, both against the euro and the dollar. we think they have changed their strategy with that hard floor at 120 towards very very easy monetary policy, and if you look at short-term rates now, the swiss are by far the lowest in the g 10, so for clients that are brave, the swiss franc is the best funding currency at the moment, but what it needs is ongoing commitment from the swiss break -- thanks to keep the easing super, super easing. jonathan: what more can they do? steven: there is the comparison with the eurozone. when they ended the floor, there was pending qe from the euro and ecb, so the key point here is they have to keep swiss rates lower. there are the other qb countries, and that comparison

helps determine how weak the swiss franc gets. jonathan: do you share this view ramin? ramin: if we do see the situation in greece, i think that is the last thing they want. so i think zero negative deposit rates is the way to do it. jonathan: great to have you with us this morning. greece, switzerland, china, everything. thank you very much, guys. coming up after the break, we're going to be talking about fifa but first, up about one third of a percent, the ftse 100. the dax is up, and a weaker euro. we have got pmi data out of china. later in europe, and we will get manufacturing pmi out of italy, france, and germany, all out in the next 30 minutes to up next russia. banning 89 people from the eu from entering the country. we will talk about the

significance of this list, if there is one, after the break. ♪

jonathan: welcome back to "on the move." i am jonathan ferro. up by 23 points, or a belt, a third of 1% and a bit of a comeback by 6/10 of 1%, the eight points higher, and checking out the fx market, the story this morning after three days of gains for the euro it is down by 6/10 of 1% against the dollar. the town pretty much erasing all of its postelection gains. and the 10-year, the german bond

0.51% and the wti. it is ok week. we are coming off of gains for that particular contract. a big day last friday, a solid game, almost 5%, and there are the rig moves. let's lift the lid on the equity indexes and get straight to the top stories. reporter: well, we are starting with lloyds. if you want to buy these, guess what, you have got six months longer. 6-2 december 2015, and also shares with individual retail investors. we know this was made during the election campaign. it is now making good on that promise. recouping more than 10 million pounds after more than 20 billion spent on the bailout of lloyds, so that is where we are

at the moment, those shares of this morning. and astrazeneca, positive data was presented at the annual meeting of the american society of clinical oncology. astrazeneca doing well after the drugmakers we have seen rally today, as well, and finally, we want to finish with deutsche. this is germany's largest publicly traded about 350,000 cities like berlin, cologne, and others, and it raised the profit forecast for 2015. germany's biggest ever property deal. they said that merger was more successful than expected. that to you. -- back to you. jonathan: 89 officials banned from coming into the country of russia. this is due to push back last

year. i guess the big question, who russia targeting now, and nick clegg, why leg? >> 89 names on the list from 16 you countries, and it is basically like you said. it is people who criticized russia last year, or who continue to criticize russia on the annexation of crimea. nick clegg is probably the most prominent person on the list. last year, he called for russia to be stripped. he has made it onto the list. jonathan: the reaction, both in europe and russia, what has been the reaction? the russians, they celebrated and how has this been taken in europe? >> it is sort of the same. and some have called it a badge

of honor to be on this list, and they have actually said something like they did not want to visit russia anyway. they had no plans to travel there, so they do not mind to be on the list. the eu has criticized the list on a couple of fronts. one, they say it is unjustified. and they say the technically russia is considered confidential, and they have not disclosed the list, and the eu says the legal basis the hind it has not been disclosed, so they really think it is an illegitimate list, and they are not getting for it. jonathan: jones, you and i can joke about this, but the bottom line, what does this mean for the sanctions for the eu and others? about them being extended? jones: right. the eu is trying really hard to get the minsk agreement to be solidified to get the cease-fire in eastern ukraine to

hold and those sanctions are tied to that, and that is what they are really pushing for. they want to see progress on that from russia. there is the reciprocal sanctions against the eu officials that mirrors what the eu has done to russian officials in the wake of the annexation of crimea, so this does not help the atmosphere there. the eu is still saying they have got to stick by the minsk agreement. we have got to see a solid cease-fire. you sanctions including travel bans and asset freezes, they come up for renewal in july, and it looks like they are going to be renewed, that they are going to keep them on, as they want to make sure that the cease-fire holds over there. jonathan: jones, great to have you this morning. a great list. we are joined by phone by ryan. great to have you with us this morning. i know you are busy over in moscow.

what is this? we have seen names like nick clegg. for a lot of people, it is hard to take this list seriously. ryan: and i've foreign eyes. as you pointed out, there is the travel ban against russian officials for a very long time, and i think what is interesting about this is that there is a travel ban list, but what has changed here jonathan, is that just last week, there was the eu delegation, so what the russians disclosed with the list, that in itself is pretty curious. jonathan: ryan, jones and i had a commerce asian about sanctions. where does this stand up between the russians and the west go from here? there is a pretty serious date coming up. these guys want to get together and talk about extending these

sanctions. ryan: i think this is noise. it is interesting. the relationship is showing some signs of hope of improving. john kerry visiting the russian president a while back, the russian foreign minister and the head of nato, so some things could get better. things could get worse. what you have to keep in mind is that for domestic public consumption in this country, the russians have to show they are responding to the pressure they are getting from outside the country so this is one way of doing it. hey, they had a blacklist against us. now, we are announcing our black list against them. you have to wonder, at a certain point, does the need for russia to show progress beating the sanctions hijack the agenda and lead to events -- events that could destabilize or derail any

potential recovery in the next year or two? jonathan: ryan chilcote, thank you. up next, the italians went to the polls in local elections in what could be viewed as a ballot on the prime minister's leadership. we will be live in rome with the latest. that is after the break. ♪

jonathan: good morning, and welcome back.

40 minutes into the trading session, some of top stories. the u.k. government says there would be shares, and this is less than a month after prime minister david cameron's real election and part of a plan to return lloyds to the private sector. lloyd says the government space is below 19%. continue to plunge for a 12th straight month. revenue plunged, which is, believe it or not, better. the year-long losing streak amid an economic slowdown and a government crackdown on corruption. pimco more than doubled its holding for 30 year treasuries to more than $18 billion in the first quarter. all of its credit swaps linked to italy and russia, now oversee $110 billion in assets after suffering outflows. and in italy, voters went to the polls on sunday in seven of the regions over the weekend, and

joining us with the significance of these elections is a bureau chief. great to have you with us this morning. i guess, the elections are shaping up, and is it an endorsement of prime minister renzi? guest, so far we have partial results, but we almost have the final. he won five out of seven regions, and that is an excellent result. many analysts have told us he comes out strengthened from this election. certainly, other people see it a little bit differently, because he did lose one key region a stronghold, and that is creating some confusion in his own party. and these were only seven regions, and he did win five so he is not going anywhere anytime soon. he is still firmly in power in italy. jonathan: i guess, going forward, the biggest question for him is those small losses,

if you want to call them back, do they mean anything going forward? alessandra: and why did he lose one region in northwestern italy, liguria, so there will be a lot of soul-searching about what happened and why it happened. there are two w way it can go. you can see more infighting problems for the reform process and the other way we can see it is, they could say look what happened. this happened because you were not united, and in the future you have to keep a united front, so either way, he can use it to his advantage. we have to see how he uses it. i suspect renzi will make it look like the far left made a mistake, and in the future, they have to allow him to win. jonathan: alessandra, thank you.

we will go from italy to fifa. the present reelected despite a probe into the election. he went as is mark art in, who brought up all of the action on friday. there are reports that u.k. banks could be implicated. mark: there was a sunday times report that they are looking at transactions to a sure that proper procedures took place. now, this is of concern for standard chartered and for hsbc, because they remain on probation by u.s. regulators. they could face fines or lose their u.s. banking license, if they did not do enough to stop the suspected money-laundering. both hsbc and standard chartered have declined to comment. they have said they are aware that there were to double your payments cleared in the indictment. we are looking into those

payments and will not be commenting further at this time. we will keep an eye on those. jonathan: this does not seem massive, but we will see with the next step is going to be. what is the next step? mark: as you know, on saturday, in berlin, they will decide on their next step area the talk of the town is they could boycott the next world cup. it was said yesterday, we could boycott, but we need everyone else to join in the fun. would italy, with a really boycott the world cup? jonathan: the story back in 2006 set blatter did not even want to produce italy with the trophy. the bad blood between italy and fifa, it is as much. and i guess the big one is that

the likes of france and spain, there are talks that -- mark: switzerland voted for someone from jordan. strange voting. bladder -- set bladder --sepp blatter was questioned, whether he minds potentially in the future being questioned by u.s. investigators. arrested for what? next question. he was then questioned at the center of this investigation the u.s. body overseeing north america and central america. within this indictment, at the center of so many allegations, one of those allegations is that they accepted $10 million from senior officials, the south african government and blatter

was questioned. he said, i am not that senior official. i have no $10 million. he has got his head in the clouds. and others up in arms, a former top man was going to take up a position on the executive committee of fifa, and he has decided not to. he did not show up at the meeting. and i think one of the big issues is prince william is the president of a group. he supported the u.k. fa start and said they have to reform quickly. on a lighter note, we talked about jack warner, the head of comcast. he posted a very funny eight-minute facebook video, and in it, he holds up this onion head.

there is the secure a that said they frantically announced their world cup in the united states. he asked on his website, if they are so bad, why did the u.s. want to keep the world cup? you might have missed the point. it is a fake story. by the way, mr. warner, it was removed pretty swiftly. he is the center of many of these allegations. jonathan: the reporting you did in syrup putting some pressure on some of these guys, and i looked at the statements, and the statements were pretty soft. mark: there were a few statements after. blatter said fifa had been in contact with sponsors. let's put it simple. it is the most televised event in the world. it is the biggest sporting event in the world. if you are coca-cola, if you are

a these the, if you remove your self, someone else's just going to step in. it is sack, but that seems to be the case. jonathan: mark barton, fantastic work. a very tired mark barton joining us this morning. a lot of pmi's coming through. italian pmi coming in at 64.8, manufacturing for the month of may. this survey was over 53, so this is a pickup run the previous month. we have not finished with the data. rather, pmi out of france and germany. join us after the break and i will bring them to you live here on bloomberg tv. ♪

johnson: good morning, and welcome back to "on the move." i am jonathan ferro. at about 52 minutes into the session. slightly lower, 49.3 was the survey and the previous reading, as well so still in contraction territory for french manufacturing. 52 minutes into the session, equities still higher. a rough day on friday, so look at this move for what it is, a rebound from friday. the dax is up. the ftse 100, up by about a quarter of 1%, and in the fx

market a weaker euro after three days of gains against the dollar, the euro just cutting back a bit, now about $1.015. and in a few moments, we will get german pmi data, and we will bring that to you, coming up in a couple minutes time. and we are joined by hans nichols in the house. jones is first. hans: it is like expectations on a pmi number. jonathan: hans nichols. hans: yes, and banned from going to russia. looking forward to that conversation. he is in venice at the moment, so, yes do you want to go to moscow? you want to stay in venice? they are talking about this, a

decent rally on friday. also, the norwegian foreign minister. asking about oil. jones: i would go with that. hans: you are not supposed to criticize your guests before they are on. jonathan: and expectation management. hans: the greek story seems different to me today, because he normally cleans up, tsipras. who cleans it up? we heard from him yesterday. normally, the sheet music for this drama is someone says something, we are close to a deal, and the germans or europeans say no, and tsipras and merkel have a conversation.

jones: it seems like they spread it out. it seems like people are in line. we can be making a lot of money. this is what is so interesting. everyone gets affected by this. even madame lagarde. among the most respected newspapers in germany, and they work up the transcripts somehow. jonathan: 61 point one. the survey was 51.4. not really going to set the world on fire anyway, but it is down. a down from the previous month. what do you make of it? hans: it is a little bit negative, but we have had positive numbers for the past month now. i don't know what to make of it.

jonathan: no country. this is a story that is on the bloomberg website. getting a show together later this week, believe it or not. the birth weight -- birth rate in germany keeps going up. jones: all of the young people throughout europe though to germany because germany has jobs, and this is the argument in germany, and it in somehow affects greece. they are very worried about their ability to pay for their long-term social security, and that is why they want to continue to have this. hans: i think you can also draw a line between this and germany and the u.k. and how you manage the immigrant story. both need to manage a youthful immigration story to keep driving the economy. jonathan: gents, we have to leave it there.

i am sure hans nichols will make a cameo appearance later on today, manufacturing pmi coming out with germany. april in eric reading on german inflation. look out for that today. good luck. ♪ .

guy: blame game. blaming each other as the payments low. francine: new figures show china factory orders stabilizing. further measures to clean up local finances. guy: the fifa scandal continues. more charges and banks linked to the alleged payments. ♪ guy: welcome to "the pulse