conversation with the former deutsche bank ceo in just over an hour. you do not want to miss that. 15 seconds from the open. ftse 100, futures up 11 points. dax also up. what are we going to get? let's get it with caroline hyde. caroline: a pause in risk appetite after adding $2 trillion to world equities. -- weci equity index cling onto the green, despite the pretty dire german factory orders. they were down 1.8%. we were expecting growth. last month, july, was revised even lower. is lacklustermand at the moment. goodness knows how much more pain the brian volkswagen will wreak. we have mario draghi taking to

the stage to speak in frankfurt. we have eu finance ministers gathering and luxembourg. let's have a look at how we are looking on the euro. basically flat -- the fx market is pretty quiet at one dollar 11193. more people are betting that we will not see a rate rise. a 10% probability for this month, whether we see a fed hike this month. december is still below 50%, so clearly, more money in risk. continuing to look relatively resolute, $49 at the moment. let's have a look at stocks. sab miller will be an interesting one to watch. down 2%. is this a ploy? is this a defense ploy, trying to show off how strong it is? in africa, latin america, in the

longer term? is it being defensive versus the 8ab index? the offer could be in excess of $100 billion. it was due to come to us one day after the u.k. take of the panel put up or shut up deadline. there were reports in "the new millerst" that sab does not want it and will fight it. a norwegian air shuttle is up 3/10 of a percent on the back of strong traffic through september. jonathan: caroline hyde, thank you very much. after four days of gains in the ftse 100, we open in the red. it is early days, but not in asia. let's get your asian market wrap shery ahn in hong kong. asian stocks are now headed for their biggest

five-day gain since 2011. we have two stories today in asia, first speculation that the fed will keep rates low for a longer period of time. second, the impact of that historic trade deal. we are seeing fishing, agriculture stocks rising. the nikkei and are up 1% higher. asx rose 3/10 of a percent. this is all despite a stronger won. hong kong still has an hour to go but it reversed earlier gains it is down 3/10 of a percent. china is still closed for the golden week holidays. we are seeing emerging-market stocks have more demand. the jakarta composite is rising 2.5%, headed for the biggest gain in over a month. is also seeing a gain of more than 1.5%. the korean won is also

strengthening for the second consecutive session, .5%. the australian dollar is also rising 4/10 of 1% after the central bank left a key rate unchanged at a record low. back to you. jonathan: shery ahn, thank you very much. that is your market wrap. here is what's happening today. an historic trade agreement is signed. we take you through the big winners and losers of the tpp trade deal. advice.ll gross's and the german slowdown -- the big weight on the german economy as factory orders unexpectedly plunge. our first story this morning -- the rba does nothing. the weaker aussie dollar absorbs some of this shock from the commodity crunch. they decided to leave rates unchanged at a record low 2%. sydney.omy reporter in

and it seems the obstacles to getting another rate cut is getting bigger, not smaller. the question is why? michael: yeah. a central bank that was content today, almost a facsimile of the month earlier. that theyno signal were going to doing anything. the general thinking is that the central bank would only be pushed by an offshore shock to cut further. the main reason is that the australian dollar in the third quarter dropped 9%. it dropped 20% in the past two years. the central bank was more concerned about commodity prices falling, and the dollar remaining resilient. now the dollar has dropped off, trading a bit above 70%.

they are a lot calmer about its equilibrium with commodity prices. they seem a bit calmer. there hasn't been too much of an increase in the unemployment rate, it has been reasonably stable, and that is where the big political push is. they noted again that it had been fairly stable. they are sitting back and watching the stage. there were few signs of any -- ther and pending stimulus. the aussie dollar rose after the ittement, and based on that, aided the currency. jonathan: we are still seeing that fx move, the aussie dollar up. here in europe we are always looking for evidence of the china's slowdown. you can see it in the german factory orders may be. where do you think -- is australia in their trade balance? michael: yeah.

we had a trade report out today for august. widening of the deficit, quite a lot wider than economists were forecasting. it was interesting because volumes of resources are increasing as australia brings more mines into production, but commodity prices have come down a lot, and those are running to stand still in terms of trade performance. perhaps more interestingly, exports and pick up much, even though we had quite a decline in the tourism industry. in terms of china, the price is more than the volumes. that affects the australian national income and it reflects impact of the government, budget revenues, wage bonuses. so yeah, we are directly impacted by china, almost an economic satellite.

jonathan: maybe that's not a bad way of describing it. thank you very much for joining us. speaking of trade, the u.s. brokered the biggest trade agreement in history with a dozen pacific rim nations. it composes about 40% of the global economy. face local parliamentary approval, but if past it would have huge ramifications for the region. brian fowler joins us now from tokyo. deals looking at these and thinking about winners and losers -- who are the big winners and losers after this deal gets signed? brian: well, i think japan is clearly a winner. it starts with auto and auto parts. their exports account for 35% to the u.s. they will come out ahead. also, i think you have to look at japanese consumers -- japan imports about 60% of its food. remember, these households have been hit in recent years by the

effects of the weekend, which has rate -- of the week yen, which has raised the cost of living. people will be paying less -- these tariff cuts will mitigate the impact of the week yen -- the weak yen. jonathan: what does this mean for the prime minister when he is slipping in the polls? is this an easy sell for him? brian: it is going to be interesting to watch. he came out today and emphasized three things -- he said first of all, i was able to protect the five sectors that are most visi sensitive. he also said that japan reserves the right to step back on the ifl, but to push it back imports rose to suddenly. he didn't say how sudden is to sudden. -- is too sudden. many think the government will put together a package by those

adversely affected. he kind of hit all the points needed to sell it to the public. in vague terms, but he was emphasizing that this is a benefit and an opportunity. he didn't spend too much time talking about those who might be hurt by it, such as dairy farmers in ho chkaido. jonathan: when you look at this, it has politics all around. it needs parliamentary approval. what are the chances that will get ratified? brian: well, there will be some opposition. i don't think in parliament. we had the ja rep come out and slammed the deal after it was done. again, i think he is worried about dairy farmers, and there are a lot of them. there will also be a demo outside abe's office at about 6:00 p.m. that will be likely little more than a photo op. abe's coalition is backing him 100% very solidly.

i think you will find it pretty easy to sell this deal to the public, just in terms of offsetting the recent cost rises for living. brian fowler, thank you very much. let's continue the conversation with bill blaine. there are clearly positive to this deal, but i do time when global trading is beginning to slow, how much does it move the dial? bill: this is a fascinating and important moment for the global economy. is it going to change things tomorrow and create growth? no. but long-term, this is the biggest growth driver since nafta. long-term, it will have enormous effects, can that us something they will see straight away. it is very positive for japanese corporate's. -- for japanese corporates. it will be another reason for

buying japan. not only do we have this agreement, but we also have all the other factors, such as with germany. so yes, long-term, very important. medium term, people should be factoring this into next year's, next two years. in the short-term, the fascination would be a political agreement. in a world that is sinking into protectionism, this one finally crossed the line last night, and that is worth applauding. jonathan: there are two stories -- what it australia. but in therm one, short-term, australia is an e.m., given how much commodity it produces. when you look at the amount of division at their right now, some are saying a bear market.

templeton calls it once in a decade buying opportunity. i can't get over the division -- is the truth in between? the truthe is always in between. it is so, so easy in times of uncertainty for people to come out and make big calls, saying this is the end. yes, there are challenges, but is at the end of the world? no, it certainly isn't. we are seeing the smart money already starting to pick off the better sectors, the better names, the better credits in . e.m. are we going to see more challenges? yes, we are. but it is never the end of the world, no matter how much bank analysts try and

convince us. jonathan: well, maybe it is. because the messages go to cash. bill gross warns that stocks can follow another 10%. he says investors need cold water splashed in their face. details after this short break. ♪

jonathan: the picture of global markets is divided. -- aeton sees a decade

once in a decade opportunity. fortress says that emerging markets are at the beginning of a bear market to rival the asian financial crisis of 1997. bill gross says u.s. stocks have another 10% fall. his advice is simple -- go to cash. >> there is no doubt that there is volatility, which indicates that there is risk in the financial markets. but in the real economy, my way of thinking, investors should continue to have a risk of posture. it can mean voucher amounts of cash, it can mean higher quality investments. perhaps even more duration than you normally would. ultimately, monetary policy with 0% interest rates is destructive to the real economy. capitalism can survive at 0% -- it wasn't meant to. jonathan: amidst the

bearishness, upland interest rate hike should be willing to 2016. let's welcome back bill. it is quite easy for me to sit here and paint a bearish picture of global markets. your challenge for the next 60 seconds is to paint the bullish picture. bill: markets are getting something of a crutch from what we have seen the last couple days, with stock markets recovering. but not really because we are seeing this bad thing reach back. we are seeing the beginnings of global recovery, and that is things like being able to do ttp. yes, the numbers still aren't great, but that is no reason to lose your head and panic. moving into cash when there are opportunities out there would be a big, big mistake. it is choosing them carefully, and that is only have to look at in the micro.

glencore, vw, absolute shockers. vw, you couldn't have predicted. glencore, though, that was a sector you shouldn't be involved in. it is a matter of picking your place to go. the world is going to normalize. that does mean higher rates. it means the recovery of capitalism. you have to be in a position to take advantage. jonathan: glencore stock was down by seven points and percent. how is this showing up? has it shown up in your world in a big way ? bill: yes, and vw is the big shocker in many ways. the new things that will grab you suddenly. but it is raising and heightening concerns. last week, talking to investors exiting a number of german positions because they saw all german credit coming under pressure. that is where i get my idea but where would you go?

you cannot just go into cash. where do you go if you exit in germany? what other economy is producing high-tech goods successfully, where there are outside from tpp? japan. the normalization of monetary policy -- you mentioned that -- at a time when goldman sachs is talking about the fed going into 2016, if the fed wants to do that, how do they communicate that without really spooking investors? bill: good question. there is a little bit of a credibility gap developing if we continue to see the push back in the timing. are going to hike rates unless something in the economics says we don't. there isn't anything particularly that has happened to say that we shouldn't. we do need to see normalization. numbers last week

looks bad but they do continue a trend. and the next couple months, we will be having this conversation in a way where we will see either a hike in december, which looks less likely, or a hike early next year. andit is going to happen, normalization spills the rebirth of capitalism. how is that for being happy? jonathan: thank you very much for joining us. sab miller unexpectedly brings forward a second-quarter trading statement amidst speculation of h&m. -- speculation of m&a. ♪

jonathan: good morning and welcome back. i am wise from the city of london. --ime to talk about deals time to talk about deals, or maybe not. sab miller says it published information earlier than expected due to tal takeover talks with arrival. sab miller down by almost 2%. caroline: are they doing this as a ploy to try and fend off the deal? we have "the new york post" reporting that we could see them try to fight, but let's get into but the stock prices are doing -- it is falling today, that as we get supplies trading,. coming

out early it was meant to be published later in october, when the u.k. takeover panel was due. but we are seeing from the trading update concerns about the foreign currency market. we are starting to see the the dollar strength versus a lot of the latin america, the african sales that sab miller has such strength, really weighing in on where the revenue is. on a quarter basis, revenue fell some 9% for sab miller in the first half of the year. strip away the fx, and underlying it, it is pretty strong. overall, second quarter organic producer is up 6%. the first half up 4%. total beverage volume picking up the pace, growing that much faster in the second quarter.

the areas of strength -- latin andica up 7%, africa up 6%, producer revenue in double figures. as i say, the fx weakness did hurt the reported revenue, but underlying this, there is strength. the chief executive is saying that the strong growth in africa and latin america is showing our deep local expertise is working. they are saying we have exceptional long-term prospects. is that a fighting talk, or is that a come get me talk? jonathan: we have a trading we have been waiting a few weeks with the details. where is it? caroline: $100 billion is what analysts are expecting. "the new york post" says that ab doesn't want to go hostile, and chairman is willing to fight off approaches. fascinating.

jonathan: thank you very much. coming up, a promise to parliament. the greek prime minister lays out his top priorities. ♪

jonathan: 30 minutes past the hour. you're a bloomberg's top stories. broker --ees from a they are accused of -- heipating in a scandal is currently appealing the at a 14 year prison sentence. the reserve bank of australia .eft interest rates unchanged the aussie dollar recorded the biggest drop among major currencies last quarter, cushioning lower commodity prices and a week outlook in china. the value of bp settlements with u.s. government have written

$20.8 billion. that is the biggest tally from the u.s. department of justice over the 2010 horizon spill. welcome back. i am jonathan ferro right here in the city of london. here are the markets. read on the screen. ftse 100, gain. down .3%. the base loses today, glencore down 5%. the dax off by .3%. a stronger euro and a much stronger aussie dollar. a very neutral policy statement this morning. let's get you top stock stories with caroline hyde. caroline: the kickoff on the west -- on the worst quarter.

btg down. 14%. an update that the sales are disappointing. it is dragging the stocks lower. glencore the second worst performer down 5%. a bit of a turning point. the shares falling for the first time in three days. 21% surge yesterday. perhaps a little bit of money coming off the table. certainly, hong kong continued to rise higher. four days of rises. ouygues up this

morning. they are uplifting their margin growth. sales bygrowing in 10% 2017. this asset they refused to sell for $11 billion as they continue on their trajectory it back to you. -- trajectory. back to you. jonathan: yesterday we saw a drop in the pmi numbers. let's go to berlin. hans, talk to me about the numbers. you have people who say this is a noisy day. another group who say this fuels a narrative that we have a slowdown in china. which one is it? hans: both can be right. ordersthe german factory and the pmi numbers that we had

yesterday which were september numbers, and you start to see a trend. with the factory orders, this is the second month in the road that we had negative readings. in the case of july numbers, they had to go back and revise them downward. both numbers are negative. when you look at a lot of the headwinds racing the german july and theof the yourtainty in greece, now have the volkswagen scandal. it is going to be interesting to see how volkswagen it's factored into these numbers. for the last half of the summer and the first part of the first -- first part of the third quarter, it does look like there has been a whole lot of economic activity. numbers.ad strong ego as always, let's win for more numbers. jonathan? jonathan: are you telling me i have to look out for german factory orders?

i don't want to do that. you don't want to do that. so more bad news for vw. west virginia may be the first u.s. state to sue vw. bring us up-to-date. hans: it looks like west virginia will be the first to file suit. they have 2368 registered vehicles in the state. a small number. over half a million in the state. over 229 class-action lawsuits in the state. you mentioned earlier, the number for petroleum was 20 billion. a lot of comparisons have been made between petroleum and the volkswagen scandal. there changed their name. you had liability, but you also had debt. you do not have actual trying to

tinker with thanks, the way we had with the software scandal with volkswagen. someone going out of their way. that is the crucial difference between bp and volkswagen. jonathan? jonathan: hans nichols not talking about greece. maybe because it is not on the radar anymore. european financial ministers have told greece not to be relaxed. alexis tsipras told parliament he plans to ask for a loan extension and lower fixed interest rates. >> restoring financial stability , recovery of the economy and the return to growth, debt relief and radical reform of public administration while fighting corruption in bureaucracy are our direct government objectives. their implementation is the only safe way out for the country from the guardianship and

bailout agreements. jonathan: let's cross over to athens and speak to marcus. is this a changed tsipras that we saw last night? times: this is the second that tsipras has delivered the leaders make up for election. he was talking about how the greek people gave him a mandate to rip up the bailout. this time around, he is talking about the mandate the greek people gave him to implement the bailout. the contrast could not be clearer. his priorities he lays out were getting past the first bailout review, restoring financial stability, fixing those ranks. returning to growth. he set a goal of returning to debt markets in the first half of 2017. he talked about debt relief, achieving that through implementation of bailout.

through that means, getting loan extensions and reduced interest rates. this is a message you can hear from any mainstream centrist politician. contrast that we were seeing in the start of the year. it isan: that his wife falling -- that is why it is completely fallen off the markets radar. when you look at the european reaction, i guess they are responding to the new tsipras with a big smile. marcus: indeed. have beenhe signals positive. we had around of and limitation with august with measures pass. no one thought that they would fill that deal in august, but they did. there is a new attitude and that is reflected which is a huge contrast to the start of the

year. we had euro finance ministers meeting yesterday. a bit of a reminder from a lot saying weiticians, any of going to relax those conditions. inre is quite a full agenda terms of a lot of measures that need to get done. jonathan: finally getting to enjoy a bit of the summer they relate in 2015. thank you very much. still to come, we speak about japanese equities. -- stay tuned. we are back in two. ♪

jonathan: 42 minutes past the hour here on bloomberg. inman factory orders plunged august, signaling europe's biggest economy is audible to weaker chinese economy -- is vulnerable to a weaker chinese economy. the value of the bp settlement with u.s. government was written for $20.8 billion. that is from the u.s. apartment of justice. -- the u.s. department of justice. it is the biggest settlement in

the u.s. department of justice's to read. recorded thellar biggest drop which cushion the impact of the lower commodity prices. transpacific partnership. this is what world leaders have been saying about it. >> we are pleased to announce we have successfully included the transpacific partnership. don of a new age, led by japan and america. tppdpp agreement -- the agreement has come -- >> a wonderful opportunity in both jobs and growth. >> does this enhanced america's a competitive edge? we believe that it does.

>> tpp has to be a stepping stone for an aipac wide agreement. jonathan: those are the official views on tpp. how will they affect japanese stocks? we are joined by tadahiro fujimura.- he is a part of the bloomberg markets most influential summit. tadahiro great to have you with us. let's start with the tpp agreement. how much does that move the dial -- the dial? call -- tadahiro: unfortunately the agreement

doesn't affect the short-term. but long-term, it is important. the bp agreement -- tpp agreement is a catalyst to improve. pharmaceutical, this kind of industry. your funds have performed very well. the big game -- the big gains of 2013 is in the -- the big gains of 2013 are in the rearview mirror. what is your advice to foreign investors? i think we -- japanese cost -- japanese companies now improving. -- let's look at a good company. ishink japanese economy

escaping from desperation. profitability is improving. more stocks have more opportunity. jonathan: let's talk about the bank of japan. a lot of people expect them to lead, maybe on october 30. on low inflation. now it seems to be out of their control. 20% of japanese exports going to china. can they respond to that kind of pressure on the japanese economy jack go -- japanese economy? on gpio: japan focusing instead of economies. as long as it remains positive, i don't think mr. cordoba -- -- the cpida

movement is healthy. i don't think it needs to change. jonathan: if they are not going to increase monetary easing at a time when a lot of people think they are, on the way up for the , if they don't ease anymore, and we stabilize around it. do you anticipate there might be a correction? i don't think so. investors start buying japanese equities, so looking at the supply/demand in the stock market. only foreign investors are selling. , mostse individuals domestic investors have been buying japanese products.

account,f that nisa [indiscernible] iselieve supply and demand improving. only foreign investors -- i think after the correction, japanese stock markets are coming back to a healthy bullish trend. that is my expectation. fujiwara --dahiro fujiwara. think you for joining us this morning. still to come, we hear what african boehner mode you were slowdown inbout a china. join us after the break. ♪

jonathan: good morning and welcome back to bloomberg tv. 51 minutes into the session. the ftse 100 is in the red. coming off the back of the biggest jump since august. down by 38 points this morning. the stoxx 600 down 1%. the dax also lower by 76 points. swiss of the board. a stronger euro. dollarronger aussie

after the rba keeps rates unchanged did -- unchanged. a very neutral monetary policy. that is the market. here is your day ahead. this afternoon, we get a 3:00 p.m. imf world economic outlook. we hear from a couple fed officials today. williams gives the outlook speech. busy day for bloomberg. mostloomberg markets influential summit is underway. manus cranny spoke to african billionaire and one of the names bloomberg's 50 most influential list. his name, mo ibrahim. mohamed: the slowdown in china needs to be taken in context. mo: the slowdown in china

needs to be taken in context. maybe if they were doing 10% or less than that, -- actually 10% of the economy 10 years ago is probably less, because the growth of the economy. you're taking a lower percentage and a much bigger economy. things are as bad shows us.dline jonathan: manus cranny, the men sitting opposite mo ibrahim. now sits opposite me. what was your take away? manus: fascinating character. he made his money during telecoms company. it is governance index that he launches. it is data. that is what we love and bloomberg.

-- that is what we love in bloomberg. tree, you gotthe bus one appeared -- you got bus .ne of the chinese have delivered a lot of infrastructure. be thankful to the chinese in the african continent. jonathan: it is crunch time. we have this huge wealth transfer. away from commodity producers to commodity print -- commodity consumers. you shut a mine, who does it hurt? it hurts africa. did he talk about that? manco he talked about the commodity -- manus: he talked about the commodity risk. every time we talk about africa, we automatically correlate over to commodities. tre is a risk there.

you heard him talking about china. it all comes down to what your view is on china. i think the point that mo was trying to make, whether you make a hard landing at 3%, or a more moderate abatement, it is going to impact what is going on in africa. we are going to tie this together on the pulse. of eaglee new ceo bank. at a whole days hard work for you. we are going to work jon ferro today. got the editor in chief and the former ceo of deutsche bank. we got our editor. you are going to pick up the bat on half of that. jonathan: i get the pleasure of introducing that. guest,e've got another

vittorio greely desperate toyo grilli.- vittorio is immigration. the economics of that. i want to know what he thinks about the conservation story in italy. what might happen on the italian banks. they conversations to be had. a bit more from mo. emmy that sheody got ade ayeyemi. john mikel weight speaking with former ceo. that is it for me. equity markets moved to the downside. you want to talk about marcus, i am on twitter. best of luck for the rest of your day. ♪

manus: factory failure. german orders unexpectedly fall as a sign that europe's largest economy isn't vulnerable to slowdowns in china. u.s. stocks have another 10% fall. the s&p enjoys its longest rally of 2015. london libor trial. six men before a court, accused of manipulating rates behind trillions of dollars of deals. ♪