ahead of the open, but the open, ftse 100 futures up 17 points. dax futures up a 46 points. it is the morning for stocks. with your stocks is caroline hyde. caroline: in full day of gains. actionot so much stock here to do so much news flooding the screen. openre up to see how we .1%. german data industrial production not looking pretty. down 1.2%. we see how germany opens. we are following asian -- we are following asia. maybe looking at evaluations. we did see the euro a little bit lower at the german production. continuing-- money to grow. brent up 1.2%.

up more than 9% in october. pushing up in terms of the price. we've got cup or on the upside -- we've got copper on the upside. thes get straight onto stocks. i would want to see how seb opens. 60%miller now getting a premium -- a 16% premium. up it goes 3%. we are still wondering if this deal can go through. whether a monopoly is being built. the number one shareholder of sab miller says engage. offersady has two rejected.

diageo selling some of its their assets. let's have a look at tesco. they won't rule out a rights issue. there pausing in their portfolio analysis. there an growth is u.k. sales down. in volume, transactions are rising. europe internationally, they are growing. arm holdings doing well off the back of samsung. the designer of ships and chips doing well. air france, i am looking at airlines, because if this goes higher, airlines go lower.

back to you. jonathan: caroline hyde, thank .ou you'd the ftse 100 all in asia, it was all eyes on governor kuroda. good morning sherry. shery: we are having that press conference. the japanese shares were fluctuating after central bank left monetary policy unchanged. they are refraining from adding more. .8%.ended up higher, asia have markets in been energy stocks advancing since oil stayed above $49 a barrel. players leading those gains. we have cost advancing for the third consecutive day. the hand saying, we still have 1 -- the hang seng we still have

one hour to go before trading. mainland china closed today. chinese stocks in hong kong trading at the highest level in more than six weeks. emerging markets making a comeback. malaysian stocks up. malaysia is one of asia's biggest energy exporters. we are seeing one stock in malaysia coming back and gaining, making a huge rebound. air asia up. will sound outer .nvestors samsung gaining 8.7%. the most since 2009. you know samsung takes the most part of the cost. .he cost will decline

santos gaining a 12% desk gaining at 12% today. back to you. jonathan: here's what is happening in today's show. first, a deal. abs offers for a b miller after a double rejection. as the specter of rejection doj -- the bojhe holds fire. norway -- ♪-- well sab miller shares trading higher on the news that there is a revised proposal to the london-based brewer. 68 billion pounds. wererevious proposals rejected. we're joined by matthew boyle, and here at bloomberg.

two headlines stand out. not just the offer, the proposal. the headliner says the deadline can be extended to the panel and sab agrees. matthew: the ball is in sab's court right now. it can be extended. was justitta, the ceo on the media call. he said here you go. here it is. we want to remember the chairman -- he hasler is faced faced some pretty battles. sab brought him in to be chairman. the ball is in his court. jonathan: here is the added spice. stock, altria the

group. they come out this group and say sab, get on with it. is that enough to get it over the line? matthew: they could've said we support the proposal. they say we encourage them to engage probably. i think they are sending a clear message. jonathan: the context around this company. on the other side, is there an argument for sab miller to stay sab miller without -- is that argument strong enough? matthew: we are not sure. sab miller is a company that could stand to benefit. we're talking about a combined company that would sell one out of every three beers that we drink worldwide. 30, not enough. 40, not enough. 4250, maybe we talked. -- 40 to 50, maybe we talk.

abi is a shark. in a shark needs targets. i see this one consummate. tom: they smell blood. matthew boyle of bloomberg. think you for joining us. coming up, as the specter of recession holds japan. what is corona's breaking point -- what is the -- what is corona's breaking point? ♪

some coke good morning. what a busy morning. 10 minutes into the session and let's get -- jonathan: good morning. what a busy morning. 10 minutes into the session. let's get the top stocks. sab miller up 2.6%. deal.ant a they want to buy sab miller. 42 pounds, 15 a share. the company call it 16 billion pounds. those two stocks in focus. tesco as well. the stocks down. the headline number is beat. there is a line from ceo dave lewis. he comes up that she comes out and cannot rule out a offer.

that will keep a lid on any depreciation on tesco stocks. down by 3.7%. over in japan, the boj kept its record stimulus unchanged. speculation that signs of a recession would present to act. ryan fowler is in tokyo. i want to try engage what is going to push the boj over the line. gauge whato try and is going to push the boj over the line. that and soto know does everyone in the world. we'll know for sure if we are in a technical recession, november 16. that is when we get the gdp data. to your point, there is a growing number of economists who believe the boj will move before that on october 30. we have updated our survey. survey that 41% of the

economists say we will see action on october 30. it will be in the form of purchases of d.o.b.'s. there is a compelling case for the boj to stay pat. he goes something like this. if the boj takes further action, protection of the congressman in the u.s. will go ballistic. japan is manipulating its currency and they will say that tpp should not be ratified. japan once a to keep -- a tpp deal to go through. there's a lot at stake. some of it economic and some medical. jonathan: it is fascinating. it seems october the 30th or nothing at all with economists. they want to put a bit of pressure on the government and fiscal policy.

is there any sense of that in tokyo right now? brian: the boj has done a lot. they have been carrying the lion's share of economics. we have not seen as much structural change. see more. wants to deal is a step in that direction. it benefits the auto industry and it helps that have contended with rising food prices. it puts pressure on the farming community. it forces statutory productivity gains. more competitiveness. that is consistent. jonathan: fascinating in japan. you are a good man. thank you very much. let's keep the conversation going and give it a european spend. spokesman kevin daly. in kevin daly.e

we are getting inflation in japan, we just need a microscope. japan to europe right now. kevin: that are some parallels. inflation in the euro areas is still around 1%. to the extent that euro area inflation is weak, it is. it is weak as a result of oil prices predominantly. core inflation is too low. it has been stable around 1%. jonathan: we'll get to the oil story. the federal reserve does nothing . depreciation of the dollar and a lot of people saying the boj is going to move. with the ecb and everybody talking about december. some revised forecast. the question is how does the ecb

react? kevin: our view is growth in the euro area is relatively resilient. there is a lot of support coming through that are still in the pipeline that will help growth. growth is resilient to all but the worse in asia. the impact of asia which is a negative drag on growth. also sends oil prices lower still. growth.utral for we expect that the ecb will extend the qe program beyond its expected closure of september 2016. thisthey announce it in month? we suspect not. draghi will allude to further action. it is possible. december is a possibility.

jonathan: is that a strong enough signal? kevin: it gives flex ability. that is the beauty of it. it is difficult for them at the moment. given that the existing program does not end until september of next year. for the more hawkish members of the committee -- growth in the euro area is growing well. why precommitment at this stage? shocks to the euro area. the commodity shock. what i see, a lot of bad news related to commodity shock. good of people tell me news is coming. i don't see the good news. i look at the industrial production numbers in germany. factory orders, was again it feeds that narrative. when do i see the good news?

kevin: in our analysis, the lags are long. boost frompect the lower oil prices. the boost from the lag effects of a weaker euro. even though the euro has been stronger recently. impact ofhat the better credit conditions in the periphery. effective fiscal consolidation -- the fact that fiscal consolidation -- there is a support in the pipeline. we expect that support to peak at the end of this year. it is for that reason we think the euro area will remain resilient toward the worst asian emerging markets. there is a shock that could derail the euro area but we have not seen it yet. jonathan: one of the hardest jobs you have is what is going to happen in 2016. at the calculations of cpi, i

wonder when the world is going to get caught wrongfooted. prices start to drop out of the calculation in a big way. when there is significant downward pressure on cpi at the moment, when does that start to drop out? kevin: the central banks are all over this. it is within their forecast. inflation is, core running around 1%. it is weak, that it is not that week. the impact of lower energy prices in the euro area but throughout the world, will begin to roll out for manual inflation comparisons around the turn of the year. we have that support coming through. we have also inflation headlines beginning to rise. -- will people be surprised? they should not be. it has been well known for the

last 12 months. jonathan: you suggest that it is a problem for the markets and not a central bank. the boj can remain dovish. the ecb can remain dovish. england, the rate expectation, where are we? kevin: it is incredible. ago --an month a half --s than a month a half ago things have changed quickly. jonathan: the rates of central banks that market caught. investors out there, maybe they are in the gilt market. when you look at what could happen with headline cpi numbers once we get that adjustment, that could be -- could it not?

kevin: the bank of england will punt. i don't think they will need to commit ahead of the november inflation. i suspect they won't. we have had weaker data out of the u.k.. it is not clear that the economy is accelerating from the stimulus we are getting from monetary policy. if you look in the performance of the economy, there's going to be some runaway inflation. far from that. the latest data suggest that things are moderating. -- mark carney said he was hugely misinterpreted. it was not meant to raise rates by the end of the year. when he thinks around the turn of the year, he may expect that she may push up expectations further. i think the risks are skewed for a later move.

jonathan: thank you for joining us. $50ext, the reality of royal. norway goes -- which may force the nation to raise its stock. details after the break. ♪

jonathan: good morning and welcome back. i am jonathan ferro, live of the city of london. the message yesterday from the slowdown in emerging markets. commodity prices taking its toll

here it international monetary ind -- 3.1% from 3.3% back july. imf painting a very mixed picture. >> we see pickup in the u.s. and the euro area. japan had a very strong q1. it is looking wobbly. economies,advanced there is also heterogeneity. if of the advanced economies are commodity exporters. australiaa, norway, are facing headwinds. jonathan: the commodity producers, feeling the pain. is budgetf norway, it day. the country could stop making its first been -- it's big withdrawals as soon as next year . the country sees 2015 oil investment falling.

ryan: and 40 minutes, the norwegian finance minister is going to attract his countries parliament. he is going to reveal his parties proposal for next year. we've got our hands on it. i can give you the headline. norway is going to raise the cookie jar if this government gets what it wants. it is suggesting that it tapped into its country's sovereign wealth fund. the world largest sovereign wealth fund. the copy yet is they are suggesting they not touch the , but the interest and dividend it generates fear. that is what they would go after. this is something that is never happened in the history of norway. that money is supposed to be for future generations. norway'srice changing plans for the future.

oil income is down. it used to be there was enough oil income they could take care of their budget and put money away for the future. not the case for next year. they are concerned about recession. gdp will come in at 1.8% next year. that is less and what they originally thought. unemployment will be higher at 4.5%. one qualifying thing to say is they have to get the blessing of two other parties to go ahead with this plan. a lot of analysts think they might get it. back to you. thankan: ryan chilcote, you very much. dario, great to have you with us. the crude reality of $50 oil. and the kansas. people always tell me that the

good news will come. the good news has not come. the bad news front loaded. when do i get the good news what we are seeing today in the norway has already happened in the middle east. it is not new news. it is creating significant deficit in economies. this is good news for the consumer side. we are in a tug-of-war between emerging markets weakness as measured by early indicated by manufacturing numbers and credit led consumer demand. lacks and accommodative policy across the globe. that takes time to filter through. we remain confident on risk assets. jonathan: i was looking at your notes. i keep seeing a lot of forecasters getting cut cut cut.

why would be minimal? dario: we have to look at valuation's. we have a lot of clients calling us and saying when is a good time. they are getting antsy about buying. we have seen a nice rebound at the moment. if that rebound has legs, we'll have to see. jonathan: i come into 2015 and the trade cap -- the trade that everybody kept recommending. i wonder how many legs are left. domino ofhave seen a a number of our growth stories. it started with energy and oil. it led to the broader commodity construct. emerging markets. we have seen it on the imf side. there has been a fallout there. on the opposite side, there is an opportunity for cymer

discretionary to benefit -- for consumer discretionary to benefit. it is filtering into higher salaries and that will create a positive momentum. we are getting into q4. jonathan: the jobs number on friday. another reasoning europe bullish. the ftse 100 has shown together six days of gains. wonder whether that changes when the federal reserve has to can mitigate that the world is a lovely place and they are not go to move for a while. dario: it depends on the communication. the fed has had mixed signals. the market does not believe them. frankly nor do we. in march.a hike there is a general consensus that a hike will be a lot slower

than we have seen. jonathan: you are a man who travels the world. a lot of times the countries where you invest. the sense i get from you is that you are optimistic. are you optimistic that the fed stays low for longer. what keeps dario up at night? dario: a lot of things. often, underestimated by investors i talked to. one of them is liquidity. at the end of the day, this tug-of-war between emerging markets weakness and domestic demand. what really fills the two and allows for slower growth is the liquidity injection. that is provided by central banks. market makers have been very much hampered by new regulation.

volatility air holes. these are profoundly underestimated. you see a little bit of that in august. that is what worries me. something you and i could talk about liquidity for a long time. we run out of time. thank you very much for joining us this morning. 30 minutes into the days show. here's what to come here it terra firma chairman says the eu could disintegrate in the next 15 years. more of guy hands this morning. present a must recovery plan today. ♪ just over 30 minutes into today's trading session. let's get you updated on where stocks are trading. a six-day of gains on the ftse 100. the longest winning streak since march. the two 100 up .2%.

-- the ftse 100 up .2%. you top stock stories with caroline hyde. caroline: focusing in on oil. we are up 9% over the course of october. brent also rallying. it is sending a lot of oil stocks higher. oil majors doing well. drill one of the more volatile -- is up 7%. oil companies continuing to drive higher. -- and ryanairt on the lower side. landing on the back that oil prices rising. that makes their business slightly less profitable. we are seeing the airline sector being affected by the oil rally.

how can you miss out tesco. down 2%. underlying business in the united kingdom looking better, improving. are seeing volumes rise. we are seeing transaction numbers rise. it is just the pressing pressure that remains in the u k next light internationally, we're seeing sales growth. not ruling out a rights issue. -- the u.k. stores -- they expect more closures. you are going to be talking tesco. jonathan: caroline hyde, thank you very much. want tesco, walkman brian roberts. bryan, great to have you with us. i feel like we are resetting expectations.

tesco this morning beating expectations. the fundamentals, the challenges they face remain. bryan: the stocks rise on the back of tesco. the stocks drifted slightly this morning. some of the promise generated by last week. the challenge still remains. a lot of the media over focuses on the legal audi thread. [indiscernible] jonathan: they are cannibalizing themselves. i want to deal with the headline this morning worst. one headline, never say never on the rights issue. at the same time, they plan to , miin -- as a investor happy there retaining -- should

they beginning -- should they be getting rid of them humvee. bryan: where talking to billion. about 2e talking billion. six month ago, everyone was talking about them humvee. the most recent value [indiscernible] which wasn't really enough. profitable in its own right. it's got variety. the rights issue is being put off -- putting on the back burner thinks to south korea. they said they are reshaping their portfolios. time, if theyrs are without done humvee, i will be amazed. d.c. tesco exclusively

in the u.k.? bryan: they put on china and south korea. that looks -- that leaves malaysia looking isolated. they are going tough for the foreseeable future. they have been looking around for those operations as well. it is not a part of central eastern europe. it is closing stores. time, the twoears asian markets probably. if the price is right, i am sure they would not need much convincing. jonathan: i want to deal with the assets in the u.k. i don't want to mention audi. what do i want to talk about is the cannibalization of sales. i look at this huge real estate

portfolio at tesco and i wonder how they are managing it. you don't get much news when they update the statements. what is happening? right: --erg: -- bryan: when it came to strictly going into the media, the competitors filing out ahead of time what they are planning. speaking with an tesco, he is running a tight ship in terms of strategy. that is the big question. how are they going to reinvent these big stores? you speak to tesco store managers, some of them are upset about their lunchtime trade has been decimated. jonathan: we're going to go inside the stock. it was a limited range. they dide wrong thing

was expand the range. we know why they did that. take me inside the store? are they dealing with the amount of product they have michelle's? are they cutting back? there's been a hold brand disappearing over the course of the summer. some of the departments are getting a lot easier to shop on the back of that simplicity, prices are getting a bit sharp as well. summer services. -- stronger services. what will inspire shoppers to drive 20 minutes and walked 20 minutes around the store. how are they going to reinvigorate their value proposition? there are some big unknowns about how they are going to drive toward in the u.k.. the ship is a hit -- the ship is headed in the right direction.

still limited visibility. brian roberts, thank you very much for joining us. after the break, a stark warning over the threat posed by a divided euro. that conversation with guy johnson coming up. ♪

jonathan: good morning and welcome back to bloomberg tv. the headlines are in the market.

the ftse 100 up for six straight days. the dax pushing back 10,000 points. a weaker euro this morning. soft data out of germany once again. the ecb might have to move at the end of the year. such of the board -- switch up the board because that is where the stories are. proposal, a 42 pound, 15 a share up from the table. up by the percent. tesco stock down by .6%. beating expectations. we have a ceo they can't rule out a rights issue, limiting visibility for investors. europe messy. a keynote speech by david cameron lived today will be

watched closely. when will britain hold its eu referendum? -- told guy johnson that david cameron holds difficulty. it probably doesn't exist today. cameron is not good to find it britain to stay in. i don't think he is to find it easy. it is going to be a hard slope for him. in my believe, the european union is not in peace. i not sure in 15 years time the european union as we know it will exist. i am pretty sure if it doesn't laws --- internal

internal wars or wars between countries, i don't know. we will have wars. that scares me. jonathan: guy johnson joins us. i was in the audience watching that. the audience was taken aback about how bleak the outlook was. let's be clear. this isn't a doom gloom kind of guy. this is serious have equity -- line iowa's he is try to figure out what is happening in the world. cameron in what is happening. he sees what is happening on the continent and he thinks the argument comes harder. why i think he thinks it will go , is that the derivative consequence of the it is hardthe union,

to achieve. i think that is the argument that a lot of people are making. on the issue of what happens in europe, he is looking at the political spectrum and saying the consensus that existed for 20 years is breaking down. .ou got corban on one hand the language of the fringes has become accepted political discourse. the foundations on which the eu was built has become more untenable. he wonders where that goes. the eu has been successful at stopping wars. it was designed to stop wars. can't continue to do that. jonathan: we can turn the page and guess that -- he jumped to chapter 50 and went to war. about what is happening with the migration story. you think about ukraine. you think about the invasion that took place in crimea.

think about what is happening in syria. the period we have had is the anomaly and not the norm. maybe he is not talking about the mass conflict that we were talking about in the past. maybe he is talking about intra-nation warfare. jonathan: my takeaway is as an fed, ir, upset with the am thinking about geopolitics. guy: i don't think you can expect them to. howve got to think about yellen is thinking about the world. she has gone multipolar. the relationships in asia. i don't think it is a great stretch to think about the fed thinking about this stuff. johnson, guy fascinating interview. you find the whole thing online at bloomberg.com. -- of vodkanking

and banking -- i don't know how you pivot from this. a fight on his hands. creditors are threatening to torpedo his plans. interview in two years, he spoke with ryan chilcote. he joins us now. what are the problems? ryan: he has a very large bank. russian standard bank. it is big in its own right. he is the second-biggest maker of vodka worldwide. he is the second biggest issuer of credit cards in russia. the consumer in russia is in trouble, there is a lot of inflation. the ruble is weak. purchasing power is down in russia. russia is having trouble paying back its loan. there is not much demand for new loans. he is engaged in

what might be one of the biggest restructurings of the bonds we have seen from any russian corporate since the onset of this recession that russia is in now. it is basically asking on holders to restructure about $550 million of his bonds which are trading down $.30 on the dollar. he has proposed giving his creditors $.10 on the dollar and a complex system where they would get bonds and payment in kind and forms of other payment. they are saying he is lowballing him -- he is lowballing them. they say both of those were affected. they want him to put in some cold cash. i spoke with him yesterday. it is the first time he is spoken about this. he said i don't have any more cash to put in there. the complexity of this is the

bank is getting recapitalized by the russian central bank. he says anything he does with creditors in london or moscow has to be approved by the central bank. he is sticking by his guns. friday it comes to a head when the bondholders are good to vote on his proposal. one group says they got enough votes to torpedo him. jonathan: thank you for breaking that down. we are 50 minutes into the session. coming up, it is a busy day ahead. we will break down the data to watch out for. stocks in europe are biking green on the screen. -- our blanking green on the screen. ♪

jonathan: that. volkswagen in focus today. vw'secall of 2.8 million will start in january. the ceo wants the staff to prepare for payment. we have hans nichols in germany. it sounds to me like job losses. should i read between lines? hans: maybe not. this does not mean job losses did they would like to see executive bonuses to be trimmed. have two sides to vw's story. one we had to come in yesterday nomura investments. tightening going on.

-- no more investments. tightening going on. he said january 2016 is when they're going to start the recall for the german vehicles. he is hinting is going to be an easy software fix. that seems to be the most speculation from the german press. on the other side, we have australia, they've announced they have 77,000 affected vehicles. when you look at where they cand trim investments, you -- you havees and personal costs which are much higher than competitors. jonathan? jonathan: german industrial production this morning, is it too early to build a case that china is starting to infect that

data? hans: you can start preparing the case. i don't know if we can close the case and finish the argument. we've gotten three straight days of negative data, obviously not a positive sign. of these are a great predictor. -- none of these are a great predictor. jonathan: hans nichols, thinking very much. here is your day ahead. we get norway's release of its budget. there will get industrial production out of the u.k. will get u.s. mortgage applications. mortgagel get u.s. applications. i am joined by manus cranny. what is focus -- what is in focus for you guys? manus: will it be the historic moment when the norwegian government -- their fiscal needs are such will it be outweighed

by the price drop in oil? i went up there a couple of months ago. we are going to wait and see what that means. it could be one of those prophetic moments. jonathan: another issue on the table -- formally on the table. , 15.unds that would mean 60 in dollars and a bond issue. billion in a bond issue. what is driving is the value of the dollar having to potentially do this deal. cranny, and the equity space, 56 minutes into the session. as the 100 advancing the quarters of 1% -- the ftse 100

advancing, three quarters of 1%. best of luck with the rest of your day. ♪

ab&d revises its offer for sab miller. tesco turnaround. retailer reported a 69% plunge in first-half earnings but beat analyst estimates. japan teeters on the brink of recession. the bank of japan keeps monetary policy unchanged. a warm