session in the next hour. you guys were down as much as 3%. you have cut those losses in half. mark: we are headed for a lower close following the first today gain. the european close starts right now. betty: we are going to take you from new york to london in the next hour. talk to us about the trade today. down by 1.2 percent. we were 3.3% lower and we are still headed for the lowest close in a year. 18% below the april that means au know

bear market -- so we are flirting with the bear market as did china today. today --orporate story it happened in france, it lt, thed with renau french carmaker. aslier, they fell as much 23%. that's the most since 1999. offices were raided by government investigators as to part of the probe into vehicle admissions. took the auto parts index with it. almost half of those losses but the fear is we have another vw scandal on our hands. betty: as if we weren't uncertain enough. now here is another troubling development in the auto industry.

of your broader to one favorite topics, the bank of england. when are they going to hike interest rates? no one was expecting them to do it today. mark: how to make the bank of england meeting sexy. that is my aim. today, he is citing outside risks to domestic costs and he says the recent depreciation in inflationmight push above target. prospect of a lower drag on inflation, but the takeaway was this -- the confer,m outlook as we we have to say it is looking unlikely. if you look at what investors have to say, this is my battle of the charts today -- it is

unlikely we are going to get a rate hike in 2016. betty: you just gave our producers a panic attack. they don't want you to give it away yet. we are 90 minutes into the trading session in the united states. julie hyman has the latest on this recovery. i know we are coming off a little bit. julie: it was ready dramatic, what we saw there. still 1% up to the dow and s&p. take a look at the intraday chart from the s&p 500. a little bit of a roller coaster we have been on thus far. take a look at the dramatic climb we had not very long ago. we saw stocks suddenly take a leg off, but it is still dramatic, that climb that we saw. betty: do we know what happened

here? julie: oil is one good explanation. the u.s. fallin yesterday even as oil was looks like today, it they are back in step again. youes rebounding and if take a look at my terminal, you see the two on top of one another. you have the s&p in white and are moving noty exactly in tandem but pretty close to it. energy is doing the best. health care is number two and that is a snap back. health care shares have been very weak as of late. not a lot of new news on the larger cap stocks.

but the large caps are in a bear market. betty: thank you very much. let's check in on the bloomberg first word news with courtney donohoe at the news desk. courtney: we start in asia where islamic state has claimed responsibility for a terrorist attack in indonesia that began at a starbucks. a suicide bomber lose himself up inside the coffee shop and then another attacker opened fire. when it was over, two people were dead along with five of the attackers. it is called the worst terror attack in jakarta since 2009. submitted key demands to its nuclear deal to the west. the government-run television onlythe core to its reactor has been removed. international inspectors will verify that. the nuclear deal requires iran to end its ability to make nuclear weapons at want sanctions lifted. oscars are for the

out and "the revenant" leads the way, with a nomination for leonardo dicaprio. forthe acting categories the films best actor categories are filled with white actors. i'm courtney donohoe. let's get back to london and the minutes of the bank of england posco first meeting did little to suggest the governor is in any rush to raise interest rates. inflation holding him back? of the facts is holding him back and weighing the view of economist is whether , the chairman of imagery grouphe

told francine look law that a damageed brexit would the financial services industry in london. >> this has brought a significant amount of uncertainty. we don't know what the timing is . we don't know what the effect of negotiations is going to bring. we don't know what the outcome is going to be. is two years with uncertainty as to how you extract yourself from a situation. in particular, financial services is such a dominant sector, it provides a lot of uncertainty. the truth of the matter is the rest of the world wants britain to remain in the eu.

: we had a report arguing that the city and financial services in the u.k. would thrive outside the eu. is there a case for that? the city ofnk london will thrive and financial services in london will thrive cousin is such a large segment. the question is will it be much better or much worse? our opinion is it would be significantly worse. francine: why? guest: we run the risk because we have this free trade area we are getting this benefit from. my own company which i'm not really talking about today, we don't have large businesses in europe, but we have very large activities relating to europe in the city of london and that is true of many of the organizations. we don't know what the impact of

withdrawal would be on that. be city look would up to if it were to leave the european union? i think it would take quite a while for continental financial services centers to emerge. that would be a process over a very long time, so i doubt there is immediate erosion. competitor and healthy competition. but it is real competition. new york may in some way try to take advantage. i think part of the problem is talent goes where the money is. just talent, but business

goes where the opportunities are. we just had several years of emergent -- emerging markets being the dominant group in the world as a whole. all of that has just changed with china and the weakness of emerging markets. we are dealing with a very different world now. argued if that maintained itself that the real threats to london, singapore and hong kong. i'm not so sure anymore. francine: what would you ask of prime minister cameron? guest: get the right answer and do a good job. we are very supportive of his negotiations in europe. less so on regulation -- it is true on the banking side that the impact of european regulations has not been that material. on the insurance side, the

impact has been enormous. some would argue unnecessarily so. makuathat was francine speaking to john mcfarland. ltming up next, shares ofrenau fraudng after their offices were visited. more on that story, next. ♪

mark: welcome back to bloomberg markets live in london and new york. look at that beautiful london skyline. usually at this

time it's all dark. i feel like a spring might be around the corner. a look at some of the biggest business stories in the news. jpmorgan held out expenses in the quarter and held out a better-than-expected profit. the cost of litigation and compensation dropped in the last three months of the air. new capital requirements won't be as high as estimated. shares of best buy are tanking today. same-store sales fell more than 1% in november and december. one reason is sluggish demand for mobile phones slightly offset by wearable devices and home theaters. a plan has finished a new round of funding giving it a value of $1.5 billion. the company is now considering an ipo. that is your bloomberg business flash.

another big story we have been following with shares getting pummeled here --renault shares getting slammed after government fraud raid searched their headquarters in the wake of volkswagen's commission problems. those came to light last fall. mark: the fears are pretty concise. peugotrg spoke with a executive about what it could mean for the wider industry. not a i can say it is good use for the automotive industry but we have no problem as far as this is concerned. informed by the government commission about our reserves on two cars. these reserves were absolutely

correct. so there were no requests from our side. mark: hans nichols has been all over this since last fall. are we looking at another vw scandal or not? i think it's premature. regulators across the globe are looking at the omissions standards, especially diesel makers as part of a fresh probe. they have looked out 100 cars. 25 of them were from renault and with the cooperating investigation. four of them have been tested and none of them were found to have the defeat devices -- that is the software where they could trick in missions standards. that is their side of the story. two other developments -- here in berlin, the economy manager

-- economy minister is looking at this and says they have looked at other automakers and visited other automakers without giving specifics. that could be why we saw earlier a pan auto industry selloff. you also side with fiat with twice on thed milan exchange. you've also seen daimler down. -- we heardick note from the environmental minister in paris and what they are saying is so far, none of the tested vehicles have seen the presence of a defeat device. so far, it looks like these are ,egative headlines for renault but nothing specific. that said, the investigation is ongoing. sensecould you give us a of how important diesel engines are for french automakers?

hugely important. something like 60% of engines sold in france are diesel engines. the problem is they tried to export it and sell it in the states. in missions standards in the states, specifically in california are much more onerous. a lot of these companies have decided not to take their diesel technology and sell them in the states. are is why when you holidaying on nantucket or martha's vineyard or someplace i can't afford, you can't get a petty diesel. in germany, those diesels have so much torque, i won't even ask betty what she drives because she is driven by a chauffeur. betty: you always say that but it is you being chauffeured around and vacationing in martha's vineyard. we have another piece of that interview where they are talking about some of this testing.

i want her viewers to listen to that. guest: it was a random test of cars. apparently, the process was set up during october and december. test took place in january and now the order of magnitude of 100 cars to be tested was given in september. so we are waiting for the next steps we are confident because put in the technology place in our car is the most efficient one. do you expect some automakers will start being more transparent about some of these test results? hans: that seems like a fair response. the economy minister is still

speaking here in berlin. he's saying that it looks like markets have overreacted and that there's no way to compare the renault case to the volkswagen case. comments also being at code by the environment minister, saying shareholders of renault need to take a deep breath. this is official comment from french authorities. bloomberg's on the in berlin. just to reiterate, the renault share price down as much as 23% aheadw down 9% 10 minutes of the market close. still ahead, how are investors feeling about the potential u.k. rate hike prospects in 2016? the battle of the charts is next. why is it so early? betty: we want to get to it faster. mark: stay with us. ♪

betty: we are doing it earlier now -- time for global battle of the charts where we look at some of the most telling charts of the day and what they mean for investors. for viewers of the bloomberg terminal, you can access this by running the feature at the bottom of your screen. joe weisenthal was the winner yesterday. famouse of the most trades is shorting japanese government that. japan has so much debt that everyone thinks yields are going to surge as investors will revolt. it has the nickname "the widow maker. japanese 10 year bonds hit a brand-new record low yield. you can see the 10 year borrowing costs continue to decline even as japanese that as a percentage of gdp surges well

over 200%. everyone thinks because japanese that is so high that borrowing costs are going to surge and everyone who makes that that keeps losing money. betty: so they keep getting killed and it's called the widow maker. mark: sounds like a john grisham novel, doesn't it? this is the chart -- this is the month to the first u.k. rate hike. this chart basically figures out how many months it will be until the bank of england raises rates. it's so easy even i can use it. it's risen from eight months to notonths, meaning we are going to see a rate hike in the u.k. until april next year. that's the first chart i want to show you. at the same time, one of the reasons the bank won't be hiking

the property rate is inflation. high,nflation is a bit but this is the green line. since september, breakeven rates are the difference between five-year government bonds and five-year inflation linked that's. a lovely divergence here with investors pushing out and inflation expectations are hedging downward. the bank of england decided to do nothing. willit the april 2017 or it be as economists say, the latter half of this year. we will find out in the next year or so. youy: i have a question for . where is your trophy? i have not seen it for quite some time. mark: it's over there. am i keeping it today? betty: you get to keep it.

deservesng to say joe and a four coming up with the term and that blue jacket -- give me one of those. thank you. we have a lot more ahead on the european close. what is going on? we are going to have a full roundup on the markets in reaction to the bank of england rate decision from someone who worked at the bank for more than a decade. he is just moved back his forecast for the first rate hike to later this year from the first half of this year. stay with us. ♪

betty: welcome back to bloomberg markets. it is 11:30 a.m. in new york and 4:30 in london where markets are just finishing the day. mark barton is still with us.

mark: i'm not going anywhere. i'm feeling good. i've got my trophy. i will fill it up with water. just at 11:30 local time, we were down 3.3% on the stocks 300. we finished the lowest in a year but it could have been worse. we saw the first to day again for almost a month. we are 18% to low the highs set last april, which was a record high. was basing ahere loss of 23%. , down 9%,nault earlier falling the most since 1999. it's offices were raided by government fraud investigators. theult is cooperating with

investigation but it has pulled down the entire industry. looks like it is going to close but year to date, because of the worry about these carmakers exposure to china, the parts index has fallen 14%. hammered.n absolutely today did not help of course. betty: and you can't stop talking about the bank of england and their non-move today. mark: how to talk about nothing? there was a bit of something some economists -- i --l ask about this later some economists were saying maybe he will pull back and join the crowd because of what is happening in global markets in the first 14 or 15 days, but the mdc hasy message is the

said the near-term outlook for u.k. growth has weakened further. want to show you what is happening to the euro because it rose to an 11 month high against sterling. 's depreciation since november has raised the prospect of a lower drag on inflation and we will talk about that in a few minutes. betty: let's get a quick check on how stocks are moving in the u.s. we did see that big rebound 45 minutes ago, but we are coming off slowly of our highs on the session. by nine sectors are up, led consumer discretionary consumer discretionary is off. -- we haverices rebounded nicely better coming

off the highs of the session. let's get to abigail doolittle at the nasdaq. abigail: volatility is the big story at the nasdaq. the composite index was down and now it's up .5%. this has happened on biotech and big tech including apple and facebook. now they are trading nicely higher. it's unclear what is driving the turnaround. ?ut can this last turning to one stock trading in the other direction, gopro shares plunging after the camera maker free announced its fourth-quarter yesterday. inenues are expected to come 15% light of what the street is looking for. degree of this in the plunge

of his stock is completely in line with the bearish story. stock is down about 80% from august, trading about half of its ipo price. a big tumble therefore gopro. you are looking at live pictures from baton rouge where president obama is holding a town hall and twitter q&a at a high school in louisiana, hitting the road following his state of the union address, talking to the american people about moving the country forward. we will continue to monitor his comments and bring you updates. let's check in on our bloomberg first word news with courtney donohoe at the news desk. courtney: republican candidates square off again -- only seven of the parties 12 contenders will take part in a debate on

fox business network. donald trump is still the consensus leader and is now comparing it to that of a republican icon. mr. trump: reagan had a little bit of this, i don't think to the same extent, but he also won. i think the closest thing i can think of is reagan, but i don't think it is the intensity we have. betty: you can see that entire interview today at five p.m. eastern. the prisonto close at guantanamo bay has reached a milestone. 10 prisoners have been released and sent to oman. that puts the prison population below 100 for the first time since it opened in january, 2002. the word health organizations is the deadliest ebola outbreak is over. in westla outbreak africa lasted two years and

killed more than 11,000 people. guinea were and declared ebola free the end of last year. a rare january hurricane is strengthening in the eastern atlantic. hurricane alex is packing 85 mile per hour winds and could threaten the azores tomorrow. it's only the fourth tropical storm to form in january cents record started being cap. british actor alan rickman has died. his roles infor "harry potter" and "diehard." he was 69 years old. i'm courtney donohoe. just checking out alan rickman on twitter. the best film villain ever? i'm going to put that out to

you. voting today to keep rates at a record low of 50 basis points. take a look at the movement in the pound today. rob would, chief u.k. economist from merrill lynch international. he served as an economist for more than a decade at the bank of england. some suggested the sole hawk on the doe might change his position. he didn't. should we read anything into i think reading into those speeches -- martin we'll gave quite a dovish speech christmas, so it looks like ian mccafferty is isolated. given what has happened to inflation, the risk we can see out there, he still may change his vote. on balance, slightly

dovish? weaker inflation, weaker growth, risk? guest: they revised growth and talked about risks being more evident. markets were more volatile. they spent quite bearish on china. why has written -- why has raged ?- why has wage growth slowed they don't suggest a rate hike. mark: the cpi pickup will be more gradual. pushing the chances of the bank meeting a 2% target further into the distance? 2%,only is it going to meet

it's going to be quite a bit above it. pricesi don't think oil will predict that. assuming oil prices don't fall any further. inflation is going to be weaker than we previously thought but the real key is wage growth. his wage growth going to pick up enough? it slowed to february level. guest: i find hard to throw in the towel. unemployment rate is back to pre-crisis levels and is still falling. that being said, it is a bit of a puzzle. if i was at the bank of england, i would be saying let's just wait and see.

--ve got no urgency to high to hike rates. tanks andmber of brokerages have made a similar call. what was the reasoning behind that change and forecast? uncertainty. there will be an eu referendum at some point. it's hard to imagine the bank of england hiking a few weeks before such a key vote. absolutely, the timing for that matters. mark: have you got any sort of pricing mechanisms on how an halt the economy? affair ifom and gloom the u.k. votes to exit the eu? we don't have any special models that tell us how it is going to be.

it goes that way of really tricky to work out. my guess is it would be serious trading fallout because ties may have to change. out, that we vote it would be serious economic fallout. from its highs? that's a big deal, isn't it? slow, bute growth is that is going to push wage growth. i think the bank of england is we can do a couple of years in a while but right now we need wage growth. november. a big interview coming up. .etty: indeed the president and ceo of the u.s. chamber of commerce, tom donohue, joining us to talk about politics and what he's

looking for in this election cycle and breaking the gridlock in washington. ♪

betty: welcome back to bloomberg markets, live from london and new york. that is a picture of the new york skyline from our bloomberg headquarters. mark barton is joining us as well. mark: let's have a look at today's bloomberg business flash, look at some of the big stories we're following here. french automaker renault faces the specter of a full flag and type scandal. aares falling -- fallout from bulk wagon type scandal.

salaries have been frozen in the world's second-biggest mining company. tintoy freeze at rio and spendingares on contractors and consultants. he says he sees no end to the commodities route that has eroded profits. lsl property services says if the current rate of growth continues, the average price may .it $433,000 this year values in the u.k. rose almost 7% in 2015. that is the latest business. turn to our story now in the global banking industry. betty: in europe, prosecutors in milan are accusing six current memberser deutsche bank

of colluding with the world's oldest bank to falsify its accounts. bloomberg reporter joins us now from milan. what is the status of this probe? guest: they have completed their inquiry and are able to keep these key accusations, which would keep these executives in their role, they colluded with the former managers to construct these very complex derivatives off public remained financial disclosure from the bank. they were basically used to hide losses the bank already faced on another transaction at the time. what did these deals look like? lisa: there were multiple transactions going on at the same time.

to cover for ag lot at the height of the financial crisis. get to therying to end of the year in a fashion that would keep them going and come up with a transaction that looked as if it was gaining funds and they did so by taking a bet on italian government that. betty: is any of this, any of those actions, is still relevant today? lisa: the banks settled this transaction. it's -- it no longer exists. government still stake and the bank

has since tapped private and itss multiple times balance sheet remained unrestrained. shares now trade at their lowest. betty: thank you so much. our eye on this. we are still in the european close, but this time we are taking you inside the world of top dining. a really harsh review of new york's first day -- a michelin star chef extending jitters throughout the restaurant world. ♪

betty: you are watching the european close. i'm betty liu. mark: and i mark barton.

it is 4:50 in london. let's talk superduper restaurants. dinnertime almost for you. we turn to the rarefied world of fine dining. diderot for here could set you back about 3000 dollars and is under fire in a new review. in a -- the review trashes everything. the story has gone viral and got us thinking about the 2016 look out for some of the top restaurants. it got me thinking about what has thomas keller been thinking about this. foodnow is the bloomberg critic and editor of reserve. i hate to make you comment on another critic article, but you've gotten phone calls. guest: i've been getting phone calls and messages. it has definitely touched a button. you are right to go to what it jittery -- it's a very

getting of the year for the high-end restaurant market and this is shining a light on it. betty: what is going on here? guest: new york city and london are both homes of high-end cuisine. costs are going through the roof. it is easy to be critical about the chef. he is at the time warner center, one of the three most expensive places to have a restaurant. the rent is asked her to michael and real estate costs have become a huge part of the business. it is really putting pressure, especially as wages go up across the country. a low-margin industry and they are being pressed more and all it takes is one critic. i was speaking to my colleague earlier and she deems herself a millennial. she says these types of

restaurants like the fat duck in the u.k.. you know it well. itdo dine at the fat duck, costs 255 pounds per person, plus a service charge, without alcohol. can millennials afford this and do they care when in formal dining in london and outside london is now so good and much cheaper? : a very good point, my friend. millennials are not going to care a whole lot. there are 64 seats at this restaurant. the number of people clamoring to get in .2 -- i think we could call it almost a fetish kind of market. they are not all together bothered. most of them are looking at other sites, following other bloggers and looking at a variety of pieces of information

to get the skin on what is going on in the restaurant industry. they are fighting to get into kitty fissures and food trucks in austin texas. we had a chance to visit off hours with the chef, thomas keller. one of the things he said was details are so important. i want you to hear what he said about that. >> it is about the staff and how they are holding themselves and the pride in what they are doing. -- i made detailed kind of person. i'm looking at how the napkins are folded and things like that. peter: takes me smile just to see him. he is one of the most respected

chefs not just in new york or america, but in the world. he is an ambassador for what good cooking is about in america. that is one of the other things that is amazing about this viral spread of the story. going after thomas keller, them the fight and words -- fighting words. betty: give me an update on the european markets. lower, but ithed wasn't as bad as it could have been. was the lowestit close since september, not january. on thead a 1.5% fall stoxx 600. oil and gas, the best performers, basic resources up 1.9%. the worst performing industry group followed by autos. we know why autos fell today.

down by 23 percent. its offices were raided by government fraud investigators as part of a probe into vehicle in additions. but it wasn't as bad as it could have been. betty: thank you so much. while the u.s. economy has expanded across most of the country in the past six weeks as the job market shows strength, wages continue to remain stagnant. donald trump says his financial experience is right for such .roubled times what our business is looking for in this campaign? joining us now is tom donohue, the president and ceo of the u.s. chamber of commerce. what are you looking for in tonight's debate?

pens a lot ofer's time about who's going to be in the senate or the house and we don't work in the presidential campaigns, but we do work in presidential policy. we will be very interested in what they say about the funnel questions of economic growth, overregulation, global trade, and how we get the most out of the skills of the american workforce at a very challenging time for american companies. this is one of the last debates before we go to the first primaries and i think what we are going to get out of that as we get away from six months from talking and estimating and down to counting some votes and it will be a useful time for the press and everyone to start dealing with reality. at what areu look the keywords trending on social

race,in regards to the people are looking up things like gun-control and islamic state, immigration. they are looking up those kinds of terms. they are not looking at jobs or the economy. in thelmost ironic that republican race, the person who is leading is a business person, donald trump. platform talking about terrorism and immigration control, not business. tom: trump comes from business and he has made that point on many platforms. he claims he knows more about it than anyone else. and the list of issues you just suggested, you are talking about immigration because we had very aboutchard and comments

the global workforce. about islamic state because everyone is concerned about that. the fundamental reality is that is a global challenge to the american people and to people all over the world. it's time to get leadership in the business community and clinical community and in as itment to move forward appears to me we are starting to do. we just had another problem this morning and we have got to put an end to this terror because no matter what we think we want to do to come out of low economic growth to put stimulation back into the economy and create more jobs and get economic growth, that can all be knocked astray

by the behavior of terrorists it is ahe world and global need for leaders to go deal with that problem and deal with it now. that is clearly a focus right now because we know how fragile the state of the country is and the economy, but getting back to the issues you can put yourself behind and the chamber and money behind, what are you going to be putting your money behind in the hopes of getting some sort of common ground and something done in washington? tom: before i answer that, before you say nothing's going to get done in washington, if you look back at the last six or seven weeks, on a bipartisan basis, the house and the senate took on seven or eight of the export of oil, took care of the cyber security bill, took care of the xm bank, went ahead and passed