guy: welcome to "on the move." we are counting it down to the european open. i am guy johnson alongside jonathan ferro. jonathan: central banks for statement of 2016, setting the tone for the path ahead. . the biggest company forecasts 2003 --est drop since

guy: what do you need to know this morning? there is caroline hyde with the first word. caroline: good morning. chinese shares have slipped after slumping industrial profits, increased concern that the economic slowdown is deepening. they have put the regional benchmark. -- taking how protection in case rates go negative. -- waning inflation expectations of

sliding oil prices, putting pressure. sees chinamits he andcially in hong kong, china they no longer offset the slowdown in the global smartphone market. global news, tway four hours a day, powered by 2400 journalists and 150 news bureaus. guy? guy: thank you. we are half an hour away from the equity market open. let me show you where we think we will go. remarkably calm, considering where we have been as of late. ftse opening flat. an ok half point lower, session yesterday. i want to show you what happened with the shanghai composite -- this is the day that we round

trip to back up since the start of the week and we are still significantly lower. jonathan: you wake up every morning and it is china, china, china, fed, oil. we will get the federal story and the oil story. brent crude at $31 per barrel, lower again today. guy, what a journey -- a 10% move friday, monday, 4% move et your crystal ball out to guess where we finished the day. i that the u.s. two-year on here, guy, because the middle of december the hike -- the front and goes through 1%. is sayingry market what it things about the rest of the year. guy: i think it is making it clear that this is a laughable concept. the question is whether we will get the signal from the fed

today, or some sort of change in the growth language. are we going to see dissenters? there is a change of personnel coming through. one with a reputation for dissent, so we will see. let's talk about central banks. they is all about the fed, fomc rate decision out at 7:00 p.m. we both have a press conference today. here's what some of our guests have been saying about the likelihood of moves this year. >> the saifed will not do anything. it neither will continue to raise rates nor will a panic. >> that is the consensus. >> secondly, i think it will mention the market volatility and it will mention the weakening of global conditions, but it will not make a fuss about it. >> by forecast is that we will be easing at some point, whether it is quantitive easing or verbal easing in the not-too-distant future.

basis have global not changed that much, so i think the fed -- >> they are tended to look through short-term volatility but the question is if it persists will they be able to. guy: let's welcome our guest for the next 60 minutes. great to happy with us. the fed has come up against so much criticism, but when you boil it down they are in a tight spot. side, there is a risk that we get an upside surprise this year, and they are clearly concerned about that in trying to get out of what could happen. where do you stand on the argument? where should the emphasis before the fed? , global growth slowdown -- on the group will clos global grow? >> they are worried it will -- we have seen spreads blow out

there and that will have an impact from the cost of capital. obviously that will have an impact on risk appetite as well. that is something we are very cautious of this year. that is one of the biggest sources of terror and the fed realizes that. they're also interested in liquidity, which has obviously dried up because banks can't play vanity risks. that is a market we are looking at carefully. jonathan: what we have seen since last your to this year is the fed -- is that what we can draw a conclusion from, further exacerbated by another move? weit all stands where it is, will see further problems in high-yield market. g that can bring this high correlation between equity markets and oil -- i think we need something to act as a circuit breaker. we published last week saying that the circuit breaker would be a more dovish fed.

the call is still for for hikes, but obviously the risk is that the fed will recognize it will be a problem and will hold off at this meeting. i want to look at this more -- go back to the mid-1990's. the element of surprise is something they clearly don't want. isn't the a case of overpromising and under delivering, or under promising and over delivering? is that the right strategy? >> the thing is the fed has always been less worried about inflation than, say, people in germany, because they still remember the hyperinflationary. -- the hyperinflationary period. they've been very successful at that. 200,000 jobs in every payroll report on average. from that point of view, their policy has been very successful. but i think conditions are tightening. if spreads are wide, and

effectively the tightening is already there -- guy: but how do they get the height that you guys are calling for if the tightening is already there? >> this is our u.s. economist call, and a trusted completely, but i think the risk is that markings will force the feds out that markets will force the fed out. jonathan: walk us through it. from high-yield into stocks, you talk about the correlation with oil. walk us through the market reaction. the fed says, you know what, maybe we will back off. >> i think the primary worry is driven by a high-yield market. does have been the ones which were highly correlated. that is where we saw the big misallocation of capital this time around. so where are the bubbles? energy companies that were overleveraged. i think the solution will be a painful deleveraging. the question is if they are more accommodative, will that usease

it. i think the equity market will rally, volatility will fall, high-yield spreads will tighten, and that would affect markets globally. we can see the same thing in europe. they followed u.s. spreads wider, and fundamentally europe shouldn't have sold off. investment grade credit shouldn't have sold off. the fundamentals were better, the oil exposure was in there. that is the market where we see a lot of upside. also in europe, if we see the earnings come through, we see 30% upside in europe for the stoxx 600, but only 20% upside to our target for the s&p. risk rally, obviously, even if credit conditions would be best for the high-yield market, and obviously that would give us a breather and correlation between energy and equity markets, which is a healthy thing. jonathan: thank you very much. european high-yield next price.

we will be talking much more as we work our way through the problem. still to come, an exclusive interview coming up at 8:00 a.m. up next, end of an era for apple. why they are forecasting their first sales drops in 2003. ♪

jonathan: good morning and welcome from the city of london. we are about 70 minutes away from the open here in london. ftse futures lower, down by 16 points, call it a quarter of 1%. let's get to some of it with caroline hyde in the bloomberg business flash. caroline: thank you. the royal bank of scotland is taking an additional charge. the largest state-owned lender a 1.5haat includes billion pound provision for mortgage backed securities.

it was all most web start in the fourth quarter as it missed estimates, as they set aside funds to compensate clients. net income fell to just 25 million euros in the lead up to december, from 1.4 6 billion euros a year earlier. see francine lacqua's exclusive interview with the santander chairman later this morning. novatis has posted fourth-quarter earnings that missed analyst estimates, as sales at their eye care unit continue to plummet. the strength of the u.s. dollar eroded the power of global revenue. that is your bloomberg business flash. guy: thank you. it's time for our morning must listen, and apple ceo tim cook talking china after the world's biggest company disappointed with its results yesterday. >> we began to see some signs of economic softness in greater china earlier this month, most notably in hong kong.

beyond the short-term volatility, we remain very confident about the long-term potential of the china market and for large opportunities ahead of us, and we are maintaining our investment plan. and the dollar are taking a bite and in a statement they said there would have been - - that number is only worth $5 today. $14, that is a significant hit. let's bring in the global macro strategist of ubs. tim cook have something to worry about? >> absolutely. the sector suffering the most of the industrial ones, affected by the slowdown in the housing market. i think that is where most of the pain will be. the worry is that we will see that following through to consumer demands

because it doesn't work in isolation. one of the things we're worried about is the debt deflation trap in china. that is one of the things highlighted as a ris. guy: specifically on the dollar, where does the dollar go from here? you look at u.s. companies, talk about earning expectations, market expectations -- how big a factor is the dollar? >> it is a massive factor. we are expecting dollar strength this year, and we have already seen impact earnings. that is why the forecast is only 5% in the u.s. versus 13% in europe. the trade weighted euro looks very weak, but the dollar is strengthening massively. that will not go away with the policy change we are expecting. that will have a further weakening on earnings in the u.s., particularly for companies which export. for domestic companies is a much for story. guy: you have the smartphone story that we will dig into

later, but one of the market is china and the dollar. the dollar can come in and out, but china -- i wonder how that is. yesterday we learned that the head of the china statistic euro is being investigated for corruption. we don't know if that is associated with his current role, but there is a suspicion around the data continuing. is that our best bet, given that we were told the consumer is ok, that this was just manufacturing? the consumer cannot be ok. what is the story there? >> we don't have to use just the official data. we have something called the evidence lab, where we hold things in china face-to-face. the housing market theire looks fairly strong. there does seem to be demand and eastern regions for property and for people to move up the property ladder. you can always go out and get your own data, and that is something we have certainly done, or you can do something like commodity markets as a read

for the state the chinese economy. it's not a particularly positive week for china, but we are not forecasting a complete deleveraging. we think liquidity will stay there, china will stay at 3% or lower, and the central bank will make sure liquidity is there between the banks. we're that expecting a deleveraging. our forecast has come down but it's still not atrocious. guy: when the world's largest company comes down and says no growth, you set up and listen. you just wonder what that means for everyone else. whether it is just the smartphone issue, whether it is an economic growth issue. which side of the better you one? >> the yuan. if they see big devaluation this year again like we saw in august, that would have a massive impact on asia. that is not what we are forecasting. we expect a 7% upside on the renminbi for this year, so we

are expecting six pointed by the end of the year. we may see variations around that, but i think the yugoslav support thing for the region. but in terms of the economy, obviously they have this massive overhang in terms of the industrial sector which they have to fix. that we are not expecting catastrophe this year. we have written the tail of the dragon -- the main contagion conduit is commodity pricing. that is a we have seen already. the question is whether we will see a further like down. we still expect 6.2% growth this year. that is down from last year, but still, not a catastrophe. jonathan: he will stay with us. global macro strategist at ubs. coming up, 11 minutes away from the open. potential corporate movemers, among them novartis and a lot of bank news. 11 minutes away, futures a little bit lower. hello to you will.

-- to you all. ♪

jonathan: seven minutes to the start of trading. let's take a look at where we think we will be going. compared with recent market moves, today is going to be dull. we are going to open flat, u.s. futures pointing to a negative open, shanghai almost back to flat. that is how we think we will open -- plenty of stock movers out there that will be more interesting than the stock market. let's listen to what caroline hyde has to say. caroline: i'm going drugs first, and eyes. novartis, the second-biggest drugmaker in the world, profit didn't live up to expectations. expect this stock to fall about 2% on the open. alcon, the eye care unit, maker of contact lenses, sales plummeting 13%. also the strength of that dollar

is hurting apple and novartis, eroding the value of global revenues. they are changing the management of alcon -- is it enough? shares are likely to drop for basf more than forecast. it's exposed to oil and gas. they are hurting in their winter unit, and i know this unit well -- a bigger than expected drop, so watch this stocks sink. watch rbs at the open, that additional charge -- they cannot escape their past. neither can send tender, both of them taking a hit on pbi and this one on pension and mortgage backed securities. much.hank you very 90 seconds away from the open. more to come. very quickly, i'm interested to get this from you -- the earnings story in your present to be better, the rating stressed, the downgrades in europe have been worse. but the magnitude of the moves

for the downside -- much bigger in europe. why? >> i think people don't believe europe can be decoupled from the u.s. >> and you think they can -- >> we think there will be a decoupling. look at the bank lending survey. if you look at the lending to enterprises, that has been accommodated for some time, and it has stayed accommodated. that is starting to tighten. leading litigators show the signs, so that is one part of the puzzle. we've seen upgrades drift in europe, downgrades in the u.s.. guy: thank you very much. we will be back in just a moment. an exclusive interview coming up. ♪

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tim cook good morning. it warm welcome to you all. i am jonathan ferro, joining you live. moments away from the start of the european equity trading session. guy johnson has your morning brief. geico fed decision today. geico -- china takes a big bite out of apple. --worlds biggest company emerging markets often. jonathan: 20 minutes away from the open here in europe.

china, fed, oil, crude. features a little bit lower. a busy one. caroline hyde is at the touchscreen with the european market open. caroline: monetary policy going to be front and center. it is the fed in the driving seat today. we saw topsy-turvy trading in asia. he saw japan the ball from the united states, driving those stocks higher. china moved up again as we saw the pboc start to step in and ask what you want. i know you will be digging into asia and a moment. features up about .1%. 1%.utures up on will we see the federal reserve -- will they start to sound more dovish because the market is more dovish? potentially one rate hike this

year. many thinking perhaps it will not live up to the dovish excitations for this year. -- brenda's upng 2%. $31 at the moment -- brent is up 2%. $31 at the moment. the meeting continues. p.m.t the news out at 7:00 it :00 p.m., we get the new zealand central bank as well. it :00 p.m., we get the new zealand central bank as well. let's get into some of the stocks to watch. we've got a lot of numbers out. they could rise because they are having to make drastic changes. chipmaker, europe's biggest. they are making 1004 to job cuts. this is their best sales. they will continue to follow. forecasts well below where

the market expected. sales job for the next quarter. novartis up 4%. not living up to expectations. the second-biggest drugmaker in your. basf waiting for that stock to drop as well. that unit could hurt. a quick look at the banks. rb is down 4%. -- rbs down 4%. bpi hits. the patent problems. they are taking a big charge. this is missed sold insurance protection of payment protection insurance to the u.k., up by 1%. hardly any profit. down 3%. back to you. jonathan: a lot of financial news out. the italian banks opening a little bit higher as the eu and

italy reach a deal. still waiting for the specifics. up around about 3%. .nicredit trading higher lots of story in europe specifically in the financials. in the early part of the session, but the opening about .25% lower. we are going to talk ask you the spanish bank profit falling below that profit. the company's chair says they are on track. we are exclusively from ana botin. what is the reality about the deal. lower oil prices. $30 crude. china takes a bite out of apple. postorld's biggest company the -- posts disappointing results. ♪ botinan: -- guy: ana

speaking exclusively to francine lacqua, the chair of spain's largest lender. ana: we have delivered on anything we said we would do. under the, strength underlying result. -- net interest margin growing a percent just growing 8%. -- growing 8%. we are above the 10% full he even aftergenerated we went off provision for bpi. 79% more in eps. is been a good year. we have delivered on every thing we said when you're ago.

francine: the raising of capital is still at the forefront and even of the markets. can you put that categorically, you will not raise more capital? ana: we will not raise more capital. the reason, this was established by the eba. against the regulatory minimum is 280 basis points. to put that in euros, that is 16. second, we have increased the target we set a year ago. in september, we committed to being above 11% by 2018. ,iven the capital generation after paying dividends, funding growth, we can achieve the target of being above 11%. that puts us in a place where we have a good management buffer against what we believe will be the minimum's.

capital.need any more francine: you think you will be above 11%? fully loaded by 2018? ana: yes, that is what we said. we generated 40 basis points this year. even after taking into account the provisions for ppi. francine: this would put all of the capital concerns to one side. ana: i hope so. for us it will always be lower. 11% for us is 12% plus for others. the very important thing is under stress, our model is very resilient. we have paid dividends for 50 years. our results under stress perform much better than other banks, because we have 10 countries that tend to compensate each

other. we are a different animal. can to do better when things get worse. precisely because of that diversification. francine: do you feel your share price has had unfair pressure? ana: i think it is more brazil and emerging markets. there might be something on capital but when we talk to investors, i think the concern is more emerging markets, because last year we did very well here it we reached the maximum valuation. we have been tracking brazil ever since then. francine'shat was exclusive interview with ana botin. she coded a good year. if you're an investor and the stock is down, i am not sure you would define 2015 is a good year if you have their stock, would you? guy: could have been worse, if probably desk could have been

worse? probably. to be exposed to latin america is not the place to be in 2015. jonathan: maybe the benchmark for a good year is where they were in the strategy to improve on profitability. to talk about brazil, things are still not good for two years. said, what is your thoughts on this. -- ramin nakisa, what is your thoughts on this. how does that play into your thinking? ramin: that is one of the ways equity strategist look at companies in europe, look at the exposure. exposed to thely upswing in europe. companiesic exposed are the ones we prefer. guy: you ignore all of the multinationals tackle all of those companies that are exposed

globally that used to have strength in that, it was an asset for them guy: those of the companies -- an asset for them? ronan: -- ramin: if it's a telecoms company and generates revenue locally, that is the place i would look for the upswing. finances,in terms of if you listen to the interview, she doesn't paint an ugly picture. uglyxpect brazil to be over the next few years. ramin: i think we are worried about the fiscal position. will it deteriorate over this year? say to collect that as a problem. at this point, we don't think not a crisis point -- not at crisis point.

600 --n: the stock severe underperformance of the stoxx 600. the bank index over the last six months down 30%. some big domestic names there did domestic stores specifically italy. what are your thoughts on that? see the cyclical upswing, who is going to benefit? it is going to be the cyclical companies, the banks. of course if you have a risk off move which is what we find ourselves in now, who is going to suffer? it is going to be the cyclicals. you can see this is a buying opportunity because this is a mispricing. if you see european markets dragged down along the u.s., oil story, this high correlation is a toxic thing. it has to break down. they could be an opportunity for the upside. -- rahman, your

good stay with us. the iranian president is holding a conference in italy. he is heading off to france next. it does seem as if european companies are picking up where they left off for a number of deals being done between rouhani . we will probably see the same thing. some big things for airbus essentially. they go for it? will hear from one of the major shareholders in the takeover of bg. ♪

jonathan: hello and welcome back . 14 minutes into the european trading session. equities lower at the ftse 100 lower big moves from the rbs. so much financial news. rbs down 4%. the .87% to be precise. the company sees a full year low after setting aside additional charges once again. a lot of news to get through. let's get some of it with nejra cehic. nejra: we get the federal reserve's first interest rate decision of the year later. policymakers are expecting the hike next year -- hike this year and next.

the implied probability of u.s. interest rates sinking below zero next year has arisen above 10%. meanwhile, a server of economists shows most expect the bank of japan to add to its record monetary stimulus this year but probably not at its policy meeting this week. weighing inflation expectations and a reversal in the yen's decline has put pressures on the boj to do more to fuel prices and growth. tim cook admits -- after forecasting apple's first quarter sales declined in 2003. even with the lunar new year, china may no longer upset the broader slowdown and the global market good global news 20 for hours a day powered by our journalists. some of bloomberg's first word gates -- guess with nejra cehic. -- bloombergs ryan chilcote spoke to chris wheaton.

chris: they have been clear in forng this is not a deal the next three years, this is a deal for the next 20 years. they are at a competitive advantage. their highest return on capital. it is been in areas of deepwater. shareholders of been on the road a lot in the last six months trying to convince shareholders despite the short-term volatility, this is going to lead to a better oil -- going to lead to a better shell. >> what is about the lng market that is different? on. and more supply coming what is your view?

chris: energy is a bit different oil because it is related to relationships. you can't really store energy for any. of time -- for any period of time. the better marketing you've got, the better off you will be. jonathan: ryan chilcote joins us now. i spoke to the ceo of shell, the morning -- he emphasized with as iflti-decade deal, they vote on this, has he done enough to convince the investors that this is a big deal but it will be profitable? ryan: it appears he has. only one of the major investors has publicly said they will not support this deal. it looks like they have a healthy majority to push it through. the bg shareholder meeting is almost a given.

there is a huge premium in it for shareholders. part of the expedition is even if you don't think it is not a good deal for the -- for the shell and the good -- for shell -- maybe they'll -- maybe they don't think is a -- they own shares in both companies. they are going to vote against it at the show meeting. that is what they have already said but for the deal tomorrow. if you look the diverging paths of the share price both bg on the one hand which has been flatlined the deal was announced , and show which is think down one third, you can understand where they are coming from. long-term,nergy,

you're looking for entry points and you got to think about the timeline. at some point there is going to point.t -- energy is it going to be this year? next year? ryan: it is an impossible thing to forecast. guy: what do you look for? energy -- expect we will work through the glut in supply. they are forecasting high 40's by the end of this year. fairly punchy forecast. jonathan: in terms of the m&a stories, ryan is talking about one of the biggest deals of last year. the energy deals, this was pretty much it. are we going to get the m&a in the oil industry? ramin: we called it pretty well the way out. we said it would rise and it did. -- at theo going

moment there is very little. i don't expect a massive upside to m&a activity in the u.s. as a whole. that is the biggest impact of u.s. so on it -- so of oil stays where it is, will see a widening illiquidity than in the energy sector we have seen it spread to ig. ig energy companies with aa ratings, their office spreads have been blown out. that is a big worry. jonathan: hold that thought. ryan chilcote, thank you very much. we're going to move things on from credits and stay on fixed income. ramin nakisa is going to stay with us for that discussion. ronnie is holding a news conference. it is the european talk for iran.

he heads to france next. up next on this program, more from our guests, ramin nakisa. .quities lower the ftse 100 down by 33 points. the dax up by .3%. ♪

jonathan: good morning. welcome back to "on the move." guy johnson along for me -- alongside me.

the decoupling of the equities in the u.s.. to?ks, all right, but bonds guy: you can see the line in this trajectory. the last month has been fairly bundesting in that the couples, and basically your view is we see a very different picture six much from now? a year from now? jockey is going to keep the short end. it will be fundamentals which will -- we're going from an inflation to 1% next year according to forecast. to get nominal growth under 3% in 2016. we are expecting in that kind of situation 18 year bund at 60 basis points is unrealistic.

we are expecting yields to rise because of inflation and because of growth. expecting that spread between the u.s. 10 year and the german tenure. draghi? does that leave markets thatteased is what's going to happen. he is hinted at this. ifwe carry on where oil -- we carry on, oil where it is, if curve, --he oil for we are expecting to reach that target in two to three years or -- three years or less. we buy u.s. treasuries and sell tenure balloons. that.an: i've got what i don't get is over the last five to six years, it is been an international bonds

market domestic issues have been one thing. the interconnectedness between treasuries, european bonds, does that are down? is a fundamental argument. it is based on growth and expectation. yes, that is what we are expecting. it is a fundamental divergence between the two economies. jonathan: -- guy: it is a reestablishment from what you would normally see. you would not expect to see germany trading this far away. kind of a weak coupling a but the desk kind of a re-coupling of what the bond markets -- i am fascinated to see how that will feed into the oil story as we see the sovereign selling off. how are they going to position themselves? ramin nakisa joining us for the

last hour. essentially a very strong position on europe. concern about what is happening in the united states. we're going to talk about china and the dollar and apple. that coming up on the move. ♪

jonathan: hello and welcome back to "on the move." we're 30 minutes into the session. tearing the early losses could ftse 100 down by .1%. the dax up by 25. such of the boards. you wake up every morning you want to know what is going on in china. down around 6% yesterday. lower this morning, up by .5% good brent crude lower by .8%. a u.s. two-year, guy, 1%, middle of december. you would think conventional

wisdom would suggest the yield would go higher, it hasn't here it guy: the market is just chuckling. it is interesting to see how the shanghai went on a round-trip today. u.s. earnings are being hit by slowing growth and ethics moves. after theighlighted world's biggest company reported earnings last night. tim: we are seeing extreme conditions unlike anything we have seen before, just about everywhere we are looking. major markets, including brazil, japan, canada, turkey and the eurozone have been impacted by slowing economic growth, falling commodity prices and weakening currencies. >> plenty other challenges for tim cook. let's break down the numbers and figure out what is going on here.

caroline, apples concerns are clear. walk us through. caroline: they are trying to blame macro challenges. the word came up 12 times in the analysts call. it is the forecast. --e have raised themselves people have braced themselves. down, that that implies that iphones are going to full 20% in terms of the amount of units being sold. this is important. 60% of their revenue comes from the iphone. .hina, we saw a slowdown growth was just 14% in china. it was 99% growth the quarter before that. what is going on in china? it is too much of a luxurious product. the forecast is missing analyst estimates.

jonathan: it is easy to talk about the macro challenges. much harder to say, smartphones saturation. smartphone challenges. which one is it? >> you are seeing smartphone saturation. upside inlenty of an terms of the high-growth economies where smartphones should be increasing. it is a fact of life. apple has to contend with these macro challenges. if you look their pricing model, they are the premium end of the market. it doesn't make it difficult for them to see great volume into these markets. made a ton of money. caroline: $50 million per hour. guy: we are seeing a slowdown in iphone sells. that is probably a given.

this is a money machine. where's the rights? everybody's getting excited by the slowdown. where is the middle ground? tim: it is very true. there consistently hitting estimates. here is whater happened with the ipad. ofsaw shipments last quarter 21 million down to 16 million this quarter. what you got is a danger of people not upgrading their phones. an innovator's dilemma. a product that is so good that people do not feel the need to update it or replace it on a yearly basis. ipads did tumble off. the danger is that happens to iphones as well.

jonathan: the numbers a people $4 billion. a huge number. the point here is where does the topline growth come from? if you strip the iphone out, it it doesn't look pretty at all here it at one is scratching their head saying where does it come from? it isn't matter because the iphone kept going higher. does it start to matter in 2016? caroline: it does since the watch has only sold four to 5 million units. this is why there suddenly telling you one billion units out there. you can see them as a services, apple pay, apple music, because no weight making up for the huge amount of revenue that portion from the phones. up. need to build that they need a watch to work. people going what about a car?

phones can keep delivering. many saying this is a value stock. this is not a growth stock anymore. whati am fascinated to see they will do on the financial engineering front. here's a company that could go out and get a balance sheet. this sick of putting them was secured the numbers coming in for investors. company that wants to secure numbers coming in for investors. i guarantee apple could buy -- can issue some pretty cheap rates. jonathan: they have a fantastic amount of money on the balance sheets. last night numbers were not a disaster. we are down 2% in after-hours. jobreal story is the 20% over the last six months. my question to you, tim, did the numbers from yesterday validate the 20% drop over the last six

months? the concerns around apple, they do. apple is looking at being a services company. of did mention a couple [indiscernible] they should 7 million in the first two quarters. tim cook did say they had a better quarter quarter -- had a better december quarter. i think there are some issues and concerns. macro factors will affect everyone in the market. has another product in the pipeline. better price points for these emerging markets. there is still some upside on their products. guy: you got to remember that

the s&p has fallen quite significantly during that. -- during that period. in some ways it reminds me of microsoft. his a company that got -- here is a company that got be rated. it churns up money like you would not believe. it is going to be interesting to see how the marketplace. junk of everyone has the memory of microsoft. everyone has the memory of microsoft. it is an incredibly well ran ciccone. they're waiting for that microsoft moment, the point where they follow up the cliff. we not there yet. risk with anya company, especially when it comes that large. investors should not be worried just yet. there is potential in apple. as you mentioned, the car coming

further down the line. that is a product that could take them to the next level. >> could they make money in cars it? tim: has love making money at the moment. keep something to investors interested. they've got plenty of money to invest. if they can find aneesh,--find a ation -- guy: tim coulling joining us. coming up, mining companies might be the worst-performing stocks on the ftse 100. more on that story next. ♪

ana: brazil is going to be difficult. brazil is much more than commodities. still is much more than exports to china. brazil exports to china is 2% of gdp. andil has 25% of gdp agribusiness. industry. an i believe strongly that brazil will come out of this stronger. jonathan: that was the chair talking emerging markets in a bloomberg exclusives best in a bloomberg exclusives. 2015 was an ugly year for investors.

bit.g back a little 42 minutes into the session. let's cross over to caroline hyde. caroline: starting on an optimistic front. the biggest gainers this morning. coming off its highs, but it is .till five and -- 5.75% they're closing and unprofitable unit. the biggest chipmaker in europe. they are raining that back. they're making 400 job cuts overall. they are taking big actions. investors like it. up goes the stock. rb is coming off its lows. at one point, rbs was trading at its lowest 2012. currently up by less than a percentage point. to ppiy related provisions.

also they are taking related to tensions and also to asset backed securities in the united states. the path is still the pain in the present for the likes of rbs. one of the big follows, tdc. at one point down like percent. down now 10%. -- at one point down 19%. now down 10%. they are canceling their dividends. that got disappointing cash flow forecasts. there is not much silver lining for this one. in --orcing a bigger drop they fell 18%. the world's largest chemical maker. tina matthews is in frankfurt. this talk to us about right down. it is to do with what is

happening with that unit and the fact it has an exposure to oil on the upside. tina: that is right. in fact, analysts and investors have been questioning for years on and off why is basf directly involved in oil and gas? the chief executive officer has repeatedly said it is a strategic raw material hedge. oil and gas are raw material for petrochemicals which in turn are used for building blocks for chemicals that go into the auto industry and construction industry. these are all of the industries that basf serve. terms, as you say this is a hedge, the belk of the business that's the bulk of the business is in the chemicals. presumably, the lower oil prices was mean their prices are much

more efficient so there should be more upside. sheenagh: there is some upside. they will be able to produce their chemicals and further downstream, the other chemicals more cheaply. this is an impairment charge for the assets. they have oil and gas reserves which are worth less. even their production facilities are worth less with the oil priced at $30 a barrel. guy: sheenagh, thank you very much indeed. on to -- jonathan: on to commodities. mark.ng around the $31 exacerbating the oversupply. will kennedy joins us. it feels like we do the same conversation every single day. what is remarkable is the magnitude of the moves.

day, monday, tuesday, wednesday. will: that is unusual in the oil market. which with which -- with which we are circling. comment from the a ramin: ceo yesterday, the it illustrates the in finding aed balance anywhere in this market. guy: it is clear the market is oversupply. will: when you are 30, it is easy. the other thing is, the markets are so financially driven. there are so much relation to other market moves. jonathan: just three 3 million ?umber, what is the equivalent

well: it is extraordinary -- well:, it is extra ordinary. it shows the challenge. 11 million barrels is a huge number. i think it is a very there's signal. guy: this is not surprising to me. you see people running home for safety. one of those is good to be gold, the precious metals sector. given the volatility, it is a hard asset. will: it is come down as the dollar has risen. that has been broken this year. the city traffic patent. what is interesting, data showing a lot of physical buying in china.

maybe they move out of the stock market and into things more solid. jack of it is been a surprise. -- jonathan: in the traditional sense, old would be where you want to. over the last one or two years, it doesn't matter what happened in the global market, gold cannot get a bit. of a safe haven asset, i don't think things are as straightforward as they were. look at your. the point on precious metals, where do we go from here? still in a disinflation area environment. will: it has a huge impact on the market. it will depend. this year, the difference is marked on the commodity index. it depends on how much turmoil we get.

on intoe fear carry china's economy, i think it is bullish for gold. guy: other investors are looking for property. you can pick it up. it could just be as simple as that. will: the chinese data is interesting because small savers going to gold good if you sold more of that in china, that would be very bullish. toathan: will kennedy, great have you with us. up next, was at the head to the feds worst -- fez first rate hike decision. we'll talk about that very shortly. ftse 100 in positive territory, up around 11% -- around .1%. sewall from the city of london. ♪

jonathan: welcome back to "on the move." hello to you all from the city of london. ftse 100 erasing some of the early losses. down about .1%. guy: popping around a little bit . by comparison, it is been a relatively quiet start. london market up by .1%. jonathan: if you said to me take the shanghai composite and the close, that was not quiet.

guy: bleed round-trip in the last hour. a backup again -- completely round-trip in the last hour. back up again. to lookabout the need at the whole day. the:00 a.m., -- 9:00 a.m., -- mortgage implications out of the united states. the main event, the federal decision.king a rate no press conference today. rich jones joins us from bloomberg's first word. so much happened since december. so much has taken place. do we guess any change guy: to be guest and a reflection? -- do we guess any change? do we guess any reflection?

richard: do we get some of the september language? acknowledging some of the headwinds. i photos interesting that tim cook -- i thought it was interesting that tim cook saying they experiencing headwinds unlike they have expense the before -- they have experienced before. if he is making that acknowledgment, let's see if the fed makes the same acknowledgment. the language is reminiscent of stuff we heard in september. jonathan: the market got ahead of the fed. it is just not there. we saw that happen approaching the december meeting. it came back and then they hiked interest rates. the fed has a decision to make. they cannot completely closed the door to march. toy don't want that market price do they?

richard: they are going to have to strike a balance. it is something that is not going to be a desk going to be easy for them. they want to go against something they said five weeks ago. they need to act in a way that is consistent. they made an appraisal of the u.s. economy. has it changed that much? markets have shifted a lot. by mental conditions have tightened. has the feds appraisal changed? story seemed into the economy? are they going to change their outlook as a result? i think that is could be critical. it will be right there front and center. fed,han: china, oil, driving markets. we spent a lot of time talking about china and oil. richard jones, thank you very much. bloomberg will be bringing you pull coverage and reactions.

that is due at 7:00 p.m. u.k. time. the pulse is up next. best of luck for the rest of your day. ♪

can the fed stay the hour course? four hike the world's biggest company forecast its first sale drop since 2003. lender's profit falls. we'll hear exclusively from the bank's chair, this lady. welcome to "the pulse" live