anna: the lira makes a comeback after the military coup attempt in turkey. president erdogan calls the takeover attempt a gift from god. in corporate news, a crown jewel of the u.k. tech space -- softbank is said to be nearing a takeover of arm holding.

a very warm welcome to "countdown." i am anna edwards. manus: i am manus cranny. there is a relief rally in the turkish lira. a tremendous level of volatility we have seen since the close of business on friday, a military coup attempt in turkey. if you want to understand volatility, this is it. the one-day move on friday, comingmazing pictures from turkey -- you saw the lira really take a hit. the market saw the biggest drop, turkish air dropping the most in eight years. we recouped some of those losses. of question is the flight capital, will it continue, or erdogan's grip on power convince investors?

goldman sachs say they have lowered their lira forecast. anna: it's a country with a big current account deficit. that is why the flow of assets really matters for the company. -- the country. the government is trying to reassure investors internationally. we will see how stocks do. wey analysts pointed out haven't always seen a sustained hit to the turkish equity market post-coup.market the ringgit, actually falling. a lot of what is going on in currency markets has to do with the dollar, and this is one of the currencies responding. u.s. data. the yen in there at 105.48. manus: the fed is definitely inching back into play. at 40 4%ck possibility, probability of a rate hike in the united states.

that is up from 9% at the end of june. goners on the dollar have net bullish for the first time in three weeks, hence the reason you are seeing a bit of a change in the gold price. anna: let's get the first word news with ross lynching. investors in turkey are stealing themselves for tumultuous trading as local markets open this morning following friday's failed coup. more than 200 people were killed as soldiers loyal to the government regained control. around 6000 people including military personnel, judges, and prosecutors have been detained while purges and arrest are expected as president erdogan seeks to concentrate power. the turkish lira has regained ground after seeing its biggest 2008.ince john kerry says the u.s. is awaiting a formal extradition request for a pennsylvania-based cleric suspected by turkey of coup.ing the military

the secretary of state called for evidence that would stand up in court and dismiss any accusation of u.s. involvement in the uprising. softbank is said to be nearing a deal to buy u.k.-based chipmaker arm holding for $32.4 billion in cash. that is according to a person familiar with the matter. the deal would be the biggest ever purchased by softbank, which has become one of japan's profitable companies. representatives did not respond to e-mails and phone calls comment. china's housing market cooled last month as second-tier cities join some of the nation's largest hubs and imposing curbs to dampen prices. new home prices rose in 55 out of 70 cities in june, versus 60 in may.

prices also fell in 10 cities more than twice as many as made. president obama has condemned the murder of three police of batonin a shooting rouge as acts of a coward. a suspect has been killed. two weeks ago, baton rouge police killed an african-american man, setting off protests. global news 24 hours a day, powered by more than 26 hundred journalists and analysts in 120 countries -- you can find more bloomberg's on the bloomberg at top . manus: let's bring you a little bit of breaking news coming in on the turkish situation. this is the deputy prime minister speaking in turkey at the moment, saying turkish democracy has strengthened, and that it has been a short-lived nightmare. of course, there are thousands arrested. these are public demonstrations.

mr. erdogan called and asked for his supporters to take to the say, we support this president. he has said of the turkish democracy has strengthened. anna: the macroeconomics are sound, going back to messages he and the central bank had been send. to let's check in on the market action in asia. juliette saly is standing by. we are generally struggling off those concerns from turkey over the weekend in asia. we are seeing the regional index up for a sixth day. certainly, we are still seeing

some risk on sentiment, particularly in australia. at asx 200 is trading 11-month highs. it is up for an eighth consecutive session. playerseeing every big move higher today. good buying coming through in taiwan. there has been a switch out of the shanghai a share market. we saw the property market cool there has been pressure coming through on a number of those properties stocks. the shanghai market just coming back after the lunch break, it is down about 1/10 of 1%. looking pretty good on the regional index, up by 1/10 of 1%. having a look at some of the big movers, one of the stocks most affected by what happened in turkey is the owner of the istanbul's- international airport. what hayden has received an upgrade from morgan stanley.

has received an upgrade for morgan stanley. i want to quickly show you the chinese renminbi. it has weekend to its lowest 2010,since november coming under pressure due to the weakness in chinese property markets. anna: thank you very much sally joining us from hong kong. comments continue to come in from turkey. the grounds for turkish reconciliation is stronger. no need to panic. turkey has gone through a short-lived nightmare, so says simsek in turkey this morning. of theof course, many articles we have read on bloomberg -- this will be the 1960, andr coup since that gave rise to the succession of power of erdogan.

you've got some more recent stats. we will keep an eye out. , it is 7:30 u.k. time when we get the turkish stock market opening. turkey's lira is rebounding this morning. it has recovered about half its losses the failed coup attempt. editorour middle east rhea ahmad he joins us from istanbul. ryan chilcote is on the ground in brussels. what is the latest? we are hearing these comments from the deputy prime minister, talking about a short-lived nightmare, but many are saying this is erdogan's chance to galvanize power even more so. hashat is what erdogan wanted for a few years and has been working hard towards.

parliamentturkey's to a presidential system where he is dominant. he holds the levers of power in his hands. what appears to be happening is he is moving to take action now with these thousands of arrest that are happening. anna: let's come to you. what are we going to be hearing from leaders in brussels? no doubt what is happening in turkey will be one of the key matters on the agenda. ryan: turkey is at the top of the agenda. we heard france's foreign minister say that the eu has not given turkey a blank check to crack down on its political opposition. we heard the foreign minister say he had questions about whether turkey was a viable ally. the question is, how much leverage does the eu have? eu whens an ally to the it comes to stemming the flow of migrants from the middle east.

those numbers have fallen tenfold this spring versus a year earlier, and the reason is the turkey-eu deal that was penned in march. now the eu has to deliver on a lot of the promises it made to turkey when it did that deal, so that is something they will be discussing amongst themselves, also with the secretary of state john kerry. they are going to meet him and about an hours time for an informal breakfast, and if that was not enough, they will need to discuss problems within their own borders, specifically the truck attack in france, as well as brexit. manus: indeed. let's go back to riad. talk to me about the flow of money. that is what we are looking at in terms of the currency. $16 billion came back to turkey. the is what the risk is, flight of capital and the current account deficit. riad: that is exactly it. the first five months of this

year have been quite strong. you had a return of foreign capital to turkey in net terms. that is as opposed to last year when there was an outflow in the first five months. the question is, will that continue or not? a lot of investors you talk to are saying, this highlights the political risk you have in turkey. you had the bombings from the islamic state, problems with the kurds, the war in syria, the strains with russia and israel and other countries. erdogan has been moving to try to resolve these. this will make a lot of investors nervous. anna: thank you very much for joining us. he is in istanbul. ryan chilcote, joining us from brussels. we've got the deputy prime minister in turkey simsek

talking, and he is sane political stability has strengthened. seem when as it might you reflect on the dreadful violence on the streets friday and into saturday, many analysts are concluding that perhaps this increases erdogan's control. that has implications for the future stability of the political system. >> i think that is happening. the failed military coup will reinforce the political status quo in turkey, and it will increase political stability. what is important at this point is that the government prioritizes economic stability over political stability. while the markets have evolved in a way to trade with terrorist risk -- while political uncertainty drove the earlier is the facte, it

that these extremely rare events, three in a century, so it's very unlikely we will see further instability in the short-term, and the markets are pricing that. are two other storylines. geopolitical risk has become a force of globalization. we have to look at the way immigration played out for u.k. voters in the brexit referendum, but also, the financial flows story. geopolitical risks , it's a facted that eu politicians will have to do more to appease eurosceptic domestic voters. franc the drive towards border controls, it will make responses harder. this is the level of volatility. we haven't seen this level in lire against the dollar going back to 2008, and you say we are

beginning to unprice. as europe and the world sees that they have no choice but to continue their relationship with erdogan, financial investors do have a choice. i would challenge the view that money will return with such flow, $16 billion, back into turkey this year. this is a president on a power-hungry trip. >> manus, i agree with you. i fear you are absolutely right here. is that there is a greater geopolitical risk attached to the. turkish asset and the currency. turkey is a strategically important market. it's important not just for the eu, but it's also important in terms of the way it has been global portfolios. a higher geopolitical risk premium, given turkey's reliance

on capital flows, and given foreign investors will have to the volatility and higher risk premiums in their portfolios, but they will also diverge their investments into shorter-term, more liquid assets, which means quicker, more abrupt capital flights. the financial knock on effect of a likely confidence shock domestically, a growth shock is something that will still play out in growth statistics. anna: lots of comments coming from the deputy prime minister in this interview, talking about no permanent damage expected to the turkish economy. turkey will return to the structural reform agenda. this is to be expected, the noise from the turkish government. important that words are backed up i action.

manus: when the press lines coming from the ratings agencies, and we had turkey just on the cusp of investment grade -- s&p global ratings says they will assess the events in the turkish market. is, do turkish bonds become less investable? anna: with two of the credit ratings agencies raising questions. thank you very much. here are some highlights for a busy day ahead. 9:00 u.k. time, eu foreign ministers be good john kerry ahead of their first session since boris johnson became foreign secretary. later, the boees speaks on brexit. at 1:30, we get bank of america's second-quarter earnings. you've got the republican national convention. that opens with donald trump due

to accept his party's present from nomination thursday. anna: the u.k. parliament votes on renewing britain's commitment to the trident nuclear program. up next, softbank makes a play for a crown jewel in the u.k. tech space. the japanese firm is said to be billion turkey 2.4 dollars. we discussed next. this is bloomberg. ♪

manus: 6:21 in hong kong. you are looking at a glorious day. the hang seng is a by 1/10 of one thing percent. these markets are stoic in the face of geopolitics. let's get a bloomberg business flash. rosalind chin is with us. in turkeyinvestors are steeling themselves, watching trading as local markets open following friday's failed coup.

more than 200 were killed in the unrest as forces loyal to the government regained control. a look -- around 6000 people have been detained, while purges and more arrests are expected as president erdogan seeks to concentrate power. the lire has regained some ground after seeing its biggest drop since 2008. england should implement immediate interest rate cuts in the wake of the brexit vote. that is the view of monetary policy committee member -- 's also said the central bank first rate cut since 2009 should be supplemented by a package of month.nal measures next singapore's state investment company is considering a buyout the city'smrt, largest subway operator. temasek currently has a 50% stake in smryt.

that is your bloomberg business flash. anna: thank you, rosalind chin with the business flash. softbank is said to be nearing a deal to buy arm holding for $32.4 billion in cash or that is according to a person familiar with the matter. the deal would be the biggest purchase ever by softbank, one of japan's most liquidity of companies -- liquiditive companies. manus, really fascinating to look at this story through the prism of a new government in the u.k. theresa may has said the u.k. government needs to be able to withstand predatory takeovers. will this be seen as a technology crown jewel that she doesn't want to let go? a bit early to ask her, because people are probably still asleep. manus: will the price trump politics.

--e news headlines coming in jeff daly, the ceo of barclays, he is saying that he doesn't expect the financial crisis in the united kingdom. negative interest rates pose a risk. he won't make further asset disposals. this is barclays jeff daly who took to the home earlier this year, and eu barriers are unlikely for eu -- u.k. banks after brexit. this is about the passporting rights. that is the critical issue for banks in the united kingdom. anna: let's talk about the u.k. we've seen a new for crest -- forecast for gdp, down to 0% growth. is that will growth will look like for the next year for the u.k.? >> i think it's not unreasonable. we need to move beyond the short-term geopolitical story of brexit and understand what is happening to the u.k. growth

model. the reality is we have a situation whereby the uk's and the of all growth model of high debt, low consumer savings, high external deficits, and domestic thend -- let's not forget u.k. economy was the strongest one in the eu the past few years. that model has come to a sudden stop because of brexit, and the result is a capital shock is translating into expectations of that is shock, and darkening prospects for u.k. housing, and also a sterling shock. sterling used to be the aaa reserve currency. it is now emerging market-like volatility. i don't believe we are at the end of weakness. it is something manus and i were talking about. tois very much a lever correct u.k. imbalances. manus: you called it an emerging market currency. we've got a quote board for you

channeling "the shawshank redemption." i think what that says to me, this is preparedness for the bank of england. everyone was disappointed the boe didn't do more. was disappointed. ultimately, the role of monetary policy is to channel financial for the government mandate, price stability. anna: a lot to explain. basis points to cut. there is no global economist out there who's not convinced, even those who voted for brexit, that the uk's economic prospects are darkening. 10-basis count cut is already priced in. 15 basis points is already in the market.

anna: thank you very much. next, he has announced his running mate. what can we expect from the hopeful?ial its donald trump. we are live to cleveland, ohio at the republican national convention. this is bloomberg.

anna: welcome back. 6:30 in london, 7:30 in paris and berlin. daybreak is available on your bloomberg and mobile. that is where you will of the top stories that have made it into this morning's edition. with, we have to start out the fallout from the coup in turkey. manus: this is the breakdown of the challenge in turkey, tanks on the streets. a giftse, it's a coup, from god. that is the sense coming from

erdogan. several dozens people from the have now the judiciary been arrested. to that end, what you saw was a major drop in the turkish lira. lire drop the most in eight years on friday. comments from the deputy prime minister. these are quite telling, saying that he doesn't foresee early elections, but of course, the second issue is in terms of a that ise story, and softbank, $32 billion deal. anna: that is according to people familiar. we could get news as early as today. check out -- check it out in the last half-hour. could they be coming after arm in the u.k.? this is the business that grew itself out of a shed, isn't it, who designscompany chips and 95% of smartphones.

the u.k. government say? will there be a counter bid? you never know. manus: the third and final one, investors are holding their nerves. we are talking about equities just holding on to their overall positions. there is that lack of collapse in terms of investor sentiment, but the u.k. entering recession, that is the other dynamic. who saideard from lena it is still a challenge. we are trading like an emergency market currency. anna: they talk about a short, shallow recession for the the t, investors are holding their nerves. we are talking about equities just holding u.k. they talk about the housing market being one of the weak spots, cutting their 2.7 -- 2017 gdp. it is 6:30 to in london. asian stocks outside japan have risen for a sixth day as energy

and financial companies advance. fromine hyde joins us berlin to take us through some of the market moves. have been talking about it all morning. i know the dreadful effects of what we have been seeing in militaryhe failed coup, having its ramifications across the market. we are seeing the lire regain some of the significant drops we saw in 2008. this is dollar strength versus the lire, and we saw the dollar did shoot up versus the lira on friday. that is when we saw it lose -- it was the biggest move in the lira since 2008. we are seeing half of those losses being undone. the turkish lira is currently outperforming. it's one of the best performing currency's out there. i will take you to this particular screen. this is what is happening in the major currencies. we aren't seeing any great

flight to safety. you're seeing money coming out of the safe havens. the yen, off 5/10 of 1%. the south african rand, charging ahead 1.5%. the emerging market-related fx, the currency's most volatile, seeming to outperform. of course, disturbances we saw in terms of another failed coup attempt in turkey. it seems the market is taking this in stride, perhaps feeling we have seen coups before. on the fx point of view, we are not seeing any huge moves and not much of a flight to safety. i want to draw to your attention 8:00 a.m. this is the market capitalization of our moldings. it's a significant deal, over

$30 billion being offered for this company. it is a 44% premium. this is tracking arm holdings market capitalization. it is currently at 16.7 billion pounds. shoot likely to see that up higher if we are to see 30 billion dollars being offered for this company. that is a 44% premium we are likely to see. i want to show you one particular thing to bear in mind. why now? if you are looking at yen strength, now looks particularly appetizing. look how the pound has eroded its value versus theapanese yen, 28%. back to you guys. much. thank you very investors in turkey are steeling themselves for this morning's market open. thany's failed coup, more 200 people were killed in the unrest as forces loyal to the

government regained control. around 6000 people have been detained while more arrests are respected as president erdogan six to concentrate power. anna: joining us from istanbul is the managing partner at 10 to capital partners, and from brussels, we are joined by the senior vice president of tell you intelligence. turkey is a country that international investors are used -- used to considering in the light of the syria war, the fight against the kurds, increasing levels of terrorist attacks in the country -- with that as the backdrop, how much does the coup change the game for investors with regards to turkey? as you said, turkey is in the middle of quite a hot geopolitical geography.

remember, turkey has had previously three coups and one soft coup before. this came as a shock to all of us friday night. is,ver, what i do think it's inevitable the markets will have short-term turmoil. lira assets will suffer. you're supposed to take a long-term view when investing in turkey. in that regard, the silver that theems to be government scum of the different political parties and people, stood up to what was going to be a very anti-democratic movement. this day and age, i think coups are kind of old news. the silver lining is the fact that the people from different

political parties stood up. this is a good thing for turkey in the long term. we will have to see how the erdogan administration and the akp play this. the rhetoric is going to be important in terms of bringing the people together, gel the people back again. manus: hold that thought. i want to bring in our other guest. when we listen to what he is saying, i think globally one would have to say that we have seen erdogan's response. he talks about a new turkey. he talks about a gift from god in terms of what he has seen. this is a president who has squashed this and seems to be rounding people up, 6000 people rounded up, and there is talk about the return of the death penalty.

this is a fairly aggressive play to thwart any pushback against him, isn't it? >> absolutely. the overall topic, the overall goal for erdogan hasn't changed, and that is to redraw the constitution turkey, to turn the political system into an executive presidency, to focus political power in his own hands. that has been the long-running goal. friday's events will probably help him. the real risk from the markets perspective over the medium-term, badly needed economic reform in turkey is nowhere to be seen. the political leadership is so busy with a long-term goal of redrawing the constitution. i think we are going to see a greater focus on that going forward. anna: how is he going to establish an executive presidency? do you see the need for elections? we have heard comments from the government playing down the likelihood of elections. forhe fundamental problem

erdogan is that he doesn't control the necessary majority in parliament. what are you achieve this through elections or are betting on other members of other parties in parliament joining akp, that remains to be seen. the risk of snap elections is something we need to keep an eye on. the goal will be to cash in on this massive popular support erdogan has been seeing. bring it backto to you. we have seen a return of capital nearly $16 billion in the first six or seven months. one of the key issues is not just that the currency -- the currencies volatility has been surreal. we have retraced 50% of the move on friday. i want to focus on the bond market. are on review at the moment. the challenge with the current account deficit.

kingdom,ike the united is at the mercy of strangers in terms of funding the current account deficit. >> correct. this actually underlines the action planf the and rhetoric that will be coming from the government, as well as president erdogan. turkey cannot afford to upset investors too much. it has to finance the current account deficit. inflows toave money make sure it can finance its current account deficit. i think right now is crucial. president erdogan is likely to move to consolidate power. anna: thank you very much.

boris johnson is now speaking in brussels. clearly, when you look at the discussion on the table this morning, over the hurt thick offense in nice and turkey were we have to work closely together, you can see the importance of that. we will be ensuring we coordinate our response to , and on turkey, i think it's important come into view of the failed coup, that we see restraint and moderation on all sides. in the meantime, i am looking forward to meeting my colleagues. thank you very much. anna: the new foreign secretary for the u.k. going to his first eu foreign secretaries meeting in brussels, boris johnson speaking to reporters. it's a coordinated

response, using words of restraint and moderation on all sides. .et's get to our correspondent what is the latest on the investigation? as you may have seen, the truck driver was a soldier, but the police haven't found any clear link between the 31-year-old and the islamic state. on investigation is focusing possible accomplices. custody,e are still in including one couple. the 31-year-old sent a text message to this couple minutes before the attack, saying, bring me more weapons. surveillance camera footage suggests -- [indiscernible]

he rented the truck a few days before the attack and emptied his bank account on july 8. ofre will be a minute silence at 12:00 p.m. french time. anna: thank you very much, the latest on what happened in the south of france. casten, one question, i suppose that comes to mind -- how does how change french politics, does this change the popularity of the national front? what is your assessment? >> probably not that much, actually. the underlying problems that you see remain unchanged in the sense that in the second round of the presidential elections, what we are going to see is an effective coalition, the lines between the epublica.ght le r

and the other parties. the biggest problem for present tlong -- presiden hollande is the weakness of the economy. this rally around the flag affect is going to get weaker. in that sense, what we are going to see is more or less normal electoral politics and great levels of contestation around the economy. manus: thank you very much, casten nickel. joining us.r let's switch our attention to cleveland, ohio, the republican national convention getting underway. that comes after present hopeful donald trump announced his running mate over the weekend. anna: for more, margaret tele

joins us. great to have you on the program. what are we expecting to hear today? as you can see behind me, the quicken loans arena is almost completely empty. anvention goers, getting little bit asleep. in a matter of hours, this place will be packed, and so will be the streets of cleveland. tens of thousands of people, peacefully marching, in some cases protesting, but a great deal of attention both outside and inside this arena. later today, we will have a chance to hear from melania tr ump, donald trump's wife, as well as some republican entertainers. there will be some "duck dynasty" action. rudy giuliani, the former mayor of new york. a big theme of the kickoff to

will be safety and security. make america safe again is the theme republicans have attached to tonight, a play on words for donald trump's notion of making america great again. manus: of course, the world's attention yesterday, the newsreels were focused on cleveland, ohio. another round of violence against the police broke out in louisiana. how do you think this is going to affect preparation for the convention? do you think trump will deal with it head-on in terms of his verbal response? he never shies away from some of these bigger issues. >> no, he certainly doesn't. hours ago, a tweet from donald trump said, our country is a divided crime scene, he calls the united states, and it will only get worse. suggests he is seeking to exacerbate the divisions, but at the same time, trump and the evangelical community have asked to come speak to the

convention both opening day and on the big night thursday, later this week, and to talk about themes of unity. we will see a juggling of those two things. a lot of rhetorical concerns about how to address what has happened in baton rouge, dallas, all over the united states, but also safety concerns. guard, forolutely on attention to security inside and outside the arena. anna: thank you for joining us. more from cleveland as we go through the week. chief's foreign-policy and john kerry there, as well, saying they were very positive talks with boris johnson. many people wondering how his first meeting with the foreign ministers would go. manus: up next, after two years of low prices, why oil producers are not betting on a rally. he will fly to abu dhabi.

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anna: a warm welcome back. bright and early on a monday morning. we hope to keep you up-to-date with what is happening in turkey. we had the deputy prime minister past hour,ing in the continuing the message from the central bank, trying to shore up investor interest in turkey. this is a country with the big current account deficit. they are mindful of not wanting to see capital flight, and that is why they are talking about in theamazing interest investors conference. elections, first which is crucial. this could be a some way that the president consolidates power. manus: keep an eye on the dollar-lira.

move.retraced 50% of that will that continue? what happens with the bond story? what happens with foreign capital coming into turkey? let's talk about oil producers. it sputtering out? we've got tracy alloway on standby. take us through this. everybody talked about $50 or $60. where are we in the discussion in terms of producers boosting their short that's? -- bets? is about oil producers trying to protect themselves from another downward drift in the price of oil. assaw crude fall to as low $27 in early january, and then it came up to $52 a barrel. it has dropped 9%. the concern is there is another downward trend in the price of crude. hedges have become the dividing line for u.s. oil producers in particular.

bets on the short price of oil increasing. they are up for the third consecutive week according to the commodities futures trading association. about 1.6% ins total. the question is whether that the shakeoutonging of oil producers we have been waiting for, particularly for oil producers in the middle east. whethera huge question, this will end up being another extend and pretend for the oil sector. anna: thank you very much, bloomberg's tracy alloway joining us from abu dhabi. we can't let you go without asking you about the ecb. we are going to get an ecb meeting this week. the consensus seems to be, no change in policy. september 8, looking popular in terms of stimulus. lena: the ecb will commit to lower interest rates. the geopolitical climate in europe through brexit, the attacks in nice, developments in

turkey has highlighted the difficulty that central banks face in terms of globalization forces, political, economic, and trade. where in a world where there is liquidity, not enough investment. the result is chronic weakness and productivity. -- in productivity. nowhere is this more visible than the eurozone. chronic debt growth imbalances. if it wasn't for the ecb recycling liquidity between the north and south, the dynamic would have meant the end of the euro. what we have seen now, in thetion to some of macroeconomic uncertainty introduced, in the aftermath of brexit, the knock on impact on the eu capital, the euro appreciation against the pound, i think what is important is that the ecb is running into technical constraints in the market.

they will have to introduce easing to maintain the current pace of wanted of easing. manus: what we have seen is bond yields returning to positive. this was quite a shock friday. is there a much bigger backlash against these bond markets? are we in bubble territory? bonds, the biggest weekly drop last week in a number of months. in biggest weekly slide bonds since may. likewise in treasuries. >> this kind of volatility is not favorable in terms of the signals for the real economy. if anything, it diminishes the impact of the ecb stimulus. collapse in bond yields in the aftermath of the u.k. referendum result, which constrained the amount of ass ets. the backing up, it becomes a self the filling prophecy. we are looking for slightly weaker oil outlook. anna: thank you very much. joining us now on the

phone is turkey's deputy prime minister. r, thank you very much for joining us. we've seen some of your comments, trying to calm the fears of the markets. we have seen the central bank offering liquidity. what can we expect next from your administration and president erdogan? good minister simsek: morning. the turkish democracy is much stronger than it was on friday. we had a short-term nightmare, but it's over. everybody was united against the failed coup.

i domestic political tensions are likely to ease. i think that should be a much better backdrop in terms of the structural reform agenda going forward. on. time to move [indiscernible] on, and we will continue to extend our democracy and push reforms. prime minister, apologies to viewers for the quality of the line. you say democracy is stronger. is president erdogan stronger as a result? simsek: president

was instrumental in getting people to stop a very horrible coup attempt. president erdogan, of course, is stronger, much stronger politically. [indiscernible] going forward, i think it will be a constructive and conciliatory tone by the government. manus: let's just talk about the

tone of your administration and the president. fetullah gulen, president suggested he is responsible for the incitement of this most recent coup. are you calling for his extradition to turkey? are you 100% convinced it was gulen and his followers? there is strong evidence that gulents fetullah incited the coup attempt. to give you some simple evidence --that [indiscernible]

he was found in military uniform .ttacking the coup for the taxpayer. they are ourish --

we work with the .nited states and korea thank you for joining us. just a recap on some of the lines coming from the deputy prime minister. he stated that everybody is united against the two -- coup. trying to affirm the hold on power that the current administration has. we have more on the developments in the market. the currency has retraced 50% of its losses from friday. confirmation of a breaking deal. anna: softbank to buy arm holdings for 100,000 pence per share.

onclosed below that level friday. the consideration values at about 24.3 billion pounds. arm holders will be entitled to an interim dividend of 78.3 pence per share. they plan to maintain on senior management team and headquarters. the arm deal will be done partly by debt provided under a 10.3 billion pound facility. arm'snk plans to double headcount in the next year. making all the right noises if they are trying to convince not only the management of arm, but also their shareholders. theresa may made it clear that she does not want any predatory m&a. she only wants the right type of m&a. manus: why does softbank want to get its hands on arm?

it is a list of the customers and the debt level. this is all about the client int and what comes next terms of funding a potential deal for softbank. a little bit of breaking news for you in terms of british land . this is one of the u.k.'s biggest guilders of commercial property in the united kingdom. ist they are saying to us that the first-quarter dividend is confirmed at 7.3 pence. they have seen a robust position post brexit. british land says it is in a robust position after the brexit vote. in terms of disposables during the quarter, this is something we heard quite a bit of. you and i had a conversation with mark at aberdeen and he said they were selling british property ahead of the brexit.

british land, non-quarter disposals, selling those. in terms of the first-quarter, 25,000 square feet of office renewals. that is the state of play on some of the breaking news that we have. what a day and what a crown jewel to consider getting off the books. the futures, let me pull them up for you. we have an indication, a little bit stronger. if you look at all of the risk we are taking on board, equity futures all trading higher. london up by 20 points. the dax up by 35 points. anna: we have emerging markets it -- market currencies for you. have, just to tell you where we are -- en has continued to

decline. gold is off as well. we have some changing thoughts about where the fed is going. a higher expectation of a rate boom in the united states because of the data we got at the end of last week. as a result, we have the gold in there. let's get to bloomberg business flash. here is rosalind chin. nd: investors in turkey are feeling themselves. more than 200 people were killed in the unrest as the government gained control. around 6000 people have been detained while purges and more arrests are expected as president erdogan takes to concentrate power.

kerry says the u.s. is --iting a as tradition extradition request. the u.s. secretary of state called for evidence that would stand up in court dismissed any u.s. uprising as irresponsible. president obama has condemned the murder of three police officers in baton rouge. louisiana police did not give further details. two weeks ago, baton rouge police killed an african-american man. that was following -- followed by the killing of another man and the murder of five dallas officers by a gunman. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. you very much.

let's get up to speed with these equity markets in asia. >> it is another pretty good day that we have across the region. the rally continuing somewhat. we are continuing strength coming through in australia today. it has flown higher by .6%, holding on to levels that we have not seen in august of last year. most sectors moving higher. an australian market up for 8th consecutive session. japanese stocks fell for a six their sixth highest session. looks like we will close at nine-month highs. a little bit of missed coming through at the shanghai a share market. down by .1%. manus: thank you very much for the latest round of. ofhave a live shot now

arrivals at the eu minister meeting. anna: john kerry should be getting out of that car. the u.s. secretary of state. boris johnson is there. we have heard from him, the new-appointed u.k. foreign secretary. he is talking about a need for in turkey. no doubt will be crucial to what has been talked about behind closed doors and in front of the media spotlight in brussels. manus: of course, she has been saying in her conversations with , we are very positive. our man on the ground in brussels is ryan chilcote. a very good day to you. turkey will obviously be part of that agenda, not topping the

agenda in terms of what happened relative to paris. where are we in terms of the discussions? what is the latest? : you can expect a real shift in the message coming out of the eu foreign ministers and the secretary of state. this.essage is we support your efforts to deal c but you must respect human rights and the rule of law. -- thee why the hell widely-held concern here, we have heard this from france, the eu foreign policy chief, that prime minister erred again could go too far in his crackdown and use it as an excuse to crack on the political opposition. that is almost certainly going to be the focus of at least the informal breakfast between john kerry and the foreign ministers.

that starts now. what we expect is, when it ends, we will get a joint statement. this is a statement between the eu and the u.s. on turkey. the eu foreign ministers have a lot more than just that, including stuff happening within their own borders, like the attack on france last week in and let's not forget the brexit. boris johnson just arrived. anna: let's get to our managing editor, who joins us from istanbul. arrivingaw john kerry to the conversation in brussels. we heard earlier from the deputy prime minister in turkey saying our relationship with the u.s. will remain strong. he did not sound that way over the weekend. some comments coming from turkey, pretty aggressive towards the united date. one element of the conversation is around where nato fits.

main point of tension is the issue of the from the u.s. r turkey has said that it is asking the u.s. to send him back to turkey for him to be tried. the 30 gone government -- erdogan government is accusing him of being behind the attack. the u.s. the same we will see when we get the request and look at it then. they were quite clear in a sense that our relations with the u.s. will remain strong. our middle east managing editor in istanbul. thank you. ryan chilcote is on the ground in brussels. we will return to both of our colleagues today. william jackson, emerging markets economist, and boris armstrong join us right now.

let me take straight to you, william. emerging market capital flow, you have the currency, the stock market, and the bond market. i think it is very much a risk to turkey. we have seen political risk gradually rising on investors' radars as president erdogan has put forward the idea of strengthening his own rule. this event is really putting political risk into the spotlight. politics in turkey had gone off the table a decade ago. we heard from one investor in istanbul who said that coups are old news when it comes to turkey. that might be the case. when we have this confluence of coups and the activity taking

place over the border with syria , it might just be one more have ahat investors who choice to go to other emerging market assets might use. william: and there are some concerns over what erdogan's response is. i have brought up dollar-yen here. you saw this immediate reaction, very traditional and aggressive risk-off shock. there is nothing more tragic than that. from a market perspective, this immediacy. to coin our guest phrase, maybe coups are old hat. or is it erred again -- erdogan's response to this.

patrick: it looks like it might be an ongoing issue. the movements that the market is not quite dismissing it. it is probably not much of an impact as what people are worried about on friday. changing yourhis attitude towards emerging markets? will you use this as an opportunity to get out of turkey and get into other things? don't have a position in turkey did very high inflation, very high current account deficit. it is not where i will be looking to add right now. manus: when we look at this in the context of politics, everybody currying to stay onside with a president that is considering reintroducing the death penalty. that is not confirmed, but one

of the things being speculated. this is a desperate europe with a desperate deal with a desperate man. be there isseems to a very difficult situation where turkey is a key nato ally and plays a key role in the eu migrant crisis. yet some of the developments seem to be running contrary to some of the political goals. manus: that is speculation in terms of news reports. patrick: -- william: were it to be introduced, it would be a major stumbling block. , demonstrating control of the military was also a major issue a decade ago. that is likely to come back to the floor if these talks continue. anna: where turkish stocks go , stock futures dropped 2%, suggesting we will be weaker

in 14 minutes time, when the stock markets open up. it is an interesting one. if you take a longer-term perspective, they were talking might see some short-term volatility, but a bit difficult for any sustained weakness. patrick: i think -- william: we are seeing some volatility at the moment. not particularly large in terms of a military coup. past few, even in the years, episodes of heightened political risk have led to selloffs that have been recouped after some time. the concern is more of a long-term one. what is the policymaking going forward? manus: that comes down to the current account deficit. this index had recovered.

it was one of the recovery trades of the emerging markets. going back, we had three major coups since 1960. 1997, the force in istanbul dropping 33%. i do not think anyone is expecting that. it is all about the deficit. it is expected to be 4.5% for and we are at the mercy of strangers. the kindness of strangers. unique capital investment to offset the current account deficit. trying to use this as a gift from god to position himself with much more presidential power. anna: the credit rating is something that will be of interest. do you see turkey hanging onto any investment-grade ratings? it is always tricky to predict these things. unlikely would say, is

to hold onto it, investment-grade, particularly given the directions on the politics he is moving in. manus: thank you very much. william jackson and patrick armstrong. patrick, you stay with us. 7:18 in london. it is to: 19 in hong kong. juliette saly has the business flash for us. >> investors in turkey are stealing themselves as local markets open. more than 200 people were killed in the unrest as forces loyal to the government gained control. around 6000 people, including military personnel, judges, and tutors, have been detained. purges and more are expected as president erdogan extent concentrate power. the turkish stock market has regained ground after its

biggest drop since 2008. softbank will buy arm holdings 17 pounds per share in cash. the offer is a 43% premium to the closing price on friday. the japanese company said it would maintain arm's senior team and pledged to double its employee headcount in the u.k. the bank of england should implement an immediate interest rate cut in the wake of the brexit vote. that is the view of a monetary policy committee member. -- he also said the first rate cut should be supplemented by additional measures next month. companye's investment is considering a buyout offer for the city state's biggest subway operator. they are weighing an offer to buy all the shares they do not own in the company. it currently has a 54% stake in smrt, which has a market value

of $1.7 billion. exxon mobil has made a superior , offering ar-oil fixed price of $45 a share. that is higher than a rival. and the possibility to export the fuel from the pacific nation. as part of the bid, it offered 8.05 shares. that is your bloomberg business flash. thank you very much. the u.k. property market seems to be painting and optimistic nature after the brexit with house prices declining only slightly. british land reported first-quarter results this morning and says it is in a robust position. draw anyoo early to conclusions about what the housing market is going to do. , who joins usack now. very good to have him on the

program. is the property correction coming true or too early to say? jack: these are asking prices. manus: the house price index shows that prices drop, but no more than we have seen over the last years. quick that is right. -- jack: that is right. , it is too early to say, but there is a little bit of uncertainty. they had extremely large sales. stories inbiggest the u.k. at a very good price. that might not be reflective of the overall market. that is highly attractive to overseas investors. themnk the question with

is what is going to happen development wise? that will tell us more. manus: we have been through some commercial and retail property bumps before in the united kingdom. the lead time between the reality, the shock and all of and awe of brexit,, isn't it? jack: property returns the last couple of years, increasing property values moderated and start to come down. it has been a decrease of rental values, which has been driving returns. that makes the market variable to tenants deciding not to take those or delay decisions. to improve thele rent and the tenants are not going to make decisions about leasing those buildings. what i would say as well, if you

look at the retail story, it has been working through very quickly. cases, deals are already being agreed to buy those. anna: thank you very much. let's get back to patrick armstrong. any thoughts on the u.k. real estate market? is that something you are interested in getting exposure to? we looked at that last week, but they ran away from us quickly. british land, lan security, some of the investment trusts. they are a place where you are getting yields. interest rates are getting very low. that is the clear attraction right now. manus: all of the analysts that i read over the weekend, it is a miniscule rally relative to the drop. all say that any rally that you see in these markets is something that you want to sell

into. that this is a temporary reprieve that you are seeing in sterling. would you concur with that? patrick: i think it will settle -1.30 trading range. we have a significant short on sterling. on july 22, we will see the first pmi numbers that come out post-brexit. i think those will lead to a weaker sterling. .he current account deficit all of those issues, more likely downside from here. interesting comments from the u.k. chancellor of the exchequer. on the same data we get the offer from softbank to buy arm, we have a statement in the u.k. chancellor of the us check or that britain is open for business and investment. the arm deal showed that britain has not lost its leeward --

lure. patrick: they are saying all the right things to make the british politicians happy about adding jobs and investment in the united kingdom. they are paving the way for a smooth transition. say: we will see what they about industrial strategy and blocking predatory m&a. thank you for joining us. we have seen some big moves in the turkish currency. at this.ve a look this is the turkish lira, a dropped by 85% on friday. those, retraced some of nearly 50% of that. the cost of insuring against .alls in turkey the 10-year government bond, the yield on that rises by over or two basis. up bythe turkish lira now

3% over the u.s. dollar in today's session. some perspective from what we have seen the markets. we will leave you with the "on the move" team. they will take you through the start of equity trading day in the turkish markets. this is "countdown" and this is bloomberg. ♪ [hip hop beat]

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♪ from the bottom of the mat, ♪ ♪ to the couch where you at? ♪ ♪ show me the latest medal count♪ ♪xfinity's where it's at. ♪ welcome to it all. comcast nbcuniversal is proud to bring you coverage of the rio olympic games. guy: welcome to "on the move." we're counting you down to the european open. i am guy johnson. i am alongside caroline hyde. this is what we are watching this monday morning. turkey, president heard it on consolidates power after a coup fails to bring him down. where does turkey's political path now lead? investors on edge. the lira strengthens this morning. jump. default swaps