>> you are in this union. eu leaders/over russia and brexit in their last summit of the year. china estimates rise in as the leader's plan for 2017. chinese stocks head for their biggest weekly drop since april. wall street and the white house. jamie dimon gives us his take on donald trump's cabinet picks and the u.s. of economy. >> in america, you keep hearing that productivity is low. a new normal. it just is not true. anna: as vladimir putin talks business with abe, the end is in

sight for russia's market downfall. >> it is bottoming out a bit. ♪ anna: a very warm welcome to bloomberg daybreak: europe. our flagship morning show from london. let us talk about the dollar. we talked about it a lot this week, certainly yesterday in the aftermath of the federal reserve interest rate hike. we are once again talking about the dollar. go long or go home is the title of this fantastic chart i have for you here. circle, november, marks the victory of donald trump. what we have on the white line is net dollar long.

their highest level since january. are we done with the dollar rally? perhaps not. a 10 year high against the yen. let us put up the risk radar to show you where we are compared to other currencies and asset classes. the euro is a focus. some big moves in the euro this week. 104.37. the euro hit 103.67 in yesterday's session. for the dollar against the euro since 2003. asia-pacific, up by 0.3%. brutal in the wake of the hawkish fed about 2017. when of conversation about it will get to 20,000. uncharted territory for the dow jones industrial. not for -- not so for the nikkei.

it has been there before, back in 1987. a history lesson from the bloomberg this morning. the 10 year yield up to 2.85%. increase in aest month. sophie joins us. china's leaders gather in beijing to map out economic plans and policies for next year, up to zip -- optimism is increasing. economists have raised first quarter growth estimates from 6.5%. by stimulus and a potential increase in global demand. -- according to people with knowledge of the matter who say the company is discussing a price of about $275 per share. bothsentatives from

businesses did not respond for a request for comment outside of normal business hours. opec has applauded donald trump for its new secretary -- for his secretary of state choice. an outstanding oil technocrat. >> he is highly respected around the world and he is deeply knowledgeable. as i have told other colleagues, there is a then line between oil, diplomacy, and oil politics. i congratulate president-elect donald trump for making such an excellent choice. sophie: the coo of carlsberg has welcomed the latest move in europe. purchase is not all that. >> the market is not only bad news for us. we have a formidable competitor

in asahi. we do not play their except for poland. i think we have good competition in the countries where we are and that is fine. sophie: we will bring you more of that interview from carlsberg's seeable. -- coo. global news 24 hours a day powered by our 2600 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg top it. this is bloomberg. anna: let us see what is happening in the live markets over in asia. details.saly has a little more green across the screen and some of the equity markets in the asia-pacific in today's session but not wait -- not making up for a brutal week. juliette: it has been quite a tough week for asian equities. a little bit of a turnaround on the shanghai market. it has been fairly flat.

earlier, we have seen like a bad week for chinese stocks. the shanghai composite down over 2.5% this week. hong kong has also been fluctuating today that in late trade you are seeing support from energy and concede no stocks. -- and casino stocks. the nikkei is where we are seeing the most action. it is all about the dollar strength. still holding onto the 2016 highs. not a great day in australia. utility stocks, health care and goal players all coming under pressure. similarly in southeast asia, host markets inc. had to buy the strong dollar which is weighing on emerging-market currencies and we are watching a few players. have a look at south korean automakers which came under pressure. and nintendo has been the story

of the day. but amario may be a head lot of concerns about the longevity of the revenue stream of nintendo. anna: juliette saly, thank you in hong kong. in europe, you differences over russia were exposed as leaders held their last summit of the year in brussels. they demanded an immediate cease-fire in aleppo with theresa may saying russia brought some responsibility for the tragedy there. angela merkel said the talks were down b. -- said the talks were downbeat. >> the beginning of the meeting was very depressing. we are faced with a situation that leads -- that leaves us are. it is heartbreaking. we cannot act the way that we would want to. we want to put an end to these attacks targeting human beings. anna: that set the tone. caroline joins us from brussels.

a downbeat angela merkel. did the eu leaders imagine --manage to agree on anything? >> they did manage to find a -- ukraineto the eu compromise. the partnership would not lead to membership in the eu. rolled over the sanctions on russia related to ukraine for another six months. over the situation in syria. discussedit was also without theresa may in the main. are havingeaders similar issues as theresa may about organizing the brexit negotiation. who is deciding between the eu consult, representing the different governments. the eu commission which is the

executive arm of the eu and the parliament. with the eu leaders agreeing on a compromise where the country holding the six-month rotating presidency of the consul would be able to participate in the negotiations along with the commissions chief negotiator. these two countries holding the rotating presidency in 2017, two of the smallest countries in the includingthe eu estonia. and the eu parliaments president martin schulz who wants to get involved. it was agreed last night that the eu parliament would be able to send some representatives to participate in some discussions because remember the eu parliament will have to ratify any brexit deal that is decided

and finally, we heard from the minister at the end of the dinner last night who expressed his concern about the relationship with northern ireland, the trade relationship and he wants eu leaders not to do anything to -- the peace process with northern ireland. prime minister meeting with angela merkel today. what are we expecting? inhe needs angela merkel order for greece to get more debt relief which is as you know a precondition for the imf to get on board and for greece to quantitative easing. angela merkel has her hands tied at home as well because the conservative allies do not want more debt relief for greece. angela merkel of force also want the greek crisis to be over with

as soon as possible. she is also facing a election's next year and she will have many issues to deal with and she will also have to work with new partners in the u.s., in france, in the u.k., and in italy. anna: thank you very much. let us bring into the conversation philip who joins us for this hour of the program. someone suggested yesterday that it was quite skillful what the ecb did recently because they are mindful of the political challenges that lie ahead in 2017. extending their program out over the time period to cover the events on the calendar on the horizon which was sensible. >> that is a factor which is a logical thing to do given the political uncertainties as well as underlying inflation remaining well under 1% for some time. is political outlook

juxtaposed against at the economic outlook next year will be a key market theme. anna: inflation expectations in the eurozone edging higher. the highest since january. groggy is watching this. what about the fundamental -- draghi is watching this. riskmber one, the biggest we see facing the economies this continued sliding commodity prices leading to lower expectations. be very dangerous and difficult to escape from. as we see from the chart, that has not happened. we have seen a rebound in commodities and inflation expectation has come back out. hasamentally, not much changed in terms of the metrics of the growth outlook. what has changed is that there are fewer downside risks.

there are issues including greece and brexit. we those systemic things were talking about a few years ago, greece and perhaps the rest of southern europe, have gone away. and it looks like a slightly safer world. anna: where does the euro head? 14 year high for the dollar against the euro. is this a christmas gift? >> do we test to parity? i would not read much into market movements this time of year. foreign exchange markets are not as liquid as they used to be and at the end of the year, that is exacerbated. we could see it possibly be tested next week. clean slate, year. where do we go? the outlook for the u.s. economy and the fed is an important factor in that currency pairing

--but what is the outlook for the currency policy? the idea of tapering quantitative easing will be the dominant factor. anna: thank you, philip. here are some highlights of your day ahead. at 10:00, eurozone inflation data which is pertinent to our conversation about inflation. a half hour later, a rate decision by russia's central bank. 1:00 p.m., housing numbers out of the u.s. bloomberg survey sees chinese growth estimates rise. but the overheating property market --can policymakers keep up the positive momentum? ceoear from jp morgan's about donald trump's incoming administration and why he thought he was not suited to the role for u.s. treasury. greek prime minister tsipras

needs to convince angela merkel that he is not backtracking as they hold talks in berlin. we hold talks ahead of that meeting. this is bloomberg. ♪

>> i have always been quite public about not feeling i was suited as secretary of treasury. i love what i do. i think i can add a lot of value to america doing what i am doing. morgan's ceo jp speaking to bloomberg businessweek. 6:18 a.m. in london. picture on the hang seng right now. effectively quiet. the week has not in so. up to 22,074.

the asian session in general up 0.3% but it has been a generally downbeat week for the asian equities session. commentrmath of the fed . let us get to hong kong and get the bloomberg business flash. here is juliette saly. juliette: alliance is in discussions as they bid on the french operations. the executives are uncertain about getting regulatory approval and they may not reach a deal. spokespeople -- declined to comment. oracle fell in extended trade. revenue last quarter was little changed from a year ago at $9 billion, slightly below forecast. by a were dragged down decline in software licenses as the company moved towards more

cloud-based programs. will beginors testing autonomous vehicles on public roads in michigan. already running similar experiments in san francisco and scottsdale, arizona. the ceo made the announcement during a speech in detroit. >> metro detroit will be one of the primary areas where gm will be doing real-world testing of autonomous vehicles. this will be our main location for cold weather which i think we are demonstrating well today as well as winter driving conditions. havette: nintendo shares fallen in tokyo a day after the launch of its first foray into mobile gaming. super mario though has been an instant hits. it debuted at the top of download rankings and 62 countries. but investors are focused on that it was the highest grossing title in just

five nations. that is your bloomberg business flash. anna: i was not responsible. up its outlook is on the seems. first-quarter growth estimates has been raised to 6.6% from 6.5%. conference concludes today. talks saw a nemesis placed on strategies to further open up the world's second-largest economy. there are concerns about china's sovereign bonds heading towards the biggest weekly decline in more than seven years. more than 30ged basis point so far this week. philip shaw is still with us. what are your thoughts on china? are putting up their forecast for china at this time. >> it sounds about right. chinese fundamentals have appeared pretty good.

in sharp contrast to beijing's morning about downward pressures. at ayear, we are looking 6.5% growth outlook, similar to 2016. we are not worried about the short-term dynamics. it is more the corporate debt leverage and the excess capacity and how those are forced into play. that may not be an issue in 2017 but what it means in the medium-term. and the banking economy. that the plea -- that the bloomberg chinese gdp is 7%. higher than it was. why do you think it will hit that target? exports of being cushioned by a weaker currency? what will enable them to come in

possibly in line with the target? >> the weakest -- the weakness of the yuan to help in the next year. beijing has a big arsenal of weapons to throw at the economy. it needs monetary policy either through cutting interest rates. it has fiscal space there as well. there is a tight regime and it can push the economy. what is not so easy is to achieve financial stability at the same time. if you start from the point of view that the economy has set the stage -- you gravitate towards the opinion that growth will be at around 6.5% next year. -- wein terms of the yuan have seen dollar strength and one weakness as a bit of a -- and the yuan weakness as a bit of a theme.

they do not want to encourage fast outflows. , if they are intervening in the market or manipulating the market, right now, our colleagues at bloomberg intelligence are suggesting that they are stopping it from falling as fast as it wants to fall. where do you think that currency and for the chinese? >> it is a tricky one. it does appear to be downward pressure on the renminbi at the moment. you look at the reserves -- they have been falling. against the background of a country that has a current account surplus. but the scale of those outflows does not appear to be as severe as 12 months ago when you were approaching crisis point with capital outflows. sure, you're the chinese authorities stepping in.

hong kong was high which is a sign that perhaps beijing is trying to push the offshore yuan a little further also. for the moment, it appears those forces are in control. we tend to believe the yuan will be somewhat softer than it is right now. anna: we saw a spike haven't we? let us talk about the role of treasuries. chinese holdings here in white coming down a bit. takinge holdings over even though they seem to be on a slightly downward trajectory. does this reflect -- what does this reflect you? -- to you? >> capital outflows. some liquidation of official chinese holdings of overseas

assets including u.s. treasury. that is not the case in japan. whether you see a downward -- they continue to downward decline in holdings and china in is next year, i think it difficult to predict what will happen with capital outflows and pressures. but they remain considerable. anna: we are waiting for a press conference with abe. we believe he will talk economics particularly over the contested islands. should the boj do more or less? >> not very much. you got to the point where the balance sheet -- it is not having a huge effect on the economy. even the boj itself is saying there are unintended consequences of lowering rates. for now, we stand tight. anna: up next, growth on cap.

we hear from the danish coo from carlsberg. that is ahead. this is bloomberg. ♪

anna: welcome back. this is bloomberg daybreak: year. 7:30 a.m. if you are in frankfurt. in tokyo. this is the dollar against the yen. it has been a theme that we have talked a lot about this week. been supporting equity markets. japanese equity markets outperforming the rest of the msci asia-pacific session today. a new a dish and of daybreak is now available. let us take a look at some of the stories that have made it into today's edition. sanofi is in-

talks. representatives from both businesses did not respond to requests for comments outside of normal business hours. the next story is monte dei paschi. the italian government is widely expected to inject taxpayer funds. that is the latest coming through from the italian banking story. and finally, a focus on a train strike affecting thousands of commuters around london. commuters on southern rail face of another day without trains. let us check in on the markets. guy: a car park in the city of london. let us talk about what is happening here. let us deal with the boring bit first. this is where we think fair value is for europe right now.

slightly positive very not going anywhere in a hurry. in terms of the overall performance. equities have not been the most exciting place. you want to click that box there to give you the fair value is valuation. let us give you what is happening in the more exciting markets. this is china. this is where things that interesting. this is the chinese 10 year. i have taken this back to 2012. the distributions are over there. look at this rally. look at this. if it carries on, it will get very interesting for the chinese authorities as they try to manage what is a short sale liquidity squeeze managed with a longer-term story surrounding the bond market. this is still my favorite charts. this is the german u.s. 10 year spread. i take the 10 year spread because i do not like the two-year spread.

the german market has a repose squeeze which is making this a little artificial. finally, this is the bloomberg barclays global aggregate. this is my favorite chart. going back to the 1990's. a straight line. this letter is what is happening in the bond market right now. is that going to turn into something more significant? of the best example chart being the simplest. i like that one. let us talk about what is going on in the banking sector and where wall street needs washington. jamie dimon told bloomberg he would not be suitable as u.s. secretary treasury. his name was floated as a potential candidate for the position. he spoke exclusively to megan murphy. >> i have always been quite public about thinking i am not suitable to be secretary

treasury. i love what i do. i am not interested in doing something else. >> that is the answer. when i look as recently as september when you were talking about what you thought about the next administration. you said you thought it would be difficult for wall street rise to get confirmed and get in and now we look at the landscape we have now. several wall street figures. several you know very well. rex tillerson from exxon mobil. when you are looking at that cast of people, what you think they will bring to the administration that is different? about seeing wrong a wall street person in washington anytime soon. but you had a complete upheaval. the republicans are in charge. they have not been in tea business as you have seen --

antibusiness as you have seen the democrats be. i think it is a mistake for the american public to be told that if you work for an oil company or a bank that it automatically makes you bad. you want the best he. i think it is a good thing. a lot of these people are very qualified who are patriots that want to help the company. they are not going to try to help their former company. these are people with deep knowledge that will hopefully do a great job. >> when you look at the shift in terms of wall street that this is a reset moment for the industry more broadly in terms of what the american people are expecting? >> i think it is a reset moment for how businesses will be treated. 125 million americans work for private enterprise. 20 million work for government. we hold them in high regard. if you did not have the 125

million, you could not pay the other 20 million. they are a huge part of american society and for years they have been beaten down as terrible people. i think it is a good reset. detroit is a perfect example. civic society, not-for-profit, government, and business working together to improve the lives of american citizens. i think the reset has a chance to do the same thing. if you can duplicate what you are doing in detroit around the country you will have a huge renaissance. anna: that interview will be viewed in full. next thursday. live pictures from tokyo for you where president -- where russian president vladimir putin and prime minister abe are holding a joint news conference. they have also signed a raft of business agreements after

seeking economic cooperation on disputed islands. they are talking about the sovereignty of four islands known as the northern territories. the fact that they have not been able to agree on these islands between the two countries has prevented an official signing of a peace treaty for seven decades. any progress towards these and this appears to be in the form of some kind of economic cooperation would be of interest. the cooperation will be around fisheries and medicine. they have instructed the relevant parties to draw of the details. seeing some official exchanging of documentation it looks like going on right there over in japan. vladimir putin and abe. we were talking about the u.s. economy. let us get back to that theme with philip shaw. the fed was the big news item. it happened yesterday. , not by theprised

rate to rise, but what about the move in expectations around 2017 surprised at out quickly the fed is gearing up for more hikes? >> a little surprised. the big theme has been fiscal reflation. fiscalot know what policy will be precisely. i just in expectations in policy will be tricky especially for the central bank. but it was not a huge movement. looking at the dot plot -- three hikes versus two. how accurate is the dot plot? not particularly good. looking back 12 months ago, how many hikes were they expecting? four and it did one. anna: where do we go on u.s.

treasury yields? 3% on the u.s. 10 here right now. this chart puts that in context with the treasury yields in blue. dividend yield and white. substantial moves and treasuries. how much higher to these yields these how much higher do yields go? should see a picture of tightening monetary policy and growing expectations about 2018 as the fiscal reflation potentially anyway takes hold. i do not think we will be in a rally in the treasury market through most of next year. our 10 your target is 3% by the end of 2017. there will be ads and flows but one theme we expect is higher expectations on inflation and that is why we are modest bears on bonds. anna: what is driving that?

is it the opec story, is it china wage or is it donald trump? >> everything. the first one is important. higher oil prices. is other important effect that what you are doing is taking away the tail risk further as deflation or lowflation over the medium term. treasury yields specifically does reflected back. we may well be looking at a different economic outlook. if you get a big fiscal package of agreed with congress and that will be a big driver over the course of next year. anna: thank you, philip. america's relationship with russia under a donald trump

presidency is something we will be watching closely. putin has been working on relations with japan. after agreeing yesterday to seek economic corporation on the disputed islands. one company betting on russia and eastern europe in general is the danish were work carlsberg. -- danish brewer carlsberg. that -- we are encouraged by the consumer confidence. or 5% further decline in 2017. on trading ind big bottles. that will have an impact on the volume. we are confident about the for their margin development of the

market for next year. >> how confident are you of the bottoming out of eastern europe? driver but itkey has been shrinking. how confident are you that we are at the bottom? >> i can only look at the figures and the history. three years ago there was a decline. last year was a single digit. in that respect, we follow the trend and feel the market is bottoming out. >> i thought it was interesting to see the asahi group agreeing to buy some of the sab -- eastastern market european market. how do you propose to meet that competitive challenge? >> the market is not only bad news for us because we have a

formidable competitor in asahi. thatare playing in markets we do not play in except for poland. -- goodgood content competition in the countries where we are. >> in terms of the balance sheet, this has been an issue. moody's changed their rating. fromdebt rating went negative. good news from moody's because they see you cutting your leverage. is your balance sheets still a problem? >> it is no longer a problem. we continue to improve it. by 2018, we will have reduced our debt considerably. earlier, but -- below

the debt forecasted. we are very much on track. >> another interesting market is vietnam. one where you have a stake. to vietnamese want to try bring in foreign investors companies, anyom news on that deal? wouldis clear that we like to have a higher stake in that. the vietnamese government is privatizing as we speak. 16.5%. already we want to increase that. we are dealing with the vietnamese government to increase our stake and that is where we are. >> do they look positively on this? >> it is difficult. it is a process. we have first right of refusal. they recognize that. the conversations are going on. anna: the carlsberg ceo.

philip shaw is still with us. we heard from one company that is still betting on russia and eastern europe. we have an interest rate decision due from russia today. ranking the currencies by performance. three months performance of the emerging market currencies. a good performance from the russian ruble. amazing what a high oil price can do. been very weaks and fundamentally very overvalued. we are seeing a return in confidence in the russian economy. some stabilization in the economy even though the monthly gdp numbers are still negative in the year on year terms. the surveys have been improving. against that background, it is not surprising to see a recovery in the ruble. anna: oil is a factor.

we have this interest rate decision today. what are the economies in the emerging markets that you are watching? trump, istrong dollar hate to use that word deliberately -- does that make life difficult for many of the economies? >> it does. you have to differentiate between those economies that have high dollar borrowing and therefore against -- in a situation where you have an emerging market selloff in currencies, obviously the debt burden becomes that much greater. they have high dollar exposure. ao economies have had disastrous 2016 in terms of gdp and russia is one and brazil is the other. we had hoped to see some stabilization and return to growth. anna: talking about the u.k.

124.28 is where we are on the pound against the dollar. are there upsides? it is very undervalued. a degree of and are valuation that is not warranted i a reasonable economic outlook albeit uncertain. paradoxically, that is slightly better economic performance than expected could lead to a fall in ftse. your loving rebound in the currency to that degree, a all of those companies reporting overseas earnings become translated into slightly lower sterling. anna: what the pound gave it can also take away. fill it, thank you for joining us. coming up on the program, we will stick with the brexit theme, the brexit battle.

theresa may needs to fight the hard brexiters or britain will be ruined. prime minister tsipras has to convince the german chancellor that he is not -- from our exclusive interview with jamie dimon including his view on the u.s. economy. this is bloomberg. ♪

anna: welcome back. this is bloomberg daybreak: europe. 1:51 a.m. in new york. expect it to be fairly flat at the start of the trading day. when will the dow jones get 20,000. a great story on the bloomberg this morning. the dow jones and the nikkei

racing to get there first. let us talk about politics. specifically around the u.k. theresa may wants an early deal on what the exit from the european union means for citizens. fight the hardt brexiteers according to our next guest. have a lot to talk about. good morning. we want to talk about brexit and corporate governance. let us talk about the latest business flow. she has gone to brussels to talk about an early deal about eu citizens living here and british citizens living in the rest of europe. it seems unlikely that is going to be seen as possible. >> this is very fluid.

it was a wake-up call for mrs. may. there is an important constituency that could vote remain in key toric constituencies and the south of england and london. she has begun to notice that she has to look after the 48% as well as the 52%. this is about signaling that she has got that mind. philip hammond has also been allowed to say that there should be transitional arrangements. what is happening in brussels is push back. they are saying hard brexit is what is going to be on the table. until the french general elections are over, i do not think that term from brussels will change. anna: what do you make of the latest on the transition deal? hammond and others are trying to paint this as a win-win.

that is why we need a transition deal to prevent eurozone companies from being locked out of financing in the city of london for example. does that hold water in the rest of europe? with a major non-u.k. think you're in london, the question you are asking is what is the framework to do business from 2019 going forward? and it is obvious there has to be a transitional arrangement and that the u.k. needs to be able to signal that one way or another, it will remain in the single market and the banks -- we retain passporting writes. japanese banks this morning said they may start moving to europe next year or. i think a lot of banks are already doing that. and the warning about the 2000 job losses. without a transitional deal,

some of the markets in london are not going to be as deep and liquid as they have been. and all of the job losses -- that it implies. anna: dealing with brexit in many paths of the administration that they are also tackling corporate governance. there are some ideas. a lot seeking feedback. one is executive pay. they want more transparency. how do we do that? the task force is a group of companies and investment houses and consultancies. we want to try to make the british system more friendly to companies that want to try to do something, deliver a purpose overtime. and there are a bunch of things we think need to happen and we will run them out in february.

the for the green paper was released, we set out our preliminary thinking on pay, one of nine things. we welcome transparency. but what you have to do on pay -- there are only six or seven things on the dial. you can look at helping ratios have moved over time. there is long-term incentive plans over the longer-term. trying to get a handle on cash bonuses as a portion of pay. what metrics do you use to judge pay? those are the dials you have. the green paper floats movement on all of them. what we say is that if you want to get a dialogue going between unions and workforce and a board britainin a system like , not german, you do that in a process.

you have the fair pay charter. just a look at the whole thing. you suggest a subcommittee on that front. i am sorry we do not have more time. been. ♪it could have

anna: e.u. leaders clash over russia and brexit in their last summit of the year. as china'smates rise leaders plan for 2017. chinese stocks head for their weekly drop since april. wall street in the white house. jpmorgan ceo jamie dimon gives us his take on trump's cabinet picks and the u.s. economy. >> in america, you keep hearing that productivity is low, secular stagnation is the new normal. that is just not true. anna: and as putin talks business with abe, carlsberg's

ceo tells bloomberg the end is in sight for russia's downturn. >> in russia, the decline of the market is bottoming out a bit. anna: welcome to "bloomberg daybreak: europe." it is friday morning. i'm anna edwards. let's look at where futures are opening up on the equity session with we get there. the asian session has been generally positive, but a downbeat week for asian equities. looks as if we will be moving a little lower in the european session. europe and asia moving in different directions. euro stoxx 50 down 0.2%. for two 100 perhaps a little more resilient -- ftse 100 perhaps a little more resilient. we are getting comments from a risk conference between vladimir

putin and shinzo abe. putin speaking to reporters with abe over in tokyo. putin saying russia and japan are considering building an energy grid. japan is an important for partner for russia in the region according to putin. shinzo abe saying they've agreed to start talks on a system for economic cooperation. the cooperation is an important step towards a peace treaty. it is not easy to solve this peace treaty issue according to shinzo abe. this is 70 years in the making. 70 years these countries have not been able to sign an official peace treaty. let's bring up the risk radar and show you where we are on the markets right now. the dollar has been a real feature of the conversation today. the dollar index fairly flat. let's have a look at the euro.

we saw the dollar near 14-year highs against the euro yesterday. we are at 1.0438. a little bounce for the euro. the msci asia-pacific up 0.3%. japanese equities getting a boost on a week yen story. we've got the dow futures up 0.1%. expecting to make a little progress on the dow. looking increasingly like we could be heading to 20,000. that would be the first time for the dow if we were to make those kind of levels. nikkei as to who is the first to get there. we've got the u.s. 10-year yield at 2.58%. let's get the bloomberg first word news. gathering's leaders in beijing to map out plans and policies, optimism over the outlook is increasing.

economists have raised first-quarter growth estimates the month earlier as stimulus and a potential for stronger global demand buoys sentiment. sanofi is in talks for a deal that could be announced next week. people with knowledge of the matter said the companies are discussing a price of about $275 per share. representatives didn't immediately respond to request for comment. opec's secretary-general has applauded president-elect donald trump's choice of secretary of state. he says the exxon loss rex tillerson is an outstanding technocrat. >> he's highly respected around the world. he's deeply knowledgeable. as i've told other colleagues, there's a very thin oil between

oil diplomacy and geopolitics. i congratulate president-elect donald trump for making such an excellent choice. anna: the ceo of carlsberg has welcomed acai's latest moving to europe. brewer'she japanese business and purchases of former sab miller brand is not all bad news. the consolidating market is not only bad news for us. we have a formidable competitor in asahi. they are playing in markets in eastern europe where we don't play except for poland. i think we have good competition in the countries where we are. that is fine. anna: more of that exclusive interview throughout the day. global news 24 hour was a day powered by more than 2600 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top .

juliette saly has details from hong kong. juliette: it hasn't been a great week for asian equities. the regional index on track for a loss of 1.7%. we have seen the shanghai market -- 0.2%.her, 2.1 not a great week for the shanghai composite. there has been a lot of concern with the fed rate hike, the yuan , and we also have leaders speaking in beijing today. the shanghai composite over the week down about 3%. nikkeistrength means the has been a standout along with the topix, both trading at 2016 highs, both erasing losses for the years. some good games coming through. australia didn't have such a good day today and we've seen weakness coming through from the southeast asian markets. taiwan in particular and the philippines off by about 0.4%.

the other movement we've been watching his asian currencies. the pboc today fixing the yuan rate at its lowest level since march 2008. if you have a look at the offshore renminbi, it has quite a downward trajectory. trade fairly days flat. the japanese yen hit that 10-month low against the dollar. still holding around 118. anna: thank you. european union differences over russia were exposed as leaders held their last summit of the year in brussels. they demanded an immediate cease-fire around aleppo with french president francois hollande: marcia out. thehe issue here is responsibility of russia and we should all be united like we were at the european council. we should all be united to say

russia needs to take its part in the humanitarian situation which it helped create, and the necessity of a political solution, rather than to let one think one only needs to talk to vladimir putin. anna: caroline connan joins us from brussels. did they you leaders achieve anything? did they agree anything at the summit? caroline: on the e.u.-ukraine partnership, they did find a compromise so the dutch can ratify it. they also decided to roll over the sanctions on russia related to the situation in ukraine for another six months. despite calls from some countries, including sweden, for additional sanctions on russia related to syria, no sanctions on syria were decided at this meeting. aleppod meet with an representative inside the consul who made his presentation and

called for a humanitarian assistance to be able to access all about -- access aleppo. finally, with brexit and trump arriving, they you leaders decided to increase their defense spending in cooperation with nato. anna: brexit was also discussed, then, caroline. without theresa may, at least for most of the brexit conversation. caroline: theresa may did make a very short presentation during the summit. she actually said that her key the u.k.were that citizens living in the e.u. and the e.u. citizens living in the u.k., she wanted to address those issues at the beginning of negotiations. it showed a little bit of the confusion inside the e.u. about who is deciding what in these brexit negotiations.

in the end, they you leaders decided to reach a compromise. they said the country holding the rotating six-month will becy of the consul able to be represented in these brexit negotiations, but the chief negotiator for the commission will remain. and today the conversation perhaps turns to greece. the greek prime minister will be in berlin to meet with angela merkel. tell us about the dynamics between the two. caroline: obviously they both need each other. earlier this week, alexis thisas decided to give bonus for low income pensioners and tax relief for some affected by the refugee crisis. theidn't go very well with creditors and the european

stability mechanism threatened to put on hold the short-term debt relief measures that were decided. angela merkel also needs alexis tsipras. 2017ast thing she needs in is for him to play whatever the election card. you very much in brussels. joining us on set, tim graf. as caroline was saying, the last thing angela merkel wants his early elections in greece. there's talk of uncertainty around the election calendar in italy. we know a lot of the political events that are going to take place. this remains a big point of concern for those watching the european economy. tim: i think the ecb had to acknowledge, not directly, those concerns last week. but where monetary policy isn't the only game in town in the u.s., i think it still is in the eurozone. you cannot count on governments

to support economies as effectively as they would hope to. it is such an environment of unrest and uncertainty. mario draghi keeps making the point that monetary policy can only go so far. jean-claude juncker is listening. you wonder how many politicians are able to act on that call. tim: merkel is the essential politician in this dynamic. to give too many concessions away too early on the fiscal side is probably not in her interest. maybe once the election season starts to get underway. this is not something i think she can really embrace quite yet even though it probably is the logical next step to help reflate the eurozone economy. anna: so germany remains the stumbling block when it comes to debt forgiveness or looser fiscal arrangements for europe that would mean a little more spending on things like infrastructure. tim: not just germany, but they

are the two essential states in the eurozone. basically, what they say will dictate the policy. anna: what would the ecb story look like if we didn't have all this politics on the agenda? the fundamentals for the european economy. tim: they look fine. if we didn't have all the backdrop of the stories going on for the year ahead, not only would you be talking about purchases, ecb asset you would be talking about potentially the end of ecb asset purchases. five-year getting higher. tim: and it is not a perfect measure. they have reduced their emphasis on it. but it is a good measure of expectations. it is going higher. the consumer data looks pretty good. the weaker euro is a consequence

of recent moves, the particularly dollar rates going higher. the growth story looks supported. all this political uncertainty taking place in the background. anna: what about the euro? how does it perform? with thed it yesterday dollar at 14-year highs. when do we test parity? tim: maybe not before the end of the year. i think you probably will see some consolidation. it has been a winning trade for a lot of people over the last couple of months. i wouldn't be surprised to see install a little bit, but i don't think the u.s. rate story is over anytime soon. i think there's ample room for correction. i think that keeps the dollar bid and that will weigh on the euro further. anna: we were talking in the last hour, suggesting that maybe

the thin volumes around christmas, it could be tested. he wasn't convinced that it would remain below parity into next year. you see that it could? i think it could remain there for several months. until u.s. financial conditions tighten to such an extent that there is a slowdown in the u.s. to follow. i think we are a long way away from thinking about that. trump and the fed now getting back into the game a little more. but icome a long way, don't think it's over. anna: thank you very much. tim graf stays with us. we hear from jpmorgan's ceo on donald trump's incoming administration. that is coming up on bloomberg. ♪

anna: welcome back. we're looking at live pictures from tokyo of the russian president and the japanese prime minister. they've been talking about economic cooperation, the disputed islands, of course. vladimir putin also talking in the last few minutes about syria, saying the next step in syria is the syrian side to be invited to talk, for russia and turkey to invite the syrian side to talk. the next step in a russian-turkey accord is full syria truce. he says that palmyra is a symbolic issue. we will leave those pictures there. let's coming out of those conversations between those leaders. london, 8:19 in

berlin. this is where the euro trades against the dollar right now. 1.0440. we saw some big moves in the euro coming through yesterday. 1.0367 is where we hit yesterday. let's get the bloomberg business flash. here's juliette saly. juliette: thank you. gilead sciences has been ordered to pay $2.5 billion. it has been using a patented invention as the basis for its blockbuster hepatitis c drug which accounts for more than half of its revenue. it is the biggest patent infringement verdict in u.s. history. oracle fell in extended trade after sales missed estimates. revenue last quarter was little changed from a year ago at $9 billion. that is slightly below forecast. sales were dragged down by a steep decline in new software

licenses as the company shifts to offering more cloud-based programs. general motors will begin testing autonomous vehicles on public roads in michigan. the carmaker is running similar experiments in san francisco and scottsdale, arizona. ceo mary barra made the announcement in detroit. detroit will be one of the primary is that gm will be doing testing of autonomous vehicles. this will be our main location for cold weather and i think we are demonstrating that today as well as winter driving conditions. juliette: nintendo shares have fallen in tokyo a day after the launch of its first foray into mobile gaming. that is despite "super mario run" being an instant hit. according to market researchers, it debuted at the top of download rankings in 62 countries, but investors are focused on figures showing the game was the highest grossing

title in just five nations. anna: i remember the days. thank you very much, juliette saly from hong kong. megan murphy sat down with jpmorgan's ceo, jamie dimon, and he struck a positive tone about the u.s. economy. >> in america, you keep on hearing that productivity is low, secular stagnation is the new normal -- that is just not true. anna: dimon was also asked about trump's pick for his administration. >> a lot of these people are very qualified people or patriots who want to help the country and not help their former company. these are people with deep knowledge that will hopefully do a good job. anna: the full interview with jamie dimon will be aired and featured in the "business week" magazine due out on thursday.

let's talk with tim graf now about the u.s. economy. we talked a lot about strong dollar this week in general. you were talking about what that does to the euro. what do we make of the other asset classes in the u.s. amongst all the trumponomics, whatever that means. we've got here a chart of the to against the nikkei to get 20,000. the nikkei has been there before and then some back in the late 1980's. what do you make -- what is the behind how far we are through this equity cycle? have an economy that is behind how far we are through this equity cycle? tim: the earnings backdrop has been decent. now, youoperating, if not at ful employment, close to full employment. and you have a president who has both houses of congress who will be able to push through some type of legislation. we still like u.s. equities on

an absolute and relative basis. i think the prospects for earnings improvements going forward are even better. there will be limits to this, where the fed is pushing rates higher and financial conditions will tighten. it will end badly as all things do, but for the time being, it does look fairly rosy against the backdrop of what are still pretty easy monetary conditions. anna: what about the trade story? at the moment, you could argue that investors are taking a glass half-full attitude to what we know about trumponomics. we don't know exactly what the agenda will look like. positives, the that's to be said about investment infrastructure and productivity, but what about the dangers around trade? tim: the dangers are the more protectionist rhetoric and the threats on trade deals. some of that i think is a little overblown.

i think corporate america will have a lot to say. anna: he certainly been consulting with corporate america a lot, and sectors that he's not instinctively drawn to, like the tech sector. tim: absolutely. inasmuch as jamie dimon is quite right to point out that these guys are not specifically there to help their companies, i don't think they are going to do anything to hurt them either. the populist anticorporate backlash that is been described to trump's candidacy, i think you might not see that come to its full fruition. corporate america is probably not going to do badly from having a businessman as a president. anna: do you know enough about trumponomics to invest around it? can only go you with trades like u.s. rates, the dollar. i think equities are a little harder. you don't know the shape of what fiscal spending is going to look like. the infrastructure projects in the media thus far are much more

about public-private partnerships, not direct spending on roads, bridges, highways. futureight be some reflation on top of what we've already started to see. anna: if you bet on higher rates, do you bet on the banks as well? tim: i think that is a fairly safe bet. with earnings not having been bad and trading volumes starting to pick up, if you get a steeper yield curve in the u.s. and that continues, that is only more beneficial. anna: what kind of fiscal stimulus do you expect to see coming through? how much do you think he will get through congress? tim: things like corporate tax cuts are a very popular project. the repatriation of foreign earnings as a means to either invest further in corporate america or two incentivize buybacks will be one of these next legs of the equity trade. anna: thank you for your thoughts. tim graf, head of microstrategy

for emea at state street. quick look at the futures suggesting we are weaker at the start of friday's trading day. have a great weekend when we get there. this is bloomberg. ♪

guy: welcome to "bloomberg markets: european open." the first trade of your day coming very shortly. i'm guy johnson alongside matt miller. he's back in berlin and he's got a hat on today. let's talk about what we're watching today. solidifies its gains, trading near a 14-year high against the euro. yields jump from d.c. to tokyo. we're going to figure out whether it was an inflection point for the bond markets. dimon on