anna: global employers from google to general motors joining the backlash against trumps immigration. he says the green card holders will not be affected. manus: the dollar slides closer to a month low. investors seek safety in gold. anna: theresa may meets with scotland, after they were ruled they had no legal right to challenge frexit. manus: overturning the establishment tomorrow beating the former prime minister to win the french socialist president nomination.

♪ anna: a very warm welcome. our flagship morning show. manus: last week it was mexico in the sidelines of donald trump in the past 48 hours it is seven missions -- nations from the middle east. uncertainty as to what that policy will be. we're seeing money come out of the dollar. buy the dollar on any weakness you see, but you see the dollar broadly lower on the week you have -- economics will challenge politics. the bank of japan, bank of england, a great deal of ego playing out. it, the no doubt about

latest vote from trump has raised the risk off in the markets. anna: in terms of unpredictably the policy, yes. manus: yes. anna: the trade-offs they have had resulted in donald trump. dollar.d about the the dollar index drives the point home, don .2%. 80 week. banksd meeting, central meeting, corporate earnings out in the u.s.. reflecting japan and australia, much of the region is closed but there is a downward bias to equity market in region. that is even being driven or spilling into the business in u.s. features. gold, money going into

11.92. this is a pretty good at month or gold given the political distemper in the markets. all of the financials in asia coming under pressure. you have the rest coming from the corporate united states of america. they put the money where their mouth is? it is up to corporate america to make a firmer stand more than rhetoric. fortinet profit coming in at 26.7 to get young. 26.7 billiopn ye step up in the sure backn. program today. net income 26.7 billion versus 26.4 billion a year earlier. good morning. guest: -- \ reporter: u.s. government is

taking steps to restore order to global air transport after a weekend of chaos following president trump's travel ban on muslim countries. u.s. resident covered by the executive order should no longer be detained at airports. the agency statement came as gate crews immigration officers tend with conflicting index. -- cross of and thousands get it from new york, atlanta, detroit on sunday to protest the trouble restrictions. he also drove it is is him from canadian prime minister and angela merkel, john mccain. suggesting the action was too broad and potentially damaging to the united states. u.k. prime minister theresa may is to meet the leaders of scotland, wales, and ireland days after judges ruled they need not be consulted about

brexit. according to a statement released by mays office, among those joining the meeting will , the supremes court said the process of leaving the eu will require approval of the u.k. parliament but not regional lawmakers. willr education minister carry the socialist flag in the french presidential election having defeated the more establishment candidate. he took 59% of the vote in the primary and is expected to face the conservative former prime minister in the far right leader marine le pen in may. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. you can find it more stories on the bloomberg best top . let's get to abu w.

the middle east market reaction. yesterday the markets more or display, what is the thinking this morning? is actually difficult to find a direct market impact. barring stocks were standout markets in the region. none of those countries are directly affected by the fit trouble van and perhaps that is the secret. in fact the one market is directly affected as iranian stocks. those were actually up yesterday. the stock market is open 3.5 hours per day. difficult to draw a lot out from that. if you do have the dollar falling this morning, down .28%. that takes some additional

pressure off of all of the gulf nations that have dollar eight. a mixed bag at the moment. unable to draw out the concrete theme. the latest on the markets. closed,the asian region pressure coming through in tokyo in sydney. after a weekend of chaos and confusion over the travel ban on seven muslim countries, white house staff has stopped to --manus: the initial band seemed to include people with the rights to live and work in the united states. but the chief of staff reince priebus said that is not the case. green card holders moving forward it does not affect them. if you're coming in and out of one of those seven countries. identified by the obama administration at the seven most

dangerous countries in the world in regards to harboring terrorists and for by congress multiple times. you are going to be subjected temporarily with more questioning. anna: joining us now is chief economist, lena. perspective,tor people trying to weigh out fiscal promise, which is what they have become excited about you how much fiscal stimulus will he deliver. the unpredictable duty of his policy. we have been trading the uncertainty of this rhetoric of donald trump. lena: this newly discovered

american policy. this is arting to series of executive orders on immigration, this is for a realized we are looking at the risks. willransition in my mind mean the markets can longer focus on the physical side. interesting how there has been no discussion from him in terms of physical programs nor any discussion from him in terms of the tax rebates he promised. there was evidence on friday, this will add fuel to the trump fire. exports from the united states dropped 1.7%, the most since 2010. this kind of data will add to the make america great again -- put america first. his rhetoric armory. would you look at the gdp

numbers last week, the first order performance this is an economy that is booming. firing on all soldiers. joblessness at the lowest levels -- a confirmation from the report this week. while the whole economy supplies high growth, came in below expectations. actuallydemand is roaring ahead. consumer spending was 11% growth. per capita expenditure was 11% growth and imports was 11% up. this is double-digit growth. this is not an economy that --anna: 20 look the gdp record he is inheriting, a graphic that illustrates the economy. you say it is not an economy

that needs the stimulus, what does therefore spending on the structure do? maybe this is over inflation in a hand that time is not needed? hand there's ae big question about the fiscal stimulus, but also when. there's a big if and when attached to this stimulus. extent an issue to what that will affect u.s. growth in the long run. in the short term, generating will help totion push up wages. in the long run i am not entirely sure what a mexican wall will do to u.s. productivity if anything at all. if you combine that with the fact that any lasting damage from current crate and

immigration protections will have a negative impact on return on u.s. capitol. beyonde a mixed picture the next two years. manus: in terms of inflation, let's pull it up again. per consumption expenditure over the next president. is this what we have been benchmarking. mrs. obama, he promises to be one of the biggest job makers in the world. how much tolerance is there at the fed for running -- there is not that much fertility at the fed to run hot. there talking about the balance sheet which is a whole different discussion. lena: the extraordinary thing is we have annot economy that is really grown up very well. we look at the trend of labor statistics over the last year, the pace is not sustainable at this late stage of the recovery.

what is quite clear is that there's a steady decline in the unappointed rate to levels that are beyond --manus: 25 million jobs on his website. is that a dream? possibly, yes. he will have to rethink its immigration policy. anna: there is nothing in the data run out of one of the fed from hiking. a dartmouth to in that chairsits last week and said actually that unemployment rate doesn't tell you the whole story. there are so many people that have left the job market. actually the u.s. economy is not ready for those rate hikes. lena: if i'm he would say that y bed be -- if i mayt

flippant, he would say that. the demands is like lightweight is growth. -- a steady upward drift in wages that demand for labor is very down in the late stages of the recovery. that is a fiscal stimulus has been introduced. manus: the market in you next hundred days, we need to see a shift and delivery in the next 100 days to shift the market forward. anna: i don't --lena: i don't necessarily think so. when you look at how the markets have behaved, even in the face of these executive orders from the trump administration over the last week, we saw the dow break 20 k.

, that tellsricing ,s that financial conditions the fed will move toward tightening and there is a reflation trade to be had. shortened rates in the u.s. are negative and the inflation rising the fed is going to fall for the behind. there is no way for them not to move soon. anna: thank you so much. later will look at the views of the harvard university president and former u.s. for kerry secretary. he will be joining to break america to discuss president trump's erica. -- america. manus: a pretty busy week. buckle up. we get decisions from the bank of japan tuesday, the federal reserve on wednesday, the bank of england. markets closed until

thursday. manus: apple facebook, shell, deutsche bank to recover -- post this week. anna: the estimate is 175,000 jobs were added to the u.s. economy in january. manus: busy week as we have been saying but also in britain, theresa may prepares to meet regional leaders concerned about brexit and the bank of england gives its latest rate decision and the inflation report. anna: and we had to paris and get on the socialist candidates. ofus: after weekend confusion, panic, legal challenges, deeper into president trump's latest executive order. this is bloomberg.

♪

anna: welcome back. takingar new year various markets out of action today and in some cases through longer into the week. let's get the bloomberg business flash. starbucks plans to hire 10,000 refugees over five years from around the world after president trump's immigration actions. the ceo wrote he had a heavy heart over trump's order and the promise of the american dream is being called into question. in a letter to employees he wrote that starbucks is in contact with those affected by immigration bands and will do everything possible to help them navigate through the confusion. toyota has lost his title was the top-selling carmaker in the world despite its rival surf that suffering the worst in history. 10.2 million vehicles in 2016 while likened menaced 10.3.

the fallout from the diesel emissions scandal. saudi aramco is said to be considering $5 billion of investment. this part of the plan to diversify away from oil dependence. hsbc, morgan has been approached to identify targets and advise on deals. saudi arabia wants to produce 30% of its energy from renewable sources by 2030. making a push in washington to help build president trumps mexican border wall. success.y security shares jump on friday after he said he would put a stop order breaches. that is your bloomberg business flash.

thanks a lot. that's returned to brexit, the prime minister is said to meet later today. that is less than a week after the u.k. court ruled that the government had no legal right to challenge pregnant -- prisons exit from the european union. anna: senior party figures want to adopt a norway style model allowing an independent scotland to stay inside the single market but outside the eu after brexit. we have just seen theresa may return from the u.k.. those pictures went viral, holding hands for a news conference that went quite well. what do we need? what is the united kingdom need for good trade relationship for

the united states? lena: our future relationship are going to be even more important, particularly if we are looking at a standoff between the u.s. and mexico traded by the u.s. administration. lead to a rise of global trade and mercantilism. protectionismrade . that would ultimately have an the u.s.ming up that has with the eu. how that affects the trade negotiations and for the global

growth at the macro level. trade flows have been weakening, traditionally for the last 100 years that has been associated with weaker global growth. at the micro level it means more winners and losers and that could really disrupt us in the u.k. economic model. anna: is that a threat to globalization, more of a longer-term trend. -- twoto u.k. assets weeks of trying to get this article 50 bill through parliament. this is going to be a point to watch intensely what is going on. sailing ift smooth it is the two biggest costs in the house of commons saying it will not let this stand in the way of brexit? the: it lends itself to discussion we had before the break about the fact that we are risk now.y from a

article 50 is about be triggered. the extraordinary change in political climate in the u.k. is something that should be noted as following the 2015 general election this is a country that was desperate to leave and now we happy pro brexit parliament. that is a extraordinary change. the worry here is that if the deal withnot have a the eu at the end of the two-year. that this is for the article 50 exit negotiation process. we are looking at a clip edge for u.k. manufacturing, transportation, and financial services. manus: this government said they will us know what happens at the hands. they want to avoid a cassette. she even used the words transition. . the bank of england has a greater job, perhaps the never before.

the acted in the eye of storm luster. an update from the bank of england. economists will raise 2017, moved on 2018. risks are rising. how optimistic are you in terms of growth should for the u.k. in a. his of two years? probablylation will can't toward 3% in 2017. manus: give me something new. everybody says that. lena: i think that's the expectation although inflation extent revisions to the growth and ncicap projections. historically associated as a hot this message. it will be very much on the press conference if he tries to talk about the fact what happens after brexit. to parisnext we had

for more on the socialist party primary and the winning candidate. what his victory on the socialist side means, who that puts him against. ♪

♪ you're looking at the emperor's palace in tokyo, 14.59.yen rising 114.59. the cover story is about president trump's band. anna: u.s. airports trying to return to calm after a week of chaos on immigration. u.s. corporate speaking out on the suspect. very directly or indirectly dialogue with the white house.

manus: one other story which is doubling away in the background is greece. the imf says it will be explosive in the decades unless europe eases the load. this is a warning coming from the imf about the reality of the agreements made in regards to greece. anna: daybreak focuses on the british prime minister theresa may, talking with leaders in wales today. she will be meeting leaders at the welsh assembly in northern ireland leadership. there's something of a chaotic situation there. the is simply being dissolved until elections in early march. we are meeting leaders of the scottish government as well. stocks in tokyo slid for the first time in four days and up to the trunk

travel ban. and lots of asia is closed and on vacation for chinese new year. we are seeing classic risk aversion today. money moving out of equities and the dollar into bonds and gold. love markets are closed in asia, , singapore,hina vietnam among those close. asian stocks trading to the downside. the index snapping a three-day rally. falling from a four-month high. groupsook at the various on the imf, the great majority of them are posting and leading the losses at the moment. talking about the dollar, we are seeing a worker dollar tracking the treasury yields cannot heading lower. these are major currencies against the greenback, beginning any against the dollar, ", the mexican peso, sterling

unchanged. dollar positions getting trimmed in asia, that's what asian-based traders have been telling bloomberg news colleagues. this is an adjusting chart because u.s. futures pointing lower. we could sit the u.s. equity market open later. these susall ratio on and he 500 falling. of there signs postelection euphoria in the u.s. market continuing. i want to draw your attention to this chart. than --atility higher this as you can see is a lingering near the levels seen at the height of the taper tantrum in 2013. that equity volatility lower than best something to think about ahead of the fed meeting this week. anna: thank you very much.

kuwait stocks, the best performers this year, have extended their rally. yousef joins us more with charts of the hour. yousef: good morning. day 18. 18 days and this is ongoing. going strongly. we are at the highest level since november 2014. really giving you a bit of conflicts -- context in the rally. the strong volumes as well which i have highlighted there. is newsdriving this around the first international debt sale they are planning. they have already picked six thanks for that. and you have the improving fundamentals off the back of recovering oil prices. have representation and a lot of these games have

been happening 70 days. outperformed stocks in real estate, financial services, technology. an of 30% in just one month. what all of this, you're looking at more than half of kuwaiti 70.ks in excess of possibly being overbought. tread with caution is what a lot of traders are now telling us. it was of caution from the dubai office in the middle east. the presidential campaign in france is gaining steam. the victory with 58% of the vote. manus: the republican candidates it isey big rally and scandal. his wife joins us from paris. consequences of this

victory for the presidential race. line: we have less than 100 days to go before the elections. dissidents in the government will represent the socialist authority, the loser former prime minister wishing good luck. but now his challenge will be to unite the socialist party. taskwill not be an easy given his very hard line on the left of the party. he has been nicknamed the jeremy corbyn of france. he wants to create a basic minimum wage of 750 euros per month for teachers. he said in his victory speech that he will try to unite the french. >> of course there are many reasons to be worried and the world around us is more unstable

than ever. the us session to power of donald trump in the u.s., the pressure of vladimir putin on in europe, and the far east and middle east the terror threat at our door. the ecological perils exerting pressure on in nature. everybody can see that if we tackle this with fear in our chest we will end up with candidates of fear. i want to unites the french. >> the latest poll last night, mightrdline on the left tear off the moderate voters who could in instead choose to rally macombe.cone -- the gap between the two has never been so narrow.

anna: the gap has never been so narrow. suffering is a result of the scandal surrounding his wife. he had a big rally lester day, did he put his campaign back on track? >> levi by wife out of this was the main message at his big rally. it was played a very long time ago, long before the scandal. he was very emotional when he talked about his wife at this rally. he said he has nothing to hide that the couple only has one bank account and grow pretty small town in his own region. ands in the first row received a standing ovation which made her burst into tears. the damage has been done, his image has been suffering and boosting the chances of emmanuel

macron. the real issue is the relationship. manus: all roads lead to the discussion about money. caroline was giving us the latest, if you go to eu go you this up. up -- pull jumping like a stone after the news, marine le pen trending slightly ahead. politics,ook at the less than 100 days, if you envisage in any way, even though everybody berates me, a possible worlds where marine le pen exceeds the power? -- comes to power. lena: the possibility is a real.

in terms of the electoral calculus it was let less so. it was quite clear that the socialist group will feature strongly in this presidential election given the difficult task of uniting the party behind a far left platform. then uniting the country. two very tall walls to climb. ideologically a very familiar sendoff from the u.k. and the u.s. between the centrist liberal consensus and the newly populism,vism, protectionist tendencies. on the far right. electoral,t to your the difference is that the european politics tends to be

more proportionate representations of the system, which makes outcomes less likely but it is quite obvious that marine le pen will be a major power broker in french politics after the election and that will affect the mainstream politics. anna: she leads in the polls run the first round and this chart is because of actually taking power at the end of that two-stage process. on the right side of this he is calling a fixed to the french economy. does that sound like a recipe that would be good for the french economy at this time? lena: i'm worried about the class divisions implied. electoralat the oculus plays in the u.s. and u.k. lends itself in the origins

of the great financial crisis. the rise of any quality and there is a rising share of the skills andhas low low wages that have not received and not been treated equitably of the last decade. repealing -- appealing to a centrist, where is he going to get the numbers? manus: is explaining the indigenous politicians rather than europe? what is blamed the local politician because you are unhappy with the traditional norms but has that translated into play in your local politician quid pro quo europe is responsible for my woes? that is the british tendency? lena: this is the pens prep for as well.

donald trump seems to be about -- we have a strong parallel across the ocean. donald trump blaming the rest of the world for the troubles of the u.s. low-wage workers. anna: meanwhile german inflation numbers, how strong would be for germany in a january? certainlye 1920's, the noises from berlin have been getting louder. should fight be listening to berlin -- lena: we like he's here clear as possible. from risk. one thing becoming very apparent that we are the last leg, the technical and political to the extension by the ecb will be great even -- couldemployment accredit the u.s. unemployment

and -- frome several years away reaching the 2% target. we are looking at the end of qe forever in the case of chronic disinflation a problem. the end is going to be coming at the end of 2018, early next year, we have to avoid because edge. at the end they will just taper off. manus: thank you very much. up we will talk to the director general of the british chambers of commerce adam marshall in his first interview of the day. anna: after weekend of confusion, panic, challenges, we the executive order. manus: we talked to the pound, the prospects,

this is bloombeg.

♪ anna: welcome back. u.s. futures weaker at the start of the trading day. what we have heard from president trump and his immigration policy over the weekend, we see limited to trade coast because of the lunar new year. starbucks plans to hire 10,000 refugees over five years around the world after president trump's immigration action for it ceo wrote that he had a heavy heart over trump's order and the promise of the american dream is being called into question. in a letter to employees he contactarbucks is an

with those affected by the band and will do everything possible to help them navigate through the confusion. its title wast the top-selling car maker in the world. despite its main rival suffering the worst year in its history. point 2 million vehicles worldwide and 2016 while. can managed 10.3 million. struggling with the fallout from the diesel and emissions scandal. is considering $5 billion of and rested -- investment to diversify away from oil dependency. several big lenders and closing agent hsbc, jpmorgan have been approached to help identify targets and advice on deals. saudi arabia wants to produce 30% of its energy from global sources from 2013. -- 2030. the second major domestic u.s. airline to ground services due

to computer glitches in a week following united continental. delta flights are exempt from the grounding -- the federal aviation administration says in a statement. it your bloomberg business flash. manus: thank you very much. publish their international trade survey today which says that europe will remain a key export market despite the brexit vote. we have the director general. over a third of the responders are planning to put more resources into exporting to europe markets over the next five years. driven by optimism from growth or fear from being left behind. adam: it remains a key export market for them, they see potential changes to their

trading, a lot of them want to scare what they have and find new opportunities as well. where seen the parties that to put more into europe. they go the conventional wisdom that suggests families would be moving elsewhere. reaction you don't seem to be substantial disclosure from theresa may. members make up what theresa may said over the last week or so about not saying the central market. this was before the prime minister's big speech. those who are likely to be directly affected have already been scenario planning, thinking about what to do next. those were indirectly affected will take it off it comes in response how they need to. quite a lot getting on with business rather than starting to look at alternatives.

manus: one talk -- one that caught my eye says 15% are interested in resourcing internationally. whatever the outcome of brexit, what are the outcome of precipitation -- participation in the market, businesses are expedient. if that the number i want to keep an eye on in terms of interests? adam: 15% to looking to source more for businesses, some are looking to say they are sourcing was from overseas markets in the european market as well. a lot of businesses are starting to take a first look at whether they can get things from the market or whether they can get him in the u.k.. you often say businesses wants to get on with business.

i was reminded of this when we looked at the impact of the nafta deal on the u.s. economy in the chinese u.s. relationship. that didn't stop that trade relationship from developing. as they say we're going to get on with things regardless? adam: they will get on with it matter what happens. want a good trade deal with the european union, the best possible terms of trade between get for the future. all this talk of free-trade agreements -- they are already working in markets where there may not be at agreement in place. you've substantial extra the continent and you're assuming free movement of various supplies coming into

your supply chain, then you find your outside the customs union and all the stuff you get importing gets held up at the thatr four days or longer is going to make a substantial difference. adam: of course well. those who are directly affected by the exchanges are already planning what do next. in case origin becomes a key issue for the future. all sorts of different reactions across the business community from no reaction to very serious changes on the way they operate. there was a real mix think liberalization of overseas markets for these businesses as important. we will make business easier, but is often more important than national agreements. manus: take the bankers of a on migratinge their business to other centers.

what kind of businesses are making serious decisions and ramifications for the growth of this economy? adam: one of the manufacturing sector while around 10% of the gdp is nearly cap u.k. exports. significant in terms of value to the u.s. economy. looking where to import, or to export. changes in strategy in order to deal with what is likely to help. adam: what we get from a u.s.-u.k. trade deal to allow freedom of movement and compensate for a lesser level of access? adam: businesses would love to -- very mind 20% goes to the rest, a flow of trade is already significant even in the absence of a free trade deal. we have to look at this carefully.

it's not necessarily a good deal. a lot of competition in the ways of u.k. businesses and u.s. businesses in the event of lowering the trade. the subject's government will look very carefully at the interest in u.s. businesses in the u.s. economy. i think they would expect the u.k. to do the same. manus: switzerland saying they want to have a deal with the picturesngdom, the usa go global. shift the bonus in a medium-term? think it is the interest of european business communities. it is up to us collectively to put pressure on national governments on all sides to say this is what we want.

business wants to trade, they want to do it as soon as possible. anna: you just said it on television. thank you very much. when we come back, we'll talk more about trump and the dollar. this is bloombeg.

manus: fighting back. global employers, from google to general electric, joined the backlash against trump's immigration. the u.s. government says green card holders won't be affected. anna: flight to haven. the dollar slides close to a two-month low and asian stocks decline. -- thetheresa may uk's highest court rules they have no right to challenge brexit. anna: overturning the establishment. win the french socialist presidential nomination in n. we are live in paris.

manus: welcome to "bloomberg daybreak: europe," our flagship morning show. anna: welcome to the program. 7:00 in london, 8:00 if you are in much of france, germany, and the rest of europe. let's have a look at futures. suggestions of weakness at the start of the u.s. trading day. limited trading in asia because of the new year holiday. tokyo open, sydney open. we are getting a downward five coming through from the asian session and nervousness around donald trump policies, immigration, and the unpredictability of his policy announceements. manus: that transfers itself nicely into the risk radar. last week it was mexico, getting mexico to pay for the wall, canceling the meeting, then of

course there was that real -- we bounced off the lows. this is dollar against the yen and the euro. our next guest says you want to use any of these opportunities to get long -- the question is how long do you want to be in a rather skittish series of announcements coming through from the new president in the white house? let's have a look at the risk radar. the dollar is down, broadly lower. it's a big week in terms of the fed action. they reiterate tomorrow -- are they going to talk about yield curve targeting again? asia,arkets are closed in but the msci is down. anna: in terms of that reevaluation of the dollar, investors are trying to work out -- how this unpredictability offset the promise of fiscal stimulus, which we have heard from? that is something we talked about in the last hour. over in asia, we see the hong kong market, malaysia, korea, singapore, taiwan, vietnam, and

the s&p futures -- we have a lot of earnings out of the u.s. and the fed rate decision, and of course the nonfarm payrolls number. manus: a couple numbers coming through on trump. the executive orders that went down on friday, the immigration policy, the courts challenged those over the weekend. more lines coming through from trump, a draft order that calls for a prioritization of american workers. the next to move on immigration will hit closer to home for tech companies, and this fines it is specifically directed at those visas for indian i.t. firms. there's an executive order draft, and and i must emphasize this -- it may cut visas for india i.t. firms. anna: this comes as many of the tech companies, silicon valley companies, were at the vanguard

of criticism over the weekend. markets.k at bond yields at 2.48%. where does the truck policy take us? how is the fed reflecting on it? let's get the first word news with desi humphrey. good morning. desi: thanks. the u.s. government says it is taking steps to restore order to global air transport after a weekend of chaos following president trump's travel ban. the department of homeland security says permanent u.s. residents from nations covered by the executive order should no longer be detained at airports. the agency's statement came as airline gate crews and immigration officers were left to contend with conflicting edicts. meanwhile, crowds of thousands gathered from new york to atlanta to detroit to protest

the troubling restrictions. trump also drew criticisms from global allies, like canadian producer justin trudeau and german chancellor angulela merkel. republicans released a joint statement suggesting the action was to broad and potential -- was too broad. theresa may is to meet the leaders of scotland, wales, and northern ireland days after judges ruled that they do not need to be consulted for brexit. among those joining the meeting will be the brexit secretary david davis and trade secretary liam fox. the supreme court says the process of leaving the eu will require approval of the u.k. parliament, but not of regional lawmakers. the former education minister will carry the socialist flag in the french presidential election, having defeated the more establishment candidate. istook 59% of the vote and

expected to face the conservative prime minister and the far right leader marine le pen,, in april and may. the imf says greece's public debate and financing needs will prove explosive in decades to come when europe overhauls its program to ease the loans. the imf's baseline scenario is that greek government debt will reach 275% of gdp by 2060, according to a draft report. the imf is once more proposing that europe extend grace periods and maturity dates on the loans. police say that six people were killed and another eight were wounded in a shooting at quebec city. 39 people were in a mosque at the time of the attack, two people have been arrested. the canadian prime minister just and true to characterize the shooting as "terrorist attack on muslims."

global news, 24 hours a day, powered by over 2600 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top . i'm desi humphrey. this is bloomberg. anna: thank you very much. let's look at the market reaction to everything that trump had to say around immigration of the weekend, and the chaos that was unleashed at many airports. will dobson leads the market live blog team in joins us in london. good to have you. in terms of the regional reaction, looking at the middle east, this wasn't a policy around the middle east -- it covered countries in africa as well. but around the middle east, it seems as if markets have taken these announcements in stride. >> yet. there seems -- yeah. gains,re largely particularly in saudi arabia, which is excluded from the ban, but otherwise not too much, to

get out of those markets. i think you will see more of an impact on a personal, individual basis. in companies, you have employees that need to move into the united states and back home again regularly. og,us: i'm looking at the bl the sentiment throughout the morning is a fairly berlin take on the -- a fairly burlish take. the start of the week will be dominated by the tone in the holiday syndication sentiment. -- holiday-thinned asian sentiment. whichs the prism through they will likely show their lack of ease. >> that's right. while the middle east isn't reacting too much, the broader tone in markets today is one o disquietf. how much reputational damage is trump going to do with things like this?

when there is uncertainty in the market, everybody goes for the havens. the yen is stronger, treasury up. anna: we live in times where political surprises keep coming. we'd be talking about wrath central banks otherwise. does that cut through all the tropump -- >> there is so much going on. legally watching the fed, but it doesn't feel like much is in play. can the fed push it onto the radar? a could be very strongly bullish for the dollar, and could push at u.s. rates. that would probably take away the doubt hanging over the currency. manus: let's see what the bank of japan comes out with. they're still very much focused on the pound. chaosafter a weekend of and confusion over donald trump's travel ban on seven muslim majority countries, white house staff have sought to allay

concerns over who the executive order effects. manus: if we reflect back on the series of what has happened over the past couple days, initially we had a ban that seemed to include people with the right to live and work in the united states. president trump's chief of staff, reince priebus, said that is not the case. >> green cardholders, moving forward, it doesn't affect them. but here's the deal -- if you are coming in and out of one of those seven countries, by the way, identified by the obama administration is the seven most dangerous countries in the world in regard to harboring terrorists and affirmed by congress multiple times, then you are going to be subjected, temporarily, with more questioning. anna: the dollar weakened against all its major peers, trading near the lowest levels in two months. our next guest recommends taking advantage of the current dollar weakness to build dollar long positions.

stephen say well is the global head of fx strategy at bnp paribas. good morning. whitey you think this weakness is unwarranted in the dollar? when you go back? -- when do you go back? >> a lot of this is positioning. if you look at our positioning indicator, we have now seen the dollar longs that have started since president trump was elected. they have effectively come out of the market. the point here is that the market is no longer pricing anything in, as far as a trump rally. if we brought in the discussion further to, say, bond markets, equity markets, foreign exchange, this is where it gets interesting. we don't think the market is fed, and we would say it's not just the fiscal stimulus that is coming from donald trump, it's the current state of the economy, and specifically inflation. it is our discerning to pick up. it will be interesting to hear janet yellen this week, to see which he has to say. could she become more hawkish?

isld she suggest that this fuel being thrown on the fire? right here and now, growth is stronger than anticipated and inflation is picking up. manus: many people would argue that -- how can they get out further ahead? they don't know when the fiscal stimulus, or for that matter what the tax policies, are going to be. how much more aggressive should they be, in your view, or could they be, this year? they are telling us three. >> this is a key point. remember, the markets are not pricing this. i'd tend to go with the fed. the key point is to listen to janet yellen to see how she responds to the fact that we have u.s. cpi at 2.1% already. we have unemployment at or below m-- think you are very right to say that the fed doesn't know

what's coming as far as fiscal stimulus is concerned, but i think that the fed may be more interested in what's happening here and now, but they have still got in the back of their mind that there is likely to be some fiscal stimulus coming later in the year. anna: in days to come, do we see the fed trying to march very much under the radar? if they think they are going to do three, they need to start soon-ish. >> i think that's a strong likelihood. the market needs the price more in. if we come back to where we started the discussion, i think this could be an opportunity for the dollar. bnp paribas says three nice trades on the dollar -- the best ones are clearly dollar-yen. we're targeting 128 by the end of the year. we like short euro-dollar as well, given that there is dovish policy coming from draghi. and we also like long dollar versus the canadian dollar. it's quite a broad spread, but we think now is a great opportunity to take it, given a lot of this positioning has come

out. manus: you mentioned the canadian dollar. has shifted quite dramatically. when you talk about the peso -- but this is, of course -- the hedge funds are bullish again, in this big turnaround. how does that fit with you? >> this is interesting. as i said in my statement, let's broaden this out to equity markets, bond market, and currencies. i'd like to link the commodity book to equity markets, and this is quite interesting. our internal models at bnp, shorter-term, that tells us what is driving currencies at any given point. what it's telling us, screaming at us at the moment, particularly the australian dollar in new zealand dollar have a very high correlation to global equities. my point would be the dow seems to be struggling at these levels.

if we do see more fed tightening coming in, if we do see equity markets come off, global equities particularly, the best way to play that in foreign exchange are short. anna: and that also stands if we see markets becoming increasingly concerned about trade, particularly the chinese part of the equation. we've se donald trumpen very active on the mexican front, on immigration policy. y executivehad an orders around china as yet, but if that becomes a big issue, then surely the australian dollar is in the firing line. >> we have already seen this with tpp. australia's focus here is to go ahead without the u.s., so they will take tpp with china but without the u.s. this is a key theme for australia. obviously china is its biggest trading partner. the currency is very elevated.

if we do get weakness in the s&p 500 and trade issues, the australian dollar looks honorable. manus: a little more to get out of you. stephen say well stays with us. anna: later, we will get the views of the harvard university president emeritus and former u.s. treasury secretary larry summers, joining us to discuss president trump's actions. you can see that conversation at 12:30 u.k. time. manus: up next, the pound post-brexit. this week's bank of england rate decision, and with article 50 firmly on the horizon, we discussed sterling's prospect, next. this is bloomberg. ♪

manus: ok. 7:19. beautiful morning in berlin. euro-dollar at 107. will at last? . -- will it last?

it's 8:19 in berlin. deadly humphrey standing by. good morning. desley: good morning, thanks . major automakers, including four in gm, have so far state silence on trump's order on immigration. in an earlier story we wrote we had said gm has spoken out. represent us from carmakers including the, chrysler, toyota, and nissan declined to comment. 10,000ks plans to hire refugees after the immigration act in. -- action. the ceo said he had a heavy heart over the order, and that the promise of the american dream is being called to question. in a letter to employees he wrote that starbucks is in contact with staff affected by the immigration ban and will do everything possible to help them navigate through the confusion. halted american

flights because of technology failure. its second major domestic u.s. airline to go down due to computer glitches in only a week. delta's international flights are exempt from the grounding, which was caused by "automation issues." the faa said that in a segment. toyota has lost its title as the world,maker in the despite its rival suffering the worst year in history. it sold 10.2 million vehicles in 2016, while volkswagen managed 10.3 million. toyota is struggling from the all out -- from the fallout. saudi aramco is a to be considering up to $5 billion of investment in renewable energy funds. this is part of its plan to diversify away from oil dependence. several big lenders have been approach to help identify target and advise on deals.

saudi arabia wants to produce at least 30% of its energy from renewable sources by 2030. and that's your bloomberg business flash. anna: thank you. prime minister theresa may will meet with leaders in scotland, wales, northern ireland later today, less than a week after the uk's highest court ruled that they have no legal right to challenge britain's exit from the european union. manus: meanwhile, the scottish national party is close to ditching its battle for all eu membership -- for fall eu membership, according to unidentified people familiar with the matter. senior party figures want to adopt a new model allowing an independent government to stay inside the market, but outside the eu after brexit. stephen say well is still with us. the pound conundrum. talk to me about how the market is positioned on the pound after what was a pretty triumphant weekend for theresa may. well, it started that way.

handholding, guiding, standing in front of the bust of winston churchill. >> we would argue that the market is very short and has been for quite some time, that the short position hasn't come off. we have seen quite some rally in guiding, standing in front of the bust of winston churchill. >> we wouldsterling, particulars the dollar, we the dollar, we wt is the right trade. we are bullish. anna: how bullish? >> it's interesting. it's hard to see a dramatic rise against the dollar because we think the dollar will do quite well. weekly on thursday we shifted our recommendation from long cable to long sterling to short sterling, because we think the euro is vulnerable. we would reckon it's now or point is- and the key the positioning. we think the market is very short sterling.

the way we look at positioning does not necessarily mean reversing, but it shows a vulnerability if there was any kind of positive news. manus: it has been very hard -- it's been difficult for sterling to get a bid win there hasn't been a piece of good news. it doesn't last very long if it does. you have offered up some structures that you think -- i want to know what makes you so convinced that we are going to get a raft of good news. >> sure. thank you for challenging. let me bring the big picture here. when we look at valuation, we can do this on a relatively medium-term perspective at b.n.p. paribas. what our quantitative analysis tells us is that the level of sterling that fell down to 1.20 against dollar, we are a very extreme levels. we know from an historical perspective, you don't get 55 year lows very often. but what we simulated was to

throw all the bad news possible market, even things like zero trade between the u.k. and the eurozone. when you do that, it gets you down to just below 1.20. the bottom line is when we got down to those levels, it's a bit like stretching an elastic band. we're very stretched as far as valuation. turned the argument around and said it's hard for sterling to follow much below that 1.20. anna: does throwing all the bad news you can think of at the pound, does that includes some fairly out of the consensus scenarios, like another independence referendum being talked about at the same time as of this brexit conversations? >> we realize that the u.k. starts with a very large current account deficit, around 5% to 6% of gdp. it has to attract a huge amount of funds. the you can has been doing that very successfully, and

bizarrely, even since the brexit announcement, it has been doing that. what we are assuming is that those flows completely disappear. what we know is they haven't. so we think a lot of the sterling weakness is speculative positions in the market we spoke about. from that perspective, any kind of talk of free-trade deal with other countries ar, a more friendly relationship with europe, ongoing access to the eu market, sterling could rally sharply. manus: euro-sterling in six months and cable? >> euro sterling, we think it goes up toward 80. manus: cable? >> less aggressive, maybe 1.25. anna: thank you. stephen saywell at b.n.p. paribas. is: 26 and the rest of europe. -- 8:26 in the rest of europe. manus: paris, frank for, all european markets -- frankfurt,

all european markets later. more investors coming. that's it. the european open is up next. this is bloomberg. ♪

guy: welcome. this is the european open, your first trade of the equity session coming up. i'm guy johnson, in london alongside matt miller in berlin. what are we watching this monday morning? trunk turbulence. the presidents immigration dan sparks a backlash from political and business leaders. european futures point to a softer opening. the president signs another executive order at 3:30 p.m. gmt. what effect will this one has?