anna: a lesson from america, but still no calls. a thank you note to smooth tensions between the world's biggest economies. manus: fourth quarter profit tops estimates. plans for an ipo of the car leasing business. we sit down with the ceo. and talking about banking and business. >> there will be no [indiscernible] anna: brexit moves ahead. britain's house of commons triggers article 50. it now heads to the house of lords. ♪

anna: a warm welcome to "bloomberg daybreak:europe." i'm anna edwards. manus: breaking news, where in the middle of the earnings season. anna: let's go with the french banking sector. societe generale, coming in above the estimate of 315 million. the other big strategic announcement in the headlines, the plan for an ipo of its car leasing business. the numbers coming in ahead of estimates. and carting -- including the sale of a croatian unit. record low interest rates. tougher capital rules. ofaging to make the most improvements in the french consumer banking business that they operate. iny plan to offer shares

their auto leasing division this year. we will be bringing you further comments from our conversation with the deputy ceo throughout the day. worked that coming up shortly. manus: we just had a red headline on commerzbank. ,his will be good news fourth-quarter net income, the market had penciled in 173. ,his is the buffer of capital 12.3%. provisions for loan losses coming in at 290 million. beating on the net income. this is a company aiming to cover its cost income ratio to 66% in 2020. move. their on zürich, full-year comes in,

let me just double checked the numbers. $685 million is what we have for zürich insurance. line withtty much in the combined ratio, that goes up 98.5% from an estimate of 97.7%. that dictating how much they make on all the insurance the actually write. it's bang in line with what they're talking about. cost reductions are on target so we will have conversations on that. cfo. we will speak to the stephen engle will join us for his first interview of the day at 11:30 u.k. time. let's get the banking financial story there and moved to steal and industrials. numbers from the german steelmaker, industrial group come are reporting numbers in the midst of a corporate

transformation. first-quarter profit increased about 41%. steel prices recovered excluding one-time items. theose to 329 euros above estimate of 318 million. thanks to the stimulus in china. the biggest consumer of alloys is china and that added some stability. we will speak to the ceo later and ask about diversification of the business and what is happening in the chinese market and how they operate in the americas right now with president trump. that's coming up later on this hour. manus: let's talk about the risk in the market. the dollar is rising, that's the driving force. they seven of a rally in the dollar. .2%.ritish pound down by we begin to understand the turnaround in the bond market. we looked at what we popped in here.

we had a rally for four days. anna: we had four days were yields were falling. that was the longest falling stretch in yields since the pre-brexit builder. just reflecting the political uncertainty in the market at the moments. things a turnaround in the overnight market. littleyields going a less for the bonds overnight. gains to some of the chinese market and the hang seng china enterprise index is doing nicely, up by more than 4%. more broadly, the asian story is a little bit weaker. .4%, above the $52 mark. stockpiles rose to the second-biggest on record that goldman sachs seeing the market surviving the darkest. screen,ottom of your

you had the new zealand dollar. what we have is no change from the rbnz. the governor said that if interest rates don't rise until the third quarter of 2019, could get ahead of itself. anna: talking about the need for a weaker currency, and the market obliged. here is shery ahn with the first word news. >> u.s. senate has confirmed jeff sessions as attorney general more than a day of contentious debate. the 52-47 vote in the republican controlled chamber follow 30 straight hours of debate. democrat said the alabama senator was too close to president trump i would not protect voting and civil rights. republicans -- saying it will put enforcing the law above politics. has said tightening

and demoralizing. a democratic senator told reporters about the comments after meeting trump's first high court nominee yesterday. a source confirmed the conversation. reportedenerale has fourth-quarter profits that exceeded estimates. net income was 390 million euros, down 41% from a year earlier. themillion euro was estimate. at the same time, stephanie ceo told bloomberg why he's not concerned about a so-called brexit. >> [indiscernible] we consider that so remote, but

you could see some volatility on ae market, and we have always contingency for that type of situation. >> boeing is said to be the front runner as singapore airlines closes in on it order for at least 35 wide-body aircraft. according to a person familiar with the merrier, wes -- of person familiar with the matter, it's supposed to take at least 19 of its planes. the aircraft will be valued at $13.8 billion, based on list prices before the discounts that are customary in the industry. singapore air and boeing declined to comment. british prime minister theresa may is a step closer to triggering brexit. that's as the uk's lower house of parliament gave approval to begin the formal process of leaving the eu boats-122 by 494

after lawmakers were promised a vote on a final deal to stave the conservative party. it now goes to the house of lords for the final vote, expected on march 7. global news, 24 hours 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 . this is bloomberg. manus: let's see what's going on in these markets. getting ready to get on board his plane to go to the united states, equities a little heavy this morning. take it away. as he sets off for d.c., we're seeing japanese shares fall with the nikkei to 25 down .5%. taking a wait and see attitude as they await what the trump discourse has to offer. overall we're seeing patches of green but the regional benchmark

being dragged by losses in tokyo. losses were narrowed by the jump in hong kong. a 14 month high, breaking through the psychological 10,000 level. we're also seeing a rally in chinese property stock continue after goldman and citigroup said they are a bargain. 4.8 percent, leading the pack in hong kong. in china, the shanghai composite up .2%, set for second at gains. looking at what's dragging on the nikkei, i talked to down over 8% after mitsubishi revealed it is doubling demand for payment in south africa. gain the most in three weeks. we had a spokesman say there will be no change of plan to disclose third quarter earnings as earlier speculated in a nikkei newspaper report.

we will see what is revealed around the chip operations as well. sophie, in hong kong. back to the banking story in europe. societe generale jumped earnings from its french consumer banking unit. net income was 390 million euros, down 41% from a year earlier but above what analysts expected. ceo spoke toputy us about the challenges facing the industry in europe. >> have announced that we will present to the market our midterm plan by the end of this year. so we will do that, and afectively, we could have on whatnderstanding will be the new model framework which is still under discussion between the authorities. there are still ongoing

discussions between the different authorities. probablysituation is taken a bit more time to fit, but probably there will be an agreement. >> if you have a new basel deal and you have no dutch frank anymore, does it put european banks added to his advantage? >> i don't think you will have an agreement without the u.s.. you are right, the key point for the banking industry in europe is to maintain [indiscernible] membership,no u.s. there will be no deal, i'm sure of that. >> so you think donald trump could just kill basel? >> i don't know, because it decision is more complex in the

u.s.. >> are entering a new world of regulations? >> probably, but it's not been addressed yet. what is the argument between additional regulation and the european economy? this will raise more of these questions, to fix the right label of regulation, which is a necessity. the inflation and term up regulation could now be stopped for a while. just to look at what is the real impact on the economy and unemployment and specifically in europe. that was the ceo of societe generale speaking to our reporter in paris. commerzbank earnings a little earlier, let's see what's happening in the banking. jim's company has around $411

billion in assets under management. great to have you on the program. a lot of conversation there about the need for a level playing field on regulation between the u.s. and europe. and other international bodies have been trying to move to that for some time. is that under threat now with donald trump in the white house? >> yes, i think it is under threat. president trump has made it very clear that he is not a supporter of multilateral arrangements, and hostile is one of those. is one of- basel those. he's attached to bilateral deals where he can negotiate something he sees as america first. therefore the likelihood of a trump administration in gauging in the next round of talks is quite low. field the level playing is not level, anyway. the americans don't have as much weight on the balance sheet as

europe. it's europe versus u.s. banks. if you look at that, you might say i want to close that gap and there is a value proposition there. is there really a value proposition there? how do you look at that landscape? >> i think it is a value trap. i think european banks did not after the financial crisis do the massive recapitalization the u.s. banks did. it was very piecemeal in europe. they have underrecognized nonperforming loans. i think european banks are not in as good a capital position really as the published numbers suggest. for that reason, i think they will continue to slow the creation of credit in your, which is a problem for the european economy. i see the weakness of the banking system, particularly in europe and germany. the other issues about the asymmetry of regulation, with

the trump administration pushing to repeal dodd-frank, that has been one of our priorities from the start. with europe, tightening regulation, i think you will see -- regulatoryar arbitrage over the next year or two. the big when her of brexit maybe new york, rather than any european center. -- make to pick that up later. where does the u.k. fall in that? where does the u.k. fall in that? sticking with the u.s., the review of the dodd-frank legislation, how positive in the short term is that for the u.s. economy and what are your longer-term thoughts on it? >> i'm not in sure that the economic benefit is as big as some suggest. it's not true that healthy u.s. businesses have failed to get loans. businesses that might justify a

loan have been under scrutiny and maybe a repeal of dodd-frank will make it marginally easier, but i think the economic impact of her repeal of dodd-frank is not all that large. the big impacts on the banks. i think about a bank like goldman sachs or jpmorgan, before the crisis, there aspirations was 20% r.o.e.. since dodd-frank, they think nine is quite good. repeal of dodd-frank probably gets them up in the teens again. so the price may stay above one for the u.s. banks. it's a good thing for the banks because they will be able to make more money. it may be a bad thing long-term for the financial system if they overlap to get the high r.o.e. that could be the seeds of crisis in the longer-term. manus: someone at black rock is talking about the on market being at 2%. says 2% on the downside,

if the dark clouds of risk rise, 4% on inflationary trade. where do you sit on that spectrum? >> i'm a little more with larry than with jeff, if you can personalize it. i think the long-term point here would make is, technology continues to be fundamentally deflationary. it makes stuff cheaper and services more efficient. more efficient utilization of capital in the economy means i structural surplus there is right now if savings over capital investment in the world is probably being sustained. there's a lot of talk in the u.s. about growth of the stimulus to capital investment. that could work, but i don't think it be so dramatic to leave us without that surplus and overhang of savings. that will tend to keep rates down. although you could see rates

pickup at some point, if growth is good, i don't think long-term that will hold. wo againwe will see t before we see four. no day is complete without talk of china. the leaders of the world's two largest economies, will they be able to work together? anna: will speak to the cfo of germany's largest steel maker about the company's earnings. manus: and an exclusive interview of a -- with the ceo of a car parts supplier. this is bloomberg. ♪

anna: welcome back.

this is hong kong for you where the hang seng is gaining ground this morning, or its 2:22 in the afternoon. the hang seng up about .2%. hisld trump has written to chinese counterpart and that's partly why were seeing some of these chinese assets doing well. he said he looks forward to a constructive relationship that benefits both countries. manus: he's not followed through on a promise to label china a currency manipulator buddies question the one china policy that's been a bedrock of the relationship between the two countries. a letter from america, he said i constructive relations, but it goes against everything he said on the campaign trail. his is an olive branch, do you think? >> probably. it's not the first contact

between the new administration and china. it may be the first wreck contact since the inauguration between the president and president xi. having said that, it's quite significant that president trump is appointing his ambassador to china. governor branstad first had a relationship with president xi going back 25 years to win president xi was an agricultural student studying the agricultural industry in the midwest. so they have kept in touch. anna: so that's hopeful in terms of finding common ground. ambassador branstad has been very involved in promotion of agricultural exports from the u.s.. so for rural america, for the midwest in particular, agricultural exports are actually quite important. they don't want to trade war with china. anna: so fear of a trade war is

not a reason to stay out of chinese assets. we have a graphic that shows foreign under ownership of chinese equities, when you compare it to other equity markets. how theynvestors fear will get out again. >> and is partly capital controls. you have to have special regulatory clearance to go into mainland china. the rules have changed almost every year, but there have always been tight rules on what foreigners can do in the local equity market in china. think to beson i cautious of chinese equities is the high debt level within china. you have debt which is roughly 300% of gdp in china. people will say that's true, but the government hasn't got much debt. that's not really true.

businesses have enormous debt. the debt overhang has been increasing in order to keep the economy moving. shift at some to stage. a cannot go on for too much longer. there's a reason to stay out of the high overhang of debt, which will hurt growth. manus: if you can get your money in it feel confident, and there was a lovely story this morning spotthe yuan is in a sweet , the basket is dropping. is it in a sweet spot? >> i think it's in a decent position. unfair if china were branded a currency manipulator. they have been supporting the chinese yuan, and you can see that with the data this week that showed the foreign exchange reserves under $3 trillion. that sounds like an awful lot of money, but the imf estimate with

the scale and openness of the chinese economy is above the foreign currency they need to have. they don't have a lot to spare. anna: thank you, jim. stay with us. we will talk exit next and get his thoughts -- will talk brexit next. this is bloomberg. ♪

manus: it's 1:30 a.m., the dollars up for the seventh day in a row. 1236 .37 is where we are on the bloomberg dollar index. breaking news from the french advertising global giant, coming in with a full-year net loss of 527 million euros. maurice levy is speaking at the moment saying he doesn't believe there will be industry consolidation. the have a dividend of 1.80

five, but the losses considerably more than the market had penciled in. revenue comes in at 9.70 3 billion. 2015 was the year they lost coca-cola and procter & gamble. it's a loss for them in terms of the actual net number. that is really quite shocking. operating profit at the drinks maker beating estimates, maintaining their forecast but the way they're beating the estimate is thanks to whiskey. jamison whiskey surging 20%, sales in asia also rebounding. , he's been seeking to modernize the company's rand by adding smooth bourbon. have, thes is what we

top story this morning, south africa where the president presents his state of the nation's beach. , yous have been deployed want to keep an eye on the rand. it's one of those currencies that's moving on every political utterance. manus: the next-door he is around the u.k. theresa may's brexit bill was passed overwhelmingly in the house of commons with just the one key concession. parliament will get an early vote on the final deal before it gets to the european parliament for final approval. it now goes to the house of lords. the pound down .2%. data andfocus on

earnings coming out through the day. 7:00 a.m.numbers that london time and fourth-quarter earnings as well. to fund itself and shell is able to fund itself. those numbers at 7:00 a.m.. anna: and the gdp reading from norway where it may have boosted fourth-quarter growth. let's check on the markets now. is it risk on or risk off today? it's not clear cut, but let me take you into some of the detail. you can see a number of equity markets in asia heading higher. the nikkei up i .5%, japan shares down in general. overall you're looking at the msci asia-pacific index ever so slightly weaker.

you talked about a stronger bloomberg dollar index, the new zealand dollar, the qb falling after the reserve bank of new zealand cap rates on hold and signaled discomfort with the currency strength. losses amonging major currencies against the greenback. a weaker aussie dollar and the yen weaker as well, all by .3%. heading to washington meet with president donald trump. in the sovereign bond space, yields heading lower after the treasury 10 year yield hit a three-week low on wednesday after four days of declines, the longest stretch of losses since the run-up to brexit. i'll talk more on bonds in a minute but of uti crude is holding gains above $52 a barrel. terms of the dividend yield, the question is have asian stocks lost their edge? if you look at the vantage of

global stock, that is pretty much evaporated this week. speaking about various spreads, i want to look at the 10 year treasury yield versus china's 10 year yield. it had slightly higher this session. china heading lower but this year you a shields have flattened after a surge in 2016, while china's have moved higher on central-bank tightening. that is what this chart is showing, is the widest spread since september. looking ahead to the european trading day, political uncertainty is continuing to drive financial markets and the key trait is the euro-dollar. aslied volatility surging investors assess political risk both in europe and the u.s. one additional line coming through on publicists, a right down up 1.40 4 billion euros.

north america looking a little bit lighter on expectations. one point to note that loss we talked about earlier. anna: the market coming back into balance, bloomberg markets middle east, shell producers there. here is the chart of the hour. you what's me tell been happening with the oil trade. you mentioned goldman sachs, but we also had the eia numbers out which show an increase. let me show you this in terms of what it means in contrast to opec output. those are u.s. crude inventories. still at the highest level in three decades. out that the put

darkest hours just before dawn. they say overseas purchases will slow for march. the sticking with her call that the market will come into balance and that ties into the comments we heard from the qatar energy minister in the last two hours. compliance levels, 60% as it stands. the next thing to watch out for will be reports from the iea and from opec, giving us a better picture of what happened in january. fors: thank you very much the latest on the oil market. of uk's lower house parliament has given its approval to begin the formal process of leaving the eu and it brings prime and us your theresa may a step closer to her goal of march. anna: the bill now goes to the

house of lords with the final vote expected on march 7. let's bring back jim. you talked about the gulf opening up between european banks and u.s. bank. where with the u.k. position itself if it wants to compete with u.s. banks? >> the key issue there is how much access does the u.k. financial sector and u.k. business generally get to the single market. if the uk's pushed out of the single market and get little access on the financial side, then i guess the threat of the british government to deregulate low taxes would mean they would aligned with the united dates. that's one possible course. i think if the eu manages to keep britain mostly in the

single market, britain will be forced to go along with tighter regulation, and that could actually benefit the u.s. banks versus the european, including the british. on how theends discussions of brexit go and i think the banking system is no exception to that. money,it comes down to to cherry pick some of the projects they may commit to in terms of participation. is that what it comes down to? what are people saying to you? >> the money is obviously a big deal. they won the referendum partly on the basis that it no longer -- no longer contributing to the eu would free up resources for the nhs. you mentioned written share of the accumulated liabilities,

which in order to keep participating, the eu will want to get britain's perceived share of the eu's commitments and liabilities. will also ask if norway and switzerland want to contribute to the eu budget. that price will be politically sensitive in the u.k. because in the referendum, contributions to europe are so controversial. i just of which way this discussion will go. i think if the politics gets ugly on the contribution, then you will have the hard brexit and you will see britain tried to align much more with the united states. as wesome of the changes go through the brexit conversations because they start eu, theestablished leaders we know very well and then things start to change in the course of 2017. even if we see more power to them in their arguments, does the conversation then change and

we end up with an eu that makes concessions and then the conversation is different? >> march is an odd time to trigger brexit because you have the french election. my french friends tell me that marine le pen doesn't have a chance. but their arguments are similar to those we had in america against donald trump are year ago. marine le pen is 50-50 to be french president. i think that is a potentially dangerous situation for the eu because she wants to leave euro and print money for the new french franc. i think that would be completely rearranging the economic structure was in europe. if that happens, i'm not sure theresa may has an eu to lead. anna: are you preparing your

portfolio around the scenario that includes the breakup of europe? , but there is a substantial probability. manus: election stress, there's no doubt about it. we've had lots of conversations, some are saying europe is under loved and under owned. you told me to expect more and europe,ck up as much of it's a falling knife. >> it looks like a value trap. it's not as attractive as some suggest on the numbers. if they to wait and see can improve the fundamentals. change ine political france in a way that i described as possible, then you have italy where the government is pro-eu but the opposition parties want to with rob. leasty with the

right-wing populism of europe, but still there will be a voice. the netherlands where there's definitely an anti-eu faction building. way, britain a with the brexit vote, when you look at the political complexion around the big member states of the eu, britain was least likely to pull out of europe, given the level of sentiment that being high here compared to france. fore i'm not saying prepare a breakup in the eu, the political blue holding in together is a lot less than it was. anna: and you don't have to seize power to influence the conversation. thank you so much for your time this morning. remember you can watch the show and video stream and are able to follow the charts

and functions. you can use almost functions and pick up all the charts that we show, anything you see at the bottom. question and if we can answer it, we will certainly give it a go. us toup next, a ceo joins discuss estimate beating earnings. exclusive interview with the ceo of a car parts supplier. anna: and will talk to the insurance ceo. this is bloomberg. ♪

.nna: welcome back it's 7:47 in berlin. kong for the hong

business flash. commerzbank fourth quarter profit falling 5.2%. net income degrees to 183 million euros. we will speak to the cfo at 11:30 u.k. time. syria insurance is one to profit in the fourth order as losses from last year were not needed. -- not repeated. compared to deficit of $424 million a year earlier in the company booked and operating loss in general insurance. i 7:15 u.k. time we will speak to the ceo of zürich insurance. shares in nordstrom so their biggest one-day gain into lunch

yesterday, despite being lambasted on twitter by donald trump the u.s. president slammed the company for dropping his daughters ran. his tweets have hammered stocks in the past. launched at lockheed martin last year temporarily erased almost $2 billion in market value. playing the purchase of a 20% stake in china's brewery, according to people familiar with the matte thdanishrewer is working with an advisor on a potential bid and the shares are worth about $1.2 billion u.s. a stone yesterday's close in hong kong. it rose today to the highest level in more than a year. deutsche bank having an overhaul of an investment bank to improve profitability. according to a person briefed on the decision, the move affected -- is part of the broad restructuring and pulling back

from some better too costly under stiff-arm capital rules. that is your bloomberg business flash. manus: thank you very much. let's talk about germany and the largest steel maker that just reported its first quarter fiscal profit. to 329 million euros. we have an exclusive conversation with the cfo. great to have you with us. the market will probably be pleased with that set of numbers. .alk us through pricing this time last year we were able nine year low. does that momentum continue in terms of pricing on the steel side? >> i can confirm that pricing on the steel side has improved, driven by the sharp increase in raw material prices we saw. coal going up to a peak of 330

and coming down to 170. overall ore was up, but were passing it on to our customers with better pricing than last year. the situation is completely different. numbers largely declined throughout the year. anna: one thing that has changed is who is in the white house over in the united states. president trump and his mexico policy getting a lot of headlines. how does this affect the way you do business? >> thanks for that question. we do have a large value creation in the u.s. itself. let me give you the example of our elevator division. we are producing elevators in the u.s. and the value creation for that business is basically 100%. if there are some upsides from

infrastructure projects, there could be positive effects. the largest value creation we have in most of our factories is directly in the u.s.. it remains to be seen what will be the outcome of mexico but there are positive news on the infrastructure projects as well. i think it's too early to judge it. us he wasr ceo told in the mood for acquisition. you talk about the elevator business being important for you. he's in the mood for acquisitions to increase profits. why's it so difficult to find? will you give a little more back to shareholders? is that two separate issues? >> large acquisitions are not the name of the game.

you have family-owned companies that come up for sale from time to time but there are no real large opportunities out there. the market is largely distributed. we're focused on our portfolio issues. we are in talks in europe so there's still more to do on the acquisition side. , weg back to shareholders have the same dividend as last year and has been paid out now, largely the same figures. take a look at our balance sheet, it needs some restoration still on equity ratios. still a bit too high so we will develop that over time. i think we are on a good track. anna: on the consolidation story

in europe, you are in talks, how many players do you think the european steel industry can support? to give anifficult exact number. you have a landscape that's why at least read and there's no real play in the europeans fear that's big enough for europe on a worldwide scale. , so there issmall some consolidation needed, given the oversupply that we have. i don'tan exact number, think there is a perfect exact number. for the to find ways needed restructuring of this market to happen. talking about what can be supported in europe, everyone is interested in your disposal program. don't want to you

give any more money away in terms of the dividend. where are you on some of the divestments? can you give us an update on the brazilian assets you might be interested in selling? made brazil last year we significant steps to be ready to sell. stake ine remaining were now 100% shareholders. on the other hand, we could get the full operating license, which has always been a question mark from any interested parties. these things could be achieved and so we receive more interest than ever. nothing more to say at this stage. we touch briefly on president trump. he said it's too early to say. if he wants to create jobs in the u.s. steel industry, the set have legs? is that something that is

feasible? >> to create jobs in the u.s. still industry can be possible if there's more demand and more infrastructure projects. we already have the import tariffs in the u.s. for and other steel that's pretty elevated and much higher than other countries. on that basis and on good prices, if the demand is there there could be additional jobs created. manus: donald trump wants to bring jobs back to the united states. if you had a choice, would you open a new facility in the rust belt of the united states of america? >> in steel we do not invest in you more. where i way to do best of these portfolio.pick -- 60 that's not something we would be looking at.

much,thank you very guido. up next, a ceo joins us to talk about the auto sector. this is bloomberg. ♪

manus: a letter from america but no call. president trump sends president xi a note. a plan for anng ipo of the car leasing business. we sit down and talk banking and business. >> so if there is no u.s. membership [indiscernible] commerce bank profit falls more than 5%. we speak to the cfo of germany's second-largest bank later this morning.

♪ it is bloomberg daybreak europe, the flagship morning show right here from the city of london. anna: some breaking news coming in from the energy sector, numbers coming in from totale. manus: net profit at $2.4 billion. we have had bp, shell, and exxon a niceort so totale, jump for them. they are confident in the prospect of cash flow. these are the top lines coming through from total. be question will be can they self funding, they are talking about cash and say they are confident of the prospect of cash flow for the company. there is a little bit of

confidence. from dividend at $.62 up $.61. that if i'm not mistaken is the first increase in dividend payments in three years. that is a little bit of a notch higher on the dividend. that is always good. no sign of a [inaudible] in terms of what they are talking about. they are still in script dividend and the question is can you find yourself in this market your capex and, dividend. we have more on that, we will bring it to you. german trade numbers coming through. looking a little more sluggish beene export side than had anticipated. export sales down 3% month on month, the estimate was for drop of 1.3 percent. sluggish compared to estimates on the exports. imports unchanged in the month exactly had been the case the

previous month. more detail there and that leads the december trade surplus to be a little bit lower. then was antipater -- anticipated. that something that politically plays nicely given the tension that exists before the u.s. and the german administration. conversations transatlantic about the euro. manus: they have said that they should be able to fund their , part of thed cash dividend. without needing to borrow its crude. it is at or about $50 this year. that is five dollars lower than when they talk to us in september time. that is about becoming more efficient and becoming more cash-self-sufficient. 52.7 six.s that but have a look at the futures. higher at the start of trade up by around .3 of 1%.

the french market getting a bit of a boost. the asian equity session was mixed. negative for the risk radar, the msci asia down by .3 of 1%. some of the chinese equity related stories are getting a boost today. the hang seng china enterprises index, for example, more than 4% over the past four sessions. chinese assets getting up bit of a boost from that letter being sent to the president. zealandhe news -- new dollar, no change. that chairman -- governor left rates unchanged. not going to move till the third quarter of 2019 and the senses the market got too far ahead of itself on the new zealand dollar and look at that crude go, $52.75. anna: we talked a little bit of what was happening in the market with stockpiles in the u.s..

let's get the bloomberg first word news. >> the u.s. senate has confirmed jeff sessions as attorney general after more than a day of contentious debate. the52-47 vote in republican-controlled chamber followed 30 straight hours of debate. democrats said the alabama senator was too close to president trump and would not protect voting and civil rights area do republicans countered that sessions will quit and forcing -- will enforce the love of politics. neil gorsuch has called on all trump's criticism of the judiciary over a federal court order that brought to the -- "dishearteningd and demoralizing." richard blumenthal told reporters about the comments after meeting trump's first u.s. high court nominee yesterday. a spokesman 80 him in the confirmation process conformed blumenthal's accounts of their conversation. reportedenerale has

third-quarter profit that exceeded estimates, the income was 319 million euros, down 41% from a year earlier but above the 350 million euro analyst estimates. the french lender also announced plans for an ipo of its releasing business. the deputy ceo told bloomberg why he is not concerned about a so-called brexit. >> -- so-called frexit. >> [indiscernible] remote.der it so of course you could see some positivity in the market -- volatility on the market. [indiscernible] shery: oh he is said to be the -- boeing is said to be the .ront runner according to a person familiar

with the matter, the carrier is considering buying 20 of going struggle 79 jets and it is going to take 19 of its 78710 planes. the aircraft valued at $13.8 billion before the discount customary in the industry. to comment.ned theresa may is a step closer to triggering brexit. that as the u.k.'s lower half of parliament gave approval to begin the process of leaving the eu. the ill passed by 494 votes to 122 after lawmakers promise to [inaudible] the draft law goes to the house of lords for the final vote expected on march 7. global news 24 hours 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 . let's take a look at what is going on with the markets in

asia as we wrap up the day. asian stocks have been on the back foot as the drop in japanese shares weigh on the regional benchmark but we are seeing the losses narrow given sengjobs in the hang getting a nice clip. breaking through the psychological 10,000 level after the economic journal on wednesday reported [indiscernible] after beijing put a lid on outbound m&a. also helping with the hang seng. china resources adding over 5% to lead the pack. composite a day of gains. and coming through with the asx 200 up about 1/5 of 1%. that is a look at what is going on in asia. for that breaku down on the market. let's talk about [indiscernible] of 18.7g revenue billion euros, a 2.6% increase

on a year ago. anna: the company confirmed it is on track to hit its 2018 target. .ohnny us from paris is the ceo great to have you on the program. you have increased her dividends, the dividend is higher than the estimate. you have confirmed your outlook. you must have a decent amount of visibility on your performance for the rest of the year. quite positive about the market. we estimate the market to grow about 2% globally. we committed to growth 400 business points above the market. here, i am just looking china is an incredibly important market for you. we just had the chinese data, i am sure you have seen it this morning. in january, sales fell in the month of january, the car association have delivered the

ot hass, xuzhou -- peuge given their numbers. how concerned are you about the situation and how that might impact your outlook for the rest of the year? guest: what we see for the first half is, it is quite positive. in the experienced second half of 2016 which was far above expectations. i believe that we will have a growth in china which will be not below.to 5% and ,sually, before the new year the chinese new year, the market is moving slowly. quite moment, we see consistent volume. anna: are you not concerned about psa's performance in the chinese market? launching new cars

to 4008 which is 3008 in europe. it is a very nice car. it is an suv which is much better corresponding to the customer's expectations and wishes. i think that with car, they will recall their market shares. manus: it is one of those days, i am afraid we will go off down the political road. you have a presence in mexico. we caught up with the cfo and he said it is to relay. how are you looking at your presence in mexico, have you modeled what a border tax might look like on your business, if so, what are the numbers, what are you thinking? guest: for the first thing is that we are probably not so much concerned about that. we are less exposed than most of our competitors. mexico, which are exported to the u.s. are around

one .2 billion. we import from the u.s. to mexico about $760 million. $400et exposure is about million. when you consider our group, we are completely covered. i do not -- sorry. anna: carry on. wanted to tell you is we have a lot of uncertainty at the moment about the nafta regulations but nobody knows. i do not think that this will have a significant impact in 2017. -- would be anna: i want to talk to about iran. you announce the creation of two joint ventures and iran. donald trump has been very vocal on that subject as well. if his involvement in the koran-u.s. -- iran-u.s.

relationship, is that delaying projects or threatening the funding of projects? guest: not for the moment. it is clear that the u.s. market is a very significant market for us and if the administration would decide some measures which will -- which would constrain the business in iraq, we would expect them, obviously. manus: let's talk about france. we just had a guest with us who is saying that he now thinks it could be a 50-50possibility that marine le pen succeeds to power. i was shocked. with that shot, what would it mean for your business if marine le pen is indeed the winner in round two? is at this is clear .ime, everything is possible the elections are extremely open in france and this scenario is

one of the possible scenarios. i think that it is too early to speculate. we need also to wait a little bit to understand the programs of the different candidates and we will see in the later stage. anna: are you preparing for the move away from diesel, more toward electric cars in europe, how are you prepared for that big shift? cars, wee electric will have electric cars on the road, that is for sure. we also need to have the infrastructures to be put in place, we need to have the technology which need to make progress. bev it comes to selling new believectric cars, we in 2030 it will not exceed 10%. 10% with some distant -- differences in the different regions, about 15% through 18% in china, 5% in north america, and around 10%, 12% in europe.

please finish, go ahead. that for aill have long time in front of us. manus: thank you for joining us this morning. the ceo of faurecia. no roadblock freeman china. anna: we speak to the ceo of that business, mario greco joining us next. this is bloomberg. ♪

manus: it has gone 8:18 a.m. in berlin. the dollar is [inaudible] it is day seven of a rally in the dollar so the question have to put to yourself is is it euro strength or dollar strength, has the dollar turned a corner?

here's your business flash. fourth-quarter profit fell 5.2% on a jump in provisions for loans. net income decreased to 183 million euros as provisions surged to 219 million euros in the quarter, that is above analyst estimates. we will be speaking to plu's cfo. the u.s. president slammed the company for dropping daughter ivanka trumps brand. his tweets have hammered stocks in the past. carlsberg is weighing the purchase of between percent tao brewery.tsing

they're working on a bid for the potential stake. the shares are 1.2 billion u.s.. it rose today to its highest level in more than a year. deutsche bank is shedding its u.s. swaps clearing business as part of an overhaul of its investment bank to improve profitability. onording to a person briefed the decision, the move effective immediately is part of the broad restructuring aimed at simple flying operations and pulling back from some that are too costly under capital rules. that is your bloomberg business flash. anna: thank you. switzerland's biggest insurer posted a net income of $685 million compared to a loss of 424 million in the same period a year earlier. joining us is the ceo, mario greco. great to speak to you once again on the program. you have an overhaul of your

business underway at the moment to my taking costs doubt, selling assets. are you on track with that, how much further does the have to run? mario: good morning. a troubling was year, markets were tough. we made lots of changes but results came out very strong and they give us optimism for 17 and the next years. manus: let's talk about pricing. we caught up with the ceo and i'm looking at your business as well. below average catastrophe claims, give us a sense of whether [inaudible] is there a floor in pricing? mario: i do not know that. prices remain soft, which means that prices are flat or negative. price increases.

but that honestly makes sense. profitsstrophe's, high reported, that is ok. we are prepared for that. anna: are you prepared for consolidation in the sector, if tessasee generale and come together, how would you reposition yourself? mario: there are lots of noise in the market. our strategy is not based on acquisition so we made that clear in november. we do look at the markets and last year, we made some agnificant steps, we bought company in malaysia. we made an offer for an australian travel and services company and we think it is an excellent company. our [inaudible] targets on

customers, we want to grow. where we can become even more leader than we are today. and we will continue with that. costs your plan is to cut as an asset, your transitioning the business, planning to cut costs between 2015 in 2019. how far along is that, is that still your target, are you prepared to up the target and what is the consequence of that on job cuts in the business? toio: i am not prepared [inaudible] announceths after we the target. we still go for that. i think 16 has been encouraging. at the first 300 million nominal action and out cost spaces, we have seen a lot more to do and a lot more to go. we think that simply location business is of paramount importance. this is about going back to

back tos, who are going the markets, it is about being quick, it is about being responsive. we will continue with that. debatehere's a live lead -- a lively debate in the bond markets whether the yield gets to 2% or 3% in the very near term. you're clearly would like to see higher interest rates. what is your position like at the moment, what are you positioned for, what do you expect interest rates to do in the u.s.? mario: we expect markets to support us in 17 better than they have done in the past year. we expect rates to slowly move up. --do not think the markets we do not expect to see what we call inflation coming back although we expect to see some movements of prices eventually.

we are cautiously optimistic on the financial markets in 17. and that is good. that is movinget progressively and it does so every february and has done for the past 10 years is the swiss franc. it is appreciating. from your vantage point in zurich, how big a challenge is that for the central bank, do you expect them to act my do you expect this to continue in the swiss franc? mario: we do expect the swiss franc to remain as a strong currency. the central bank of switzerland is controlling it, but the swiss economy has adjusted very quickly and very effectively to the stronger frank. it is still growing nicely. the swiss economy will continue performing well in 17. manus: thank you for joining anna and myself. the ceo of the zurich insurance joining us on the line from zurich.

numberssome breaking coming through. futures indicated higher up .1 in london. that was quite a good set of numbers from them, the net income came in at $2.4 billion. the market was looking at 2.23. ona: not a very obvious risk or risk off environment this morning. a little more complex. asian equity section was moving lower as a whole the chinese assets were quite well supported in some cases because of this letter from president trump to president xi. things are looking more positive european session. european session. looking flat for the start of trade. manus: the dollar is rising for the seventh day in a row. guy will pick the schema. that suggests maybe even though mario greco does not leave in the reflation trade, maybe the market believes a little bit more in the dollar although we know donald trump likes a strong

dollar. anna: donald trump and his policies have been a focus. theher that has been around car industry, the steel industry, or beyond. we live you guys leave you with the european open. this is bloomberg. ♪

♪ thursday morning, welcome to bloomberg markets. this is the european open. the cash trading session coming up shortly. matt miller is in franklin. what are we watching this thursday morning question mark -- morning? earnings thater topped expectations. and struggling to sell [inaudible] matt today'