>> terror in paris. isis claims responsibility for a deadly shooting of a policeman last night. polls remain tight ahead of sunday's presidential election. the u.s. treasury secretary says the shakeup will happen by the end of this year, even if the health care bill fails. the greenback and u.s. stocks rise. and kuroda exclusive. the bank of japan governor says he will keep a policy in place. ofwe think the current pace the process, as well as the monetary base increase, will continue for some time.

>> a very warm welcome to "bloomberg daybreak: europe," our flagship morning show from london. i am anna edwards. matt: i am matt miller in berlin. a lot going on this morning. markets will be very interesting as they open and into monday morning after we have these french elections. anna: absolutely. we need to talk about the french policy story and what we heard from the u.s. yesterday, also from governor kuroda at the bank of japan. let's put all of that in the mix right off the top for this morning. i have a chart of the s&p 500, making steady gains, but getting a boost because of what we heard from the treasury secretary around taxation. this has been carried into the asian session. the u.s. of ministration is

aiming to complete the biggest overhaul since reagan by the year end, even if the second attempt to reform obamacare, even if that fails. this seemed to capture the imagination of investors yesterday. investors say he is worried about the high levels of the s&p. he draws our attention to the ratio between market cap and gdp that is.s. and suggests stressed. markets liked what they heard from the u.s. yesterday. matt: let's take a look at the yen right now. obviously, we heard from kuroda in a bloomberg interview. we will continue to play sound from that. we see a little yen weakness against the dollar today, but the yen is a place, and i am sure we will share an amazing chart that came out of "bloomberg asia" overnight, showing the yen is one place where euro investors go to hide in times of stress. take a look at the cac.

obviously after the tragic events of last night and the elections coming up on sunday we are watching this closely will futures are up 1.5%. they castrate was up 1.5% -- the cash trade was up 1.5%. the cac, doing very well yesterday, an outlier as far as the big gainers. s becausecoffee future they have slumped for a loss yea 2.5 date and are down standard deviations away from the 30 day mean. so, a big move in coffee, something a lot of treaters only to stay awake late sunday night and into the morning on monday. anna: it will be a demand for it. i doubt it, matt. we will keep watching the coffee price. let's talk about what we are

hearing this morning. we have numbers breaking across bloomberg. first quarter revenue, $1.96 billion ahead of the $1.66 billion estimated. they are well-positioned to achieve their ful midyear targets. have been lookingsts for the decline. jpmorgan had an organic sales decline of 4.6%. the focus will be really on watching for clues on the top line in the second half. we will see what can develop there as the market transitions towards the led side of the business. we will be speaking to the ceo at 6:30 a.m. u.k. time. that is coming up later on the show. matt: let's get the bloomberg first word news. for that, we go to hong kong. reporter: matt in france, the islamic state has claimed responsibility for an attack that left one police officer debt and two other senders.

othersicer dead and two injured. the shootings came three days before the first round of voting in one of the most highly contested presidential elections the country has seen, and at a time when france is under a state of emergency following a wave of terrorist attacks. in the u.s., deutsche bank has been hit with the federal reserve's first major fine for failing to ensure traders on risky market bets. the company will pay even more for letting currency debts chat online with competitors. the simultaneous engines, totaling almost $157 million, was the last oversight of traders that persisted into last year. the donald trump administration is aiming to complete the biggest overhaul of the u.s. tax code since the reagan era. n saysry secretary mnuchi the reforms will go ahead even

if the second attempt to repeal the affordable health care act fails. the priorities are to simplify taxes, great middle-class tax cuts, and create competition. >> it is a big priority for the president. we will get the tax reform done. it will be sleeping, significant, and create economic growth. reporter: the bank of japan's governors says the central bank will continue with accommodative monetary policy and maintain the current pace of asset purchases for some time. wrote exclusively told bloomberg -- kuroda exclusively told bloomberg that while the economy is doing better, the inflation rate remains sluggish. , ase think the current pace well as the monetary pace will continue for some time. reporter: global news 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries around the world.

you can find more stories on the bloomberg at top . this is bloomberg. matt: let's check on the markets in asia with juliette saly. reporter: matt, it has been a great day for asian investors, rounding out this trading week. the regional index look close higher for the first time in a month. we see good movement coming through on japan's index following those kuroda comments and buying coming through in the hong kong market and the turnaround in commodity prices is helping out the australia asx 200. there has also been a fair bit of corporate news around. a very big story in terms of the energy player in australia. it has risen the most since june 2008. 99.3%, of investors

have a crew the takeover, the $5.6 billion takeover. up by almost 10%. toshiba, also in focus. there is a report that digital wants to purchase its memory chip unit. coca-cola, the worst performer in the regional index, down by 11%. there is sluggish sales growth in the australian market. we are awaiting the french election and in terms of how that is playing into the asian market, you are seeing safe haven buyers. this shows that in essence, we are actually seeing a lot of investors prefer hedge in terms of the euro-yen relationship. that is seen in this white

line, compared to the euro-sw iss franc. the yen is in focus, following kuroda's comments that they will be keeping monetary policy the same. anna: thank you. matt miller was saying he was sure we would get to that chart, and we did. 7:09 inlondon and france. two days before one of france's most tightly contested presidential elections, another terrorist event could alter the course of the race. one police officer was killed and two others were injured. the attacker was shot dead. the islamic state has claimed responsibility for the attack. we will try to get to france in a moment to get a report from the ground. let's go straight to some market analysis. we are joined from ccla

investment management. fra we believe the analysis of what has been happening on the ground in paris. let's talk about how we go into this week. have you been adjusting your portfolio around the french elections, or does this not seem like the kind of event you need to do that? >> i definitely think it is a key event. i am fascinated by how sanguine the bond market has been. idol think the french bond market is where you should be allocating capital right now. betting that europe can write to the rescue. bet.is a big if there were to be eight marine le pen victory. if you look at the equity market, they are good quality french companies. that look atanies

win,scenarios, a fillon which would be well-received by markets. pen victory would be poorly received by markets. but these international names would still be relatively well-paid. you think the bond markets have been relatively sanguine. this is the euro-dollar one month implied volatility and one week volatility. we have seen one week volatility spiking as first round risk looms. this seems to be a around the ability of him to get into the second round and the percentage we might see from le pen. >> the worst outcome from the market's point of view would be marine le pen going into it together as the trade-off for

around two. that is how it is perceived. markets believe that either of those candidates would be bad news for the markets. there is a broad expectation that hollande would be the runaway winner. the markets and the moment are hoping macron can win out. obviously, madam le pen will make the first cut. anna: matt? matt: james, hold on for one second. we are live in paris with carolyn. what is the latest on the attack we heard about overnight? reporter: we know the attack happened shortly before 9:00 p.m. at the top of the champs elysees. one attacker drove a car, pulled out of the car, and shot at some police officers in a van. he killed one of the police officers and seriously injured another. then the attacker tried to run away, but was shot dead. the attack was quickly claimed

by the islamic state, who initially said the attacker was belgian. however, the french prosecutors are verifying the man as a 39-year-old who was born in the eastern suburb of paris, and who had already been convicted and jailed over the last 15 years for trying to attack police officers while in custody. the investigation of course, is still underway. the antiterrorist prosecutors are leading the investigation, looking for any possible accomplices and we should also have the french president, francois hollande, holding an emergency defense meeting one hour from now. anna: how have the candidates been reacting to this? how is it expected to impact the race. many of them are being

interviewed on television. >> exactly. at the exact same time the attack took place, the candidates were giving one to one interviews on the national broadcast. had already spoken to the independent and for the first to react to the attack. in fact, the national broadcaster had told the candidates to bring an object they would bring to the presidency if elected. i want to pay tribute to the police officers, marine le pen, of course reacted a little bit later. she had the opportunity to speak at the end of the show. she said, we should not be naive country that cannot defend itself. let's not panic.

let's not give these violent people the last word. matt: thank you very much, caroline, live in paris. she will continue to cover that tragic attack and the election on sunday. bloomberg will give you all of the election action as well as it happens in a special programming sunday evening. tune in to bloomberg television and radio at 8:00 p.m. paris time and 7:00 p.m. in london. let's get back to james bevan. james, obviously, regardless of the timing of this kind of terror attack it is a tragic event, but because it is two days before the election, does this change the game at all? >> i think there is an expectation that marine le pen would get through the first race. it is intriguing, if one were to

look at the pattern of the data on the polling. francine lacqua has relative -- marine le pen generates a lot of dislike. the market's expectation is that while she can make the cut for the first round, she will not attract significant new voters into the second round. therefore, whoever goes into the second run with her is likely to be the overall winner. anna: we are waiting for these results to be released. james, thank you. james

up,ation rate will go reflecting improvements. anna: governor kuroda there, of course speaking to francine lacqua in the united states. james bevan is still with us here on set.

what are your thoughts about japan at the moment. you are listening to what governor kuroda had to say and he said it is too early to talk about the exit from the accommodative policy. he does not seem to be concerned about the policy divergence coming through from the various global central banks. >> the backdrop to this is the big shift in the global inflation-deflation mix. i would suggest the most important a challenge is what will happen to the chinese economy and therefore, whether or not china continues to export inflation. deflation was the story of last year and the year before. continue to export inflation, then japan is in a much better place. therein lies the challenge for japan. anna: we saw the role of china in the crucial trade, then didn't we?

matt: you point out there is stilealth tapering. explain. >> there has been a lot of talk that the bank of japan remains toply committed continued purchases, but they are taking their foot off the accelerator of purchasing and beginning to wind back. i think it is appropriate to marketut that this is a that has been heavily supported by the central bank, not just i n bond terms, but in equity terms. anna: that is interesting because governor kuroda was making the point yesterday to francine that he does not think's monetary policy is constrained -- does not think his monetary policy is constrained. he does not seem to feel constrained by the amount of ownership that they have. >> i think he doth protest too

much. he is not going to talk down the support the bank of japan can provide. the big issue is whether or not japan's companies will step up to the table. obsessed withare the french productivity challenge. we technology there are increasing points of focus on mergers, acquisitions, all the things we take for granted in western markets. now, they are becoming the agenda. i think that is healthy. i would be looking at companies like subaru, companies i think are making the right noises. matt: james, those boardrooms are also buying back their sh ares and the government is buying equities and they look undervalued. nikkein in a buyer, the

has not risen back to its 2015 highs? >> i wish it was so transparent and clear-cut. numbersry the economic are not supported. i look at the u.s. market, which many people say is overpriced, but i see companies that are continuing with earnings at a good level and i see upgrades in the s&p 500 numbers. i see no reason why we should not expect a correction. until the get real evidence that japan's economy is moving up, i am not prepared for that. anna: james stays with us on the program. 6:26 in london. here are the highlights. 8:00 a.m. we get pmi out of rents. 30 minutes later, germany's turn. then, we get pmi data out of the

eurozone as a whole. then, u.k. retail sales. movein says the biggest since reagan is close. this is bloomberg. ♪

♪ philips lighting out with results this morning. first-quarter revenue beating the top of analysts' estimates. joining us now to discuss this firm result is philips lighting ceo. thank you for your time this morning. confidenceabout your to achieve your full year and midterm targets. what are the big risks to that? >> good morning and thanks for having me. let me first tell you that we are pleased with the results for q1. trajectory on the

that we experienced in 2016 on the operating margin. and improvement at the operational marginal level. element which is a continuation of the performance in 2016. the other positive element it -- the other positive element in q1. europe and the rest of the world are already growing and our energy-based businesses are growing by 90% in q1. risk factors. we see our business in the sustainability and energy efficiency. fabulouse we have possibilities moving forward in most of the geographies. asking you about the

transition to led. a sector in led. what percentage of the market do you see as led into the future? moving faster or slower than you expected? >> the fabulous transition to than webeen much faster anticipated originally. at the end of q1, 61% of our sales are already made by led-based activities. in q1, we launched on the market tubularvalent of the elements. this is the transformation of conventional technology to led. at the same time, we also launched on the market colored and white candlelight which is connected. source couldight

be changed to connected lights. at the other end of the spectrum, also in q1, we close to 80 projects which -- with the cloud-based software connected to streetlights in order to them, andem, control making energy savings of up to 50%. the big part of the transition is done. -- andre are still a lot there is still a lot of traction in the market and a lot of potential to innovate. matt: where do you see that innovation happening? bulbswe see your light becoming media players? mesh wi-fie part of networks? >> what is clear at this point and time when you look at surveys, lighting is seen as the number one or number two carrier

when it comes to connected objects in the internet of things. this is where we see our company. we will not be an internet company in the future. but we will be the lighting company. every light point can be connected and we can extract information from remotely connected like to point and this is where we see the future going. there is a lot of data coming that we can already analyze today to bring back services on the full light cycle. part of the transition of the industry, it is not only the movement from transitional to lad, but led to connected lighting. as a company, this is how we have been shaping. anna: what about pricing power? does that innovation give you that pricing power? i am thinking specifically about he u.k. -- absolutelyon is

fundamental to bring to the market new offers, new functionalities, and new requirements but it is also necessary to bring the cost down. if you look at our successful story, it is coming from the growth margin. we have been able, with declining prices, to grossuously improve our margin by reducing costs. as far as the u.k. is concerned, what we have said previously is that we are extremely committed to the customers and investment that we have found in our -- in this country for many years. we continue to support our operations there. on the other hand, with the devaluation of the british pound with the brexit, we have not transferred to the market the impact it has had on our gross margin. we could not do it, thinking about our customers there.

but we are deploying our innovation to continue to grow in that geography. matt: what about the u.s.? border tax, how problematic is that for philips lighting which gets a quarter of its revenue from that market? is the number one market for us. at this point and time, we are looking at what could be the potential outcome of decisions made there. we are extremely invested in the u.s. not only manufacturing plants but also r&d. it is our number one country. we are also a net supporter. at the potential consequences of import taxes in that country. on the other hand, we are also looking at what could be the consequences of a reduction of the corporate tax in the us which we would benefit from. as a responsible company, we are building scenarios here and

waiting for decisions to be made . thank you so much for joining as. philips lighting ceo joining us after beating the street's expectations on earning. let us check in on the markets. we are seeing asian equities following the gains in the west session yesterday with egg woody's climbing are crossed asia, partly on the optimism of the u.s. tax overhaul with steve mnuchin says the administration is shooting to complete by the end of the year. japanese stocks looking at the topix -- the nikkei is heading in ahe first weekly gain month. bloomberg dollar index is fairly unchanged. poised for a second weekly decline despite the signs of conviction on the rate hike plan

from fed officials. 10 year yield fairly steady as well. we have the final day of campaigning before the first round of the french residential election on the weekend. the euro heading for its best weekly gain in three months. as you can see, speculators have in adding to bets that the euro will weaken. and bank of america, merrill lynch, saying -- seeing asymmetric risks. parity in anelow negative one. euro-dollar, keeping a close eye on dollar-yen as well. the yen weakened yesterday for a second day on comments from willa saying the boj continue with accommodative monetary policy. i wanted to show you one month and three month risk reversal. one month, showing that traders

were the most bullish on the yen since june. that has come up a little bit. ,hree-month risk reversals traders remain skeptical that the current gains in the yen will last. a flow into that payment asset with geopolitical risks. as well as the comments from donald trump on wanting a weaker dollar. i want to show you what is happening with dollar, heading for its biggest weekly loss since early march. goldman sachs says there is no fundamental evidence in the market to justify this week's selloff. keep an eye on these technicals. anna: oil prices bouncing a little bit. the u.s. government is aiming to complete its overhaul of the country's tax code by the end of the year. even if the second attempt to repeal the affordable care act fails. that is according to the treasury secretary, steven

mnuchin, speaking at a conference in washington. >> big priority for the president. we will get tax reform done. it will be sweeping. it will be significant. it will create a lot of economic growth. anna: james bevan is still with us on set. a column by the daily profit on the bloomberg was this morning. if the as -- it is as has learnedstration about the power of mentioning the tax cut. there is a lot of promise here. the expectations. >> i certainly think that the u.s. equity market is now dependent on tax cuts and deregulation. for many small companies in particular, more important even then tax cut the cause it affects the way they can run their business as opposed to the profits they can keep.

we have not heard enough on the regulatory front. if you wanted me to translate these targets, i think the s&p 500 will and the year between 2400 and 2500 points. not all long way higher from current levels. the expectation that the u.s. market is ready to roll over. concernedare not as as say paul tudor jones or scott minard about a correction here in the u.s. market? >> to be very clear, i certainly anticipate that there are regular cases where there are corrections in a long bowl run. -- in a long bull run. and there is a difference the upwardking about grind in a bull market versus a bear market. i am not saying that we could not have a significant correction.

we are well off the high seen on the first of march. if there is that correction, it will be as part of an ongoing process of prices moving higher rather than the onset of the market. anna: you do not bleed we will have -- you do not believe we will have a bear market. beenconomic data out has more negative than expected. the different parts of the market are reacting differently to the hard and soft data. >> what is deeply important is what is happening to the corporate numbers. examples, thelic tone of the q1 numbers is generally better than expectations. i am expecting analysts not to be downgrading earnings forecast. in general, i am expecting a

moderate upgrade. in the market will be able to trend higher over the balance of the year. anna: the earnings story is not consistent with negative data. >> i think there is a big difference between the company arnings level and macroeconomic numbers. i completely accept there is a gap between the soft numbers, this survey expectations, and the real economy. i expect the real economy to catch up. and there will be a more solid tone. i am not worried that the tax cuts will not be put into place until 2018. by the time we get there, the market will be focused on 2018 in any case. matt: james, i want to back you up on your earnings call. you are correct. u.s. are earnings are beating the estimates of the street. we have a fantastic tool -- if you type ea go, you get earnings

assessments. -- financials are doing quite well. a financials are one of the biggest out performers as far as earnings go. on the other hand, u.s. equities are fairly fully valued. peaks.at 1990's we are not getting tax reforms yet. we are getting details on infrastructure yet. corgi regulation. all we have gotten so far is the protectionist side of the ledger. aren't you concerned that u.s. equities are cap heavy? -- top heavy? >> if we must come back to the valuation issue. the long-term trend multiples which people are using as the yardstick, for example, cyclical

price-to-earnings. that is all predicated on the premise that we have something that looks like a normal bond market yields. i think 10 year yield will be heading higher. i do not think we will see them at 3.5% or 4%. equities are looking vulnerable than. that i don't think we will get there and that is why i think the platform is high. can companies continue to positively surprise? come back to financials? that isn is a company winning global market share. does the much performance of those stocks you referenced depend on higher yields? i'm thinking of the fed story. more 2017 pricing one hike. talking about the balance sheet.

fred kaplan is still saying that three rate hikes is a good baseline. >> i think we will see modest tightening. substantialct tightening which is good news for the banks. a steepening yield curve. an increase tie to initial public offerings. bond offerings. the loan book challenge that was evident in the first quarter numbers will begin to roll over. we will begin to see stability and better earnings numbers. the banks have strong balance sheet. they have the capacity to buy back shares, paid dividends. anna: we're going to hopefully talk more about that sector, the financials, later in the program. james bevan, the ceo at investment management. if you are a bloomberg customer, you can watch the show with tv . you can follow all of the charts, the functions that matt

and i have been using during the program and you can reach out directly to the program by hitting the button at the bottom of your screen. you can ask questions of our guests. coming up, deutsche bank, the by the feder fined for breaking the rules. this is bloomberg. ♪

♪ matt: our top story is in francematt: where two days before one of the countries most tightly contested elections, in apparent terrorist incident could alter the course of the race. one police officer was killed and two others were injured last night. the attacker was shot dead. the islamic state has claimed responsibility for the attack. caroline is live from paris.

caroline, give us the latest on the attack. caroline: the attack happened shortly before 9:00 p.m. car, a man pulled out of the car and fired as police officers were there. killing when police officer and injuring another. the attacker ran away but he was shot dead by the police. state quickly claimed the attack. and initially, identifying the man as a belgian national. however, the french prosecutors say this is a 39-year-old who was born in the eastern suburb of. and he was already convicted in the past it. even spent time in jail for attempting to attack police officers in the past while he was in custody. the 11 candidates quickly reacted. were just doing interviews on national public broadcast

when the attack happened. marine le pen was the first to react, live. and she reacted. she has been playing on this anti-immigration and security issues during her whole campaign. she will hold a press conference in paris in about two hours from now. anna: thank you very much with the latest from paris. bloomberg will bring you all of the election action as it happens in special programming on sunday evening. tune in to bloomberg television and radio for "france decides." let us which gears and talk about the banking sector. deutsche bank has been hit with the first major fine for failing to make sure that traders abide by voelker demands. the german lender will also pay a penalty. buying toons come

equal over -- million dollars. we got through one wave of fines that were around the financial crisis. and now, we are into another wave of fines around the voelker rules. where do we stand on reform of the u.s. banking sector in your view? is it headed in the right direction? partsr the plan regarding of the voelker rule but we also hear a revival of classical? -- glass siegel? >> for me, the big story is not so much regulation. it has much more to do with the global climate. more from asia versus europe where one looks at the scale of m&a, how much has been put on

the tables. they are back to being highly competitive. i would still be holding jp morgan at current prices and i would be using the recent weakness of dominion. matt: what do you think the problem is with european banks versus u.s. banks? -- much is the playing field how much will it be tilted if donald trump comes through with this deregulation? >> i think america is ahead of the game in terms of having reorganized its banking challenges. if we go back to the trouble asset relief program, europe still has a banking system that undoubtedly has bad debt embedded in balance sheet's and everyone is nervous about that. there are some punchy people betting they want to be in the french banks in advance of the

election anticipating the greatest spring. for me, the european problem is not france but italy. italy say people in they would rather not be part of the euro project. that to me is a big challenge to the banks of europe. if i were going to purchase a bank in europe, i would look at the spanish banks like santander . anna: making that point about italy, back to the start of the conversation. focusing on the french election. even if marine le pen were to become president, there is not necessarily a direct line between that and her having the ability to take the country out of the euro. >> quite right. and a marine le pen overall victory would be bad news for equities sentiment.

italy is the real challenge to me. james, it has been a pleasure having you on the program. james bevan, cio of investment management. , canadian prime minister justin trudeau tells bloomberg while the world can thrive without divisive policies. that interview with our editor in chief, stay with us. this is bloomberg. ♪

att: terrorist strikes paris. isis claims responsibility for a deadly shooting of a policeman last night. the attack comes as polls remain tight ahead of sunday's presidential election. drums tax overall -- donald trump's tax overhaul. steve mnuchin says the shakeup will happen by the end of the year, even if the health care bill fails. exclusive. the yen weakens after the governor says he will keep accommodative policy in place. current pace of the daily purchase as well as

the monetary base increase will continue for some time. ♪ matt: welcome to daybreak europe, our flagship daybreak show. i am anna edwards here in london. some breaking news. numbers being reported. the first quarter comparable sales, flat versus an estimate of an increase of 1%. additional details for the performance of the company. total revenue -- in line with the estimates. there have been low expectations reading what analysts have been saying going into these numbers. organic growth would start slowly in 2017.

ubs, talking about headwinds from india, south korea, and russia. interesting to see what they are saying about their food business. there were questions raised about whether they were working of thenkers on disposing food part of their business. they are exploring a range of options and will update the market when appropriate on this food operations. share prices performance. goodersonal and household segment in europe, up by 12.8%. m&a expectation circulating around this type of business. a quick look at the futures. we are expecting to open up. looks like we will be perhaps, a little positive although we are looking ahead to the french elections and the nervousness that exists in the markets around the outcome. looks like we could be stronger by about 1% on the ftse 100.

and 0.2% on the check. what are the other stories to focus on this morning? you see happening today could be dollar dependent. look at the risk radar. the yen, although it is showing a little weakness against of the greenback, it is flipping back and forth between gains and losses. at 109.32. less to do with corrode is -- less to do with kuroda's statements to bloomberg and more to do with steve mnuchin's comments. take a look at the cap. .- take a look at the cac futures are up. yesterday, the cac was up 1.5%. it was a gainer among the european stock indexes. a big day yesterday for the cac.

watch the pound. it has come back to unchanged. it was showing a lot more weakness but now, we see the dollar is showing a little weakness and currency is catching up. that is what happened with the yen. the pound could turn around as well and that could have a real effect on british stocks this morning. anna: we are keeping an eye on the fx markets with that in mind. it is keep an eye on sony. ofinary full-year net income ¥73 billion. well ahead of the forecast. they had been forecasting ¥26 billion. they plan to issue for earnings on april 28. we have some detail on which bits of the business are doing well. other than components, these divisions have been performing well. a bit of an update their from sony. we continue to watch that into

monday morning. juliette saly has the bloomberg business news. state: in france, islamic has claimed responsibility for an attack that left one police officer dead and two others injured. the assailant was shot dead last night in paris. the shootings came three days before the first round of voting in one of the most tightly contested presidential elections the country has seen. and at a time when france is still under a state of emergency following a wave of terrorist attacks in the past two years. and the u.s., deutsche bank has been hit with a federal reserve first ager find for failing to ensure traders abide by the volcker rules. the company will pay even more for letting currency desks chat online revealing positions. the simultaneous sanctions totaling almost $150 million.

german police have arrested a for carryinguspect out a bomb attack 10 days ago. prosecutors allege the suspect, who has german-russian options on thet team ahead of the blast. the bank of japan's governor has said the central bank will continue with their he accommodative monetary policies and maintain the current pace of asset purchases for some time. kuroda exclusively told bloomberg that while the economy is doing better than thought a few months ago, the inflation rate remains quite sluggish. pace ofink the current purchase and the monetary base will continue for some time.

juliette: global news 24 hours a day powered by our 2600 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top . it is coming into the end of the trading session for the week here in asia. we have just had japan and australia close-out. a strong gain on the nikkei, up by 1%. in thend particularly iron ore contract. some fluctuation on the china market. it is in negative territory right now. off by 0.25%. but a good week for asian equities, on track for a weekly gain of about 0.7%, the first weekly gain in five weeks. the duet group rising the most since 2008 due to the government approval of the cki bid for the company. to sheila falling. about the salets

of its memory chip unit. will be a meeting on april 24. another lawsuit filed against toshiba. coca-cola falling sharply in sydney trade down 10.5% seeing lackluster sales in its australian unit. -- this is kospi interesting showing that investors are preferring to hedge against declines in the euro with the japanese yen rather than the swiss franc which is also often seen as a safe haven. the white line is the euro, japanese yen. while we are seeing this, that it could be japanese investors trying to seek protection for their french bond holdings, the yen in focus following the comments from kuroda and steven mnuchin. you can find this on the bloomberg. anna: thank you very much.

tosident trump has returned his protectionist rhetoric in recent days slamming the canadian dairy holdings. and others have also been speaking out on the issues of free trade and protectionism. prime minister trudeau: we are in favor of trade deals and progressive trade deals. >> we certainly will be looking at how we can participate and continue to support the growth of trade and how it can be done , fair andt efficient global way as possible. >> we would prefer that no one has tariffs. but, if you want to insist on having a tariff on a product, the president believes that we should treat you in a reciprocal fashion. >> that implies a level playing field. no use of distorted of --

distortive measures. looking forways good trade deals for canada. as we move forward in what seems we are post tpp world, very interested in growing our relationships with asia to look at how we can grow. >> we have to export more to them so the trade deficit narrows and narrows quickly. set, lisa us now on mcdonald, cio of global equities at alliance. of voices they're hoping trade is not threatened by populism. and explaining why it might be in some cases. you put these in the same box as the political conversations being held at the moment that some of it is not investable? much france, it is pretty on investable -- it is pretty

estable at this point. most of it is priced in. we will wait and see on that one. as far as trade is concerned, we have had discussions going on in washington but also with brexit. trade will be front and center of the discussions. as far as it -- as far as investing is concerned, there is not much we can do. anna: have you been protecting your portfolio from a melenchon, marine le pen second round? in ourre pretty core investments in europe and focusing on a weaker euro. the fact that we have an election is not a surprise. the fact that marine le pen is

there, is not a surprise. but and extreme outcome is not a surprise. matt: what about the u.s.? focusing on the tax reform issue. steve mnuchin seems to think they can go through with tax reform even if health care fails. the last time we had real tax reform in the u.s. was in 1986. i believe i was in middle school and i am no spring chicken. it is such a difficult issue. it is pretty shocking that steve mnuchin can be so confident and that u.s. equity market seem to buy it. >> it is good timing on his part because of the donald trump reflationary trade was looking quite tired in markets in the last few months. from the timing point of view, it he is talking about the issue that is of most interest to

investors -- that is well-timed. and giving a sort of timeline on it has led to this enthusiasm in the markets. we will need to see delivery. is, in particular, how it made to be revenue neutral which was the implication of what he was saying. and, without using anything to -- and,, as far as without using anything too creative, as far as making numbers up, that will be of interest to as. it was just what the market needed in terms of timing. the marketis what needed. the market also wants to see something on infrastructure, which it looks pretty far off. even if it comes in at a trillion dollars over 10 years. the market once to see something on deregulation. the markets are not going to get

very quickly any of this donald trump reflation driver. stocks or ares. you concerned like paul tudor jones or scott minard, that we could be in for a serious correction? >> we prefer stocks outside of the u.s. that has been the case is the beginning of the year. as far as a large correction, we think there is certainly scope for some correction. but the statement that u.s. stocks are expensive is not news as far as most people are concerned. i don't think that should be an enormous shock. markets are where they are because of the low level interest-rates. looking at the normalization, it will continue to be of great interest to all investors. anna: the reassessments of where the fed goes with that -- with

the interest rates, is that supporting stocks a little bit? the market seems quite happy with the series of hikes, to the point that the market is worried about the data and reassessing expectations. how do you view that reassessment? data which had the election, beginning to recover and momentum was strengthening, also the second half of last year, now, there is more of a question mark regarding the consumer. consumer confidence shot up after the election. it is coming off of those highs. and there is no real followthrough into consumption. the levelrtly because of debt is still very high and partly because the rise in rates that we have seen are beginning to have some impact.

there is not enough follow-through meaning economic momentum is slightly slowing and that is why the assumptions on the rates have been coming down. that is all behind why the whole donald trump reflation trade has quiterazy -- has gone flat. now had a have fantastic course at the end of last year. they have underperformed in the first quarter this year and now, they are coming back to more interesting levels again. particularly, if the reflation trade has another little go. i think that is probably what we are going to be seeing in the rest of this year. a bit of a flip-flopping between reflation

and deflation. but that is against a background of markets where you have, still some positive earnings coming through. we must not forget that the earnings are still growing, the economy is still growing. economics are slowing slightly. and you have interest rates rising part that also just that you have probably seen the best of the returns. the story.entioned thank you for joining us today. program,n the following a fatal shooting in paris, just days before the election. we had back out to the french capital for the latest on the incident and how this could impact the presidential race. this is bloomberg. ♪

8:21 a.m.s just gone here in berlin. london.. in it looks pretty nice over the brandenburg gate with the qua it willt i assure you be cold and rainy here in berlin. we head to hong kong with juliette saly. : a message for janet yellen and investors -- the very upgrade -- be very afraid. years of low interest rate has lowered his stock portfolio. according to people present at a closed door goldman sachs asset management conference, he said the value of the stock market relative to the size of the

economy should be terrifying to a central banker. inres in duet group jumped sydney as the australian government approved of the takeover bid. duet also bid more than 99% of proxy votes to approve the deal. to anl give li access energy network three times the size of hong kong. french voters head to the polls on sunday in the first round of voting in the country's presidential election. tight polling. a final day of campaigning today will be overshadowed by a fatal shooting last night in paris. let us go to paris with caroline. the main question today is will these attacks last night change the outcome of the

first part of this french a presidential election? i am very happy to be joint by of the french senate. and also representing the french --. how could this attack change this first round of voting? >> people will react with their emotions. solidarity. feeling badly for the family of the police man who was killed and those who are fighting for their lives. one needs to be coolheaded in a time like this. and work on preventing further attacks rather than reacting with emotions and possibly being led to finding the wrong solutions. far right wing candidate, marine le pen, playing on security and immigration issues during this campaign. could this attack benefit marine le pen? >> she has been playing with

fear. these attacks have nothing to do with immigration. i think she is mixing up different issues just because that is what her party stands for. based on racist party nationalism and so on, so she is taking any excuse to blame people. is playing on that, and she will continue to do so. caroline: could this also benefit france while field -- francois fillon? >> these two candidates have had a very hard line with the security at the center of their speeches and program. he didoking back at what when he was prime minister, he did not find any solutions. otherwise, france would be far more secure than it is today had he done so. caroline: you lead the socialist

party, the current government. and the first time since 1965 that we have had an election in the face of an emergency. have the socialists done enough to prevent these kinds of attacks in france? >> we have had three major pieces of legislation to reinforce the cooperation among giving more means it to the police forces and information services, secret services. we have done a lot. of course, it is never enough because we see attacks from loan peoplewho -- from lone who decide to attack. that is difficult to prevent. a lot has been done. of course, it is not enough. your candidate is fifth in the opinion polls.

run --they go for make mhould they go for macron,: elenchon? support mr. melenchon or his stance on europe, syria, or other issues. i would not go for him. as for mr. macron. he is in charge of the new movement. i do not belong to that. i do not see what that vote would be useful for. thank you berry much for joining us. a representative of the socialist party obviously, talking about the emotion created by the terrorist attack last night and how it could play in the french elections. anna: thank you.

we will look to see how that will play into the french election. we will bring you all of the french election action sunday evening. tune in at 8:00 p.m. paris time decides." -- france this is bloomberg. ♪

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you wouldn't pick a slow race car. then why settle for slow internet? comcast business. built for speed. built for business. ♪ >> good morning and welcome. london andhnson in matt miller is in berlin. what are we watching? terror strikes paris. isis claims responsibility for a deadly shooting of the police man. will the attack affect the election? u.s. treasury secretary, steve mnuchin, says a shakeup will happen by the end of the year, but the dollar barely moves. hama