anna: good morning from london. manus: this is "bloomberg daybreak: europe." anna: thanks tele most in 22 months as investors sell this month top stocks. asian agrees are mixed. manus: the u.s. president nominates a sometime critic to the central bank. anna: pressing for a deal. opec in russia takes -- set to extend oil cuts today in vienna. today we speak to the nigerian petroleum minister. ♪

anna: a very good morning, everybody. this is "bloomberg daybreak: europe." let's talk about what happened with the technology universe and tech stock and into the asia session. msci asia down, mixed trading but the overall sentiment is one that is negative as some of the technology stocks weakness we saw in the u.s. falling through into the asian session. fascinating to look at how the session developed yesterday. the markets inching higher early in the day, talk from janet yellen of broad-based growth and then tax cuts coming, let's sell some of those technology stocks. that seemed to be the realization that was going on in the market. i know you have more on that. more than $7 billion being lost by tech moguls.

nasdaq futures look to be flat at the moment. we'll keep an eye on that for any followthrough. the pound is up a little bit, around .5%. talked about this in the program, on expectations that we could see a rate hike sooner than the market might of anticipated. the ftse was down the most in five weeks yesterday. as always, the link between the pound and what is going on in the u.k. market. manus: we started off with jeff beezus going through 100 million dollars. nobody make that kind of money except for bill gates. outas a $60 billion wiped so to speak. interrupt the flow and go in terms of the tech route with a few lines from credit suisse, one or two lines coming from north hydro as

well. let's look at the top line, these are the top headlines from credit suisse. they remain committed to their 2018 target in the target is adjusted pretax profit of 850 million swiss francs. janet yellen made it clear that this is not the year for effusive play out -- payouts to bankers, remaining committed to the 2018 target. the talking about a target of 16.5 billion-17.5 billion swiss francs. we got a little more flow on that as we go through. let me take you back to a wipeout. every day begin will and bear. -- we get bull and bear. all going lower through the day. let's roll it over and look at

the others because it is a group of five. a clear indication that banks lost 3.7%, semiconductors lost nearly 4% in terms of value. the question for the markets, are we seeing the beginning of a great rotation? i suppose they are creative in their approach to taxes. is that a generous statement? is were going to see a more aggressive fed. the rich get richer one day and the next day we change. anna: when is having a low tax rate a bad thing? when there's a big piece of tax legislation coming, that's what we learned yesterday. we have some big guests to talk to in the next hour and a half. we will speak to the nigerian petroleum minister and it 6:30 will speak to the ceo of north

hydro. increasing their improvement new guidancee there and at 7:00, we will sit down with martin gilbert of standard life. here's juliette saly with the bloomberg first word update. the global stockpiles keep falling and prices maintain gains. member's and russia agree to cut should last until the end of next or. to delegate said yesterday that -- also recommended extending until the end of 2018. that chinas demented cut off all oil exports to north korea after the country's latest intercontinental ballistic missile test, warning that washington will force action if

beijing fails to do so. speaking during an emergency session at the you in general a simply, u.s. ambassador nikki haley said donald trump had called pratt -- china's president to discuss the matter. >> president trump called president xi this morning and said we've come to the point where china must cut off the oil from north korea. that would be pivotal step in the world's effort to stop this international pariah. u.s. senate republicans have voted to begin debate on their sweeping tax overhaul bill that would cut rates for businesses and individuals. it touches oprah protest that could produce an up or down vote before the end of this week. if they can approve a bill this week, they would accept a hammer out cover month legislation with the house which proved its own package of tax changes earlier this month. u.s. president donald trump has left out at u.k. prime minister theresa may after her office rebuked him earlier in the day paris tweeting and to muslim videos posted by a right-wing

british activist. focus on me,on't focus on the destructive radical islamic terrorism taking place within the united kingdom. we are doing just fine. he initially tagged the wrong person, linking to a woman identified of twitter as theresa scribner. moments later, he fixed the error. australia's banks will be subject to a wide-ranging public inquiry after prime minister malcolm turnbull bow to pressure for setting the industry. examine financial services providers and pension funds and consider whether regulator cap enough power to tackle misconduct. shares in the country's big banks fell on the news. bank of korea has raised its benchmark interest rate for the first time since 2011, marking a likely turning point for asians and for bike. the region faces pressure to increase foreign cost after the fed begin typing at the end of 2015.

hike since 2014. the won they'll on the news. the manufacturing purchasers managing index rose in november while nonmanufacturing pmi also climbed. ss foreign and domestic demand help with the effects to clean up the environment and the financial system. global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. find more stories on the .loomberg at top all of the movement in the asian market was reacting to those stories we just heard. the bank of korea rate decision, the won at a two-month low. the cost the up at 1.2%. continuing to see the tech story play through into the asian region. the likes of tencent and some of the biggest insurers and japan's

had as closing higher by .6%. in terms of the stocks we been marching, i mention the tech players, you can see the apple suppliers coming into pressure in taiwan. 6%ent semiconductor off by and the commonwealth bank in theonse to the story, largest bank by market cap affects the largest stock on the asx 200. manus: just a little more depth in terms of the credits we story. why would you buy ubs? i would you buy credit suisse? they and to pay 50% of its net income in buybacks and dividends. that is the reason why you only

stop. also talking about the return on tangible equity. talking about 10%-11%. if you look at the performance year-to-date, credit suisse up 15.9% and of course the question , whether theng smart and savvy move driven by money? those are the top lines from credit suisse this morning. anna: interesting to see the specifics around the individual names, but also the overall story you'd touched on with financial services. we saw a credit suisse up by 1.9% yesterday. 2.6%, all because of what we had from the united states. the big picture story about that surround financials at the moment.

nominated by president trump to serve as a governor at the central bank. manus: fed watchers are digesting the latest news from janet yellen and her successor, for many, it was a case of meet the new boss, who is similar to the old boss. let's look at what they had to say on rates. the american economy, and inflation. >> we do think it is important to gradually move our policy rate tort a neutral level which would be consistent with sustainably strong labor market conditions. >> now the economy is strong, unemployment is low, growth is strong and appears to have picked up. so it's time for us to be normalizing interest rates. wage increases are modest. >> we don't see it signaling any tightness in the labor market.

>> the labor market and economy are not significantly overheated. >> there's no sense of an overheating economy are a particularly tight labor market. >> inflation has been below the 2% objective for most of the past five years. >> inflation has been below are 2% objective every single month or maybe everything a month but one since i joined the board of governors in may, 2012. >> against the specter of the fomc indicating that it intends to carefully monitor actual and expected progress toward our inflation goal. >> is a transitory, or are there more fundamental things at work here? we're all watching carefully to see and we will be guided by the data as they come in. anna: a fascinating and let -- edit of yellen and powell. you, lawrence. there are certain things that

overlap on, certain messages you get from both of these highly qualified individuals. laurence: definition of singing from the same hymn sheet as christmas approaches. that's what the market wanted and what the market expected as well. so it's nice reinforcement of a kind of smooth handover of the baton. manus: i love the pod in the headlines, good friend from carnegie mellon with a scathing point that they've added a phd, which will help mr. powell. but marvin good friend, he's little bit chastened with the yellen tenure, but he also likes -- what does a good friend bring to the table? the fed as an institution has been much less of a democracy than the bank of england policy committee. the chairman decides what to do.

way theast that's the firms have worked. it's not about to turn into kind of one person, one vote situation. have ace that they diversity of opinions across the spectrum. you hear anybody, you say that is dovish, but they are always dovish. i think it is ok, it's good to see that the committee is broadening out. anna: previously talking about andfeds they'll your pegging progress to some sort of rule. how does that sit with the other members of the fed, liking a rule-based approach? we will not see much more that, from what you have said. laurence: janet yellen made a

defense of flexibility. the is the benefit to institution of boxing yourself in? the flexibility stays. failureuse words like much more when you are not on the committee. it's easier but it is a marginal thing. manus: that's get into the dirty business of what you do. business, we should not call the bond market a dirty business. this is the performance of treasury -- delivering a better return than the cousin's which are just good old, normal bonds. bank of america, and we touched on this with derek the other day , and he was rather scathing, saying is not telling me that much. the biggest flow of money in history is gone into inflation

take the bonds. i know we are rolling over slightly, but come with me on the journey. you have a longer-term view, and it does make sense to have inflation protected bonds. if you look at the stance of monetary policy and the situation of the economy globally, the economy is doing really well. it is running hot. excess opacities being eaten up. unemployment rate is falling. economy is rolling above the trend rate. and yet policymakers are keeping policy extremely easy. why is that? if you think back for five years, the downside risk of moving into a d inflation environment -- a deflation environment was real. now the economy is recovering but they want to make sure it continues to recover strongly. that should be a recipe for rising inflation.

anna: barclays, goldman sachs talking about global growth being 4% next year instead of the bullish global growth picture. i we rotate within assets? i know this is away from your day-to-day job, but we started talking about move out of stocks into financials yesterday. spitting in context the selloff we saw in tech stocks. many people have been waiting for a rotation out of don's and here we are talking about this interest equity rotation. get to that,ill even though i know nothing about them. in terms of intra-bond market rotation, that's the same thing. what happens at this time of your typically is market moves, which have little information, as the year-end approaches, people want to flatten balance sheets. banks want to reduce their

balance sheet. the trades that, but this time of year are the good ones. because the bad ones are not there anymore. in the u.s., you have a big curve flattening. there's a lot of talk about that. the traits people have on for kerry reasons have been curved steeply. world,e in the stock it's a time of year to reduce risk. it's a seasonal gift. manus: stay with us, laurence mutkin. ceo lloydn sachs blankfein joins a team -- joins the team. next, china's official factory gates jumps, approaching

a five-year high. this is bloomberg ♪.

>> i think this year we seem profits of 90%. there will be a balance. should not expect anything spectacular, but something fair. not a big increase compared to the previous year. the news this morning is , shareholders have put up with a lot. orthe form of dividends share buybacks. into the double-digit sphere, 10%-11%. to double-digit returns is a huge objective. ,ransformation of credit suisse

it's entering the final phase. he's talking about the cost base target, 50% pay out and remain committed to the 2018 targets. let's talk about china, after the banking news this morning. in atcturing pmi came 51.8 for this month, close to a near five-year high. for an end demand help cushion the effect of parallel campaigns to clean up the environment and financial system. and nonmanufacturing pmi rose in november. we're talking to laurence mutkin who is still with us. way from the month by month movement in the pmi figures which we have charts to show the audience, the broader picture is on the domestic front, they are counting down on the environment

and financial leverage, but the global growth story is keeping them afloat. it's a good time for them to do this, i guess. think that's right. you can see it in the domestic bond market. domestic bond yields have been rising since the governor of the pboc started sounding more optimistic on growth back in october. and the data shows his optimism was well-founded. you would expect the bond market to deepen a bit. there has been some concern expressed that the credit spreads within the bond market have wide out a bit. or convincedegist its that more than a signal of anything else. manus: we talked about this often. is that restriction in the our story this morning from china, global use

falls to a three-year low and the curbs on one side that anna is that whatout, causes the rig -- the restriction? why would i want to be stepping into the bond market? laurence: it's harder to buy when the bond market is going up. by definition because it's a good environment for the company, it's not good the bond market. the fluctuations are quite modest and there is a long-term goinglan as you said, into a global economy. it's a little bump on the road. the: we tend to increase

forecast around global trade. is that part of the overall global story at the moment, that trade has picked up a little bit ? laurence: it's part of the global economy thing. it's a sign that not only in my market, the g10, but the overspill globally is much stronger growth. manus: stay with us, we have a little more to get through, laurence mutkin. >> i found some shelter, it's snowing heavily here in the city. remember the market is betting on a nine-month extension. a lot of discussions on the sidelines about what an exit strategy is going to look like. we'll get a feel of what the situation is out there in terms of the market with the nigerian minister of state. stay around for that interview. this is bloomberg.

♪

is this a phone? or a little internet machine? [ phone rings ] it makes you wonder. shouldn't we get our phones and internet from the same company? that's why xfinity mobile comes with your internet. you get up to 5 lines of talk and text at no extra cost. so all you pay for is data. choose by the gig or unlimited. and ask how to get a $200 prepaid card when you buy any new samsung device with xfinity mobile. a new kind of network designed to save you money. click, call or visit today.

yen,the dollar against the .2%. 6:30 here london. let's check in on the market action. >> the tech selloff we saw in the u.s. session at followthrough into asia so tech stocks providing the biggest drag on the msci asia-pacific index. a fair amount of red across the region, you see on the hang seng and the shanghai composite. in australia if the losses there and the session, led by banks

after news about inquiry by the government into banks. we saw that rotation in the u.s. , but tech stocks in asia still outperforming this year. it's a southce, korean won that has been underperforming, but outperforming has been sterling. touching a two month high on reports the government in london may have come to some agreement over the irish border. we may see sterling close above its three-year downtrend. inll short of the high back september but we did touch a two-month high. take a look at what's in happening in the fixed income space, yesterday on the progress we've been hearing about tax reform, we did see a reaction, steepening the most in september. despite all the hullabaloo over curve flattening we've had over the past few weeks, what we had is remarkable movement in the 10 year yield overall.

even though we saw it move higher six basis points, the 10 year yield has been trading and is tightly -- titus monthly range since 19 79 -- society and 79. 2.39% which is about where he finished off yesterday. and finally taking a look at it coin, this is where we have seen a lot of volatility. it searched and then dropped significantly in 90 minutes. it's back about 10,000 in today's session. anna: hullabaloo, my word of the morning so far. apply to other stories like this coin. let's talk about oil, a hullabaloo indiana about that one. delegates attending talks in vienna say the ministerial committee recommended the current supply curve be extended for nine months from march. that's get to yousef gamal

el-din. a different tone here more positive than previous meetings. still a lot harder than it was one or two years ago. then you have inventories coming down. let's get straight into the conversation with emmanuel kachikwu from nigeria. thank you for joining us on bloomberg television. seems toi counterpart be convinced it's a done deal, the market positioning itself for the most part around that scenario. is he getting ahead of itself? emmanuel: lots of positive five rations in the conversation. we would think we could rounded up a little. [indiscernible]

in.ybody comes at that point you get to know everybody but i got the impression that it's not a done deal yet. what has been the hardest part about the discussion this time around? the american oil production numbers just out overnight, the highest in 30 years. geopolitics in the middle east, what has been the trickiest part? seeing what washington is going to do, that's one. by opeccompliance members, there's a little bit of slide in some countries. more see a lot [indiscernible]

there are three issues that have come up. yousef: in terms of the exit strategy, there's a lot more focus on that, it appears. what are you pushing specifically in terms of the gradual drawdown of interference in that market? mean from a you nigerian perspective or a global perspective? yousef: what would you like to see in terms of an exit strategy? , itnuel: the reality is looks like you're walking it down, and he goes up. there is increasing lesser capacity from a year or two ago. discipline, it's a great. [indiscernible]

make sure the cost structures are down to ultimately, the only --ater and where you find yousef: has there been any change in terms of opec reduction as far as nigeria? word cut has not been used, we've resisted that were cut. clearly there's a continuing obligation to ensure -- there's country.gy as a [indiscernible] current production of 7.5 is comfortable, but you will see a

lot more pressure as we go into next year. yousef: that is the key thing, isn't it? conversationss you have outlined some of the reforms you are doing in terms of increasing capacity. where does the number go from 1.75? seenuel: poole probably capacity to do close to 2.3-2.5. we're not going to begin to look -- [indiscernible] that's where the margins are. what kind of price range would we be looking at for brent crude for 2018? give us a sense of where you see it. last year home we

talked a said of forget route.es to 60, will be mid 50's, not too bad. is there a risk of adhesive to quickly that you will encourage the u.s. all industry to cut back faster, meaning you need to take additional measures to keep this in check? emmanuel: we must not get focused on shale. there is really -- we have to look at greater reduction to as low as 45. [indiscernible] will shale get up potentially? yes, as technology improves. there's not much you can do about it. productione cost of

because then we can take the shocks as they come. theef: we've seen cease-fire with the avengers come to an in. they are blaming the government. what is your position, is there concern that he can feed into a cycle of violence? i think we are , we delivero engage on the promises in the commercialization area. [indiscernible] it's growing positively. given the tension in the area, i am optimistic. substantialg progress on the key issues.

how much progress are sales ofg in terms of 5% of some of the domestic oil companies? is that still on the agenda? ,mmanuel: we've just announced but we haven't begun to process, this will take time. compliment see a within the next year. yousef: in terms of international companies that are still outstanding, anything new on that front? emmanuel: we are doing very well. [indiscernible] program.ve-year there is a lot of booing of confidence in the area of personal finance. yousef: emmanuel kachikwu

, thank you very much for joining us on the show. still a lot ahead. thank you very much, great interview there with the nigerian minister. we just need to focus on the opec errol. back to the u.k. and e.u.. are we moving closer? closer to compromise deal on the irish order that will allow the brexit talks to move to trade next week. yields rose the sharpest since mid-september. all the speculation is that the bank of england could be re-pricing in getting more aggressive. there was a lot of hurly-burly yesterday about get ready, mark carney. a hullabaloo.

a lot of hullabaloo about nothing. i don't want you to thwart my enthusiasm but there has been a shift, albeit miniscule, but the market is moving its perspective on a trade deal and transition and that has consequences for the bank of england. do you buy the hype? laurence: it's always nice when it seems that things are moving forward. the market is worried about the uncertainty about the outcome and progress of the talks. is there any hint that there is a little more progress toward some conclusion? it's reassuring to confidence. move in terms of the low volatility we have in the we., but it still small and think that is right. we see the economy underperforming for the bank of england expect already.

we don't think the bank is going to go as many times since 2018 as the market has been suggesting. what is your negative take this is numbers from the gasquet. we have figures showing retail sales barely rose in october. it's a large part of the economy. laurence: u.k. has been doing all right. better than the bank of england feared when it did his emergency action. that was reassuring, but if you compare it to how the u.s. is motoring and the e.u. is motoring, say hasn't really seen that same pickup that other big develop markets have seen. there's a lot of indicators within the u.k. which are looking a little bit soft. for us, if you think about why the bank would need to go again,

it would do with the pace of economy. don't see the economy running as fast as they do. perhaps the first rate hike doesn't come until a year from now, november of next year. if there's a rewriting of very'sk of england, analysts have written and said it is a game changer. it's a trade and transition deal that could be a game changer. circle that back into the bond world. a more aggressive move in about onetalking dollar 40 cents within a week. what does that do to the flow of international money into the gilt market? >> this is why the gilt market keeps being stuck. there's a feedback loop in terms of every time you get encouraging news and the pound goes up, it means the bank of england has more confidence that imported inflation will be less so it has less to do.

so whatever the interplay nets out to, it doesn't have to do much. that's where we stay, broadly speaking. gilt any strategy on the at the moment? laurence: there's always reasons for it to do with pension line -- pension fund flows and so on. i think it's probably not a sustainable situation. we do like being short at the long end of the u.k.. anna: thank you very much, laurence mutkin, on the subject of the u.k.. just getting a red headline crossing the bloomberg on the swiss economy. it matched estimates. manus: keep non-euro suites on

the back of that, encroaching that level of 120. supplier, the aluminum to becomeo aiming carbon neutral by 2020. we have the ceo and will ask him what his plans are. that is next. this is bloomberg. ♪

1:49 a.m. in the united states of america on the east coast. the rich got a little less rich yesterday in terms of leaders of those industries. is there a great rotation from these tech stocks into financials? one lady who can tell us the bloomberg business flash with

confidence is juliette saly. good morning. juliette: credit suisse has set of plans to return to shareholders special dividends ahead of its -- the bank also increased its target for wealth management and connected businesses in the asia-pacific. the lender confirmed its target for the swiss universal bank, international wealth management and investment banking and capital markets and global market businesses. bitcoins roller coaster ride showing no signs of easing. yesterday the cryptocurrencies soared above $11,000, representing a gain of more than twofold in september. then plunged nearly 20% in less than 90 minutes and is currently trading back above $10,000. that is your bloomberg business flash. anna: thank you very much, juliette saly. hydroum supplier northern announce its aim to become

carbon neutral from lifecycle perspective by 2020. this being a capital market stay, we had an update on the target this companies aiming for. we have the ceo of north hydro joining us on set here in london. great to have you with us this morning. tell us a little more what's behind this improvement in the improvement in your target you are able to deliver. some operational challenges you are having now been corrected. what is the biggest driver of this improvement? inquiring shares [indiscernible] the largest global integrated aluminum company with several opportunities for us to improve. our target for 2019, in several parts of the company. manus: many ceos who sit down

with us talk about the synchronized global recovery. i want to get your sense of how global is the recovery. if you look at the function on the bloomberg come we can see where you do business, core areas in europe, asia, the u.s.. talk us through your global spectrum. visit synchronized? it is situational. the receipt positive growth and development in all areas in the world, china is coming down from expectdigit growth, we 6% growth in china next year. up, sou.s., gdp is going demand in the u.s. and europe is very positive from our side.

there's also additional substitution making it even higher than gdp. anna: where is the substitution coming from? i want to ask about the fast-changing automotive industry. do you see continued demand growth from the automotive industry? >> were discussing the next car models and we see there will be more and more and demand for aluminum going forward. there's a drive for reducing co2 emissions and fuel consumption. our customers are also asking for the carbon footprint of the cars which is why were launching two new products today. manus: let's talk about those in context. mention the environment 89 times. he talked about the economy 70 times. or going to see a much more

foressive demand manufacturers like you about the environment and the carbon footprint of your product? or going to skip a generation in china on the environment question? >> this is very important. china representing 50% of the global demand in aluminum. china is coming to the point they're at the limit where they have to be corrected. china is introducing the so-called loose guy initiative and that hashe air impact on the global demand. we've also seen the supply-side referring china has impacted the supply balance in china, which means we're now entering into a largely balanced market coming from the supply situation globally attending toward a tighter situation in 2018.

there's still a substantial deficit in china. anna: president trump in the united states has started a probe into aluminum that china has called protectionist. you see anything the president is doing in the united states as a threat to what you do and european producers? >> so far, we don't see the impact. so far it doesn't have a big impact on our business. fairly loftyhad a run on aluminum, up 20% on the year. in terms of the supply you talk china,the oversupply in and those constrictions on the other side, you see aluminum prices going? give us your overall outlook.

-- with thee price situation where it's increased there are prices in different parts of the world that are higher today so the cost curve is going up. at the price we had today, we're close to long-term pricing of aluminum. anna: so the price is going higher. >> it could also go sideways. anna: thank you for joining us and spending time with us this morning. martinwe're joined by to talk about global markets and get his take on what's happening

in the bond market and the stock markets. and bitcoin possibly. a lot to talk about in the money management market. this is bloomberg. ♪

manus: good morning from bloomberg's new european headquarters in london. i am manus cranny. anna: this is bloomberg daybreak: europe. these are the top stories. manus: credit suisse plans to raise returns to shareholders and pay half it net income and share buybacks for special dividends. banks tumbled as to 22 months as investors sell the year's top stocks area asian equities are mixed. manus: trumps good friend. nominating a son time critic of the fed under yellen to the central bank. anna: pressing for a deal. opec and russia are extending oil cuts today in vienna. ♪

manus: our warm welcome to daybreak. it has been a heavy 24 hours, the chinese have delivered a surprise, pmi up near five-year highs. that has given the equity markets a little bit of food for thought. sterling continues higher and down goes the ftse relative to their cohorts. you have to u.s. equity market. a balance between the china data .nd the blockbuster selloffs $60 billion wiped out of technology shares. what are they going to do and opec? the line?oing over futures indicated up 14.5. china data dominates. also warning about the healthy

state of the european economy. what that might mean for the market. oat's up 4.5 pips. focus on your barrels, that was the message from the nigerian interview we did and the times carries the story that we are inching ever closer bit by bit to our trade and transition discussion next monday. anna: that puts the u.k. karen c and the gilt markets, that futures on the risk radar. by one third of 1% this morning as we see the politicians advancing slowly toward some kind of agreement may be on ireland by monday. that seems to be the deadline many are working toward. the level of optimism pushing up the pound once again. we have the nasdaq futures and the msci pacific. we saw this story developing through the u.s. session yesterday. the start of the day was

positive. bankomments about regulations were moving the market higher. come it from yellen moved the markets. the markets thought that means we want to get out of the stocks and get into some of the financial services stocks so we saw the selloff in the nasdaq. banks down the most in 22 head -- 22 months. asia-pacific down by .8 of a percent right now. we are getting some breaking news on of effect, upgrading its growth, cash, and dividend targets aiming for more than made single digit percent growth per year. this is ifrs numbers. there talking about increasing -- they are talking about an increase from 7 billion to 8 billion pounds in upping the payout ratio target 55% to 60%

2020,rating eps by increasing payout ratios, that is a theme. manus: it is. credit suisse has their investor day and telling the markets they are ready to pay out more in the form of share buybacks and dividends. let's talk about the bond markets. there are a couple of different stories on the bloomberg terminal. this is the stage of play, bunds and u.s.o pips treasuries fall lower. what does mr. good friend made for the fomc? same speechwriters. keep an eye on french bonds, they will underperform because you're going to have a huge supply coming into the market in 2018. this will be one of the biggest losers, the yield is likely to take place in the second half of the year. the country is set to see it looked of supply. thean bunds will face

environment. this is the view from deutsche bank. and on the other side saying that economic strength points to the ecb forecast of grade. could the ecb morph as move more aggressively? that is the risk for 2018. bywill get a view of markets our guest. let's get to juliette saly, with the first word news. juliette: u.s. president has nominated marvin good friend to be a governor of the federal reserve. he is widely respected my three economist and some time critic of the fed under yellen. a professor at conic email and university and rector of research under richmond fed, he served on an independent panel known as the shadow open market committee providing alternative views on monetary policy. opec and russia are ready to

extend their oil production cuts until the end of next year to ensure global stockpiles keep falling and prices in 10 recent gains. according to delegates in vienna who attended all members and russia agreed the cuts should last until the end of next year. two delegates said a committee overture -- charged with overseeing the agreement recommended extending until the end of 2018. the u.s. has demanded china cut off all oil exports to north korea after the country's latest intercontinental ballistic missile test morning that washington will force action is -- if beijing ails to do so. speaking at a emergency session, nikki haley said donald trump had called china's president xi to discuss the matter. u.s. senate republicans have voted to begin debate on their sweeping tax overhaul bill that would cut rates were businesses and individuals touching off a process that could produce an up or down vote before the end of this week.

if they can approve this week they will have to hammer out a compromise with the house. which approved the tax package of changes earlier this month. australia's banks are to be subject to a wide ranging public inquiry after prime minister malcolm turnbull bowed to pressure to address scandals. the role commission will examine the conduct of the nations's banks. insurers and financial services providers and pension funds and consider whether regulators have enough power to tackle misconduct. shares in the big banks fell on the news. china's official factory gauges increasing to a near five-year high. the index rose to 51.8 in november while nonmanufacturing pmi also climbed. foreign and domestic demand cushioned and the effective campaigns to clean up the environment and financial system. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries.

you can find more stories on the bloomberg at top . nikkei bucking the downward trend across asia today. the regional index lower for a fourth consecutive session but you had the nikkei close higher by .6 of 1% in tokyo thanks to a rally in financial stocks similar to what you saw in the u.s. but similar to the u.s. to my big selloff in the tech players. tencent weighing on the hang seng index and the taiex under pressure due to the apple suppliers and the kospi off by 1.5%. lifting the rate, the one falling to a two-month low. taiwan semiconductor following -- falling the most. toshiba coming through saying it will sell its hospital unit. closed due toe the weakness in tech players. the singaporen higher byp by 18%,

17% in late trade. manus: volatility for christmas, that seems to be the bite word -- byword in the markets. lifeesult was standard everyday and after the merger. we half an exclusive conversation with the ceo. good to see you. martin: great to be here. manus: aviva said to pay the target. and credit suisse ready to pay out more. you would be carrying the banner for bigger payouts. you have aviva on your books. martin: it is doing well. we welcome the payout. we do not push for big payouts because companies have used for the cash. that is also a good thing to do. of -- thesiness

business is doing well generating lots of capital. anna: other sectors you think should be paying more. other sectors should be paying out more? martin: what we prefer is a progressive dividend rather than -- i prefer a fixed percentage so that you do not get fluctuating dividends. at the banks are generating lot of excess capital at the moment. hopefully the u.k. banks will follow suit and pay dividends and pay a progressive dividend. atus: what are you proposing aberdeen standard? you have done 40 days in your lifetime -- deals in your lifetime. is it better to do perhaps more deals with your cash? is that the agenda for 2018? martin: generate the cash is a good thing for us but let's see.

deals are off the table for us for the next year or two years just because of the huge integration we have to go through here in the u.k.. generally i would encourage companies if they do have a good use for the cash to find something to do with it. too mucha bit criticism of companies buying back shares, paying out the cash rather than building their businesses for the long-term. i would encourage people to think long-term. anna: you think the criticism is well-founded or no? martin: i think people especially in the u.s. have been too ready to buy back shares. it is great for earnings per share. we are the sadness is not investing in this country or the u.s. enough for the long-term growth. anna: you mentioned the

integration, m&a us off the table, you have a lot to do in terms of the integration of standard life aberdeen. it has been some that passed, hasis a progressive -- how it progressed? are you seeing uncertainty around housing and what the business looks like in the future? do you have concerns about driving talent or money away from you? martin: it is going as well as expected, probably slightly better than we expected syria to have to be cautious in this business. there is always something around the corner comes around to surprise you. as to talent, we put in retention packages for our top talent. want to be cautious here, it has gone pretty well in retention. no supplies is yet. marketthe other big

story was about funds and money and people deciding, do i want my money with the new combined merger and what -- one of those market stories is around lloyd's. have you had any meaningful discussion with lloyd's, how confident are you at this stage that you will retain them? lloyd's places funds with you in the marketplace. martin: we are in ongoing discussions with lloyd's is how we can work together going forward. it is a big price to have lloyd's as a customer. and a big prize to get access to their wealth channels. ceo wants to build wealth. it will be a great opportunity but nothing to announce yet. discussions are ongoing. anna: brexit is a big thing we have talked about with you in the past. you have seemed to be calm about the impact it would have on your business personally.

in terms of the u.k. financial services sector we had mark carney talking about the opportunities to rollback or change some of the regulatory environment in the u.k. as a result of brexit. of regulations you want to save rolled back when we exit the eu? martin: preparations are going pretty well. most financial institutions have press thean b and button on plan b and are setting up subsidiaries wherever it might be, amsterdam, frankfurt, dublin. there is no real world -- road back. my view is you take whatever regulation is thrown at you. i have long since stopped worrying about second-guessing. anna: what you said about the banks are financial services, is -- does that mean a transition

deal this that matter? martin: i think the two aspects to it, we have to have plan b. we all have to have land be in place by whatever date brexit actually occurs and we want to hard --on after the after the announcement. just to grandfather and contracts and all these things because they will be a lot of unintended consequences. we have not seen will occur after brexit. manus: picking up on anna, part of what we were reading together looking at mark carney comments, he was talking about intensive cooperation necessary to proceed with the disruption to financial services. an unlikely supporter in calling for an agreement to keep financial services clearing in london. john you stand behind

brett? this is a rather surprising development. will it happen? martin: i do not know. europe would love to have the clearing against all the infrastructure here. manus: what it is, we understand costs are going to go up, that is a fact. but there is a risk in taking clearing to europe. do the politicians listen to that or are they cognizant of hellbent onare they delivery of brexit? martin: a bit of both. if you speak to the regulators, mark carney' would say, if it was left to the regulators, the deal would be done straight away. the politicians are as you say hell-bent and probably trying to get as much business to move from london to continental europe. i would do the same if i was in -- their place. this is a one-off opportunity to

grow some of that capital cities in europe. anna: talking about politicians and reacting to them and the info -- regulatory environment changes, china increased the look estimates on foreign ownership of business. one opportunity exists to go bigger and two more in china for you or how much trepidation do you have about that? martin: china is a huge opportunity for us all. it is where the growth and wealth there is enormous. it is opening up. we have a wholly-owned subsidiary there. the issue probably is the foreign exchange control. it is not, it is difficult to outsideney to invest china and that would be the holy grail for asset managers. manus: before we let you have a in thewhere are we middle east?

oil is in a flurry. get a room in riyadh. it goes to your heart. what is going on? martin: i know as much as you do. he chucked all the guests through the ritz carlton. manus: are you getting more business through that area? martin: i think it has stabilized. the budget deficits are coming down in the region. aramco is an of massive cash generator for saudi. anna: we will see where that ends up. thank you. martin gilbert stays with us. an exclusive coming up later, we firstpeak to the ceo of group.

this is bloomberg. ♪

manus: welcome back to daybreak. you're looking at a live shot of the city of london. what a beautiful city it is. powerful and resplendent. anna: it is called. itus: it is a little bit and we have martin gilbert with us. anna: still with us here in london. let's talk about glencore. you sit on a number of boards. how does it look from the mining perspective? martin: he looks pretty good from the miners. glencore went through a near death experience it for a joined the benefits of that now, and,age will -- well down t prices globally have recovered.

probably a bit better than oil. which seems to be lacking in terms of recovery. manus: the other big market move that we had was yesterday. there is a debate. ,e saw $60 billion wiped off all of these stocks. off the tech site yesterday. did you come out of the office and talk to anybody? martin: we do not own any of them. we need these stocks to go down. in terms of relative performance. when you come from the aberdeen standard investment type of approach which is looking at good quality companies, more of the value and, these stocks are difficult to own.

we had a tough time because we have been underway china, underweight the tech stocks. it is a welcome correction for us. india, you have talked positively about india in the past. we had comments today talking about the data doubled inflation and india. favoritendia is our probably emerging market at the moment. it is easier to take money there than china. just the companies are well around, good quality. not saying that china, is not good. a lot of them, there is more state owned businesses. unilever,nesses, these companies are well-rounded and doing well. the market is not cheap there. bonds are looking good quality there. as you said, the economics are

looking good. the yield of 7%, local currency. it really good value. manus: martin knows a lot of people. he is deputy chair and on the glencore board. part of the who is bloomberg family is on the board at glencore. that is our global disclaimer. martin: i told them i could not use a bloomberg screen. manus: can i upgrade you? i will get you bloomberg mobile afterwards. talk to me about donald trump, you are a buddy. you play golf, you know him. how important is the tax deal to donald trump and the economy? martin: it is very important to both. america will do well if you can get this tax cut through. anna: some people say look at the bond market -- what the bond

market is selling you with the flat curve. martin: they'll preface the remarks in america by saying we do not like donald trump but, and then they go onto the tax cut and he is doing the right things for the economy, etc. he is quite important. manus: great to have you with us this morning. that is one of the broadest churches we have managed to sweep. we wish you well. we did not get to bitcoin. martin: i would not know how to buy it. thes: martin gilbert is co-ceo at standard everyday life. thank you very much conversation continues with martin on bloomberg radio. will be alongside michael bloomberg. martin gilbert

continues the conversation. credit suisse will be the top billing headline this morning. the payout, 50% in the buybacks and dividends. banks and aviva in focus. ♪

guy: welcome to bloomberg markets. this is the european open. i am guy johnson alongside matt miller. cash trade starts in 30 minute'' time. this is bloomberg. ♪ the technology stocks in u.s. and asia turned red as investors dumped to this year's out performers. could this effort -- offer some respite? marvin goodfriend is