♪ high expectations. said chair janet yellen prepares for a rate increase. more than a dozen other central banks announce the last policy of the year. matt: cracking $65. brent crude hits it ties number in two and a half years as the most important bible and the world is shut down. -- seekingsleep

to create a cybersecurity giant. ♪ anna: welcome to the program. this is "bloomberg markets: european open." --this is "daybreak: europe. " of more thanwhen 1% and again we see it moving higher this morning. it's moving up by one and a half percent. it's gone over $65 for the first time in two and a half years as matt was saying in the headlines. it's the most important pipeline of the world shut down. msci asia-pacific there as well. we are waiting for clues from a host of central banks to wear policies going to shift.

those low as we wait for news to come through. aren't expected to move very far very quickly today. first day of the two-day meeting of the fed will hold. stocksght we saw u.s. touching new highs. technology and media stocks in the front line there. the commodities sector very interesting because we saw goldman sachs talking about this. they are talking about qualities over goldman's. energy will raise driven by oil. also, bitcoin is not taking demand away from gold. that is fascinating. in fact, we saw a big volume as bitcoin came to wall street in

the form of cbo he futures -- cboe futures. take a look at the futures, i've got a pair. 3818 on the bloomberg. the top panel shows you the futures price. it's come down. 18,600.oint touching here you can see 70,720. the underlined price of bitcoin has come down about 5% this morning. 15,000 plus for bitcoin. at the bottom panel you see volume. we have had light for them this morning with the exception of the spike at the open of the trade. very light trading. as called down. down -- calmedd

down. we have quite a lot of activity taking place on the debt side of corporate m&a. this one is a dutch australian feel to it. .55 offer. this is going to be valuing the ev of 24.7n billion u.s. dollars. 755 -- 7.55 per security. it's a pan-european operator of real estate. invest in research and manages. thehe united states and united kingdom. we have dutch m&a to talk about this morning.

they said they are in the process of reviewing an unsolicited proposal. they projected deutsche bank and j.p. morgan as advisors. they were suffering from at least two profit warnings in the last year. it seems as if they overestimated the ability to penetrate into the united states . let's talk about some interviews we have. i talked down -- i sat down for john mcdonaldith and later manus cranny sits down with john -- robert gates. let's go to the bloomberg first world news update. britain wants a trading relationship with the european union after brexit that is virtually identical to the one it has now. speaking at a wto meeting, the

international trade minister said he wanted keeping eight transitional -- similar arrangement to him courage a smooth transition. a can the style free trade agreement is the best the u.k. can hope for. brent crude has jumped above $65 a barrel for the first time in two and a half years. that's after one of the most important oil pipelines the world has been shut down. the operator said it will take about two weeks to fix the pipeline system. in the u.s., stockpiles are forecast to drop a fourth week. u.s. president donald trump has said that yesterday's nurse sitting bombing shows 00 tightening immigration laws. the suspect was wearing a pipe bomb that exploded in a subway station near new york's port authority bus terminal. he injured himself and three

others. department of homeland security spokesperson said the suspect was admitted to the u.s. from bangladesh in 2011 on a family immigration visa. alabama will cast their votes today in a senate election. roy moore aidate republican former judge, and jonesatic nominee doug are close in the polls. one election for senate our governor in alabama analyst two decades. preparing to deal with tax changes orm interest rates in the u.s.. the pboc in the state ministration of foreign-exchange did not immediately replied

seeking comments. a company merger seeks to seek a -- create a european leader in some security. pay four point $3 billion for jim alto. for gemalto. dealdisney may announce a as soon as this week to acquire large piece of 20 century fox. that's according to a person familiar with the matter. that comes after comcast said it is no longer in the running. fox's wants to acquire movie and tv production and networks. this includes u.k. provider sky.

powered by more than 2700 journalists and analysts. you can find more stories in the bluebird -- on the bloomberg at top . we are seeing the nikkei down by .3%. we see little bit of money coming out of tech players. that had an impact of the taiwan market. down by sole market half of 1%. however we saw in a -- we saw a rally in energy players. we had some banking players move. thees were suspended above announcement. we are waiting for a press conference from sydney. matt: thanks for a much. the fomc begins its two-day policy meeting as it makes its

final monetary policy decision of the year. with a hike virtually certain, investors will be focusing on the central banks outlook for next year. janet yellen will be expected to signal more interest rate increases were next year. join us now is our expert. ?o you think it's a sure thing what do you expect the outlook? it's an expectation that there will be a hike. it will be a major surprise for markets is there is not. in terms of the forward expectations, i expected to be a more hawkish assessment of life ahead, particularly in terms of life -- inflation. we know the fed is becoming more cautious on inflation. component imported

and sometimes economies are beginning to export inflation. the other is the domestic picture. expectation wage inflation will change. at some point, retail will be unable to cut prices and some inflation will sink back into the system. year treasury10 yields getting up to 2.9% by the end of 2018. i have a chart here. worried of people it about the flattening inversion of the juncker. you don't share that concern. >> i don't share that view. for the curve to invert it imply two things. is early hikes of scale. in terms of the long in the

market, to argue that rate hikes will fall below to have an imply you have to expect a recession. there are zero signs of that. matt: you don't think we could see a flat or inverted curve without a recession a company that? you don't think that times of change here? case is absolutely the that markets anticipate recessions and don't always rise but it would be the case if we had endured -- inverted yield curve, it would be because people weren't dissipating cuts along the line and either discounting recession or deflation. long,gic of lending money i don't know if you believe mr. scenarios. anna: what is that take us in the stock market story? when you to be concerned about being near the peak?

you don't see many of your preconditions. you don't see this as the market peak. how concerned are you about the expensive nature of equities? matt: i think equities can continue higher. where is the reasonable peak for the s&p 500 lie? it's probably 3100 points. risk of aere is more melt top meaning that money pours into markets and ceases to be reasonable based on the valuation and sibley cases returns. we know strong returns to get more demand rather than a more rational perspective that higher prices mean you should be less. there may be momentum behind the market that takes into territory that is overpriced. bond market yield, i think us to get to around 3.5% before the mathematica equities become stretched.

meanwhile, corporate earnings continue to upgrade. i would have to see a markdown in corporate earnings or a sign that a recession is coming. we need to become cautious of equities. you are expecting 3100 of the s&p 500 and 3% on the tenure the end of next year? >> that is correct. that's what looking for. what do you think, and by the way, we've heard this from a lot of people. people expected earnings expectations to come down throughout the year. that's a we see in hindsight. a lot of market players that it had on think 2018 earning estimates tarlow the low. what you think about the valuations in the u.s. compared to europe? right now we're looking at something in the 20's for the s&p and something in the mid teens for the stock 600 --

stocxxx 600. indication of a underlying securities. man market to have a perspective, i think the u.s. tuesday win. you want to own a global bank, i'd rather own jpmorgan than any european players. how about a global tech company, i would say that it's easy to make a strong argument for microsoft and much less compelling than a european tech company. i think the u.s. market continues to offer upside. you have to be increasingly selective. there are some great opportunities in europe. think banking sector, i usually looking a credit agricole. economye the french

will continue to strengthen and that is a direct benefit of -- beneficiary. anna: we have this chart. this is the fangs. didn't catch you by surprise? cleare you always stayed of amazon n.l. obama? and alley -- amazon bob off -- and ali baba. i am definitely in amazon. i am worried about acting against monopoly. the long-term investors is prepared to look through the short-term volatility and relatively expensiveness, amazon is siliga by. anna: and update off but high

multiples. especially. nvidia, however is overpriced. thanks for your thoughts. james stays with us. party hasition started preparing for an election that has a mccaw yet. the hard left agenda has gathered momentum as the prime minister struggles to record -- recover her authority. i spoke with the shadow chancellor to discuss with labor government could offer. we set out our taxation proposals. we said there's nothing up our sleeve. if we go to government, that's what we will be them plummeting.

we want to take things further. the reason i want to take things further, as i look at the last budget. downgrading of productivity demonstrate that we have a crisis we have to do with. that crisis has to be dealt with by investment but also more detailed proposals about the structures and operations of those structures that will achieve that investment. so of course the manifesto will move on. what i'm saying is, in terms of the issues that people have raised, for example taxation, we have set out our policy. we will not raise income tax a 95% of the population and on a 5% it will be minor. in terms of the financial transaction tax, we put that forward but we are going out to consult people. how do they think it's going to be implemented? what changes to they think is good? we want to keep them involved in the process. in terms of

nationalization, is that list fixed? >> we said let's run through. we have responded to popular demand for a large extent. energy willave set grow from the grassroots and look at the national grid at some later date and also several mail. all of those have been plucked out of the of a myself. if you look at opinion poll after people they feel ripped off at the moment but his privatizations. that's what anna: is room for the private sector energy but not water. >> i've been sitting there with all these injuries as well as in -- as well asns talking about the supply chains. anna: you talk about capital controls and whether that would be necessary. work?u doing any

>> i've had always question started me and i've never raise capital controls. no run on the pound. it was a question to me and what did i say, there won't be a run on the pound. there won't be a run on the pound. the proposalok at we are putting forward, i think there will be a strong pound under us because you will get certainty for all those investors that are commonly will be strong and be based upon the investment we want them to contribute to the growth of our economy. and we going to powers make sure we can cope with anything that comes up. on the base of their be around the pound, quite the reverse area -- quite the reverse. anna: you describe yourself as a marxists and forth many people to sue the first --

>> i describe myself as a socialist. what is socialist entail in the british sense? there's an element of marxism, there is social democracy, there is the forms of how you manage government in terms of british division of wealth to fund equality inces and regard to train and education. all of those, i am body all of those trends in the broad church of the labour party. that's our tradition. when we have been in government in the past, we have drawn on ensurethose elements to that we are successful government. that's a we will be again. anna: one banker referred to you as creating cuba without the sunshine. had -- sets unappealing? i think they need to know we

are all about. 70 people are knocking on my door to come see me. when we have had those conversations, people go away reassured. they know what we are about. it's achieving a prosperous that is economically and environmentally sustainable. most are on the same page. anna: that was sir john mcdonald, the u.k. shadow chancellor. still with us, james bevan's. we are not standing on the brink of an election of u.k., make that clear. things are uncertain politically polluted -- politically. if it were to go down that road, would you be in the camp that is nervous about a labor government and the tax indications in the nationalization plants? are you would -- or are you that is on the side softer on brexit and has an

interest in investing the structure. >> i think there's a possibility of both of those. america, wages have been rising pass inflation so the consumer confidence is the night. over in the u.k. we have inflation in excess of wage inflation. living standards have and falling back. that makes people angry. that some in the labour party would want to address. if you push up wages, you stand the risk of reducing profitability because whether the wages get paid for? the way we talk about growth, it is how growth is attributed. it's worrying for the markets. markets are dependent on growing profitability. if profitable shrinks, share returns go down. matt: i wonder, to take it back to square one, i was there for

the breakthrough last week, but it seems much ado about nothing. they don't come up with some sort of magical solution other than a hard order between the republic of ireland and northern ireland, they are just going to fall under and remain under the regime of the eu as far as regulations are concerned. is it just brexit name only? >> there is a real challenge that the british people in essence have said they want the free movement of goods and services because that's good for the economy but not of people. they don't want to make can divisions to the central budget. they don't like eu regulation. there is no deal that resembles that sort of cocktail. if you want free trade of goods and services you have to accept some elements of common regulation. that is just the basic reality of how europeans like to do business. made very clear by europe.

we cannot expect to become a low-cost, low regulation, low tax economy and do ongoing business in europe. they will not allow that to happen. liam fox saying he wants to create a future trade deal that's very much like a we have at the moment. it was see how much like he has with that. want to ask about u.k. equities. in your note to say that u.k. equities away from the politics reflect a well-placed titration. they have a pe discount. showing the clear underperformance of this. you say it's the cheapest in eight years. >> i think you need to be very selective. there a miss expectation that people combine an expectation of a will happen to the u.k. economy on a relatively slow trajectory. we are getting an underperforming key economy.

however, you can economies are not the same as u.k. companies. u.k. companies when they are global in nature look very well-placed. i look at unilever, some of the smaller companies, and i see real opportunity. anna: there got to hear from them us today -- later. i worry the prices relatively high. i believe we are going to have relative coordinating growth through 2018. values -- scale that the justifies the valuation a large scale. matt: you can stick with us. he is chief of investment management. there's a lot going on this tuesday. when you're traveling to work, you can trim and to bloomberg radio. you can do on your mobile device or dab, digital radio in the london area. up next, manus cranny is going

to sit down with robert gates. we will hear live from the arab strategy for. this is bloomberg. ♪

♪ "daybreak:is europe." it seems some investors are waiting to hear from central banks this week. fall units are a little lighter than they normally would he in the asian session. let's head out to the arab strategy session in dubai. that's were manus cranny is. he's with robert gates. manus? >> anna, thank you very much. this man knows a thing or two about foreign policy. robert gates, welcome. great to have you with us.

let's start with the issue with mr. netanyahu, which is mr. trump's decision to recognize jerusalem as the capital. what's the rationale here? what is to be gained from doing this now? >> that's frankly what i have a difficult time understanding. it seems to me to be counterproductive to the administration's own object is. at least on two counts. first, they have devoted a lot of attention to try and see if there is a way to bring progress on the israeli-palestinian peace process. multiple previous presidents have tried this and failed. it was a sense this administration really thought it had a shot at making some real progress. if that were at all true, it seems to me that this announcement, especially since nothing practical be done for several years in terms of moving

the embassy, that it makes it muchif that were tougher to tryy political progress between those two. even if you totally discount the possibility of progress in the israeli palestinian process, one of the things that president trump is achieved is a significant improvement in our relationships with the air states. particularly, the gulf skates -- gulf states. this announcement makes that more difficult for them. they may not feel strongly about it but their people do. it seems to me that the time we've made some progress in improving state of our relationships with the arab world after the obama administration, it seems to me that it does not contribute and is maybe a setback. >> if i look at the european response, sigmar gabriel says unilateral u.s. rendition of jerusalem is a very dangerous

development. a push, youked in have worked under obama, you have seen escalation. how do you see this playing out? the real danger is that people in the street react very strongly. there is violence that comes out of protests and so on. i think that the governments probably will accommodate themselves to it. there is a certain truth to the reality. every time that i would go to israel and visit with the prime minister, i would go to jerusalem. that's where a lot of the government industries are. but i don't see how it gets into any forward thinking strategy. -- >> the british press have kept pointing out

that the u.s. can no longer be the good piece arbiters. nothing good can come from this. the ability to be the arbiter pieces abdicated. >> i think that's going too far. i just think it's made it harder. >> you are here at the arab strategy forum. we have the saudi leader mohammed bin solid. some are saying he's being aggressive. he's raising the stakes of destabilizing the region. is that overstating the policy matrix? >> i think you're seeing a much more assertive saudi arabia. prince is acrown man in a hurry. both in terms of saudi arabia's role in the region but especially the roof norms that is trying to bring it home.

i think we all worry a little bit. too manyis doing initiatives. going forward on too many things. lebanon, from yemen to qatar, you're seeing a more assertive saudi arabia than the past. if he is in a hurry, what would you advise him to do in iran? it's the most divisive issue in the region. >> we've seen for a long time of his conflict between shiite islam and sunni islam, it's not a new phenomenon. going on for quite a while. i think you are seeing as we have been discussing, a more assertive saudi arabia and this. i think that in some small part, at least, it's a reaction to the

fact that the united states signed on to the nuclear deal, the united states wasn't very assertive towards iran. the day president obama signed the nuclear agreement, he should have gone on television and said it would not have allowed it to enable ron's interference in the region. i think frankly, some of the states decide it was time to pick up the slack. >> you mentioned iran but very few people have gone to war with iran. what are the risks of war in this region? are they hire? -- higher? >> i don't think the risk of war is higher than it has been. i think what we are seeing is surrogate conflicts. whether it's in yemen or in lebanon are potentially elsewhere. i think the risk of a direct

confrontation, i personally don't think it's a higher that has been. >> should trump be doing more to get the rid -- get the qatar against -- the embargo against qatar lifted? >> one of the things president bush asked me to do is go to qatar and talk to the cutter is -- talk to the people about all the things that are unacceptable , beginning with the things on al jazeera. given a platform for the people we are fighting against in iraq. the bush administration, even in early 2007, had a long bill of particulars. this is not a new problem. we value the military relationship with qatar.

the of a very important airfield there in terms of the whole region. we would like to see this situation resolved. but on the same token, all some measure of compromise is required, some change of behavior is also required. change behavior you need a state department that is regional newspapers. mr. tillerson. it's hard to imagine doing more in ae to an institution shorter. of time. op-ed.the words of an is tillerson gutting u.s. diplomacy? >> it's important to remember was the writer of the op-ed in obama's secretary of state. i think it is tougher to get things done and you don't have

assistant secretaries and place. secretary tillerson would tell you he has cable professionals that are filling in those places. but, clearly, from my standpoint, getting people into these assistant secretary positions, getting people into key indices, these are very important. i hope they will act as quickly as they can. >> mr. matt displeasing continued american engagement. he believes in compromise being fundamental. his job report so far, i know you are supporter, what you make of his work so far? i think secretary mattis is doing a terrific job. that will not come as a surprise. one secretary of defense to another. manus is somebody who i thought highly enough of that i

recommended for two senior commands. joint forces command and central command. i always have a lot of respect for him. as i have told people, if you're going to have one and amend the law to allow a recently retired general to be the secretary of defense, and you're only going to do that once every 60 years since george marshall was the last time, jim mattis is the guy i would choose. savvyk he brings a lot of , a lot of experience, a lot of historical knowledge. very good judgment. one being the least disruptive, 10 being the most disruptive, how disruptive has donald trump global foreign policy? >> it's hard to pick this kind of things but without giving a numerical value i'd say it's been fairly disruptive. in terms of trade agreements, relation alliance, and the truth

is you have a lot of countries, both because of their concerns about barack obama, but reinforced by president trump, looking for alternatives. >> thank you very much for being with us here on bloomberg television. that's it from dubai. we have more to come. later on in the day we get more political. guys. anna: thank you very much. manus is going to be speaking to the columbia university professor at the 30 u.k. time. 8:30 u.k. time. matt: a very interesting interview there. can't wait to see what joseph stiglitz has to say. he has previously said he thinks bitcoin should be outlawed. futures, let's check

on a markets. nejra: i'm glad you mentioned that going. i'm not sure when it here but i'm showing other things. the shanghai down more than 1%. we are seeing pullback in japan from a high. australia bucking the trend. it's up 3/10 of a percent. a bit of weakness and asian stocks. we were seeing little bit of strength earlier with the dollar. see the next chart. we're on seven days of gains. if we end up with that at the close it will be the longest winning streak since january 2016. the bloomberg dollar index managing to hold near high. take a look at the twos tens curve. tilt do see a more hawkish , there is more of a flattening risk on this curve.

are.sis points is where we finally i'm taking a look at oil. a lot of focus on brent going above $65 for the first time in two years. this was the pipeline shut on a hairline crack. we understand it might take two weeks to the fixed. but we are seeing the second day of strong gains. x-ray much -- matt: thanks for a much for that. we are can a bring you our exclusive interview coming up on bloomberg television this morning. stick with us. ♪

♪ london. is 6:46 here in over new york it is 1:46 in the morning.

s&p futures are going to be flat the start of training. -- trading. the fed, the ecb, and the bank of all set to give their latest the liberation some forecast. let's get the bloomberg business flash. atos has agreed to acquire competitor is 62 create a european leader in cybersecurity. a postnch company has pain 46 euros per share, represent a 36% premium. offerivered the friendly and wants to engage in discussions about a deal which are be the biggest of the year between two european technology companies. disney may announce a deal as soon as this week to acquire a large piece of 21st century fox. that's according to a person familiar with the matter.

that comes after comcast, the other major contender said it is no longer in the running. disney wants to acquire fox's movie and tv studio, networks, and international assets including a 39% stake in u.k. satellite provider sky. boeing has raises dividend by 20% and announced $18 billion of share buybacks to replace a $14 billion program put in place year ago. .71 upidend jumps to one from 1.42. boeing shares rose in extended trading at the announcement. that is your bloomberg business flash. matt: x-ray much for that. but demko has agreed to buy australia's west fee -- westfield as a consolidation for mall operators. it's from europe's largest commercial landlord and values

westfield at about an 18% premium. paul hankerson joins us from hong kong. what is driving this deal? >> i think for both the trend thatlly, the topic bloomberg has written so much about, the retail apocalypse, as e-commerce changes everything, globally we are seeing a wave of mergers and acquisitions as he referenced. we have seen the traditional operators come under a lot of pressure. we are basically seen a global shakeup two new models of retailing. new raise of doing business. new ways of satisfying customers. we see that the board of westfield has recommended this offer.

they have unanimous mislead -- unanimously recommended it. what will happen next? saying thatrer is after the transaction, the companies will get benefits that they wouldn't have a standalone operations. , theublic relations speak way the deal is being described, as in terms of concentration, differentiation, and innovation. the bottom line is, we get to see -- it's yet to be revealed the details of how will play out. this is the end of an era for the australian point of view? i think from the australian viewpoint, this was a business 1959, expanded

globally, did fantastic things in the 60's, and now here we are. 2017. it's time for a bit of a revamp. a revamp, founded by the billionaire, it began in 1959 as you point out. thank you very much call. still hear us in london, james. westfield, how are they in the u.k.? it now operates shopping centers in the u.s., united kingdom, and australia. see a company that was hesitant to get involved in u.k. retail real estate, they are doing it by buying an australian firm. -- no one looks at the gains

losses than retail. retail has been a net loser. however this is a number of key economies. the shoppers to wants an experience. retail can hit back. it can deliver reasonable returns. one of the interesting things is that parental yields are rising less fashion inflation. -- less fast inflation. how much longer they going to be -- as we look at this brexit right through that begins to slightly unravel, is there any concern or investors still on the up in u.k.? of concern plenty but there is a bifurcation in the u.k. between those who are very nervous or properties of the city of london where the disruption of financial services

is key and so the broader opportunities in the u.k. including industrial. people say the u.k. economy is too little long. a place in the proverbial for property exposure. anna: this is tangential but does of u.k. bent. brent jumped above $65 a barrel. it's worth getting your thoughts on that. first time in two and a half years using that. important most pipelines for that is shut. what is your outlook for commodities. you see a lot of upside? i see limited upside by think a realobserving both recognition of supply-side risks and demand is more than previous expected.

people say when the oil price goes up, show comes under attack. -- shale comes under attack. the oil price can remain easily flat. supply outages remain order of the day. that was likely. matt: we always talk about the supply side we forget that the demand side, it's not coming down. even if we switch over to electric motors, some of the people, mostgreen of us are driving cars and using oil. green person because on a long-term basis it's clear

that renewable energy will win out with your absolute correct to say that the transition to that long-term renewable sustained will be many years. goldman sachs of dating investments run a whole host of commodities. energy return 60%, they say. 16%, and bitcoin is not taking demand away from gold. what you think about it going? is it a commodity? currency? are you invested? >> i say there are three different aspects to what is going on here. is luck chainhere which is the greater of the -- the creator of the bitcoin. it will be a really important part of the way we take transactions across the financial space.

is does bitcoin of relevance in the global economy, yes it does. it allows people more security than is the case with conventional cash. a lot of people having given up on central banks because of the banks have been printing money. the third issue is wise the price moving. a significant part of the speculation. to say the currency has the future is a mistake. but i won't be buying. anna: great to see this morning. up next, we'll 2017 and with a series of rate hikes? we are on central bank watch as the world's major policymakers

prepared to announce their final decisions for the year. janet yellen shares what's likely to be her final meeting. there is plenty of that conversation coming up in the next half hour. this is bloomberg. ♪

matt: this is bloomberg daybreak: europe. i am matt miller. i am anna edwards. these are today's top stories. hike expectations. janet yellen prepares for what is likely to be her penultimate policy may as it's for see a rate increase imminent. more than a dozen other central banks announced that their last policy decisions of the year. anna: cracking $65. brent crude hits its highest level in 2.5 years as one of the most important pipelines in the world is shut down. matt: digital deal. aptos makes a three point 4

bid.on euro seeking to create a cybersecurity giant. anna: this is bloomberg daybreak europe. matt miller in berlin. i am in london. ng have glencore in the mini space giving an update because they have an investor day taking place. they say they are confident in returns.lity to create guidance was $2.8 billion u.s. -- they seeing out that coming in at a range for net debt. $10 million to $16

billion. also what they have to say about seeing production and copper. there have been hiring staff in the zinc area on the subject of copper. prices of copper up 19% year to date. also watching for anything they have to say about aquaculture. they could be an interesting expansion into agriculture. in terms of the distribution inicy, including $1 billion waste distribution so keep an eye on zinc and copper and agriculture, anything they have to say about many of that. it is an investor day at glencore. bloomberg lp and the parent of bloomberg news is a senior independent nonexecutive director at glencore.

at the features. will continue to get breaking headlines this morning. let's take a look at how the markets are reacting to everything. right now if you look at bond futures, you see gains across the board here. these are the equity index futures. those.ook at ftse futures up and dax futures cac ap futures -- futures. you have a bigger weighting of oil in europe. watch those as oil prices rise. let's take a look at bond futures. could we take a look at those? a we going to show those? -- are we going to show those? there we go. futures down although very

little change. we waited all that time for nothing. anna: best laid plans. let's talk about more breaking news. coming through from unicredit. giving confirmation of the target at this point around the balance sheet measures. raising the dividend payout to 30%. that can be interesting for investors. post-2019 dividends increased from 30% up to 50%. giving an update to the market on the distribution policy here. and other factors, other comments coming through from them as well around their balance sheet. interesting to watch that on unicredit. let's have a look at the risk radar and sherry -- show you where we have been. as we said in our headlines we have seen a uptick in brent up by 1% -- more than 1% and

another 1% today. this is all to do with the pipeline in the north sea and the price of brent going at $65 a barrel. two pointrst time in five years. as well as all the other factors pushing up the oil price. we have a cracked pipeline to do with in this market. that is one factor we're watching this morning. also equity markets, we have the ofi asia-pacific down by 1/8 1% and u.s. futures unchanged. both of those not moving very far and that is underlying the number of central banks we have later speaking this week. hearhe decision we get to about and the forecast we have yet to hear about. there may be some investors on the sidelines waiting for them. the ecb and the bank of england and others set to speak. here's juliette saly. britain wanted trading relationship with european union after brexit that is "virtually

the one it has now. the uk's international trade secretary liam fox said keeping a similar arrangement would ensure a smooth transition. a canada style free trade agreement is the best britain can hope for given theresa may's redline. to $65 a barrel after one of the most imported wasmportant oil pipe line shot. it will take a few weeks to repair after a hairline crack was discovered during a routine inspection. and dropping ad fourth week when data is published. u.s. president donald trump said that yesterday's new york city bombing shows the urgency of tightening immigration laws. the 27-year-old suspect was wearing a pipe bomb that exploded in a subway station knew the port authority bus

terminal injuring himself and three others. department of homeland security spokesman said in a twitter post the suspect was admitted from bangladesh in 2011 on a family immigrant visa. the people of alabama cast their votes today in the bitterly fought senate election. leading candidates roy moore and doug jones, a former prosecutor who is the democratic nominee have seesawed in the polls. the tight race is all the marks ordinary by the standards of the southern state where no democrat has won an election for senate or governor in almost two decades. china's leadership is preparing plans to do with any fallout for the nation stemming from the u.s. tax overhaul in the feds expected interest rate increases. according to an official involved, the people's bank of china is prepared to use tools including interest rate controls on the flow of money across its borders and currency intervention to support the yuan if needed. stateoc and the

administration of foreign exchange did not immediately apply to investors seeking comment. 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 . a weaker session across the msci asia-pacific index. we did see japan's nikkei index closed down by one third of 1%. still holding onto the 26 year highs. in techkness coming in players. down.he kospi closed higher. in terms of stock we have been watching in the region, a little bit of a route. down and sales data disappointing. in bgs falling once again

the second session. this is a day after the reorganization into a holding company. it is a return -- retail firm in seoul. kospi today.he anna: 7:08 a.m. in london. and others will announce their final policy decisions of 2017. this five central banks set costs of more than one third of the world economy and 10 others delivered policy decisions this week. a lot to think about. joining us, thomas stevenson. great to have you with us this morning. -- thethe central banks fit is certain to raise rates. should we be focusing on the dot plots in the forecast and how much they move those.

thomas: interest rates will rise by another quarter point. essentially we will focus on the dot plots as the trajectory of rates are important. there is some uncertainty about that. if you look at the latest payrolls out of the u.s., they were relatively strong but which growth was notably weak again. this is the dilemma facing the another fed expect three quarter-point rise next year. the futures markets are assuming a bit less than that. there is an outside risk, we may see for rates. it could go either way. this is why it is the most important question at the moment for markets. fall whene do you you're looking at the curve at the end of next year? some people are looking at a flat curve. maybe 2% on the 10 year.

2% on the 30 year and about that on the two-year. does that make sense to you? thomas: i think so. we are seeing a flattening of the curve and what that is indicating is the degree of nervousness about the economy further out. to a split.this we could have interest rates rising by more than three quarter-point or less. we are more likely to see a cue rate rather than three or four. anna: when you put together the tightening we will see from those central banks, jpmorgan and citigroup suggesting that markets are facing the biggest tightening and monetary policy since 2006. developed markets set to climb to at least 1%. this is in terms of developed market average policy rates. it sounds at a big headline.

it only gets you 21%. that, you characterize the shifts the market seems to be nervous about or is it is -- it is inevitable? thomas: we are going to see a rise in interest rates but we are starting from a low base and we will end up at a low end point. that is the crucial point. the base case is for a relatively lower for longer rate environment. undergoingeconomy is a synchronized upturn but it is a relatively honest one -- modest one. that will be reflected in the tightening cycle. matt: are you worried we will see a slowdown, are you worried that the u.s. economy is going curvell out as the flattens out? thomas: that is the implication of the curve flattening out. that is the message it is giving we willthat is a risk see slowing down. i think when you look at the

global stock markets and in particular, the u.s. stock market, but that is saying is there are -- there is a lot of beingews burning gas brought in from 2018. that will be a worry for markets. your expectation around the u.k. getting a decision from the bank of england. do you see the bank of england being more hawkish? i saw a story that it could push up the pound if the bank is more hawkish given the breakthrough we have seen on the brexit negotiations. do you join those two things together so soon? thomas: no. the bank will remain cautious. we had a bit of a success on friday but the outlook regarding brexit, for the u.k. economy as a whole, productivity, growth is pretty subdued. there is no pressure on mark carney to raise u.k. interest

rates any further for the time being. would you call that a success what we saw a question market seems the u.k. caved on every -- a most of a single point. thomas: to describe it as a success is to say the can was kicked down the road a bit further. that is what we are going to see progressively over the next couple of years. it is in everyone's interest for this to be pushed out further. in the business interest and the eu's interest and the uk's interest. where going to get this transition which will last a great deal more for -- than two years. anna: we talked about how markets are starting to think about what a labor government could be. i spoke with john mcdonald and was trying to gauge from him the last manifesto, is that is hard to the left as the party would

thereo go or will they -- be more and he said there is nothing up my sleeve suggesting the last election but that would be a good thing to look at still. market fear ine the labor government? thomas: if we were to get a jeremyovernment under corbyn and john mcdonald, it would be the most far left labour government we have had in many years in the u.k. i think the market inevitably cash -- take that it scans. has been going with the discussions around brexit and the internal strife within the governing conservative party, it is something we cannot dismiss. matt: we just skimmed the

surface, a lot more to talk about. hopefully we can get you back here on bloomberg television soon. tom stevenson, investment director at fidelity international. coming up, joseph stiglitz joins us from the arab strategy forum in dubai. he has said in the past very recently that bitcoin should be outlawed as it is outside of the control of central banks. we will be speaking with him in an hour. definitely an interview you do not want to mess. and joining us for an exclusive interview. the company which is the second biggest renter of basic construction increment in the u.s. and a big u.s. market for this company. just announce to buy back program up to one billion pounds over the next 18 months. we will discuss that next. this is bloomberg. ♪

matt: welcome back to bloomberg daybreak: europe. you're looking at a beautiful shot at the brandenburg gate with the sun coming up behind this clouds behind it over the tiergarten. markets are waking up across the continent. to juliette saly. juliette: westfield is being bought for 50.7 billion dollars u.s. at anfer values westfield 18% premium to yesterday's closing price. the rise of e-commerce has squeezed traditional retailers. create a leader in cybersecurity digital technologies and payment services. the company proposed paying 46

euros per share representing a 36% premium to jamaal charles -- gemalto. ideal -- ao discuss deal. walt disney may announce a deal as soon as this week to acquire a large piece of 21st century fox a careening -- according to a person familiar. that comes after comcast said it is no longer in the running. disney wants to acquire fox's movie and tv studios. networks including fx and national geographic and international assets including a 39% stake in u.k. satellite providers. that is your bloomberg business flash. anna: thank you, juliette saly there. a buy back plan has been yearhed and sees four results ahead. joining us is the company's ceo

jeffrey drabble. to talk to you about your experience in the u.s. an interesting gauge on how the u.s. economy is doing. tell us about your decision making around returning cash to shareholders. >> things are going well, the economy is strong. we saw stronger employment numbers once again and gdp growth is solid. we're seeing good organic growth create we will invest over 1.2 billion pounds in the fleet this year and spend it over -- on boats and acquisitions. we have -- think it is appropriate to return this to shareholders. anna: i will ask you about the trade-off between returning the cash and investing it. the fact your returning the money is not saying your not

spending it on rental fleet or but how much are you doing on the rental fleet versus previous years? jeffrey: we are growing organically and we have added to that. buyback,back -- share we're trying to strike a balance to purge. tax: how much does the reform affect you, assuming this goes through, i am sure you have looked at the numbers, what does this mean for you and is it in your forecast? we have done modeling. it is not an element that is built-in in terms of buybacks. rate would come down and the cash tax rate would come down from around 19% to

around 10%. it is significant from a cash flow perspective. we have a deferred tax liability on the balance sheet. be a 400 million pounds savings. looking forward, it is potentially material in terms of our cash tax. anna: what about for your customers and how you view it as something that will stimulate your business, what this be good for your customers and good for you? geoffrey: the question is how people spend the cash savings, the expectation would be that some of that would trickle into the economy and that would be positive. that is against a backdrop of a very confident business sector in north america. hard for people who have not been in the u.s. to

understand how decrepit the infrastructure there is. collapse,es near roads falling down, jfk airport seems a get would be better located and the -- a third world country. any additional spending to be fed up and is that in your forecast? geoffrey: we have not included anything from the infrastructure initiative. d not to agree with you. you are starting to see people traveling going through laguardia will see significant initiatives there. issuance, at bond the mental disability -- at the municipality and state level. we have included some thoughts on further infrastructure spending but we have not built the $1 trillion

of trump infrastructure. some upsidecould be revision to your guidance based on tax and infrastructure. geoffrey: the guidance we have given is based on current tax. any of this changes are likely to be to the upside, not the downside. anna: thank you for your time. that is it for daybreak europe. the european open is next. you might fail to spot the difference because matt miller and myself will be cohosting that program as well. we will bring you as part of today's programming an exclusive interview with mark carney at 10:30 a.m. u.k. time. you can switch off bloomberg television and there is bloomberg radio at your disposal. a quick word on the futures. the futures in europe are

pointing to moderately higher, u.s. features -- futures flat. we will see how are we go on the start of the european trading day. this is bloomberg. ♪

anna: welcome to bloomberg the european open. at bloomberg headquarters of alongside matt miller. the crack -- cash trading session is often are away. crude link. in dots we trust. thing it safe ahead of the final meeting of the year. well t