♪ >> this is "bloomberg daybreak: middle east." our top stories this morning -- hot jobs numbers for a cold month. nonfarm payrolls showed surprise strength, jumping the most in almost a year despite the government shutdown, but wages disappoint. extension speculation. the u.k. chancellor philip hammond is the clearest signal yet that britain is pushing the brexit deadline further back. partyael's ruling prepares to hold primaries, benjamin netanyahu's main challenger sets himself up as the anti-bibi. we are live in tel aviv this hour. and saudi arabia declares the so-called corruption crackdown a

success, saying it raised about $107 billion from 87 people detained at the ritz-carlton. ♪ manus: just gone 8:00 a.m. across the emirates. this is "daybreak middle east:." i manus cranny in dubai. i want to show you just what momentum the s&p really had. it was the best stock since 1987, it was a pretty tricky year -- will we see a rerun of 1980's heaven? expansion months of in jobs, but can this rally last? upside, enjoying the best month in almost three years.

down on theiring crude bearish bets. you are seeing brent rally by 15%, the drillers are cutting production the most in two years. venezuela is also a key risk and we will talk about that. the dollar dropped, the fed pivoted, and it rocked the dollar lower. the question is the cooling wages first is the sentiment from people like woolard, who says the fed is set up for a couple years. will it really delay that long? the manufacturing data was rocking it up. when we talk about data, we have had the manufacturing data from china this morning, so this will build momentum over the next 24 hours. reading sincewest 2018, but on the employment side, the employment reading

comes in at 51.1. that is against 50.3 in december, that's the highest the chinese data, that will begin to make sense. it adds on to the pmi's from last week. let's get to your first word headlines. christine burke is with us today. >> thanks. venezuela has dueling protest as the nation remains divided by the two men that claim to be president. nicolas maduro attracted a larger crowd than expected, a show of wars apparently aimed at suggesting he retains wide support. his rival said he is absolutely certain that change is very near in venezuela. up 2 millionpped tons of u.s. soybeans following two days of trade talks in washington. a top white house adviser says president trump is optimistic about the prospects of the deal

with aging. director larry kudlow spoke with bloomberg. >> i think the talks on wednesday and thursday in general had what i call a good vibe. we are not ready to put things down on paper, much hard work is still in front of us. but nonetheless we did plow some new ground in so far as talking about specifics, the chinese really didn't want to talk about it. >> saudi arabia has declared the so-called corruption crackdown a success. a commission headed by crown prince mohammad bin salman says $100 billion was recovered from 87 people. in october, 2017, some of the richest and most powerful people. were in the ritz-carlton riyadh and only released after giving up assets. meanwhile, and advisor to the turkish president says mohammad bin salman remains the chief

suspect in the killing of the "washington post" columnist, amid reports that the united nations representative was allowed to listen to audio recordings of his murder in the saudi consulate in istanbul. access tot granted the three-story building. chancellor says the eu and u.k. would agree to delay brexit if more time is needed to pass the required legislation. it is the clearest signal yet that britain is contemplating an extension to the deadline. "if we do gettv, the deal and we need more time to put all the legislation is the one in place, and i'm sure everybody on both sides will take a reasonable approach to that." the brexit uncertainty is likely to make life tricky for the bank of england officials as they need for a rate decision this week. global news, 24 hours a day and at @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries.

i'm christine burke. this is bloomberg. manus: thanks for the roundup. has was saying, the u.s. hit a record 100 consecutive months of job growth. it came in better the next acted despite the government shutdown. it is seen as validating the decision to pledge for nations. mike mckee has all the details from washington. >> the federal market is still very strong with only a minimal impact from the government shutdown. unemployment ticks up, 300-4000 jobs were created. that's not quite as good as it sounds because they initially reported 312,000, revised down to 222,000. the biggest monthly revision since 2014. earnings were up a tent on the month, 3.2%.

that will get the fed's attention. drops every hour. 170 5000 federal workers reported being furloughed, enough to push the governor worker unemployment rate to two point x percent from 2.2%. worker rose by a lot. other categories, 13,000 manufacturing jobs, 900 and primary metals, 3000 in metal fabrication, 52,000 construction workers were hired and construction pay dropped during the month. 100. mining jobs fell by retail jobs rose by almost 21,000. the bottom line, january showed the u.s. economy is still chugging along, 100 consecutive

months of job growth, a record. michael mckee, bloomberg, washington. manus: the white house is also hailing the strong january jobs report at the national economic directors saying, saying they should not underestimate the strength of the u.s. economy. >> more people are working in prospering, and by the way, it's not inflationary, ok? productivity is rising. of lower tax rates in deregulation and energy and trade reform are working. we are sticking with our 3% economic growth rate. manus: let's bring in my guest host, the managing director at abs investment solutions. he joins us from abu dhabi. good to see you. you and i talked about the pivot, but what i want to know is those the softer wages data validate the fed? >> good morning, manus. great to be back again.

i have to say that what happened with the fed -- i call it a u-turn. it is quite surprising. buy the u.s. economy another two years. wages, it iso stable, and i inc. the big factor is inflation. previously we used to see the u.s. economy overheating and the fed used to increase rates. this is not happening at this time. one of the primary reasons for that is the nonfarm retailers. the price adjustment is happening very quickly, so we are not seeing inflation, hence the fed is in a tough position, because there's no overheating, so there are no hikes. >> ok. there are no hikes priced in, that's exactly the chart i put

in the gtd library. the average move year on year for wages is over 3% for six months. before the report, there was no chance of a hike, and a 25% probability of a cut. post the data, there is a 1% chance of hike and a rate cut has now dropped to 11%. so the market is just a little bit skittish that they will have to review their position later in the year. do you leave the door open to that possibility of back end hikes? think that for 2019, we are not going to see any hikes. i think the fed will maintain this year. all things equal, obviously. with regards to the wage growth, i do not think we will see inflation again, because the price adjustment mechanism that has taken place is absolutely amazing. we have to review our textbooks.

we are not going to see any inflation any times in, all things equal. manus: with that in mind, let's look at the asset classes. let's go to stocks. this is a rally that some would say only a mother could love. best since 1987. are you will love her of this newfound love of confidence? from the worst december since the great depression, what do you reckon? >> well, this is a knee-jerk reaction by the market. december was a very, very difficult month from all asset managers. everyone was positioning for the worst, and finally a big u-turn happened, and everyone got exuberant and enthusiastic. the performance of the stock market in january was pushing me

to say, let's close our positions. we are taking the profits for the year. think there is more to come. u.s. is pushing a good story and this might continue through 2019. manus: ok. we will pick up what those other assets are when we come back. ryan stays with us. still ahead, we have protests on the streets in venezuela as maduro continues to cling to power, this by the pressures from the rest of the world. what happens next? but up next, extension speculation. u.k. chancellor philip hammond gives the clearest signal yet that britain is contemplating pushing the brexit deadline further back. this is bloomberg. ♪

♪ manus: let's get your business

flash this sunday morning. christine burke is with me. >> thank you very much, manus. the slump is getting worse at deutsche bank. largest lender reported revenue strength for the eighth straight quarter. should complicate the ceos plan to turn the bank around. gotmberg has learned that i -- a government brokered merger is possible. >> we have talked, and there's a lot of talk in the sector over time,at mergers, consolidation in the european banking sector would be sensible. we have tended to agree with that, how long it takes to do is anybody's guess at this point. china, the largest electronics retailer has cut the price of apple's latest iphones again. they are now selling the 128 $138,tes apple pen for

cheaper than apple's own website. they had artery cut prices on the device last month, underscoring flagging demand for iphones in the world's largest market. and job cuts are coming advice media. the company is slashing 10% of its workforce, about 250 jobs, as it seeks to shore up profitability. these layoffs are the latest in a string of cutbacks. significant layoffs were announced at is the, of post, and jeanette. and that's your bloomberg business flash. manus: christine, thank you very much. the u.k. chancellor, philip hammond, says the eu and the u.k. would agree to delay brexit if more time is needed to pass the required legislation. if the clearest signal yet that britain is contemplating an extension to the deadline. hammond told itv that if they do get the deal and they need a little more time to put all the

legislation in place, then i'm sure everybody on both sides will take a reasonable approach. the brexit uncertainty will make life tricky for the bank of england. officials need to make their rate decision this week. they have said the u.k. needs limited in gradual hikes, and will likely vote unanimously to keep interest rates unchanged, according to the majority of those we surveyed. my guess toast this morning as the managing director of abs investment solutions. he joins me from abu dhabi. the rhetoric is building toward the potential for a delay on article 50. in your mind, ryan, are we coalescing around deal, moreover no deal at all? what is your current brexit-ometer? >> well, i have to say that this object is starting to sound like

opera, it's really funny. delay, there will be a no one has any interest in a no deal brexit, it is catastrophic for everyone. let's not forget the irish backstop, it's the worst outcome of the worst case situation, so no one really wants to go there. it's in the best interest of everyone to delay it. the deal, probably they will try to find him sort of a deal, and the parliament will probably vote for it. electionsative is new -- they aret think a bit scared of that. i think they can find some sort of deal. one ring that caught my eye is the volatility on the pound. 15% from the december high. the pound options are risking

pandemonium by underplaying brexit chaos. if they don'tk, give anything to satisfy the brick deals on the backs and we crash out. is the market underpricing that tail risk? i don't think it is underpricing it, i think it is it has at correctly, low probability of having this situation happen. this is a worst-case scenario , andt europe and the u.k. let's not forget there is still an option on the table whereby another referendum might take in another vote against brexit might take place. there are several expectations that are positive for the pound versus negative for the pound. i do not think it is underpriced. manus: jay powell is not the

only man in the world who can paivot. italy is in a recession, under pressure. they had this to say about the economy. the measures we approved will now be implemented. they will have full affect mainly in the second half of 2019. in my view we are finally building italy's future with our own ideas, resources, commitment, and it will be a positive future because we have passive expansionary budget. manus: that was the prime minister of italy talking about the fiscal latitude that he is about to implement. is this the hallmark of what we need more of it europe? well, europe is really going sideways, nothing is really happening. we had some good news a few days ago with the pmi, however i think that year pass to take

some action. it cannot continue working this way. there is a lot of headwind taking place and i do think there needs to be some expansionary action to counter this for the european economy. manus: ok. thank you very much. that is the managing director at abs investment solutions, joining us from abu dhabi. up next, president trump's economic advisor says talks with china had a good vibe. that's next. this is bloomberg. ♪

♪ president trump's top economic advisor says that the u.s. is optimistic about the tree deal with the chinese after the "good vibe" of the

negotiations this week. he spoke with jonathan ferro about the expectation. >> the president is reasonably optimistic about this. president xi sent a lovely letter, a very positive letter, in good faith. i think the talks on wednesday and thursday in general had what i call a good vibe. we are not ready to put things down on paper, we are away from that, much hard work is still in front of us, what nonetheless we did allow some new ground and so far as talking about pacific's that hereto for this chinese did not want to talk about. whether you are talking about ip after force transfer technology or ownership or cyber interference or tariffs or nontariff barriers -- we tackle the tough issues in very specific ways, which i think is

a big plus. but let me put this thought on the table which is terribly important -- the march 1 deadline that remain that president trump is sticking to. timee have for quite some -- -- and i would just a to you, that is a subject which is absolutely essential to successful trade talks. manus: most people would agree to you and there are many people that don't even believe the chinese gdp numbers, let alone any agreement. what's the proposal from the u.s. side on enforcement? what does enforcement actually look like? ahead ofant to get that curve and i don't want to dig into any details -- that is the ambassador's domain.

all i can say is it's a key subject, it was agreed to be discussed by both sides and it was the cost. i think that plots some new so it is too early for details but all i will a is it is on the table. that kind of enforcement discussion and ultimate resolution would be central to any sort of agreement. but again, the president is broadly optimistic and most of the trade team -- we like the talks with china. they had a good vibe, if you will pardon the phrase. room. so take me into the i want to understand the urgency on the other side of the table. we just saw a really strong manufacturing number from america. i don't see anything like that in china. did you sense urgency from the

chinese delegation to get something done? >> yes, the answer is yes. the chinese economy is softening, there's no two ways about it. i don't want to dwell on that, but that's the reality and everybody knows it. short-term problems which may have something to do with our aggressive nature on trade, but also there are longer-term problems. here's a key point. if you step back a moment, it seems to me that china has been losing away from market based economic reform and toward a more central planning, horse the control. issue, and i think that has damaged their economy. from: so we have to get good vibes to an agreement, that's the gap to bridge. data is king and we have had a little more validating data point six,ugh, 53

lower than the estimate. we will see how that plays out. we are going to top ownership numbers. ♪ i'm a veteran

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♪ matt: age: 30 a.m. in dubai. 90 minutes away from the start of your trading day in the arab emirates. it's a beautiful day. christine burke has your first word headlines. >> good day. thank you very much. venezuelans have marched in dueling protests says the nation remains divided by the two men that claim to be president -- authoritarian leader nicolas maduro attracted a larger crowd than expected, apparently suggesting he retains wide support. he seeks to outmaneuver a renewed position that is