>> good morning from bloomberg's european headquarters in the city of london. manus: live in dubai. this is bloomberg daybreak europe. these are today's top stories. >> getting back together, signs of reconciliation between the world's two biggest economies. a 60 is said to consider day delay to china tariff increases. airbus scraps its slow selling jumbo. hostt suisse headlines a of european earnings. a.m.eak to the ceo at 7:00 u.k. time.

theresa may will bring her plan back to parliament today. ♪ manus: breaking news at credit suisse. these are the numbers. revenues rmb. 4.8 billion swiss francs in the fourth quarter. volatility, widespread. the shutdown in u.s.-china trade concerns remain a concern. the top line is fp. there's a g live on your bloomberg. hop into that. the editors are there. francine is on her way to talk to the ceo. this is what we have. francs.ion swiss the revenue is big.

when it comes to the net income, a very comfortable be. -- beat. 292 million. the estimate was 191 million. these are beats on the revenue side. when it comes to the start of the year, it's a very slow start in terms of fees. credit suisse with a very slow start in terms of their fee structure. the man himself is having the conversation with one lady from bloomberg, the ceo of credit suisse at 7:00 a.m. london time. wealthr how his ref -- management has done. good morning. nejra: happy valentine's day. we are seeing a be for common bank. fourth-quarter net income coming at 114 million euro. the estimate was 82.1. that's a very comfortable the

there. we want to take a look at the dividend. euro, ining in at 20 line with the estimate here. it is seeing higher underlying revenue than 2018. seeing 2019 higher underlying revenues in 2018. we were looking for guidance, guidance on the dividend to maintain for 2019 at a level comparable to 2018. what analysts were looking for was cost. i'm looking through these numbers to see what i can find on the costs. euros..8 billion upbeatly, we are seeing on the fourth quarter net income. that is key to maintaining that cost base.

the dividend, excuse me. guidance on the cost as well. targeting a 2020 cost space of 6.5 billion euros. cfo,eak to the comet bank live from frankfurt. what else have you got? manus: it's in the airline space. i just finished speaking to air arabia. ,he end of an era for airbus our national carrier here emirates is slashing their orders for the 838.

the project will end, there will be 3000 job cuts. side, we thenal have an interesting story. raising the dividend to 1.65 euros. market had penciled in 1.75. they told us about their projections for their cash flow. that's going to be 4 billion. they also be comfortably on the full-year ebit. 15%, going to grow it by free clash flow be around 4 billion swiss francs. in at 64 revenue came billion last year. that was a beat on the estimates.

these numbers. this is seminal moment for the a3 80. emirates/the orders. it didn't rack up anymore. let's talk about the conversation we will have on bloomberg. the president of airbus commercial aircraft will be with the team. but the conversation you don't want to miss, the future of eight 380 is over. -- eight 380 is over. you have a little bit more breaking news. had socgen sounding the retreat after missteps foiled their ambitions. they were rewarded on the day the earnings. here isare seeing basically fourth quarter capital markets and investment banking revenue down 29%. we are following a theme here. it's proposing a dividend of 69 euro cents per share. net income at 1.0 one billion euros. the take away here is that it is capping a tough trading quarter for the top french banks. manus: they are coming in hard. they are coming in fast. the u.s. president donald trump the mood to consider pushing back the deadline for the imposition of higher tariffs on

chinese imports by 60 days. next hourhost for the is from royal london asset at -- asset management. your initial reaction? >> it's good news. we have to hope that backdrop stops this cliff edge of tariff increases again. , are's a lot of data significant slowdown in china due to the first-round of tariffs. if you look at it from domestic demand, exports to china have dropped off. it has hit global trade hard. in the u.s.ss so because the trump tax reforms have provided a boost to the domestic economy there. it's an important step forward. it's one of the key things we raised when i saw you a month ago. the backdrop of trade this year. it will be important to get it right. nejra: thank you so much. you stay with us for the hour.

let's get to these markets. we did see the s&p 500 and in the green for the fourth day yesterday. it shrugged off comments about taxing buybacks on an equal footing with dividends. futures pointing higher today. higheryear yield ticks on a 271 handle. we have -- the economy and a good place. u.s. inflation data, the curve flattening yesterday. i'll be watching the euro as well at 7:00 because we get that fourth-quarter gdp data out of germany. it is crucial in filling out the picture about eurozone growth. right now, the euro holding up. bouncing back after it hit a fresh 2019 the yesterday. i know all eyes are on the dollar. goldman holding onto that short dollar goal. manus: there you go. that just about sums it up.

they say the dollar itself will trade back to 93. you will not have an explosive growth scenario in the united states of america, or this major contraction. i popped in oil there for you. you have the u.s. imports from saudi arabia back down again. the bti up for a third day -- wti up for a third day in a row. the inflation data we had yesterday was quite interesting. it doesn't say you have one array inflation. jpmorgan has their survey out. the breakevens rising. we will discuss that throat the next hour. let's get to more markets in asia with juliette saly. juliette: we've seen that rebound across asian stocks which was the fastest in over a year. they took us all today.

asian stocks trading mixed. the nikkei closing flat there. we had japan's economy rebound in the fourth quarter from the disaster prone third quarter. chinese exports beat today. it certainly is a mixed session. indian stocks dragged down today by telcos. let's have a look at some of the stocks in detail. one in india doing very well is he is bank. the most in 14 years after the r.b.i. came through saying it has no divergences in the lenders asset classification. amp falling by almost 8%. it's for your profit slumping 97%. that was a beat in terms of what the market was looking for. sunny optical off by 5.6%.

analysts cutting their ratings on the stock. credit suisse cutting after the preliminary 2018 net profit mixed -- missed expectations. thank you so much. let's get back to our top story. president trump considering pushing back the deadline for higher tariffs on chinese imports by 60 days. this comes as trade talks resume in beijing. president trump says things are doing well. our guest is still with us. we got your top thoughts at the start of the show. i'm going to take a more skeptical view. this pushes out the uncertainty further. to me, 60 days is not enough for them to find an agreement on the structural issues which seem to be the aim here. >> the good news, they are having a dialogue. the risk last week was, you are taking the cliff said.

just like the brexit clips -- cliffs edge. it's interesting, those corporate results you see in the top of the morning, a lot of that poor trading in q4 is about the volatility we had. the macro things that dominated at the back end of last year. we are looking for clarity. buying more time, we are open to a dialogue. but not always so, i see your point. manus: you know what? i've done the credit suisse numbers. it will be one of the big stocks that trades today. a poor feebout of -- landscape in january. that's not going to set the tone very well. how you look at the banks? look,t of that, if you when i saw you before christmas, i noted there was a drop off in deal activity at the back end of q4. we had a drop off in issuance as well. that has started to pick up in january.

it's not at the same pace we saw at the beginning of last year. yes, it's coming back again. there's a concern that that drop off in liquidity around that volatility, issuers were uncertain about whether it was the right time to come. one thing that concerns me most this year, a huge rollover requirement in the leveraged loan market in the u.s., for small to medium size companies. i think activity will pick up. it will take more time to come through. there's a big amount of credit we need to deal with this year. a few entities have been out of it earlier. we've seen the italian and belgian government out in this month already. making significant quantity of their issuance to get ahead of the credit demand. risk for you assess 2019, are you part of the high-yield or other corporate credit party? >> the one thing i would flag, the senior loan officer service.

we take it very seriously. that has shown a significant tick up and concerns for the first time. it was a good bellwether in terms of tightening credit conditions. it started to pick up in late 2006. it's her to do that. it's one data point. i'm always nervous when you try to extrapolate a trend from that. it just says that all that rate rise last year is now starting to transmit into the economy. i've said for a long time, we are positive on the outlook for quality equities. what we are worried about is fight -- hidden financial leverage in the system. we have be diligent about that this year. manus: i was on a panel the , the night with apollo leader there and a number of other people. they said, we are in a deeply under levered moment, more so in the u.s.. that sounds different to what

you are saying. are you saying they are -- there are hidden bubbles of leverage? 500 don't see it in the s&p as a listed index. that is probably under levered. where we have seen it is in the small to medium-size companies. a massive trade of retiring equity. initially that was done through fixed-rate credit. as markets are anticipating , so we saw and raise in the loan market. a classically has a shorter duration than fixed credit. a lot of corporate spaces swapped to loans. squeeze ofe a great that now refinancing to come through. stay with us, we have much more to go through.

let's get your first word news. debra mao in the hong kong studio. debra: theresa may takes her plan to parliament today. six weeks before the u.k. is due to leave the european union. the prime minister could face a revolt in her own party. they insist that leaving the block with no deal must remain an option. patrick harker is adding to the voices calling for patients on the rate. 2019 andne hike in another in 2020 is appropriate. risks are slightly tilted to the downside. a full voting member in 2020. goldman sachs must bear responsibility over the why am be disanto. investigating is potential crimes the bank may have committed.

he's not sure malaysia can get back the $7.5 billion it is seeking from goldman of compensation. >> we were complicit to the crimes. being, the whole image of the country, the confidence of investors and the state of the economy, they must bear responsibility. debra: global news 24 hours a day, powered by more than 2700 morealists and analysts in than 120 companies -- countries. nejra: thank you so much. staying with that story, goldman sachs has since responded, writing the bond offerings were designed to raise money to benefit malaysia and 100% of the proceeds were deposited into an account. not a cent ever passed through any account controlled goldman sachs. --uge portion was stolen

let's get to some breaking news from nestle. for your organic sales come in at 3%, bang in line with the estimate. the other red headline coming through is that next week -- nestle is exploring options for one of its brands including hot dogs. including a potential sale. those are the redheads. complete a 20to billion swiss franc bright back -- by back six months early. full-year sales coming in. a slight miss on the estimate. the four-year dividend per share comes in at 2.45 swiss francs, a little bit of a miss on the estimate. organic revenue went up 3%. that's the mainline. ifus: it certainly looks as

the lunchmeat company is off the agenda for nestle. the activist investor has been wobbling -- lobbying nestle. , just caught up with the ceo it dropped by nearly 9%. air arabia is having a very tough run in the markets here in dubai. we are 19 minutes into our cash trading section. -- session. he said, i'm ready to buy another 100 airliners. airbus are slashing their orders, air arabia is ready to buy 100 aircraft. either with airbus or boeing. this is their first yearly loss on record. you are just seeing a bit of a move there on air arabia. coming up on the show, european bank earnings in full swing.

macro forces keeping the lender shares depressed. what's it going to take to get the industry to move after a year-long slump? ♪

♪ manus: you are watching bloomberg daybreak: europe. nejra: are european headquarters in london. let's get a check on the markets. the asia-pacific index softer. a mixed picture across the region. crude on the front, above $64 per barrel. falling shipments outweighing gains in u.s. crude. a number of fed officials say the economy is in a good place, but his inflation -- is inflation contained? manus: s&p futures rise.

let's see what the corporate feast gives you in terms of delivery. trade talks extended. is that a good thing or is that more punch up succumb? come? to today's mliv question, this is it. nejra, you would like this. which asset has captured your heart when your head is saying this year will end in tears? you can join the debate. did you get me a valentines card ? nejra: it's in the post. manus: i don't have a po box. let's talk about the banks. they've had a tough time. we've just on the numbers. we've done credit squeeze. you did on the french side. commerzbank is in the fray as well. let's get through the numbers there.

even regardless of how individual companies report, there are macro forces. the environment is keeping shares depressed. i have the german yield curve and the european stock bank index. we have to pick up in inflation for any breakout. instead, we have been getting a flattening curve. putting the pressure on net interest margins. you can see the price in the blue has fallen in tandem. the ecb unlikely to offer any support. traders don't see any rate hike until 2020. it can also say, shares could absolutely be worse. what is supporting them a little bit? dividends. the dividend story, really positive here. the banking stock dividend i have in the way. the overall is in blue. if we look at this big pickup

and payouts, this is the highest since 2009. for investors looking for income as yields remain low, this is where someone might turn to. perhaps we are going to get investors enticed by banking shares. it's another region -- reason that any sort of dividend areuts that companies announcing the season's top of mind for investors. nejra: thank you so much. joining us now is our european market open anchor, we are up against a heart break. you will be speaking to the cfo later today. what will you be asking him? >> i'm going to be asking him a lot more about their possible merger plans than the fourth quarter results and their outlook. they did beat estimates by a healthy amount, about 40%. it was only 113 million euros in

profit. we are not talking about big bank numbers here. there are bankers that get paid that much. i will ask him about what he thinks about the deutsche bank reports. manus: we have to go. good to have you in the show. ♪ the latest innovation from xfinity

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asian equities. we are seeing week lists -- weakness on the asia-pacific index. china in the green there. extension of the tariff deadline or trade talks. about renaultl and they are saying they see high revenue in 2019 barring a hard brexit. this is the reality on the european side about brexit. in terms of the actual numbers billion.u can see 57.4

uncertaintyentire around the markets. 3.55, this is lighter than the market had anticipated. 3.71. it's interesting in terms of their guidance. they are talking about the potential of a hard brexit and the ramifications there. they see around 6%. you know what? therein lies the point. they are concerned about hard brexit. they have a huge number of issues around carlos ghosn which they are trying to work with. those are the numbers. look at the markets today as well, we've had a slew of earnings. it's been really interesting in terms of the beat from commerzbank. seeing further pain coming from agricole are in terms of the banks.

are we going to see more optimism from what we have heard on these trade talks? that possible extension prolongs the uncertainty, for me. manus: you had that chat earlier about that. when you see the allocations, it's interesting. it's about global equity allocation. it's the lowest since 2016. exposure to cash is the highest since 2009. that's the bank of america let's get advise -- to the markets around the rest of the world. we have the team standing by. let me take it first of all to you on the indian markets. they've had a very divergent

move compared to the other asian markets. what you think that is -- why do you think that is? >> there are a lot of internals internal shocks the indian market is dealing with. we are down one quarter of 1%. markets have been like that for the past five days. a lot of corporate issues, specific companies have come off late. that could be weighing in as well. the broader markets pulling back. the oil market, crude moving up. stocks falling quite a bit. pressure,bit of a only adding to the pain at the broader end of the spectrum. to that extent, on the benchmark indices as well. nejra: anne-marie, you are

looking at the ongoing normalization in market volatility. >> a lot of this has to do with what we have been hearing over the past few weeks. this ongoing optimism over the past month that we could strike a trade deal, perfect considering donald trump is said to be considering adding 60 days before he would add higher tariffs on chinese imports. come and look at my turmoil. , markets ahead. these are the past few weeks you can see here. say, what has been consistent is that traders in the market have been optimistic. there's been progress and talks. we have high-level officials meeting in beijing. as long as beijing and d.c. keep moving closer to an agreement, it could calm the markets. we have to talk about this trade data. it was an absolute surprise for the month of january. shipments rose 9% year-over-year. more than recouping the 4% drop

in december and bucking the consensus forecast for another decline. economists are saying, most of the time in january, trade shipments are overshooting because we are going into a february break for the lunar new year. economists are saying it was such a good overshoot that it wasn't just about the lunar new year. this data for china was really quite significant and strong. thank you so much. more and more people saying to me, you have to be tactical. you have to be nimble. this mliv question we are asking today. what asset has captured your heart when your head is saying this will end in tears? you can join the debate. reach out to us and the mliv team. let's get bloomberg first word news with debra mao in hong kong.

the deadline for higher tariffs by 60 days. he's already indicated his willingness for letting the march 1 date slip if the two countries are close to a deal. top level trade talks resume in beijing. president has trump -- president trump indicated he would have to meet to the -- with the chinese president before making a deal. the result was likely boosted by companies trying to ship goods ahead of the lunar new year holiday. outbound shipments rose over 9% from a year earlier while inbound deliveries slipped 1.6%. it left china with the trade surplus of $39.2 billion. an investor who grain -- gained prominence is now in hot water of his own. tom barrick drew criticism in washington for saying it was a mistake to judge saudi arabia for the murder of democracy be. he quickly backtracked, apologizing for his own words.

his comments echo previous statements by president trump. theresa may takes her brexit plan parliament later today. there's six weeks before the uk's due to leave the european union. she could face a revolt from anti-eu lawmakers in her own party. they say leaving with no deal must remain an option. global news, 24 hours a day on air and on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. manus: thank you very much. here's a look at how things will stack up for the rest of the day. grow atk predicted to 0.2%. you want to watch out for the reaction after all the recent weeks data. later today, the house of commons will get frisky on brexit. watch out. if they come back with any

amendments that failed to make headlight -- headway. our guest host this morning is with us. there's a lot to discuss. i want to go back to volatility and the earnings outlook. many have said, they will fade slightly in this quarter and you will get your pay in the back part of the year. historic, are is we being juked? >> i'm not quite sure that's the right phrase. was this what you had uncertainty factor going into the back end of last year. a lot of activity dropped off. what surprised me is that for the first time this year, we've had stronger earning beats than the revisions downwards. analyst optimism fades as earnings downgrade through the year.

curiously, we've got a situation where the expectations for the rest of this year are zero. in terms of earnings growth. it's not a bad place to start from. me, people error on the side of caution and say, what make it backend loaded. that, quitegree of a few of those earning , we look at the airbus piece, we are ceasing building the a 380. that more interest to my 13-year-old son. is real change in that order about the purchase of more fuel-efficient planes. that's been a critical piece for airbus. has thrown ar massive march on airbus. the fact that they switched to the 50 is really important.

job issues in europe but the fact that it has come through is that the new slowing growth -- -- -- about twoo think secondary effects. economy,t on the u.k. a major power plant supplier is going to factor into the economy. , i've been on here more times raising concerns about aircraft leasing. people buying this for an income boost you have concerns about reversionary bally's. -- values. there is a huge number of people out there with these kinds of assets in their portfolios. they generate 9% nominal yields. if yournd of the day, capital value will fall away because demand is going to fall away, that could be a nasty shock. not an issue for this year. an issue maybe in the future. nejra: i want to ask about

emerging markets. we were talking about earnings expectations. my chart shows that em stock prices have diverged from the profit outlook by the most since 2007. you can see that clearly with that little dip often read in terms -- of if in red. do we need to see a correction in stock prices or profit expectation? >> markets are trying to anticipate the future. you classically get a term which is not always justified by earnings. why did emerging markets rally in the fourth quarter of last year? is it because of the fed? liquidity? were negative on emerging markets until the fourth quarter. it was the liquidity withdrawal the fed was undertaking. half $1 trillion came out of liquidity into the qt last year.

the biggest effect is in the emerging markets. the fed may even moved to normalization, it's a huge positive. there's a lot of flow. the relative legs of change will improve. you start to see markets rally before the earnings numbers come through. that will be an interesting piece. linked to that, export data is very interesting. , weak again.ta the secondary effect on other -- asianomedy's economies, consumer driven demand. exports from korea, japan into china have dropped off dramatically. that's evident again today. manus: we're all trying to grapple with what ramifications are from china. i, of the things that, i state street berated me for this, three-year high for

dividends. u.k. large caps at a 10 year high for dividends. am i incorrect to be drawn to that story? , that's because of the capital depreciation on the equity side. it makes a dividend yield look nice. is it nice? >> i ultimately think that the value of most assets is the present value of future cash flows. when i look at dividends, i used to me it'sme funds, all about understanding cash flow projections. dividend yields rise because the expectation that yields will become. when you see high yields, don't think, great opportunity to jump in. the clash flow quality, will they -- that convert in the future? you are right to raise the point about dividends.

that's why we have stayed more constructive on equities despite the volatility. we've been focused around cash flow. be careful about earnings. the pressure from interest-rate rises or tighter credit, they make ways to find the numbers looking good. cash never lies. it's either in the bank or not. nejra: can i get your insight on senator marco rubio announcing a bill to tax our backs on equal footing with dividends? how much support will that give to the u.s. equity market and 2019? >> the phrase called deactivation -- they were making, a lot of the growth of the u.s. stock market comes from refinancing exercises, retiring equity. what he's trying to get out there, let's get away from that theoretical trade.

let's get back to fundamentals. we want companies to deploy and invest. i'm at the lowest point in the capital structure. i want to take advantage of growth. i don't want to play a clever game of financing. it makes sense for you to be issuing debt rather than equity. he's trying to get away from managing earnings through a program of fat and getting companies to invest in the economy. it is what trump has been banging on about for five years. manus: how was i going to manifest itself? you have mohammed o'leary and making very big calls. you have a number of different houses making very strong calls about divergent trade being long america. point,ad a turning people being prepared to make more definite calls on markets. across the assets for the rest of the year, you want more equity, bond, or fx exposure? >> we've gone the other way.

of coming toasure see your guys on a regular basis. we were most active last year, buying risk assets at the beginning of the year. selling them through the summer. being a flat by the beginning of q3. we were early buying risk in q4. we look to dumb in december. it has rallied in january. my point is, quality equity in this environment, credit, it's very happy. nejra: you see limited value in g10 government bonds. great to have you this morning. he will be continuing the conversation with us on bloomberg radio at 7:30 a.m. u.k. time. in from the cold after more than 20 years of isolation. itskistan is opening economy for the world. that's next.

manus: if you are driving to work, tune in to bloomberg radio. ♪

nejra: this is bloomberg daybreak: europe. let's get your business flash. debra mao standing by in hong kong. debra: airbus is pulling the plug on its low selling a 380 superjumbo. the european playmaker will seize deliveries of the double-decker jet in 2021. emirate cut its order book by 39 aircraft. 3500 jobs will be impacted over the next three years. the ramp up of other models could offset some of that.

japanese e-commerce giant has revealed it shunned while weight equipment over security concerns. the decision was made despite being cleared by the japanese government. they are facing a global i told myself, i should not take 1% risk. [inaudible] i decided to not use them. debra: that's your bloomberg is this flash. nejra: debra mao in hong kong. uzbekistan has issued its first eurobond, following in the

footsteps of other former soviet republics. they issued $1 billion of debt. puts the gold rich central asian nation among the parade of nations taking advantage of increased appetite. uzbekistan has lifted currency controls and eased some travel restrictions. joining us now from exclusive interview is the deputy prime minister and minister of finance from the republic of pakistan -- uzbekistan. thank you for joining us. i hope you've been enjoying our new building. this is big news. it is clear that uzbekistan is not necessarily in desperate need for cash, in terms of this bond sale. the role of the sale was to set a benchmark. can you reveal which state companies might tap the market

in the wake of the sovereign? >> thank you. we think that during this year, maybe not say don't companies. willbig commercial banks tap that market. we think we have done a good benchmark for them. manus: good morning, minister. >> good morning. manus: welcome to the show, sir. many will say that this bond offering is good news to help foreign direct investment into his pakistan -- uzbekistan. do you see it as a big moment to say to the world, invest your? >> -- here? >> we are sure that issuing news for fdi or potential investors to his pakistan -- uzbekistan.

it makes us accountable in the investors, alln of them are partners. nejra: what about the access of economic statistics in english? some investors have shown concern about this. what assurances can you offer them? >> ok. this issue is new for us. openness of the statistical data. now it is united to the imf statistical agreement. a of the data regarding to economics could easily be found out on the imf website. at the same time, we are working in translating to english all of our data. for example, the minister of

finance and some other living economic institutions have many information in english. we will have to improve our work in this area. manus: can i ask you about the currency? your currency is not free-floating at the moment. ambition to perhaps introduce more free capacity on the currency side? beginningf all, introducedf 2017, we free access to foreign currency. now we have unallotted exchange rate. everybody has free access to foreign currency. investors could easily get it for the purposes of import or

repatriation of profit. no problem. there is still limitation on capital movement in the market. nejra: let me talk about gold. the there any beast -- large state licenses for gold deposit? >> i couldn't catch that. nejra: will there be any large state licenses for gold deposit auctions? uzbekistan all, in we have two big gold-mining companies. have hugeally deposits for them. idea toreparing some provide investors some landmarks to explore it. nejra: thank you so much for your time. the deputy prime minister and

minister of finance from the republic of was pakistan. -- uzbekistan. we speak with the ceo of credit squeeze, the big interview coming up. , the big suisse interview coming up. this is bloomberg. ♪

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this is bloomberg daybreak: europe. these are today's top stories. >> i'm always nervous. it's my job. the uncertainties are well-known. u.s. trade is different. manus: credit suisse hits the streets on the top of the bottom line. it's bigger than expected loss. more with the ceo ahead. getting back together?

signs of reconciliation between the world's two biggest economies. trump is said to consider a 60 day delay to the china tariff increases. --aking up with a 83 80 8380. divorced day nears. theresa may faces a revolt over signs she will take a no deal brexit off the table. to bring her plan to parliament today. ♪ nejra: good morning everyone. let's get to a german gdp number. we've seen a number of things show some slowing in germany's economy. , 0.6%.ber comes in the estimate was 0.1%.

that's better than it -- expected year on year. germany just avoiding recession after we had signs of the economy stagnating in the fourth quarter. it'll be interesting to see how the euro reacts. it was higher in -- earlier in the session. manus? just give you a little bit more from t jim. three-year restructuring at credit suisse group has ended. plaguedr problem has earnings out of the bank. 193 million francs, the loss over shattering the gains.

how he plans to grow the bank regardless of market conditions. >> we have been growing. we have for years. it is upok at revenue, from 15%. we have a very simple approach to this. when you look at total revenue, you are adding one swiss franc a to onee capital business swiss franc of high-quality recurring capital efficient revenue. i think the two dozen tell you the story. we have lost about 4 billion of revenue. it's at a 7% margin. we have replaced it by 2 billion of additional revenue wealth management. most of that is very positive. that's why the profits from our core this year are higher. from low-margin

business to high-margin business. we focus on the clients. we went from high net worth because we can have a broader relationship. we can manage their assets but we can also advise them on their business. the interesting thing about that, it makes your assets more picky. you have a proper relationship. we've seen this in q4. lost 35 billion but we are authority for billion away from anything. to 771.from 722 billion we only got 13 billion towards this. when you convert that in swiss francs, they keep strengthening. it is down from percent -- 2%. >> are you frustrated with your trading unit? >> i'm not frustrated.

they have done a very good job. we've eliminated more than 3000 jobs. we gave them a harsh capital target. we took it size down, very significantly. we exceeded our capital target in terms of reduction. in revenue we did 5.1 billion. given everything that happened in market in the last two years, they can't really be blamed for that. >> however they been performing in the last two months? >> a number of my peers have said this, i'm afraid it is true. q4 18.s much better than that's where we are. bounce back but significantly lower.

things are positive on the wealth management side. the au when is now back where we were in november. >> word you see the best opportunities in wealth management this year? range ofe a broad funds and services. as the economic cycle unfolds, we do different things for our clients. asia had it's

market since q4 2008. it's a huge dislocation. our financing group, second-best since its creation. you will see that it's not because of markets. what we have done, put capital towards our clients. if you don't deserve your clients when things are tough, they won't is really there. -- dessert you either. manus: one piece of breaking news we get to francine, this is on easyjet. they are in talks with a cohort, delta. easyjetd easy debt -- talking. it's going to be fascinating to see what delta and easyjet might do. discussions to do a deal. incirlikk now the lady -- incirlik -- they are all battered and

bruised. there you go. how's the bank looking, how's the volatility? >> if you look at the banks, you are right. it's a tough environment overall for banks. you just heard, overall the bonus pool should be flat. these are numbers that beat estimates. if you look at the trading units, there are concerns about the volatility. it was interesting the way he put it. the fourth quarter was a rubbish fourth quarter, it was a stress test. perform if we can still in the fourth quarter under these stress tests, the bank is resilient. it can face anything. he said the first couple of months will be better than the fourth quarter of last year. it is so low, the bar is so low. it doesn't say much. points really three main

that we talk about on bloomberg qe day in and day out. u.s., thee with the shutdown in the u.s., brexit. these are very difficult things to actually see what happens to the market. they just want to stand behind their clients to make sure that they stick with them. nejra: bloomberg surveillance zurich.ncirlik -- in we need to bring you a correction. the numbers have changed. what we showed you earlier was incorrect. quarter on quarter gdp came in at 0%. you are seeing no growth at all. the estimate was for 0.1%. stagnated atonomy the end of 2018, barely dodging a recession. seneca.d numbers from

fourth quarter court eps is a beat. what else are you looking at? >> upbeat by $.10. billion versus an estimate of 6.32. 2019, they are saying we could see earnings-per-share three dollars and $.15. sales products will be in the high single digits for growth. it's looking like strong numbers. look at how they performed over the year. this is normalized compared to other pharmaceutical stocks. blue,eneca in the pharmaceutical stocks in the whites. they are outperforming their peers in the broader u.k. market. speaking to the ceo later today, one thing analysts are really keen to learn from him, what's going on in terms of the manager positions?

several left the community -- company. one thing is key for that. they are now splitting their company operations into two divisions. cancer and everything else. how will that work? we will talk about brexit. astrazeneca is stockpiling. they are putting testing facilities in europe, preparing for the brexit scenario. a lot of these pharmaceutical companies will be testifying in the senate. the man himself will be testifying at the end of the month in front of the senate. a lot of things to discuss later today. nejra: we look forward to that interview. let's take a look at the futures. they have been trading overnight in asia. we are seeing them in the green. futures tracking higher. -- bytures higher than 0.2%.

the me, it's positioning in the jpmorgan client survey index. let me show you what is going on with the bond markets. the jpmorgan survey says they have the biggest net long position since 2016. they are long up to their gills in cash. looking at treasuries on the bottom. the breakevens rose ever so slightly yesterday. you saw a flattening in the curve. inflation is not rabid there. wounds down by a tech. even i cannot risk more than a one take move in boones -- bunds at the moment. the dollar with slippage this morning. the reporting season how it stands so far. the stoxx 600 in have finished reporting their earnings for the past quarter. it has been a bumpy season so far. the u.k. corporate landscape,

they missed estimates more than but -- by any other point. equities are posting steady games. the main global indexes covering at a two month high. what does that mean for sebastian relative, head of european strategy? welcome to the show. season, has it been a cathartic moment? are we all just glad to move on in terms of what tony 19 brings us -- 2019 brings us? storyre was a phenomenal over the last three months in global markets. in december, we saw a sharp deceleration in global growth momentum. stocks overreacted and fell significantly more than the weakening in growth would've suggested. that's because of fears that growth would slow further, and the fact that the global uncertainty index is at an all-time high.

there's very low visibility there. what we have seen in the year so far, this uncertainty. nejra: since then, we've had a rebound in the start of 2019. you are not convinced by that. you are turning neutral after the recent rally. why is that? >> it depends the part of the market you are looking at. we expect an improvement in growth momentum. will stabilize but that's already priced into the equity market. if you assume the most reliable lead indicator of the economy picks up by two points, you are at fair value in european equities. it doesn't mean that that's true of the whole market. there are some segments further upside interview. we see upside in u.s. equities. rise inlds should

response to more stable growth momentum. we think there will be a sector rotation. the most cyclical sectors will outperform. manus: it's interesting that you mention the banks. we've had banks in every direction today. credit suisse got better in the first couple of weeks. this is the yield curve. do you think whether the flattening yield curve in europe is a value destruction to the banks? how do you look at that relationship? >> for us, it's important to , seetest over long time what the conditions are under which banks can perform and suffer. there are two main drivers of the bank. -- banks. the first is the rate of change

in growth momentum. twenty-year highs were always going to weaken. if the pmi falls, banks will underperform. they are the worst performing sector in 2018. the second driver is the bund yield. in an environment where the pmi drops, that's a toxic environment for banks. they will underperform. banks have continued to be week. if the pmi's pick up by two rise, boththe boones of your main determinants of your performance point in the right direction. banks will finally be able to perform again. nejra: i understand the relationship you are drawing. what makes you cope -- convinced we will see the pmi's pickup from here? >> there are two points. we've seen a sharp underperformance relative to the main drivers of the economy. factors,e to temporary

it dropped by seven points in france in two months. we had the street protests, suggesting there is sentiment undershoot. we have a negative impact from the car commission regulations, which had a longer impact than we expected. we look at the forward-looking drivers of the economy, such as fx. the euro has depreciated a lot. we see a nice turnaround in the inventory side. fundamentals are improving. you had an undershoot. taken together and it points to upside. manus: the head of european equity strategy at deutsche bank. he stays with us. coming up, 60 day delay. trump considers postponing the china tariff talks -- extending the china tariff talks. that's the driver for markets. ♪

manus: it's daybreak europe. let's get a check on the markets. european futures on a further footing. we could see a fourth day of gains for european equities. up 0.2% almost. brent crude up higher. wti above 54. here are the headlines around production from opec members, seeing -- seeming to offset we've gotten from the u.s.. we hold on that to 70

be good as long as there's no hard brexit. what happened in parliament today? anybody's guess. goldman sachs sticking with the short dollar. the rest of you are wrong. s&p 500 up. a lot of the sentiment is driven by trade. the potential extension by the u.s. and the trade talks with china is one big issue. your mliv question of the day. the team is standing by. what asset captured your heart when your head is saying this will end in tears? we are not talking about your last marriage or partner. we are talking about markets. the mliv team is there. your business flash with debra mao in hong kong. debra: trading losses at credit suisse with gains in the wealth management business. they posted a larger than expected loss but the banks all less outflows than many competitors.

the ceo says geopolitical concerns are making him nervous. >> i'm always nervous. that's my job. my clients aren't nervous. uncertainties are well-known. china-u.s. trade discussions. debra: airbus is pulling the plug on its slow selling superjumbo after 12 years in service. they will cease deliveries of the double-decker jet in 2021. emirates, the only remaining buyer, cut its order by 39 aircraft. 3500 jobs will be impacted over the next three years. the ramp up of other models could offset some of that. the french government is set to , it would beg etf the first step in a corporate restructuring to address the challenge of replacing the country's nuclear power fleet. .he government owns 84% of eds

it is likely to be taken into full state ownership. that's your bloomberg business flash. nejra: thank you so much. president trump is said to be considering pushing back the deadline for higher tariffs on chinese imports by 60 days. this comes as trade talks resume in beijing today. president trump says things are going well. our guest is still with us. people often talk about hedges if things go wrong. you've got a hedge in case things go right with these trade talks. >> it's always interesting to see when things have dislocated. the global macro uncertainty at the moment is at an all-time high. what does that mean for asset prices? is the main reason for why the dollar has been so strong in 2018. why did the dollar fall by 10% in 2017? everybody thought it would

continue to be week. it spiked by 12%. uncertainty dropped sharply in 2017 after the french presidential election. it spiked up again at the trade war and the worries about italy. if uncertainty starts to trade -- fade, the dollar loses the support from i uncertainty. a weaker dollar is good for commodities. falling uncertainty helps cyclical assets. i want to pick up one of the themes from the last conversations. you talked about bund yields. what's going to happen in the treasury market? , they might go well go splendidly. what might that due to treasury yields? where would that retest? >> we have a similar model for bund yield and treasury yield. you have to ask, what are the reliable factors driving bond yields on both sides of the atlantic?

there are four reliable factors. the rate in changing growth, global central bank balance sheets, oil price and inflation. we see the same drivers on both sides of the atlantic. pmi stabilizing, oil price moving higher in response to a weaker dollar, global central bank balance sheets shrinking. it points to 50 basis points upside for bund yields and treasury yields. that would be consistent at 3.2%. nejra: great to have you with us this morning. manus: a little bit of value there to be had. the head of european equity strategy at deutsche bank. that's it for this edition of daybreak europe. european market open is up next. where did they go if they want to switch the television off? nejra: bloomberg radio. i will be there and 30 minutes. you can get it live on your mobile device.

this is bloomberg. ♪

♪ >> good morning. welcome to "bloomberg markets: european open." we are live from our european headquarters in london. i am anna edwards alongside matt miller, who this morning is in frankfurt. matt: that's right. stocks trade mixed. european futures trade higher as a germany narrowly misses falling into a recession. the cash trade is less than 30 minutes away. ♪ anna: time to