manus: good morning, i'm manus cranny, live from dubai. nejra: this is bloomberg "daybreak: europe." and these are today's top stories. manus: sterling jumps as theresa may promises a vote on taking a no deal off the table. deal, we aret her live in westminster all day. crosscurrents and conflicting signals, markets braced for a second day of congressional testimony from jay powell. this as a technical error at the cme halted trading for hours. journalist are

evicted from hotel housing. , a north korean leader second summit marked by low ambitions. we are live in hanoi. manus: a very good morning and welcome to "daybreak: europe." we are poised for another day of political theater. nejra: we absolutely are. bynificant climb down theresa may to appease some of the pro-european ministers in her cabinet payment we are hearing she will offer them a chance to vote on delaying brexit to avoid that no deal scenario on march 29, so a delay is on the table. the question is, is the

momentum working? let's get into the markets, we are waiting on a couple of results to come through. we have the dollar in chinese equities. we've had this cracking run. it's the dollar index we are going to go with. conflicting signals coming through, muted inflation. if the power to direct markets or to deliver on the upside in terms of inflation? suggesting a restart of rate cuts and qe. that's putting a little bit of pressure on the dollar. let me show you what's happening with the other equity markets. goldman sachs saying you might see a little bit of a drawdown in the chinese market. if you see that you will get an opportunity to jump into these markets again. irish or, i bring your attention to that. goldman sachs say we are near the bottom and barclays say iron disasterlose its

driven gains. we will debate that through the next hour. nejra: so we had a little bit of movement in the session yesterday. we heard from jerome powell pledging to stay patient with the fed policy. disruptedre a little earlier. if we look at how are trading now, pretty much debt flat. edging slightly into negative territory. i put oil in there because we have seen a jump today. wti futures were disrupted earlier. we drop in u.s. inventories and some pledges from russia, lifting the oil market today. we had a september high in yesterday's session and we are holding that high pretty much today. against the euro we saw the pound hit a two-year high in yesterday's session on the prospect of a delay to the march 29 deadline. are the gains in sterling cap?

if we see that delay, it could be only until june. juliette saly is in singapore. how is it looking today? we are reversing yesterday's losses, so little more positivity coming through in asian markets. i want to bring your attention to what were seeing in india, indian markets up by over 1%. starting to pare some of the losses in the last 15 minutes or so as we hear news that pakistan jets have phyletic indian airspace, reports that in indian aircraft has crashed on renewed escalated tensions between india and pakistan. indians that -- stocks are still higher. a lot of fluctuations coming through in the china markets. in negative territory but it had been in positive territory for some of the session.

some indian stock still holding onto those gains because yesterday we had that attack by india on a pakistan camp. kong, there is pressure. an earnings miss there. analyst sticking to their calls ,n that stock and in australia coming through the first cap numbers. analyst happy that the outlook for the full year is pretty much in line with prior estimates. juliette saly in singapore, thank you so much. let's get back to westminster, and theresa may has promised the u.k. parliament a vote to rule out a no deal brexit and a vote on a delay to the e.u. departure date. averted looks to have mass resignations of pro-e.u. ministers. the u.k. prime minister insisted she doesn't want a delay and still hopes to leave the block

on the 29th of march. the house had rejected leaving with the deal negotiated with the e.u., then rejects leaving on the 29th of march without a withdrawal agreement and future framework, the government will on the 14th of march and forward a motion of whether parliament wants to seek a short, limited extension to the date. nejra: my guest joining me in , neil and lucy macdonald. great to have you both with me, thanks so much for braving the cold. let's just get this clear in terms of how likely an actual delay is. theresa may is still trying to negotiate this deal and hoping to get it through parliament. i think an extension is now far more likely. theresa may has considered that she doesn't have the majority

effectively, when she needs to get the agreement of the european union as well. today showed us again that government policies being driven by internal infighting within the conservative party. this is a win for the pro-e.u. ministers, taking the prospect of no deal potentially off the table. it's something they are vehemently against. the conservative party will fight the tweeted self to determine what the u.k. policy is. so we may see a reversal of this yet again later on. line: i read one cracking from a columnist this morning, everyone is locked in brexit her tory, if they do go to an extension, is this the worst-case scenario? or would it be that hard brexit? the hard brexit is

definitely the worst-case scenario as far as markets are concerned. and the fact that that armageddon has been averted, you can see the reaction from sterling. i don't think you're going to get much reaction or funds shifting round at this stage, though. most of the action will be in the currency. hold those thoughts, both of you. we got a little bit of breaking news from rio tinto. in termse best to last of the miners. $8.1 billion in terms of underlying profit. the market had canceled in 8.54. this company has paid a huge dividend to investors since 2017. there's a final dividend of another $3 billion. by my reckoning its $10.3 billion for the last year. point 4r net income, 13

billion. dividend the same as the year before. remains the same, but the underlying profit, will get into that with lucy shortly. back to brexit. let's get back to lucy , just wanted to pick up on what we're talking about with sterling. in terms of whether sterling gets cap, even though we've seen these gains, what are the implications for the ftse 100? we were talking about how it has underperformed even this year. lucy: it is continuing to underperformed this your. it's up about 6% and the u.s. is up about 12. investors are just waiting to see what happens.

more certainty we get, the number of scenarios being whittled down, there is more likelihood of shifting. i think everyone is still pretty much weight in see. there is the overseas earnings component. manus: there's a lovely line used by a lot of the market, recalibrating the brexit risk. to that end, there is the labor possibility of a second referendum. why the map i've looked at over the past couple of days, that doesn't look like a statistically likely probability right now. we've got to look at either a delay as being the more probable outcome or a hard deal. .eil: i absolutely agree there doesn't seem to be enough support in parliament at the moment for second referendum.

possibility that we have an open election the way the conservative party has infighting. we have to see if the attorney general who is in brussels at the moment can find a way around the backstop in northern ireland , can find a solution to the problems that will determine the future course in terms of whether an extension is needed. nejra: explain to us how this tactical gamble could actually ministerspro-brexit back onside? they feel they had to keep the idea of no brexit on the table because it was forcing the e.u. to give concessions. they felt the e.u. would back down on they no deal brexit because it would affect earnings. now that may be taken away and they may fall back to line. it, it isn't like

preferable to know brexit at all. therefore they may rally behind the deal now. in screamobably kick a bit along the way until that happens. you will see shifts in patterns and they may well at that stage go in behind the prime minister which is what she is betting on at the moment. manus: she almost wants to back everybody into their own corner. can you trust the prime minister? thank you so much for being with us. underlying profit $8.1 billion. us all have the ceo join little later on in programming. stay tuned for that.

let's get to debra mao with the first word headlines. >> the federal reserve chairman jay powell says a healthy economy is facing some crosscurrents and conflicting signals. but that the labor market still has room to pull in workers. his remarks showed no bias toward further hikes or cuts. >> the outlook for the u.s. economy is a positive one, a favorable one. the predominant risk to the economy are slowing global -- global growth, china and europe. we've seen a significant slowing of growth over the course of the past year with our policy rate in the range of neutral. with muted inflation pressures and some of the downside risks we've talked about, this is a good time to be patient and watch and wait and see have the situation evolves. >> president trump is in hanoi preparing for his second summit

with kim jong-un. the plan is for the two leaders to hold a one-on-one meeting before sitting down for dinner. the u.s. have played down expectations for the talks and key details remain a mystery. the two sides have not even agree to the ultimate purpose of negotiations. technical error at cb has ,rompted a lengthy trading call it temporary halted buying and treasuries,ontract, stock futures and commodities. trading reopened about three hours after it stopped. global news, 24 hours a day, on-air and @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. nejra: debra mao in hong kong, thank you so much. coming up, jay powell said the world's biggest economy is healthy but faces some

crosscurrents and conflicting signals. we will talk about the fed and the u.s. next. when you're traveling to work, tune in to bloomberg radio live on your mobile device or digital radio in the london area. i will be running back to the studio to join you there from 8:00 a.m. london time. this is bloomberg. ♪

manus: this is bloomberg "daybreak: europe." i'm manus cranny in dubai. nejra: and i'm live from westminster. let's get a quick check of the markets. turning to asia first, a little bit of a mixed picture. the msci asia-pacific overall in the green. looking at gains up point 25%, 10-year gilts unchanged on a q 64 handle following jay powell testimony yesterday. we will discuss more about that in a second.

the pound hit a two-year high against the euro. that should be switched around to show eurosterling. cable hitting the september high following the prospect of a delay to the brexit date. everyone is debating what jay -- what jamie dimon is saying in terms of preparedness for recession. emerging-market currencies trading on a one-month high. we will as lucy about looser policy. we've had some reprieve in the oil market. to the fed now, there is no rush, that was the signal from senateell in his testimony yesterday. he said a healthy u.s. economy has faced some crosscurrents and conflicting signals that were to

taking a patient approach to future rate hikes. >> the outlook for the u.s. economy is a positive, favorable one. predominant risk to the economy are slowing global growth, as i mentioned, china and europe. we have seen significant slowing of growth over the course of the past year with our policy rate in the range of neutral, with muted inflation pressures and some of the downside risks, this is a good time to be patient and watch and wait and see how the situation evolves. that's jay powell, concerned about the crosscurrents. we are tracking the pakistan isry, the latest line pakistan says that jets fired across the india border from airstrikes. this is the latest from pti. things are beginning to ratchet up between the geopolitics

between the two countries. let's get back to our guest host this morning. lucy mack donald is with nejra cehic. jay powell is worried about the crosscurrents and financial markets have become more volatile. he mention that first before the u.s. economy. it sounds as if he is buying the market rather than the economic data. what do you make of that proposition? my crosscurrents he means market volatility. it was really volatile last year and it is wise to take notice of that. the other issue he spoke about, the china slowdown, trade as well, these were real significant concerns. what they're doing is entirely irrational, and although he

didn't expressly say they were , that ismarkets exactly what the markets are understanding. if we see volatility continue to remain suppressed, what does that mean for an active manager like yourself? what specifically are you looking at in the businesses you look at with that broader context? long-term investors and were not trying to time markets to it he extent. but what it does mean obviously supportyou've got overall for getting some return, we are more concerned about where within the market should one be? is clear that liquidity will

be very important. it's where you can see the growth. quicklystill grown most , it's technology related. in just in the sector but industrials and in some areas, health care. that's where you're seeing the most structural growth, which is the most important thing. if those are the pocket you are looking at, are you shaving american risk at looking at those things globally or in the united states? , justan cutting the stock shaving that risk. is that a global perspective on those sectors? those are some of the recoveries we've had in january, has been quite sharp. trimming some of those positions

on the margin, that is a marginal thing. portfolio management hygiene, when you get those sort of moves, there is plenty of that to be doing of trimming and pruning. nejra: with the fed on cause and if we see rates remaining where they are or even moving lower, how concerned are you about companies taking on additional leverage and balance sheet risk? lucy: these are the major concerns, corporate leverages clearly one of them. and the fact that interest rates have been rising is bringing that more to the core. the fact that you may you see a take that out the worried for the moment but it is still lurking there. we cannot forget that debt overall is higher than it was pre-financial crisis.

a lot of that has been taken on in the corporate sector. the one thing i mentioned earlier was emerging markets. we've had a fantastic run in em. and its splendid run in how does it play into your thinking? say, it's ays strange concept. if we look at china, that's the most important thing for the low. china we think has the potential to stabilize now. it's growth toward the end of the year. the chinese authorities are doing everything they can to , pushingt about

monetary and fiscal policy, everything, to ensure that that is what happens. said, that's one of the major things they are looking at. nejra: do you get your exposure directly to china or by developed market equities with exposure to chinese consumers? lucy: when you look at the exposure in the portfolio to it's aboutd china, three times what it looks when you're just looking at the underlying where the companies are located. it's the biggest source of growth for many of these companies the last few years. it's extremely important. nejra: lucy macdonald's stays with us. next, as pakistan says jets fired across its airspace, we will bring you the latest from

mumbai. kims: up next, trump and come face-to-face tonight. will the meeting ill any real progress? that is the question. we are live in hanoi. ♪

manus: this is bloomberg "daybreak: europe." i'm manus cranny in dubai. nejra: and i'm nejra cehic in westminster. we have some breaking news. headline on red bayer. a little bit of a beat. and thenht monsanto found out they had litigation coming out there is. another red headline coming through, there is the bayer

numbers. of 10.69.timates litigation, fourth quarter in line. plaintiffs going after ba yer regarding presumably back to the monsanto deal. going to cut a number of jobs and increase sales. i want to get to the other red headline. what is going on with litigation and what is realistic to assume at the moment? i guess will join the team a little later on. another red headline coming on pakistans time india. pakistan said it shot down to indian aircraft, the pilot has

been arrested. we will get to our partners in india. us, take it away and give us an update on what you are seeing in markets right now. >> equity markets have come off a little from the levels they were trading at it i just heard manus speaking about the developments as we understand, , theyakistani aircraft dropped some bombs. we do not have clarity on where , so no clarityd on that front. this, equityf markets have come up from the levels about half percent.

there's a semblance of strength in the currency. today is the situation looks like the indian rupee is weakened. the stress is showing right now in the markets. not a drastic reaction because we don't have exact clarity on theyhas happened, but dropped some bombs. manus: this is the latest crossing the terminal. give me a sense of the escalation we are seeing here. escalation that comes at a critical time for the new premier. >> that's what is happening out

here about the kind of response, yesterday you heard what the officials had to say, these are preemptive strikes in order to prevent further attacks in any fashion against pakistan itself. -- today's move -- it would bet foolhardy not to believe there is an escalation the has happened. nejra: thank you so much for explaining all that to us in taken us through the indian markets. if we look at asia more broadly, we are seeing some gains there. what else is driving global markets? >> we are seeing some gains across asia, up for the second

time in eight days. i want to pop -- one out what is going on in china, we're seeing a little bit of weakness in the indian market as well as the indian rupee doing -- due to escalation between what's going on between india and pakistan. and the bloomberg dollar index of it higher, w g.i. is also higher today. i want to look at what's going on, the market impact between the summit happening in vietnam between president trump and north korean leader kim jong-il and today. the lowest levels you can see sense 2007, an 11 year low. the last time we saw this level, the leaders of the two koreas met and nuclear facilities were shut down. the big question is what comes out of the summit and what could it mean for the market impact. south korea is one to watch.

great work, team. let's stay with the political risk. u.s. president donald trump is in hanoi the second summit with kim jong-un and is planning to -- withh north korean the north korean leader this evening ahead of the formal summit on thursday. however, the white house has no ambitions for thursday's talks p let's get with stephen engle who joins us from hanoi. good to see you. why does the white house not expect much real progress from the summit? beingt's the west wing the west wing. they are lowering the bar and the expectation so they can excel and beat expectations because a lot of the media has been here for four days previewing this.

we have built up the expectations saying they need to put meat on the bones from the rather uneventful declaration we got out of singapore in june of last your. so we have all built up the expectations. donald is not lowering the bar. he said today he expects big things and he thinks kim jong-un wants to do something special. int's why tonight's meeting the hotel seen behind me here in the center of hanoi is going to be critical. they are going to meet a scheduled 20 minutes one on one with some other aids. we are hearing that kim jong-un's sister will be in participation. we will have that -- they will have that one-on-one facetime. the north koreans want to see if they can get a personal level with donald trump to eke out some concessions. donald trump has already said i'm not going to relax sanctions, but kim jong-un wants relaxation of sanctions.

.t will be an interesting night for 20 minutes they will meet face-to-face, then have dinner and then the big summit tomorrow in the same building behind me. and symbolic gestures is perhaps what we can expect from the summit. meanwhile the u.s. has been busy making deals. talk to us about those. >> that's right. to thetrump went presidential palace, we were over there today when the metrcade came in and trump with the prime minister as well as the president of the annan. they signed a number of deals, mostly in the aviation space. one of the upstart carriers here in vietnam signed a deal for i believe 100 boeing 737s. they will also by engines and maintenance services from ge electric, whose representative

was also there. byther upstart airlines will 10 boeing's for $3 billion. flag carrier,bent vietnam airlines, will be buying some technology solution from sabr corp.. we had an interview monday with the vietnam airlines ceo here in hanoi. he told me that will likely withce the aging planes boeing 737 max and are also from airbusothers for the long haul. so a lot of aviation deals adding to the momentum that the u.s. and vietnam have been building as the vietnamese economy has been booming. 6.6% and will gdp growth for the past decade here in vietnam, and the u.s. is trying to capitalize on that. much forank you so

joining us, stephen engle, our chief probation correspondent, live in hanoi. debra mao has the first word news in hong kong. >> goldman sachs is the global economy may have artie bottomed out. the bank's current activity indicator is slightly higher now than it was in december and january. the chief economist said growth remains soft, but there are signs of green shoots emerging. jpmorgan is a little less optimistic. jamie dimon says he is readying the bank for a downturn. >> we are prepared for a recession. one of the things that came across the tape saying jpmorgan is preparing for a recession. we are not predicting a recession. we are simply pointing out that we are very conscious about the risk to the company. >> a technical error at see me has prompted a lengthy trading halt at the world's largest

exchange operator. andemporarily halted buying selling of contracts tied to treasuries, stock futures, and commodities. ,t hit a slew of markets trading reopened about three hours after it stopped. global news, 24 hours a day, on-air and @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. much. thank you very quarters ofhree european corporate have reported their earnings so far this season. earnings-per-share misses are at-bat -- outweighing the beats. u.s. china trade disputes all adding into the mix. lucy macdonald is our guest host this morning. focus on real. -- on rio.

they're keeping the dividend flat. how do you look at the miners? are they inextricably linked to your perception of global growth? lucy: they are. they have all performed pretty well, so they are looking at those, where you want to be taking some profit. nejra: i was reading an interesting note to do with the miners. it argued that if we have a stronger pound on the back of brexit, of outcome from that could impact miners more. that is what we talked about, global growth, china will, -- china. would you agree with that? lucy: that would be the case because of the impact on earnings.

from that perspective there are too many variables that come in when you are looking at these companies. manus: do you want more exposure to the consumer or two industry? you talked about looking for opportunities for growth might,. the consumer in the u.s. is quite strong. it might be more debatable in europe but we are not falling over. in terms of for want your exposure in the sectors, where would it be? lucy: looking at where technology is really beginning to drive some productivity gains, we've had a lot of investment in technology over the last few years, which is not really helped us for a striving productivity. we are getting to the stage where we are beginning to see that. you can see that happening on the top line but also you've

done a lot of investing, that is interesting. pervasive through many sectors. industry, capital goods, you're thatg some extra revenues companies are able to get an improved quality of business. intohat they are getting long-term relationships with clients, they are connected all the time. they could be providing services and charging for them. talking about technology and how it is changing businesses, the big thing was five g. i wonder how we are factoring the prospect of five g and the impact on industrial internet of driving, thoseed areas. how are you factoring that into your investment prospects? a slightly more subtle

area is that it is looking as if it is changing some of the attitude of regulators toward pricing. time with herough has been a huge focus from the regulators on driving down prices for consumers as much as possible. area,ou get into a 5g when you're talking about dropping a personal call to one of your relatives, it's not the end of the world. you can pick it up again. but if you have some machine reworking, driving, you need that quality. that.nnot afford so the focus is now shifting more toward quality networks than price. a better environment for investment by these

companies. and a less aggressive attitude toward regulating price. that is quite a helpful development for the companies. manus: hold those thoughts, thank you for being with us, lucy macdonald, cio of global equities at a long -- at allianz. coming up on the show, goldman sachs says the global economy may have bottomed out. jpmorgan's jamie dimon says he is readying for a downturn risk. we will discuss. this is bloomberg ♪.

manus: this is bloomberg "daybreak: europe." i'm manus cranny in dubai. year the far this

pound is among the best-performing g10 currencies, still with one month ago, investors are unclear what kind of exit the u.k. is heading towards, or if theresa may and secure a delay and block a no deal brexit. so how should investors play sterling? here is what we have been hearing. brexit uncertainty swirls, analysts are trying to forecast an event that many of their peers have said is untradable. a canada style deal could raise barriers to trade in europe and could see the pound dropped to 125 before settling higher by year end. another analyst says the deal could give the pound a boost to 140, but extension of article 50 would keep it supported around the current level. divorce could see sterling fall to 120. still, none of these forecasts are as pessimistic as the bank

of england's worst-case scenario. mark carney warns the pound could drop to below parity with the dollar. with time running out until britain leaves the you, with a without a deal -- leaves the e.u., who knows where sterling will end up trading? as we heard at the end, who knows where sterling will end up trading? a number of people saying even if we do get these gains for now, they could be cap. one of fire analysts said made keeps everyone locked in brexit her tory if we do have this extension. our survey said a referendum would be a bigger bid for starling than a brexit delay. that was the latest in january. nejra: it was indeed.

still a lot of things on the table, even the prospect of no deal seems to have receded significantly, nothing can yet be ruled out, can it? manus: you never know what they will say on the back benches. we will see how the politics plays out today. is it cold there? i am colder than i was in barcelona, that is for sure. manus: i'm just checking that you are ok. let's get the business flash with debra mao in hong kong. >> the dutch government has bolstered its stake in air france klm to 13%. you previously held just under 6%. this is part of a move to reach parity in france, the most powerful shareholder in the group. it will put the dutch in a position to ask for more seats at the next meeting.

at&t has defeated another effort by the u.s. to undo its purchase of time warner. the decision by the u.s. appeals court of men -- cements the deal. said it would had lead to higher prices for pay-tv subscribers across the country. right toeen given the continue managing u.s. tensions without interference for one year. biding a criminal conviction in france. however, the u.s. labor department did say any further conviction anywhere in the world could jeopardize that status. french court convicted ubs of fundsg french citizens -- in undeclared swiss accounts. that's your bloomberg business flash. you very much. goldman sachs says the global economy may have already bottomed out, and current activities indicators higher

than the numbers they have for december and january. the chief economist at growth remain soft but there are signs of green shoots emerging. jpmorgan a little bit less optimistic. jamie dimon says he is readying the bank for a downturn risk. >> were prepared for a recession. one of the things that came across the tape saying jpmorgan is preparing for recession. we are not predicting a recession. we simply are pointing out that we are conscious about the risk we bear as a company. manus: which side of the coin does lucy mcdonnell come down on? we started the show, you said you are -- i want to bring into this chart. home prices in the u.s. dropped by the most in four years. to me, this is the root of concern in markets. what does it say to you? what does that data say to you

in terms of the slowdown of house prices? lucy: we are definitely expecting further growth in the u.s. this year. at the same time, we had confidence figures coming out from the u.s. which were stronger. we do think recession will be avoided, coming off a very strong year. earningsrly corporate the taxn boosted by reform yesterday, so now we go back to more normal levels of growth. decent dispersion of earnings. last year we got the full numbers in, the strongest growth was technology and the biggest surprise on the upside as well. energy was also quite strong. that's not going to have an

issue. are going to lead more -- need more leadership from elsewhere in the market. i think it's going to be technology driving growth, across a number of different sectors. so much, lucyou macdonald. a real pleasure having you with me at westminster and getting your thoughts on all aspects of the market. ask a ceo ifl fiscal uncertainty is hitting his business. that interview comes next. manus: and joined the team on bloomberg radio live on your mobile device on digital radio. this is bloomberg. ♪

>> good morning. this is bloomberg daybreak: europe and here are the top stories. mp's a votepromises on taking a no deal off the table. crosscurrents and conflicting signals. second dayce for a of testimony from jay powell. and bumpy start. american journalists evicted from a hotel housing the north korean leader. .e are live in hanoi

♪ good morning and welcome to "daybreak europe." prime minister theresa may has made a significant step. she is going to continue to get a deal but if she does not, she is going to give mps the option to vote on a delay to brexit. has theprocess -- prospect of a no deal receded? sterling against the euro, jumping to a two year high. a prospect of a delay perhaps until june. let's look at the futures. we had a disruption to u.s. futures earlier due to the cme. futures, really

unchanged. a more aggressive move to the downside. ftse futures down 0.4%. .ax futures down as well if you switch the boards and look at bond markets, the 10 year yield not doing a lot. bond futures in europe shaping up like this. not a lot of movement. bund future's, maybe a little bit of money going into bunds. for the 10 year treasury. let's check in on the markets. juliette saly has more. great to have you with us. we have seen a fair amount of green. .> we have we are focused very much on what is happening in india.

stocks higher, rebounding after we saw the attack on a terror camp in pakistan. now we have heard pakistan has downed indian jets. investor way into sentiment? china closing out what has been a choppy session. elsewhere, there was solid buying. the nikkei up 0.5%. of the other some assets. we are focusing on india, particularly the rupee and indian bonds. as wee seen those fall hear more news of escalations. the rupee down 0.5% against the dollar. a lot of traders are not taking this escalation strongly enough. holdingks it has been

up relatively well. the korean won, has been up for three sessions in a row ahead of the dollar, the second trump kim summit. thank you very much. in the best tradition of tv, the foreign arm has started to bear with me. news from marks & spencer. the deliver service after i leave. biggest piece of news, marks & spencer to correct a right issue and raise up to 600,000 pounds -- million pounds. issuelatable is a rights in retail to do an acquisition like this? that is the confirmation on the retail operations in the u.k.. up to 750 million pounds, a

rights issue of 600 million pounds. it the rights issue i think is interesting. there was speculation this could be the deal. hope the fire alarm was not too hard to hear over that. have you back. hope the fire alarm holds off. let's get to a ceo interview. pretaxve reported profits. a slight beat on estimates. tohas seen a positive start 2019. joining us for his first interview of the day, pete redford, the ceo of taylor wimpey. point to pick up on this you are seeing a positive start to 2019. there were signs of a political drama late last year that might transaction on

volumes. are you not seen that in 2019? >> not so far. sales rates, up 10%. that is a solid start. manus: go ahead. >> i would saying it was a solid start to 2019. on theseeing cuts purchase. manus: we all have to move. you might want to trade up. we all hit that moment in time regardless of politics. england, consumer credit the weakest in four years, are you having to reduce prices? manifested?at data

>> not really in the way you might expect. we are not reducing prices. central london is a different market. prices are very stable. it comes back to your opening comment. underlyingd up demand. slow.condhand market is weightedapproval data toward new bills. they will want to get on with their own lives. as long as their own job is people feel secure in their own particular circumstances, we are seeing them happy to go ahead. there is a prospect of delayed to the brexit deadline. perhaps until june.

does that extend the uncertainty and dampen the prospects for the crucial spring selling season? don't think so. effectively, it starts in mid-january. we are already in it. we can already see how that has begun. of exit,at the impact deal or no deal, there has been a lot of uncertainty. there is an air of caution. fear is thedo disaster horse stories of a note brexit. -- no deal brexit. >> many say it has been

controversial. we understand that they are at a risk of losing their extension. conversationsny with the government? something we should consider? >> we have always had a slightly different view. we have always struck a note of theion going back right to early days. sense and it of may in the future. reasonablyrket is robust, the exit route needs to be thought through. we have an ex -- ineffective exit route. ushave not had any sense for that is under threat. a very good dialogue with

government. timeormous amount of getting it right. the beginning and across the whole business. we feel we are in a good place. how we operate with our customers and in communities. >> i am wondering if you think the house building industry is losing the pr battle over the wider contributions to society support ofdeserves government policy. issue that is stern to get difficult? >> i think there is. if you work with that the industry, you see a different affordablerate housing numbers are up significantly. those are houses we are selling at a significant discount.

we build schools, we improve roads. charitable and as part of the planning process. i don't think we have ever been very good at explaining it. it is a significant part of what we do. it has been the core of what we have done. the charitable works we have done. also, just the community connection. it at helpinglly people to understand it. >> i am living in dubai. where's the best place in the u.k. for me to put my money? in your mind, to get a bargain? which area? >> near where you want to live. -- know where you want to live. you want to do the opposite what everyone else is doing. five years,ooking

it is probably central london. >> there you go. i need to buy the basement flat underneath me. great to have you with us this morning. the ceo of taylor wimpey. breaking news coming through. appetizing is down, 3-4% in the first months of the euronet -- of 2019. debate between traditional advertising and digital advertising. 3% full-year profit will be above estimates. let's see what the ceo has to say a little later on. thel mccall, she takes challenge. she will join us just after

half past seven. nejra: theresa may has promised the u.k. parliament a vote to rule out a no deal exit. it looks to have inverted -- averted mass resignations. is a macro strategist. great to have you with us. cable hit a september hike. sterling hit a two-year high. at what level does sterling gains become cap? it is toward 135, 136 against the dollar. there are two bank scenarios markets are focusing on. we can focus on two things. common is a tory brexit deal.

135-136. you have global headwinds. a weak european economy. we do like is sterling outperforming in the european currency space. in terms of the brexit debate, would you think there is a short-term bounce in sterling? you go back into a new cliff edge. you have a cap on the upside. my downside could reopen. it depends what we think would happen. momentum for a

second referendum, markets will shift toward 50% odds. at 130.cable we think it is a good level. enough room to take no deal risks to the margins. and add abe priced in layer of support to sterling. i think cable can come off its recent highs. >> global macro strategist. staying with us. a week starts to the year, we will get insights into the state of the european economy as they publish a set of policy assessments. the italian budget takes center stage. a special guest. good day.

>> good morning. we know the european economy had a poor bank start to the year. bym happy to say i am joined commissioner don't bresky -- a commissioner. should we be worried about the state of the european economy? the economick at forecast, we see some slowdown. expecting the euro area economy to grow by 3%. growth in allct member states. is expected to continue. positive developments. employment is that record high levels. we expect to the european economy continue to grow.

global trade tensions, slow down in developing economies. there are certain internal factors, a couple of weeks before the supposedly eight. no certainty how it is going to play out. there are certain domestic factors at play. economies, one is germany. the italian economy, are we concerned about that deficit target? is that one of the areas where

progress needs to be made? >> germany, indeed. we see certain slowdowns. also some specific factors which are like nature. the european commission advice demand side. the quiet in terms of the italian a close eye onp it. are you concerned? 28 eu economies, the slowdown has been more pronounced. we expect to 0.2% growth at least in the year. to the economy by

uncertainty on government fiscal now resulted in slower economic growth. interest rates have gone up. it is negatively affecting investment. it is important italy continue responsible fiscal policies. >> the deficit target, still valid? are representing the with to package -- winter package. alsoll come back following when italy will submit the medium-term. >> i have to ask you about brexit. will the u.k. be leaving the

european union? will they have to ask for an extension? all, it is difficult for us to speculate. it is for the u.k. to regulate. it needs to come from the u.k.. you wanted to give the u.k. an extension, what is the purpose? case it is a case of extension. the eu has signaled that kind of extension. maye have an election in that would clash with it. how long should it be? >> it is not for us to speculate

how long it should the. there are different possibilities. european parliament elections in may is a factor. eu codee of the legislators. then we can work based on that. >> i have to ask you about trade. are you concerned we could see them being hyped up to 25%? negotiations on avoiding this scenario. escalation of trade tensions. those still are ongoing. we are pursuing some more. we want to avoid that kind of escalation. >> i thought it was very interesting.

prime minister may wants to make it clear if you want an extension, what purpose does it serve? the eu conceptually open to discussing an extension. let's get a quick cause.

a.m.. 7:25 we are 35 minutes from the start of cash at any trading in europe. let's get back to our guest here with me outside westminster. we heard from jerome powell. patients was the word. priced out the fed? has it gone too far that way?

>> with fx markets, it is nextmarily pricing in the stage. slowing u.s. economy and potentially a rate cut. you couple that with other headwinds we look for, political uncertainty. have a dollar policy, forwhite house pushing stable dollar policies. those factors mean we think it is an inefficient investment vehicle. the only thing is if we get some sort of sustained geopolitical risk. flight to safety in the dollar. >> it has the hallmarks of safety. make sure you join me in the middle east show.

and global strategist. that is it from there and i -- nejrabnd i. market open is next. good morning. ♪ you.

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morning.od i am anna edwards live in westminster alongside matt miller. thehe american saying -- markets saying give peace a chance. indian and pakistani assets falling amongst conflict between the two nations. the cash trade is less than 30 minutes away.