yousef: top stories. flightsoeing grounds after a second fiddle incident involving the aircraft. yousef: the fed chair says rates remain on hold as policymakers watch evolving conditions, particularly in iran. manus: theresa may enters a defining week for brexit, with reports saying she lost the backing from all but two of her cabinet. yousef: oil investors are awaiting reports from the iea and opec. how will the search in libyan output affect prices? ♪

manus: 9:00 a.m. across the emirates. this is bloomberg daybreak middle east. i'm manus cranny in dubai. yousef: i'm yousef gamal el-din. people perished in the latest accident that ethiopian airlines plane went out down -- went down. here's what we know. a pilot reported problems shortly after takeoff. he was cleared to return to the airport, according to the chief executive officer. he dissented twice briefly during the first two and a half minutes after liftoff. the critical speed is talked about, unstable after takeoff, according to a company. about some striking similarities to what happened with the lion air fight --

flight. what we're hearing from authorities, it's too early to draw comparisons or conclusions. we saw the grounding of aircraft. manus: those groundings, from china, all boeing 737 max. until further notice. to put this in context, it has got boeing 11% of the dow jones industrial average. this plane generates about $30 billion in revenue. looking at 250 of these planes delivered last year. this was one of the major tour de force is within the boeing arsenal, taking the stock just shy of a record high and producing $15 billion in cash flow. this will have major consequences for boeing. as the day goes on, we get more information and the consequences for markets. they are there, as well.

tragedy in terms of the death toll on this flight, 157 dying in the latest 737 macs crash for ethiopia. yousef, there is the rest of the world to consider. big world in terms of data, retail sales, etc. yousef: let's check in on global markets. asia stocks going in different directions. 2/5 of 1% higher for the msci pacific index. the dollar is nudging up. a little bit of gains in india. manus: day eight on the drop of a british pound. fitting to secure -- failing to secure significant concessions. sterling down for the eighth date in a row, longest losing streak and 10 months. is she going to the under pressure to resign? these are part of the conjecture we will discuss ahead of the meaningful vote in the united

kingdom. it is brexit devcon two. first word headlines from around the world, annabel julius has the very latest. annabel: we stay on exit and theresa may entering a defining week with reports saying she lost the backing of all but two of her cabinet. they discussed whether she should resign. some say that could help in -- happen this week. bill faces heavy defeat tuesday after her appeal for concessions from the eu fell on deaf ears in brussels. >> we all need to support the prime minister. permission is clear, to get the withdrawal agreement through the meaningful vote on tuesday so we can move on. get onto the withdrawal agreement bill, which offers more opportunities for companies to scrutinize the arrangement, to potentially amend how we do this. and he gives them extra

opportunity. annabel: president trump's expected to deliver his 2020 budget and expected to ask congress for an extra $8.6 billion to help pay for the wall on the border. -- the budget the is the first democrats won control of the house last year. satellite images suggest north korea is preparing a new rocket launch, with increasing activity. south koreans newspaper cites an unidentified government official and says it's similar to past long-range launches. president trump welcome to the north's suspension of nuclear tests and say he would be disappointed if they resume. -- nissanrict court board meeting.

-- made the request through his lawyers. his freedom includes the condition before having contact with certain people connected to his case. global news, 24 hours a day on air and at tictoc on twitter, powered by more than 2,700 journalists and analysts in more than 120 countries. i'm annabel gillis. this is bloomberg. yousef? yousef: our top story, jay powell repeated interest rates can remain on hold as policymakers -- and policy is new in an appropriate place. the fed is looking at growth, job numbers, and inflation as it considers its next move. he said his watching china, europe, and brexit. >> patients means we don't feel any hurry to change interest rate policy. what's happened in the last 90 or so days, we've seen increasing evidence of the global economy slowing down,

although our own economy is continuing to perform well. yousef: his comments come after payrolls came in 20,000 for february, the fewest jobs added in a month since september of 2017. wage gains indicate tightening labor market. the head of debt capital markets at the gulf investment corporation joins us from the line from kuwait city. the strategists we spoken to underscore that the fed's view is better expressed in the rates rather than the fx market. how do you see that particular asset class moving forward, given what we've heard in the last few days from the fed? guest: good morning, yousef. i agree with your statement. i think mr. powell was very clear last week. we had interest in economic data. the change on payroll was weaker

than expected. -- related to the government shutdown. and also, if you look at the average of the last three months, the economy has been able to generate 180,000 jobs per month, which is exactly what we should expect at this point of the economic cycle. earnings were a little bit higher than expected. but overall, the economy in u.s. is growing at a good speed. [indiscernible] more interesting, growing without generating any inflation pressure.

this makes the u.s. treasury market quite interesting. we maintain our longer duration. we think the 10 year u.s. treasury could reach 250 in the next couple of months. manus: good morning. it's manus here. can we just pick up that fame? -- theme? showing perhaps a lack of inflation. we're seeing some pretty big call option trading, very big, bullish trades on the bond market. you say 2.5. how quickly can we get there? guest: it's difficult to set the always,is always, -- as but i think in the next couple of months, we could reach 2.50. in the last three months, we already reached 2.55, so it's

not very far from the lows of the market. and as you said, the older data is saying inflation is not there. therefore, the long end of the curve is one of the better bets of the market at the moment. been a real roller coaster ride from the fed in terms of the shifts and the twists we've had in the last few months. what worries you the most about what you are seeing from the fed? what could be the greatest source of concern? guest: i think the biggest the speed ofill adjustment of the banishment of the fed. they said clearly in december that they will be much more patient than before. we need a confirmation of this. theuse for the bond market,

size of the balance sheet of the fed their is going to be more important than rhetoric on guidance. yousef: hold that thought. we have a lot to talk about. show, chinaon the grounds all domestic boeing 737 max 8 planes after yesterday's it gop and airlines crash, second fatal incident involving the aircraft in five months. what could this mean for boeing? manus: of next, theresa may enters a potentially defining week for breakfast -- brexit, with reports saying she lost support of all but two of her cabinets. what are the possible outcomes? this is bloomberg. ♪

manus: theresa may enters a big week for brexit, with her bill expected to fail. reports her cabinet have turned

against her. she's sent colleagues to meet conservative lawmakers to persuade them to back her. on tuesday, risk a no deal divorce. >> on many, many counts. i would love to be able to vote for it if she gets the ability to pull out. at least then it's rescue hubble. throughout this whole process, been trying to get the primitives are to get this thing rescuable. all into theus situation where delay after delay after delay, i think she forced to go back to the european union. then it will be up to the european union. what they've said is three months. there's no point in having a delay if she's going to run back the clock and come back with the same deal again. >> it's very important we grasp that opportunity because there is went in the sales. if you want to stop brexit, you

only need to do three things. kill the steel, get an extension, and have a second referendum. and within three weeks, those people could have two of those three things. the risk is no brexit at all. that's the current rhetoric. current -- the risk for no brexit is the dominant theme. what do you make of that? becoming's definitely more of a chance. but it is becoming an option. because it looks like theresa may steel is going to be rejected. the question is now, the next about, they agreed to avoid a no deal. we're not sure how anyone is going to vote on that. theresa may is being encouraged

by a former secretary to encourage people to vote. we will have a no deal option. many options across the tail -- table. , and ofnd of the day this week, we might have no clarity at all. how much of the moves in cable is a function of stories or developments outside the uk's control what's happening in europe or what's happening across the atlantic in the u.s.? guest: there's some impact about the ecb's decision on global growth. that was not a positive for the euro. whatever the fed says, we had fed chair powell say they were maintain a patient approach. that's two sides of the equation. those do impact, but the near-term weight is really on the sterling side, and that

comes back to brexit and how it plays out. the market really doesn't know how it's going to play out. there's no guarantee tomorrow's vote even goes ahead. there's expectation she may cancel the vote. a lot of uncertainty, no surprise, as a result, high volatility across the curve. manus: thank you very much, david finnerty in singapore with the latest. still with us is the head of debt capital markets at gulf investment corporation. there's an interesting article in the telegraph. 44% of the public now believe the u.k. should leave the eu with no further concessions. so we are seeing this shift in terms of tolerance from the public in regards to the situation. what is the worst-case scenario, in your opinion, as we go to a meaningful vote?

the risk, in my view, is that we, i think that there are a couple of scenarios here. what i expect is that tomorrow the vote will reject maze proposal -- may's proposal and it will likely reject leaving the eu without a deal, forcing the prime minister to go back to brussels and try to negotiate something different. negotiate an extension of article 50. scenario is that mps try to reach an agreement [indiscernible] the u.k. will remain in the

union, which is actually what rock scissors don't -- brexiteers don't want. maybe at the end of the month, we can have another vote, and this time it's going to be more positive. or the alternative is a new election. that's the worst case scenario, in my view. yousef: we also have a dovish thought from the ecb, and that caught a lot of traders and investors offguard. you look at the net short speculative decisions, the largest since december 2016 on the euro. that's what hedge funds are doing. what are you penciling in than for the currency and for the ecb? ecb, i think the latest announcement is the recognition of the slowdown in the second half of last year.

something in do order to support the economy, not only in the periphery, but also in the core europe. it is essentially lower rates for longer. they will postpone any adjustment on interest rates [indiscernible] the second half of 2020. the net -- expectation for the market is negative for banks. this is going to have any pattern there because it will be a much flatter yield curve for longer. and obviously for the euro, dollar. weakening the in our view, the dollar is set to remain strong, not only against the euro, but also against all the other currencies, not only because the

the monetary adjustment, but because all the major economies veryentral banks are in a acrimonious stands at the moment. the euro, lower euro against the dollar means lower expectation going forward. yousef: thank you very much. it's been great catching up. bertoni, head of gulf investment corporation. they do everything from short-term agriculture and disability insurance, coming in with fiscal year adjustment headline earnings at 11.5 billion rand versus 12.9 billion rand this year on year. the final dividend is going to be $.72 per share, net asset value of 18.6%. the i frs profit after tax,

that's a big beat, versus 32.4 billion randy year on year. stock is down 3% this year. manus: up next, china orders domestic airlines to ground all boeing 737 8 jets after a fatal crash in ethiopia. we discuss. this is bloomberg. ♪

manus: in south africa, $10 billion market cap. it has actually missed -- the market was penciling in 19.284. talking about the credit loss ratio, likely to increase from a fairly low basis. this is what they are giving to us. the core equity will remain above the board target. talking about costs, well-controlled, targeting positive operating jobs, good

old financial job simply. let's see how asset trades through that on that miss on the earnings-per-share. to one of our top short -- top stories, if european airlines grounded the flights of boeing 737 planes after a crash that killed 157 people on board yesterday. that is just months after a disaster in indonesia involving the same type of plane. china has grounded all 737 jets. they asked boeing for more information. let's get to stephen engle. this is the second tragedy in five months. details but't have we have printed action taken by the chinese and ethiopians. stephen: that's right. reaction to this really starting in this part of the world with china, civil aviation administration of china announcing that it is grounding, 737orarily, all of the 96

max 8's in operation in china. keep in mind, of this model, 20% of them have been sold to china and many more are on order, to leasing companies as well as the big airlines. we're also getting a headline in the last hour, china eastern, this a quarter to -- according to the magazine. janet east is requesting safety promises on the boeing 737 max 8. we don't know who they are -- are requesting that of. if european airlines also five 737 its fleet of 8 maxes until further notice. number of other airlines waiting in. southwest airlines in the united states is the biggest customer, globally, obviously in the united states. they say we remain confident. they have a fleet of over 750 boeing aircraft and have 34

max-8 aircraft on property. iceland air says they take about 1000 trips a day worldwide. the airline has three of the aircraft and has never had an incident. obviously, we can't go without mentioning the human toll here, 157 people on board that ethiopian air flight that crashed, as you said, the second crash of this model, a brand-new aircraft that came into service november 15. so the only real parallel that we can really safely say right now, that line air crash on october 29 of last year, they were both brand-new aircraft and the accident happened within the first few minutes of take off. yousef: thank you very much for giving us the latest run-up of developments. our chief asia correspondent stephen engle. here's what is coming up on the program as we keep a close eye

on what is happening with the plane crash. we look at stocks at this part of the world, erased gains for 2019. why are we seeing this downtrend? we discussed that. this is bloomberg. ♪

manus: it has just gone 1:30 a.m. in new york. clocks havee shifted a little bit. ng on the1% weighti dow jones industrial average. that will bring weight to the tragedy from the ethiopian airlines. the fleet has been grounded. the dollar -- goldman sachs was wrong. the dollar but they

got stopped short. they have a reappraisal. short the dollar and long the yen. china is pushing back in terms of what happens with the trade discussions. that us check your first word headlines. annabel gillis is in hong kong. powell: fed chairman jay has repeated that interest rates can remain on hold as policymakers watch evolving economic conditions. he told cbs that inflation is muted and the -- is an appropriate place. he reiterated his patience mantra. watchingaid he is china, europe, and brexit. >> patient means we do not feel any hurry to change our interest-rate policy. last 90happened in the or so days is we have seen

increasing evidence of the global economy slowing down though our own a economy has continued to perform well. annabel: president trump is expected to present his 2020 budget on monday and is expected to ask congress for an extra $8.6 billion to help pay for the wall a long the mexico-u.s. border. this expects the economy to grow quickly. sinces the first budget democrats have taken over control of the house. the final result will be known in late may. around 900 million people are eligible. seenprime minister modi winning the most seats but short and overall majority. supportment has lost over concern regarding the economy and jobs. north korea has voted in a largely symbolic election -- seen as an endorsement of the

current regime. voters were offered a single candidate per seat. un is the most common it candidate. he is seeking reelection in his pyongyang district. global news 24 hours a day on air and on tictoc on twitter powered by more than 2700 journalists and analysts in over 120 countries. i am annabel gillis and this is bloomberg. checking the markets now come here is juliette saly in singapore. >> speaking of elections, the election in india announced today. that has indian stocks and the rupee up. up 0.9%. we did have a couple of sessions of stocks tracking sidewise -- sideways in india. the aussie dollar also coming under pressure after the slowing chinese credit data. the cfi 300 up--

by 1.3%. it did fall by 4% in the big downturn on friday. when we look at downturns, we are still seeing quite a wait list -- weakness in commodities. iron ore off by 2%. steel off by 1.4%. mixed data over the weekend with ppi, cpi and the slowing credit growth figures. manus: keep an eye on the aussie dollar. you know the risks with a credit card. let us keep an eye on the most -- on the more serious issue with the airline stocks. we will see what happens later in the day with but waiting in the wake of the easy the -- ethiopian crash. how is that manifesting in the markets? it the you look bloomberg airlines here on the asia-pacific, it is holding up well, a gain of 1%.

so much is coming through with china saying it is going to maxnd its boeing 737 planes. let us have a look at some of the stocks in particular. you have seen china southern airlines coming under pressure. down by 0-7 percent, one of the worst performers. it has several of these points. air china doing ok with 14 of these aircraft. singapore airlines is virtually unchanged although so far it has not said it is going to ground its planes. it says that silk air will continue as scheduled for now but they say they are closely watching the investigation into this deadly and of course very devastating crash. yousef: thank you for the update. let us stick to the markets in the middle east. erasedbi's main index

gains for the year. a multi-day losing streak, the biggest since may 2017. it is not only a story of weakening oil prices. >> we have to talk about large caps. this has been a stock that has been delivering a lot in terms of delivering to investors. if you look at the stock by itself. forre seeing the recovery the year for this market. some people are saying that this is just not the end yet because we are talking about almost 40% of the index. it will have more room to drop further. that is because it is trading quite extensively. and we may not see many capitalists on the radar as they were before especially when it comes to the fundamentals. manus: my offshore pension fund is stuck there. yousef: i am not sure about you.

manus: talk to me about gutter. -- qatar. it was the darling of 2018. if mark barton were here, he would be singing to the church. >> an interesting market to look at right now. -- it was the best market in 2018. it attracted a lot of positive headlines. right now though, we are seeing a correction. mostly driven by large caps in doha. ,f we look at the weekly index looking at the index on a weekly basis, it is about to cross the 15 day moving average. the last two times this happened, the index declined 11% in the following 20 sessions. there could be more losses to come but we are talking about an index that rose around 25% last year.

which was a very tough here for emerging markets in general. there is a correction to take place there. yousef: there was a downgrade from hsbc. that will weigh on sentiment today. >> it could. and a stock that is up 8% on top of 20% in 2018. very good market when you look at at economist. there is a catalyst that a lot of people say they believe kuwait will be added to the emerging markets group by msci later this year. mbk is key in the emerging markets that many investors are saying that it is trading quite extensively at the highest level since 2008. hsbc is recommending that we if weroom by -- brumbai

see other houses moving in the same way. stay with the region. investors are starting to worry that the world of emerging-market bonds is starting to overheat. federal reserve is a dovish about a trade deal with china and the u.s. a record on a year-to-date basis. after a selloff last year, yields on emerging-market dollar bonds globally have fallen to the lowest level since may according to the bloomberg index. breaking down the implications. we are with alberto bigley. he is with -- alberto bigolin n from exotix. looking at the spreads now come and it is becoming more difficult to make that argument. alberto: i am more of a visual person. what i do is look at the gcc normalized chart.

i look at the last 12 months. if you look at the last months, gcc is tightening. the tightening is happening in the last couple of months, since the beginning of the year. if you look at the two best performers in the region, oman and bahrain, they have tightened since the beginning of the year. months show that bahrain has tightened 12 basis points. oman has widened. yields six months forward, trying to overlap with the amount. i am not -- trying to overlap with oman. there are balances in each country. manus: this is one of the charts that we put together. oman versus bahrain. bahraintanley favors

over oman despite the downgrade. that spread we are looking at their -- you say it will not cross over. will it widen? alberto: i am not suggesting that oman will experience the same v-shaped recovery that bahrain did. bahrain's recovery was triggered by an external intervention. oman is in a different place. it is not in as critical a situation. the gdp ratio is 10% larger than five years ago. .till off from bahrain's the fiscal deficit is less than 10%. i think all of this data tells us that and external intervention is not justified. the second reason is that historically oman has been less politically aligned than the other members of the gcc.

less -- direct intervention is less likely. the spread differential is becoming more overwhelming. alberto, look at who has been coming to market. it has been a busy few months. the likes of egypt, saudi arabia, and qatar and qatar came in with large issuances. will we see the same activity given the global dynamics? alberto: there will be much more supply in the market. in the region alone there is 60 billion fiscal deficit that will need to be refinanced in 2019. we see qatar and saudi arabia coming to market with sizable issues but i believe there is

still more to go. one of the drivers would be supplied. the supply risk is there, i believe. manus: alberto, thank you so much. the qataris came up large. from you, alberto bigolin exotix partners. group in the middle east by 11% in 2017 to $3.8 trillion to --.ng we speak to christine no vukovich head of wealth management from ubs. that is next. this is bloomberg. ♪

wealth in the middle east group in 2017. 3.8 trillion dollars according to the data from boston

consulting group. ubs is looking to capitalize on doubling the size of its business here in dubai. we are joined by christine novakovic. welcome to the show. christine: thank you so much. manus: a big target. how much are you going to grow? ubs has are ready been in the region for over 46 years. to go to your question -- we have expanded and doubled the size of our office. when we look at what is happening in wealth management, i think we are going to do something similar to what we did last year. we are out there hiring advisors, managers. and is our core business one of the regions that we really love. we have in here for so many years, we have had the pleasure and the honor of following many generations for several -- many

families for several generations. we know them well and are committed to the region. tosef: let us add some color where you are seeing the most exciting growth coming from. is it with the wealthy families from dubai? or some of the big names from saudi arabia? how would you rank them? christine: we see it across all of the gcc countries. different in size and different dynamics but i would not really say one bigger than the other. they all have a different history and a different dynamic. we see growth everywhere, to be honest. and we are trying to support and we also have different approaches in each of the countries. manus: can i ask you about the flow of money? we have investors wanting to ship out their money post jamal khashoggi. a flow of money out of saudi arabia from the

finally's that you talk to -- from the families that you talk to or status quo? christine: more status quo. a little changed but not a total change in approach to be honest. pop-up but not more than that. when we look at investors though, more are starting to invest in this region which i think is a great thing. ar the rest, it it was pop up little bit but no fundamental change in their approach. yousef: what is the biggest risk that your clients are worried about and makes them less willing to deploy additional capital? is it the volatility we are seeing in global asset classes? christine: that is the fundamental thing. and not only here in this region but globally. with volatility, people get nervous and insecure and do not know how to invest.

at the moment, it is that but that is driven mainly by economic or political uncertainty that we see and that might be a little different than in europe. it is uncertainty and volatility the different behavior in investing from our side. christmas,t before there was headlined after headline. we are not at the end of the third month. you must be able to tell us about client activity -- is it getting more pro-risk? christmas,before clients were nervous because markets were only going in one direction. markets came down and still the activity by the clients was not what it was before. they were nervous about what happened. but clients began to think about

how to get back into the markets. and are starting to hedge their investments more than they did. yousef: let us get your input on some of the global market seen. brexit. how are you dealing with this uncertainty? we see developments day today. i'll -- day to day. christine: when brexit came up, we look at it from the client perspective. moreve decided for a decentralized approach. what we are doing is they have not chosen one city where we will put all of the people from london into the eu. we are going for a decentralized approach. those covering french clients go to paris. those covering spanish clients go to mitch redd. -- go to madrid. as disruptivee it

as possible for the clients. manus: from the client side -- there is a property aspect. investors lovec a little bit of parklane. are you seeing any more preparatory work in the height of this turmoil? christine: there is still some requests but it has slowed down. prices are also coming down. london is still going to be an important place to be. don't forget, in this region, investors love to have trophy assets. having a nice hotel somewhere in london or in paris or having one of these trophy buildings, it is still one of the things that people from this area are after. yousef: a wonderful opportunity. joininge, thank you for us and giving us those insights.

christine novakovic, head of wealth management from ubs. on trackrude output is for a six-year high. what should investors be looking out for in the coming days? this is bloomberg. ♪

yousef: breaking news. from saudi. are seeing thebb transaction to be completed during the first half in reference to an intention to go ahead with the merger with another bank. a stock that has seen a 20% -- a 26% gain. this is an industry seeing tectonic shifts. -u are looking at the sabb alawwal merger. sabbsts mostly positive on

but the line coming through is they have a firm intention to go ahead with the merger. let us talk about libya's crude oil output which is on track to hit an almost six-year high. the opec member is expected to pump almost 1.6 billion barrels in march. oil prices remain a touch firmer. monthly market survey. anthony to paolo joins us now. -- us start off with the in with the developments in libya. it has scope and size to really affect what is happening with pricing. >> a couple hundred thousand barrels here and there is enough to affect the market. setting -- sitting stable where we have been so far this month. investors are looking at the economy and looking at supply to

see if there is an impetus to go lower or higher. libya is up and down as there are issues around security and around the groups taking over fields and the impact on production there. they have been under their potential for a long time now so this could be them getting back into the market. thatis one of those things the opec members are going to have to be watching when they evaluate their plan to cut production. whether they decide to extend that plan for the second half of the year. libya is not part of that plan to cut so they do not have a target but anymore oil that goes on to the market is more oil that opec will have to deal with. the saudi's have cut more than their fair share so they will be looking at balancing the market out and the increases. manus: this takes us to the comments about the cuts in april. and we may see some in june. the market remains long in

cutting short positions. >> that shows more investment, -- investor confidence. there were some gains in the price in february. opec cuts -- we saw them buy in. thecontinued comments from saudi's about their production going lower and lower. 9.8 is january and now what they are talking about for march. and for april. keeping the exports stable. not add intohey do the amount of oil in storage on the market. yousef: we are keeping a close eye on the aviation tragedy that has taken place in ethiopia with the ethiopian aircraft. boeing 737 max-b distending briefly twice in the first few minutes after liftoff but ultimately killing all 157 people on board. manus: we are waiting to hear

more details. the second incident in five months. unfortunately, we have to put that ramification into the markets. 11% down. waiting to hear from boeing. full coverage here on bloomberg. ♪

>> good morning from bloomberg's european headquarters in the city of london. with dennis cranny live from dubai. here are today's top stories. grounded, china and ethiopian airlines suspend all boeing 737 max-b after the second fatal incident involving the aircraft in five months. the fed chair he is in no hurry to raise rates. watching economic conditions at home and abroad. and deal or no deal? theresa may is working on her plan. britain leaves the block in eight days. ♪

nejra: -- manus: welcome to daybreak europe. the main story is of course the tragic incident involving ethiopian airlines. the downing of that jet. the secondboeing -- boeing 737 max-b going down in a matter of months. china has grounded its domestic fleet as has ethiopian airlines. the stock price -- unfortunately, it does get turned into pounds and dollars. this particular boeing plane -- 11% of the is dow jones industrial average. 250 planes were delivered last year. the plane has sold out until 2023 and the stock is at a

record high. as we cover this story throughout the day from the tragedy to the reality of what it means -- the loss of life through to the ramifications for boeing. we will have that covered here on the show. having a small moment of reprieve after three weeks of declines. libyan production is down 0.3%. -- lift to lift its itself up after a three-week decline. nejra, good morning. nejra: you showed dow futures down largely on the boeing story. five days of declines for the s&p 500. week for the worst global equities since mid-december. data globally is concerned about global growth. are we heading a trough in the data and will it get better in the second half? a question that the markets have to ask themselves.

mentioning the dow jones industrial, the transportation index has 11 consecutive days of decline. the worst run in 40 seven years. is that a harbinger of future doom? the 10 year yield dropped every day last week. dropping 10 basis points. edging up today. jay powell on friday still seeing "patient." and cable is hitting -- is taking a hit. theresa may did not get significant concessions from the eu. will she be able to get her deal through parliament? and reports that her very position could be at risk. juliette saly is in singapore with more. good to see you. >> a little bit better than what we had seen earlier or what we had seen at the end of last week when we saw that big downturn coming through in chinese stocks.

remember, it fell 4% on friday. we did see chinese credit growth slowing over the weekend related to the australian market. the kiwi market and the currencies as well. it is worth noting that india has had a good session because we finally got the announcement on when the indian election dates. the nikkei closing out the session firmer by 0.5%. looking at stocks -- we have been watching and following after the deadly plane crash in ethiopia. china is under pressure but overall the asian pact airline index is tracking higher. with china on the front saying they would ground all of their boeing 737 max-b planes. 37 of them are on order. singapore airlines will continue with its silk air route flying nowboeing 737 max-b's for

though it is keeping on top of the probe. 26% after rising saying it would get more involved in the pharmaceutical index in shenzhen. manus: juliette saly in singapore, thank you for the market story. china has grounded its fleet of boeing 737 max-b jets following the ethiopian crash tilling all when a to 57 people on board yesterday and just months after an earlier disaster in indonesia involving the same model. putting the spotlight back on boeing. stephen engle is tracking the story for us. the very latest on these groundings. momentum is building. where are we in terms of the moment? en: not the spotlight that boeing wanted on its workhorse

in the aviation industry. -8 and we areax hearing today from the civil aviation industry of china saying they have put a temporary grounding of all 96 of the boeing 737 max-b in service in china. many more on order from china. 20% of the order and delivery book of that model for boeing. a significant size. china has ordered a temporary grounding until they get assurances that the aircraft is safe. china eastern also seeking assurances that the aircraft is safe. ethiopian airlines also grounding today it's entire fleet. it had five. it now has four and 30 on order. another 25 on the way for ethiopian airlines. some other airlines in the

region watching the situation very closely. not issuing bans yet other than the cayman airlines which has two in-service which have also been grounded. the 10th time that boeing commercial aircraft -- they are trying to figure out what to do and how this happened. aircraftese brand-new in operation now. do not have the facts of what caused the incident but in the meantime, how damaging is this for boeing? damaging extremely potentially for boeing. the013, we covered dreamliner fiasco with the batteries. this is taking a more sinister tone because of the deaths. two very puzzling crashes.

we do know the circumstances around the lion air crash involving the sensors that were malfunctioning causing new put the plane into several dives that the pilot had to control. to control a false reading on stalling. lion air did not get the directive to the pilot on how to correct that or turn off the system. pilots worldwide should've gotten that directive. that is why we cannot draw the line and say this accident in ethiopia was caused by that. potentially, this is very damaging to boeing if more airlines and aviation authorities around the world do ground the airline. this is a $30 billion annual revenue program. one third of boeing commercial aircraft operating profit.

57. they were going to ramp up operation to 57 per month. it will be interesting to see the boeing shares when they open. manus: thank you very much, stephen engle with the latest from the ethiopian airline disaster. breaking news -- we need to bring this to our viewers. tesla. it was the story last week about the closure of stores and going online. tesla has closed half of its stores that it had previously announced. raising prices by 3% worldwide. this is a very latest clarity. they will keep significantly more stores open then were originally announced. they will only close half of many -- half as many stores. let us talk about the word much ." d -- "patient

it is a watchword for the fed chairman, jay powell and he said interest rates can remain on hold as policymakers watch evolving economic situations. he thinks policy is in an appropriate place. means that we do not feel any hurry to change our interest-rate policy. 90t has happened in the last or so days is we have seen increasing evidence of the global economy slowing down although our own economy has continued to perform well. manus: joining us now is called brain from noon. newton. this is very much an american platform. the patient message. what i found interesting was that the current rate is roughly neutral. we need to readjust our perception of neutral rates in the u.s. l: the fed has been telling

us that the neutral is higher than where we are now but they have changed their mind given the global backdrop. the u.s. economy is doing well. good and bad data coming through. we are late into the cycle. the fed seems to want to suggest ont they will stay -- sit their hands until the global economy moves one way or the other. look at the you curve, the market is already there. suggesting the market will not do something quite yet. the next move could be slightly down rather than slightly up. nejra: do you expect things to get worse before they get better? paul: they will deteriorate. we are not looking for a recession. we are looking at growth to gradually slow. the investment cycle is key and that is what should be slowing

as we go through the balance of the year. companies have borrowed heavily to give money back to investors. without investing. profits have been good. squeezed, the cycle will slow. manus: it is going to be that capex andween dividends. we are taking the full rate. zero. just kissing the the last time we went negative, we had the powell pause. does this build the case for a substantial pause or more movement -- a rate cut sooner than the market might think? aul: i think it is unusual to see such a flat yield curve.

even after 10 years, it is a fairly flat yield curve. you might normally expect some positive bias. it is suggesting that the market is looking for the next move to be down rather than up. they are not suggesting that it will happen right now or in the next six months it as you move into 2020, more likely the fed will cut rates as we get into that phase. a rare environment. it is more about the general liquidity, uncertainty, the uncertainty about global growth and trade. that whole story gives enough impetus for the safe haven assets to do quite well. creating the flat yield curve. nejra: what does that mean for inflation? are you in the same camp as blackrock and others? paul: we are at the moment. we have been writing them for the last six months.

as you get closer to the 2% level on breakevens, we start to exit again because you do not see inflation expectations moving much above 2% in the next couple of years. if that is the case, you do not need a breakeven rate above 2%. that is where we are looking to take profits. we have been there and enjoyed that and we are looking to reduce exposure now. manus: those breakevens are moving higher. we will see what happens with that cpi over the next few days. newton fixed income at stays with us. annabel: china has ordered to ground all of the boeing 737 after a crash in ethiopia yesterday that killed all 157 people on board.

the chinese airlines have until 6:00 p.m. local time to cease using the jets in operation. the best-selling boeing was the same involved in a fatal crash off of the coast of malaysia in october. u.k. cabinet members have called for last-minute concessions by the eu so theresa may can get her brexit deal through parliament this week. -- ministersarned have warned that there is a danger that brexit will be stalled altogether. he called for one last heave from negotiators. >> in the event that we can get the changes that parliament wants, parliament will be given an opportunity to thwart the deal. that is why the government is absolutely 100% determined to seek the changes that parliament wants to see. annabel: president trump is

expected to present his 2020 budget later today. despite deep spending cuts, the proposal will see the budget deficit continue for 15 years. expected to ask congress for an additional $8.6 billion to pay for the butterball. rejectionaces certain from the house democrats who now control the house. global news 24 hours a day on air and on tictoc on twitter powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. thank you. today, we are asking the question on mliv. you can join the debate and reach out to us and the team. manus and i are awaiting your responses. manus: waiting with bated breath. --be that was last week maybe that is retrospective. there is the lady herself.

she is resilient and nothing else. a big week for brexit. devcon junior? junior?n theresa may has another chance. does it have any chance for passing? that is up next. radio is available for you on your mobile device in the london area. this is bloomberg. ♪

nejra: this is bloomberg daybreak: europe, i am in london. manus: i am manus cranny in dubai. a quick snapshot of the markets. msci asia-pacific, after its

worth day since christmas on friday has a reprieve. goldman sachs was wrong. they wanted to short the dollar. they were stopped. the dow futures -- impacted. weighted on the dow. consequences of the tragedy that thea fallen -- befallen airline. nejra: dow futures taking the heat. cable futures. what is going to happen this week? volatility has been rising. euro stoxx 50 higher. had their worst week since mid-december but it looks like we could get a higher opening in europe with oil on the front foot and hedge funds betting on that oil rally.

let us get the bloomberg business flash. here is annabel in hong kong. annabel: several automakers planning to create a single board to oversee their alliance. the new structure well replace two separate entities. helpskely reorganization the carmakers streamline their decision-making following the arrest of carlos ghosn. assing half of many stories previously announced according to tesla. after evaluating retail locations, it will raise vehicle prices by 3% on average worldwide. tesla boss, elon musk, faces a decision deadline later today to be -- to say why he should not be held responsible.

recent statements on twitter that the commission says violated earlier settlements prompted by his "taking tesla private" t -- tweets. manus: lines coming through from fly dubai. with regard to the boeing 737 max-b. they are the second-biggest order maker with boeing. look at that. southwestern and fly dubai are orders with boeing. fly dubai says it continues to be in touch with boeing on the 737. from thehe news in various companies that have ordered these. to this week, the prime minister is going to have another go at getting her deal through parliament which could reverse

the record defeat back in january. what is next for brexit? we had the timeline on what could happen in the coming days and weeks. danny, good morning. >> under theresa may's current plan, lawmakers will be given a meaningful vote tomorrow. the idea of this is to overturn to house of commons record feed to other prime minister's deal in january. if the government wins tomorrow's vote, the u.k. is expected to have an orderly exit from the block which should be more or less on time. if tomorrow is another disaster for mrs. may, it is likely the members of parliament will vote on wednesday and they will vote to remove the possibility of a note deal. and labor will propose a vote on the second referendum and that should be either tomorrow or wednesday. will the vote go to a great of the government needs to ask the

eu for an extension? it is likely but not inevitable. we will have to wait until the 21st or 22nd of march when a final deal or a delay will be signed off by the eu 27. nejra: let us stick with brexit and the possible outcome for the pound. a one month low. paul brain is still with us. i have a chart. get either of these outcomes come a deal signed off a a delay, i know you're not traitor, but would it be a reasonable traitor to buy on the weakness and hold for the rally? paul: it makes eminent sense. ng in a week or two. you have a chance to make money

on the trade. and a chance for volatility to come through and make money on that. we personally want to stay on the fence for a while longer. it could go either way. the slight belief that the market has or what was driving the market a few weeks ago was the idea that the outcome will not be as bad as a no deal or a hard brexit. there are alternatives. either may's deal or a delay. i am not sure that it will be that positive. it will continue to raise debates. and it will go on and on. i would not be wanting to commit to much capital but if you are a traitor, it is not a bad idea. manus: there is one line that they may vote for a delay. what price might the eu want to extract from the u.k. to give them that delay? paul brain will stay with us.

cable is lower. 129.88. eurosterling, 86.53. we are going to talk about china and if the new consensus is on the trade talks. ♪ .

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nejra: asian stocks recovering index, you are seeing games and a bit of a mixed picture. australian in the red. bad week for global growth last week and we saw forward, a lot to look to in terms of economic data and a trade discussion. actually, the covering of the latest from the mpc. when it comes to putting a floor un