seeing earlier in the year. this is theresa may granted another lifeline. futures are shaping up. dax futures are up, .3% in france. just ahead of the market open, it is 8:00 here in the city of london. the ftse will be in focus as theresa may is granted another lifeline, a short time to get this deal through parliament. is the third time the charm? anna edwards is in brussels bring us all the drama. spain opening higher. interested to see how the italian market opens as xi jinping heads to rome to bring italy into the belt and road initiative. it is very interesting to see what is actually said and what gets signed in the italian capital today. let's look at how sectors are shaping up. relatively green across the map. one thing i am particularly interested in is financials.

of deutscheort out bank saying 2000 might in revenue should be higher than 2018, slightly. a growingre joining chorus of investment banks warning about volatility. credit suisse is out with their compensation report. relatively, we're seeing agreed on the screen. health care to the downside, energy slightly softer. individual movers, what are you looking at? he is getting a 30% raise, shares were down 40% during the year. meanwhile, deutsche bank's board is getting a bonus and paying a dividend after shares drop the 6% last year, i love the stories. almost four-one, gainers to losers, so it is positive. 449 up, 137 down.

you got tech stocks taking the all adding points to the stoxx 600. i should not fail to mention louis vuitton since i got annmarie here. ringry stocks, caring -- ka also doing well. -- kering also doing well. doing poorly, including bp and hotel. you have got pharmaceuticals and oil stocks dragging on the stoxx 600, although it is generally higher this morning. european markets are opening up with the exception of the ftse, and we saw that play through in the futures picture as well, and -- anna. absolutely, this market

opening up, digesting the latest headlines from brussels. eu leaders have agreed to give theresa may extra weeks to work out what to do with brexit. they said that if lawmakers do not endorse or deal, she will have until april 12 to decide whether to leave with no deal or saystend, something she she doesn't want to do. joining us on set, head of credit at hermes investment management. let's start with u.k. assets, good to have you with us. i try to write a list of all of the possible outcomes that could come to pass, i soon ran out of paper. let's go with a few of you can tell me what you think. do think she will get her deal through, or will she fail? and if she fails, will she stay? we have to work through those concepts before we can work out where we had next. >> i agree there are more potential outcomes then you have

pieces of paper? -- than pieces of paper. the date has continued to be pushed out, and while it remains unlikely deal gets passed next week, the idea that there is further with room to look at some potential other scenarios and build more consensus in parliament is what the market is taking comfort from, whether it is sterling or broader risk assets. how does this affect long-term british growth? are you concerned about uncertainty as the starts to look more and more of a european case kicking the can -- of kicking the can? this is ally, negative for long-term growth. you can see that coming through in data in regards to business in spending and long-term growth lands -- plans.

that is mostly an equity story, ,ut from a credit perspective the model through is rarely a bad thing. what we are seeing is near-term volatility of being suppressed, any potential trade is further out and is not particularly relevant from a near-term credit perspective. fraser, let me ask you about exposure to u.k. assets. my colleagues were talking to ubs earlier, reminded that the u.k. economy is only 2.5% of global gdp. if you don't have a mandate that you have to have u.k. exposure, would you choose to? fraser: that is an important point, and not just relevant for the u.k.. it is remembering we are at a time when there's so much uncertainty across the world and one of the smartest things you can do is to leverage the fact it is a global world.

the u.k. is a small part, but a much bigger part in financial terms. there are opportunities we see in accessing sterling denominated assets of companies that are not necessarily exposed to the u.k. economy. that would be one way, to the extent you have a global mandate , but are not willing to put forward a particularly positive you on the u.k. economy -- view on the u.k. economy. mandates, we have been asked closing ourselves to a brexit premium, but not overly to the u.k. economy. matt: thanks very much, you will stick with us. fraser from hermes investment management. we bring you stocks on the move so far. deutsche bank seems to be doing pretty well here in frankfurt. as it sees than 2%

2019 revenue coming in slightly higher of them yes year -- the than last year. this is bloomberg. ♪

anna: back into the european

open, 10 minutes into your trading day. many of these markets are getting a boost, but the ftse 100 under pressure a little bit. a little bit of strength returning for the weakness some of these oil sectors. let's get to the top individual stock stories. today.e: rpc is sinking buy pe fund had offered to rpc and it is saying its final share price is the one that is announced. it is saying it reserves the right to increase the price if a third bidder does not materialize, but it does not seem like that will be happening. that is taking some wind out of the shares. adidas also rallying. nike had weak results, especially in north america. there seems to be optimism that perhaps adidas can get back some of the share it lost to nike.

finally, deutsche bank one of the big movers, up more than 2%. one of its key figures is that 2019 looks stronger than 2018. though a bit of pessimism is frank throughout, but i know you guys want to talk about deutsche bank some more. back to you. ,att: thanks very much for that we are going to get deeper into deutsche. the german lender is promising to end years of revenue and the client, but the bank says -- decline, but the bank says it relies on solid economic growth, joining other banks warning of a difficult start to 2019. joining us is bloomberg's a german banks reporter. what is the outlook here for deutsche bank? >> as you said, they are giving a positive for your outlook -- full-year outlook.

almost all analysts think it is not going to happen. for them to say it is really good is helping the share price, that is an optimistic assumption. it is dependent on solid macroeconomics and global growth, and if that -- and that is questionable, i think. anna: good morning to you, steve. all of this in the context of m and a, what about the news on bonuses? on andmerger debate is the bonuses show that deutsche bank is trying to strike a very delicate balance between the need to cut costs on the one side and the need to retain talent on the other. if they want to grow revenue, they will need revenue earners. deutsche bank has long had a problem because it attracts negative headlines, people are not very happy there, so it has a problem keeping people.

the reduction is clearly in line with previous reporting we've had. i think it shows how deutsche bank is trying to strike that balance. matt: stephen, thank you very much, bloomberg's german banks reporter in frankfurt. fraser from hermes is still with us. deutsche bank is saying revenue can rise, but it relies on solid global growth. what is your view on the global economy? it does not look like it is going to happen. fraser: [laughter] certainly, there are a lot of caveats in that report. it is difficult to be high conviction about the economy, given how many potential catalysts there are. but it is not a terrible situation. in fact, not a million miles away from a goldilocks situation.

as a credit investor, you are looking at low growth, absolutely, but also low inflation and accommodating central banks. for a lot of the market, not necessarily all, but for a lot of that is ok. we are quite constructive. anna: let me ask you about the banking sector. you can give us the credit perspective. a long list of headwinds for the european banking sector, not least of which the low rate environment you just talked about and challenges to the growth story. what about the things we are hearing from the banks over the recent days and weakness in the fourth quarter -- first quarter? how bad does it get? fraser: i don't think it gets bad, i think it is just disappointed. ,e talked earlier about brexit there is a lot of uncertainty which makes deploying long-term business plans difficult.

here,is also a psychology we are 10, 11 years into an expansion. people do not want to be responsible for being over year in terms of aggressive growth. it will become a more and more difficult at this late stage in the cycle for us to go above trend growth. while inflation remains subdued and the central banks are so things are moving along, but i would not expect major surprises. matt: one of the great cliches thrown around concerning the possibility of deutsche bank is that to turkey's don't make any make antwo turkeys dont eagle. but they are really pushing for this acquisition. does it make sense to you for

deutsche to buy commerzbank? fraser: i love the phrase. it definitely encapsulates some of the execution risks they will face. the deal has been talked about for years. it has now gotten to the point where it is more likely than not to happen in some say perform -- shape or form. it is a defensive move, i think it's fair to say. are these two institutions going to create a national champion? not anytime soon, and there are a lot of hard yards to get through to justify this. but it needs to happen and needs to happen to dudley to the investment bank's influence on the story. to ensureds to happen a scalable answer for the german economy in terms of the funding required over the coming years. it is not without risk, but at

this point, it is necessary. anna: take you very much. hermes investment management stays with us. pmi falls to 48.7, well below the forecast of 50.6 and well into construction territory -- contraction territory. yellow vests taking its toll once again. another point to watch on the european growth story. coming up, hailing an ipo. nyselk uber's pick of the in what could be one of the biggest listings of all time. when you look at the management, perhaps not that surprising. we talk more about that. this is bloomberg. ♪

matt: welcome back to the european open, 20 minutes into the trading day. a bit of a loss in london on the ftse. down .2%. let's get to one of the biggest shakeups in the established order of private equity. brooke shields purchase of oaktree capital might not be the only time in the asset management industry. bloomberg's eric chester spoke

to two money managers in an exclusive interview about the thinking behind their deal. this is one of the great credit to businesses in the world and we have followed them for years. howard is a legend in the markets. talkedoach them and about it, and from there, we ended up with this transaction. >> it was your idea than? -- then? >> i guess you are right. >> how long did it take? >> the markets were rough in september. but in transactions, you learn a lot about the other side. that was probably good for the results that we got. >> howard, you have been telling clients for 17 years what would shake -- would it take for oaktree to be acquired. >> there was a rumor that we

were for sale. in my year end report, i published the five criteria for a transaction. never been satisfied, i assumed they never will, so let's forget about. nothing ever happened until this transaction capable. >> -- came along. >> the criteria you set are being satisfied. what about the timing? >> you know, i am not a market timer. this is a fundamentally sound transaction. our entering into it at this time has nothing to do with the timing. nobody should in for some sense of where you think we are in the credit cycle etc.? >> not at all, this is a forever transaction. whether it was or was not ideally timed, which i don't

have a view on, would not matter. matt: and why brookfield? some of matter why you are not tying up another firm in the same industry that might use a little help in credit, a carlyle, akaka are -- a kkr? one, there are no other firms with the heft of brookfield. of offeringsst so well with hours without significant overlap or cannibalization. with the same reputation, the same growth record. and the same culture, we think the culture is very important and we agree on that. recently, or in the 17 years since you wrote that note, did you seriously entertain other offers?

>> we never found anything that satisfied the five criteria. 2017 it, you told me in was unlikely brookfield whatever by another asset manager. what changed? >> you always have to eat your words sometimes. would say it is not something we ever thought of too often. biggerour clients get and the offerings need to be larger, the one area we were lacking to be able to deliver his credit -- is credit. business is a large enough that it can be delivered to our clients. anna: erik schatzker speaking exclusively with the oakfield capital chairman and oaktree's ceo. -- hermes iserem

still with us. let's talk about the credit cycle and where we are. what the fed doubling down on dovishness, give us your thoughts on how far through the credit cycle we are and how long it lasts. fraser: we are clearly some way through his, but as you point out, with the fed firmly on hold, no meaningful side of any inflation surprise, it is difficult to point to an end. i will say the other thing credit potentially has in its favor is that it can lean quite heavily on equity as things begin to deteriorate. there is a significant buildup of share buyback programs and meaningful dividends that can and probably will the cuts as we go through these late stages of the credit cycle to further preserve balance sheets.

ist that is likely to show maybe some more surprising deep correlation between equity and credit then you might have seen in previous cycles. and for hikes a defensive aaracteristic -- perhaps defensive characteristic. us, wehanks for joining appreciate your time this morning. lundie is the head of credit at hermes investment management. anna edwards is in brussels on the ground as we continue to follow the trials and tribulations of brexit. what do we know now? march 29th is definitively no longer the brexit date? anna: definitively no longer the brexit date. we learned that this week at -- and the new date is april 12. if she succeeds next week, then we go on to talk about may 22.

if she doesn't, all kinds of options could be on the table. talkwe come back cover we more about what is going on with china and italy as european leaders gather here. this is bloomberg. ♪

matt: we are 30 minutes into trading. off are the top headlines the bloomberg terminal. the prime minister her brexit pause, but she only has two weeks to get a deal over the line. backing the bankers, deutsche bank and quits race -- credit suisse payout despite a turbulent 12 months. in frankfurtnk said revenue was going to rise this year. and ducking the nasdaq. isomberg learns that uber lining of the new york stock exchange for the mega ipo. in might be one of the biggest listings of all time.

welcome to bloomberg markets. this is the european open. alongside anna edwards in brussels. i want to quickly point out that we got some disappointing french data, a contraction of pmi's there. march manufacturing pmi is a lonely 44.7, missing even the contracting estimate of 48. a big miss for the german economy as well. europe is not looking very strong. miss, isn'ts a big it? and there are a lot of other things to talk about. not just brexit. it today we might hear a little macrone of merkel or responding. we can see what it is doing to the 10 german bonds this morning. and the french data on the euro, there is a global trade conversation creating a european champion.

brexit does loom larger. we will catch eu leaders in a meeting for seven hours. ,he new date to watch out for we look at april 12. that is the decision day. u.k. will leave on the 22 of may or the decision will have to be made to go without a deal in april or to ask for a longer extension. that opens up a whole can of forms. and to who exactly will be putting for that request. she said she did not want to do it through the u.k. elections. many questions will arise. days to win over that support to get the votes that she lost in meaningful vote number two. deborah has the headlines in hong kong.

: president donald trump says it is time for the u.s. to recognize israeli sovereignty. against decades of u.s. policy and could prove a decisive swaying israeli voters. it is likely to draw a refuse from the international community which never recognized israel over the disputed territory it captured in 1967. officials are downplaying the prospect of an imminent trade you with china. trump is heading to china for talks at the end of next week. the vice premier is set to travel to washington in april. a deal is not expected until president trump and xi meet. a date has not been set. italy is said to be signed up for the belt and road initiative. it will be the centerpiece of president xi jinping's visit to europe. it will make the first european

nation to sign-up. i lies are worried about a threat to sovereignty and the u.s. is fighting the risk of beijing's growing influence. has picked the new york stock exchange for its imminent ipo. it will take place in april and could value the company at $120 billion. uber would only have to float about 60% of its shares to make the top five listing of all time. uber would only have to float about 16% of its shares to make the top five listing of all time. 2700ed by more than journalists in more than 120 countries. mao in hong kong with your first word news. most of the west is cautious about dealing with china. is imposing anion continent wide vetting process for chinese investments. etc. and european countries that were close to insolvency a , as much as

insolvency as possible, have been much more welcoming. as president xi jinping needs officials in rome, italy is set to become the first g7 nation to participate in china's infrastructure projects. tomarie: let's take it back seven centuries ago. marco polo turned his city into the westernmost point of the silk road. another chinese city is eagerly to the its belt initiative. the master plan has a wish list of one billion euros. this would speed the movement of goods into the continent. drawnaly's attempts are criticism from both inside and outside the country. even italy's own deputy prime isn't on board and

won't take part in the festivities. he doesn't want foreign powers colonizing the country. gain from a to close relationship with china. bilateral trade was 2.5% of italy's gdp last year. eu's 3.8%ler than the or the u.s.'s 3.4%. clearly room for some growth for the italians. anna: let's continue this with the new belt and road initiative and italian involvement. john isner for us. -- john is there for us. we were reminded by the italians that this is not the first european country to get involved . just the first g7. >> the u.s. is concerned about

the symbolism because this is the first g7 country volunteering to join the belt and road project. it is more of a question of they are trying to preserve a united stand with china and european partners see this as a breach of italy going out on its own. what is the significance of this memorandum of thatstanding, a phrase drew a lot of controversy in the u.s. when donald trump's administration made a deal with china. >> the memorandum is very vaguely worded. the italians said they were trying to persuade the chinese to accept lots of references to the european union principles. more than others signed by the european country. way to apening the much bigger relationship from

now on. like the strategic sectors telecoms and ports. matt: all right. us out ofer joining rome, talking about this really controversial move between italy and china. next, we will bring you some of the stock movers this morning including that's the -- vespa as jpmorgan downgraded the stock to underweight. we see kind of a mixed market in europe. equity indexes are gaining on the continent, but down on the ftse as theresa may gets an extension to brexit. here you see yields dropping to zero after that big german contraction in pmi. this is bloomberg. ♪

matt: welcome back to the european open. we are 41 minutes into the trading day and we have seen a real turn around and european equity indexes. see indexes down.

for individual stock stories, let's go to dani burger. dani: swedbank is coming off of some of the lows today. it is now down .7%. they survived their initial money laundering probe, but they said that there needs to be more investigations and need to look further to get to the bottom of it. on the board here, nokia is investigating some compliance issues at a french wireless network operator it bought in 2016. the shares down more than 2.5%. we are getting analyst notes coming in impacting the shares. jpmorgan to be specific. seen the pressure on going as new orders aren't coming in as strong as they once were. a no deal brexit has been

averted at least for next week. prospect of a chaotic exit still looms large. this is that in some of the potential problems. eu leaders have granted theresa may a delay. --might just be differing deferring. can agree that we are at the moment of decision and i will make every effort to make sure that we are able to leave with a deal to move our country forward. >> we have done our best. this completes the full package. and there is no more that we can give. this is an event of historic

significance. so we must proceed carefully. >> it is a real political and democratic crisis. that this demo -- but this crisis is british. anna: conversations continue for a second day in brussels. ourselves talking once again about no deal. chief global regulator and market strategist at brown joins us now.man you pointed out some of the elements of a managed no deal that would -- that was put in place. be no deal,e to despite that, you go into many considerations that asset managers would have to think about if they would be no deal. how disruptive would no deal be for asset managers?

much of it has already been completed by asset managers. being deal, of it no deal, delay, no delay, pensions still need to grow. payments need to be made, and insurance companies need to react to their business. they are concerned about growth and opportunity. , ity day we see brexit causes not only a delay to that opportunity, but a great deal of uncertainty in the financial services firms. how do you think a hard brexit would affect these firms? if at first they hit them hard, with a recover fairly quickly? -- would they recover fairly quickly? would it be disastrous over the long-term?

are really waiting for that uncertainty and direction whatpoliticians, to say brexit will look like and what it will behave like. in the event of a cliff edge shockwaveswill send through politics and the industry. i think a lot of managers are really going to go back to the drawing board to think, did we make the right contingency plan? did we make the right decision? obviously, that has been very resource intensive. that it willhink be a shock wave through the industry. to belabor the point slightly, you do suggest that would putu regulators

in place supervisory cooperation and retaining reciprocal market access for regulated entities if there were to be no deal? i just trying to understand how much that takes the pressure off asset managers in a no deal situation. how much does that leave them with a big headache? how damaging would no deal be? >> it certainly would be a lot of effort in terms of contingency planning. services and especially asset management work in decades and they need uncertainty in decades. while a grace period is always welcomed and there would be a collective sigh of relief, what we are looking for is what happens beyond. would there be a determined and for what markets

would look like beyond that period and the initial equivalents. what is the best outcome for financial firms? of the things on the table, what is the number one choice you would go with? >> think the delay is welcome for a little bit of a grace period. we really need to get the brexit roadmap laid down as quickly as possible. the contingency timeframe would be between 12 and 24 months. and we would see that burgeoning opportunity from brexit. much of the financial services, they will redraw the lines to create a new marketplace and create a different competitive

place for eu as well as the global stage. the sooner we can get there, the sooner we can speed up the process and get into a post-brexit stage. that will really be the rebuilding and the architecting stage. that is where the growth will come from. anna: we will see how that develops. it is interesting to see how regulators in the u.k. will walk that tight rope between diverging from eu regulation and retaining equivalents -- equivalence. think you for joining us. -- thank you for joining us. has reportedly picked the new york stock exchange for its imminent ipo. atcould value the company $120 billion. at that valuation, uber would only have to float about 16% of its shares to make the top five

listings of all time. there is no doubting the scale of this. what do we know about the ipo so far? >> it is good to see it come into action. valued as much as 120 billion dollars which makes it one of the five biggest ipos ever. what we have learned is a little bit of an unconventional pick for stocks, because we have google, microsoft and the nasdaq -- it can be more retail-based. what we can see here is that there is probably a little bit of a sentiment of value as to why they pick the new york stock exchange over the nasdaq. cfo, what they are trying

to do here, they are trying to differentiate themselves from lyft which is also racing toward ipo. a small arrival that has picked nasdaq. i have seen this before in 2014 raised an ipo and they also picked different exchanges and different banks to try to be as different as possible. matt: i'm sure we will be coming back to you a lot in the coming days. our bloomberg asia deals reporter joining us out of hong kong. what if i told you i want you to lend me money for 10 years and i .009% interest on that loan. .008%.

these are german bund's right now. 0.008%. that chart doesn't show it quite as well as the one next to me, but the german bund yield is falling almost all the way down to 0%. 0.007%. bloomberg terminal users can interact with the chart you see on bloomberg television. you can browse recent charts and keep them for future reference. up next, it is the battle of the charts. this is bloomberg. ♪

matt: welcome back to bloomberg markets. this is the european open. we are 55 minutes into the trading session. it is time for battle of the charts today. amory is going head-to-head with dani burger. annmarie? no glasses. i'm disappointed you have taken them off. annmarie: i took them off. i do not think you liked them. you can see here out of the money, euro calls versus the pound have exploded.

it is seriously going to cost you a lot of money. part of it is that they don't want to get involved this late in the stage of the brexit process. and it is going to be a binary outcome for the pound. you can see the explosion if you are getting involved in hedging this late in the game. matt: clearly an expensive activity and that makes it difficult to do. we had a disappointing german manufacturing contraction continuing in france. the same story. weak data. we see the euro tumbled today along with bond yields. i will go with the broader picture. when you look at the five-year inflation, investors don't think we will get prices to arise anytime soon. it puts the euro and a tractor and it continues to be lower. i feel like the euro is still stuck in the same range that it has been for weeks now.

i don't know if it is tumbling quite yet. i will give it to annmarie. i love the glasses. please put them back on. surveillance is next. this is bloomberg. ♪

>> cliff edge delay. the european union delays,

giving another two weeks before the brexit so the sterling can recover. president xi touches down in are the g1 and g7 compatible? and google chooses the new york stock exchange over the nasdaq which might become one of the biggest ipos of all time. this is bloomberg surveillance, live from brussels. i am in brussels where we are meeting.the eu summit a lot of the focus is on the new deadline for brexit. is a technical extension in k's theresa may gets her vote through parliament next week. the other is april 12 and by that time, theresa may has to find a way forward of parliament rejects her deal. taylor: interesting comments i'm hearing in the morning shows across the bloomberg today about

delaying one edge of the cliff to the next edge of the cliff. isting your tone about what changed. let me get to breaking news. -- is out. a -- is coming along the lower coming in a little bit lower than forecast. francine, in the last hour, we had some germany and france data that came in much weaker than expected, which is why you see some euro weakness as well. they sent deeper into a contraction and france's composite pmi as well fell below the key 50 level. aboutof concerns again slowing euro growth. i want to see how that is translating to the equity market this morning. s&p futures had a very good day yesterday. you see a little bit of witness today.

we see some of that global dovish central bank in terms of the risk that they see on the horizon. i am interested in the stocks index, rising to a record high on some of the chipmakers. the 10 year yield really just coming in. strategistsm key that the 240 is not far off on the horizon. thank you so much, taylor. we are catching up with the prime minister of luxembourg. that he wasesting thinking about brexit because of what the eu leaders decided yesterday. the threat ofted a no deal brexit for now. this will give theresa may a little bit more leeway when it a lot ofnegotiating this stuff. trying to figure out exactly what comes up next. they have agreed to give theresa may an extra two weeks to work out what to do with lawmakers. she will have until april 12 to

decide whether to leave with no deal or to request a much longer extension. here is how some of the leaders reacted. >> i hope we can all agree that we are now at the moment of decision. and i will make every effort to ensure that we are able to leave with a deal and move our country forward. >> we have done our best and the solution now has to be a full package. >> there is no more that we can give. >> everyone must be aware that this is an event of historic significance. we must proceed carefully. >> it is a real democratic crisis. but this crisis is british. in no way must we become stuck in this situation. joining us from the london offices mark burgess,

chief investment officer. always great to catch up with you, especially on such an important day. theresa may gets a little bit more leeway to actually negotiate something, at least for now. of march 29the deal off the deal. mark: yes, for now. and that is what markets are saying. we saw sterling we can yesterday but down's this morning on expectation that we will see a deal agreed over the next couple of weeks. but the stakes are very high. and clearly there is a lot of difference of opinion that needs to be ironed out. .ery high-stakes it will be a very challenging couple of weeks for the government. what do you think the outcome is? is it a long extension? what are the chances of this deal getting through parliament next week? and that would almost automatically imply a sterling rally, right?

mark: sterling thinks that a no deal brexit is off the table. the challenge that we face is parliament struggling to function. a majority of parliamentarians remain -- the government is clearly a minority government. a large faction wishes to leave with a hard brexit. and against that backdrop, it is difficult to see the consensus on which they can agree a deal with the eu. the no deal brexit, it is likely to be so damaging for the economy that i think we will find the soft brexit eventually agreed to. thank you so much, mark burgess. he stays with us for the hour. let's crossover, speaking to the swedish eu affairs minister from brussels.

>> good morning, francine. march 29 is april 12 now. and i am joined by sweden's foreign affairs minister. thank you for being with us. there is a delay. what do you hope will be accomplished that has not been accomplished in two years? >> if next week they decide to agree to this withdrawal agreement, we will have the british government. it is good for the u.k. and is an orderly process to leave the european union. it that will be the very best that would happen. -- that would be the very best that would happen. see a defeatould by triple digits? i'm not sure what makes the eu think that it would be a different scenario next week, but if we see no again, would we head to a no deal by default? hans: there are different

possibilities there, actually. britishally up to the to tell european union what they want to see. and the message last night to theresa may from leaders, please the house ofn commons next week with the alternative route you would want to see. questions thatny arose during this meeting that went over one hour. -- does have a plan b she have a plan b? will she decide to drop her own redline? hans: i don't think she spoke on that. nextalk is on the vote week. if she gets that through, we would be glad because it is good for us and it is good for them. there's great risk that that won't happen.

>> and i have to ask you, when you talk to your other european colleagues, there was a time that it seemed that the issue was the prime minister. that she was the weak link. is she the main obstacle still? hans: it is for the house of commons to accrue. the british government has to work out the other choice that .hey want in the process we need to have a relationship with the brits. this is regardless of how they leave. -- it wouldexit mean trouble for our citizens, for their citizens. the money we had been promised may not be coming in the same way. on the islander may be a reality if this hard works.

brexiteers will tell you that this is the end and we would get a better deal. the you agree? -- do you agree? concerning, but we would discuss anything they would like to discuss. >> the discussion is done? hans: on the withdrawal, yes. but we would love to talk in the future. i think it is clear that negotiation is done and it is time for a vote. we do want to avoid that no deal brexit. what the let's see house of commons votes next week. coming up, we will also talk with gina miller from -- this is about what is next in the debate as theresa may gets another two weeks from the eu. this is bloomberg. ♪

viviana: president trump says it is time for the u.s. to fully recognize israel's sovereignty. this is a political gift to prime minister benjamin netanyahu just weeks before a tough reelection vote. it also breaks years of u.s. policy. during the 1967 war, israel captured the area from syria. advises are encouraging taiwan to submit a formal request to fighter jets.60 this is a policy u-turn by the trump administration, and one that is certain to provoke china.

the u.s. hasn't sold advanced fighter jets to taiwan since 1992. boeing 737.g of the the problem affecting the plane could affect the composition of gdp. the notes as business investment seegrowth may seem -- may more inventory growth and less of a boost. leaders tell the british prime minister that if lawmakers don't endorse or yield next week, she will have until april 12 to select two options. one is to leave without an agreement, the other requests a much longer extension. pass thement does proposal, that u.k. can stay in the eu until may 22. global news 24 hours a day on than 2700d by more journalists and analysts in more than 120 countries. viviana, thank you so

much. we're trying to determine the to the and the delay brexit deal. the other one is that the u.k. needs to give the eu the idea -- an idea of what they want. it is the deadline by which the u.k. needs to organize european elections. let's go to mark burgess, chief investment officer. when you look at the possibility of parliament not actually , when willdefault happens for the euro and pound? , in isolation, looks a touch undervalued. but the sector is dominated by what happens if we have a recession induced by a no deal brexit.

back to the conversation we were having a little while ago, it feels like theresa may has undermined her negotiating position a tad with the ert -- with the eu are -- with the erg. clearly they would be in favor of that. so it will be a very tense week. ,f we have a no deal brexit there would be a contraction in the economy. and we would have more support for the economy. that is clearly facing investors at the moment. sterling will rally and i am bee that there would sterling assets more broadly. it will be an interesting couple of weeks. francine: let me also bring in our bloomberg editor-in-chief john micklethwait that joins us from our london studio. you are a little bit of an expert when it comes to brexit. how do we find out or when to we find out what her thinking is?

do we have any idea what she would choose? >> nobody is an expert in brexit, but even the participants. i think the europeans strongly that theresa may, given that choice, would definitely go for no deal. herb session is tory party unity. has is the message that she across very strongly to everybody around her. that the only way to keep the tories together is to go ahead with no deal in that circumstance. that is what is scaring the europeans. that is what is scaring markets. possibly scaring mark. the fact that she is pushing that, i think she is being genuine about it. if she is bluffing, she is

bluffing incredibly effectively. to break in here, getting the german ten-year bond yield now falling to 0%. that is the first time going back to 2016. you are having global dovish central banks pushing everything pretty much to zero. mark burgess, i want to bring you and quickly here to just talk about this quickly. as we see these bond yields falling today, falling to zero, is there any place you can get yields these days? >> is moving away from investors, isn't it? we have dovish commentary from the fed. more dovish than investors were expecting, setting up the fact willinterest rates probably not go up any more than in the u.s. you haveon to that, had some very weak data in europe overnight which is just

added to the weekday -- the weak data we have seen. down in thef slow economy and slow down in the chinese economy. that is weighing heavily on the prospect for european growth. germane: and we also had pmi figures. it john micklethwait had a pretty great conversation with the chancellor of germany angela merkel a couple of days ago. what will germany look like without the chancellor? >> you remember all the talk was about britain becoming europe's most powerful economy. we are a long way from being

able to persuade people that they should take your money and give them no interest for 10 years. i think in the context of germany, i am not an investor. there are many good reasons for that. you go to germany and i sensed much greater pessimism than i have seen for a long time about what lies just over the horizon. certainly way before the 10 year mark. people are worried. you will see the lay offs which might come from georgia and commerzbank. you have to deal with the car industry. of jobs in germany and you have the underlying problem in the eurozone. germany does not agree to any of the integration most economists think you need to hold that together. there is an element of angela throwing it as she comes in to get it.

the markets go one way and politics go another. francine: so is it just a further sign that the german signear yield could have a that europe could be becoming like japan? >> i think it is. it is a long way from germany having the same problems as japan. the have not had 20 years of deflation that japan has faced. but the economy is growing sharply. , bmwn addition to the cuts announced 22 billion euros across savings. that is an enormous number and would result in a lot of job lay offs. uncertainty would be weighing heavily on the german economy and that slowdown is real. of what they do about that, given the interest rates,

the ecb is about to start stepping away from supporting the economy. admirer ofery strong angela merkel, but no one will make the case that she has pushed through a whole series of reforms. is still economy living off of the schroder reforms. that means that whoever takes over for her, they will be inheriting quite a difficult thing. there is a new series of adjustments that need to go through. this is on a much bigger scale. my definition, is the most powerful economy in europe. taylor: we will be speaking more about germany next. that was mark burgess and john micklethwait. recapping the headlines, the german ten-year bond yield is

falling to 0%, the first time since 2016. this is after a slew of weaker euro pmi data. pushes the euro lower and pushing the tenure german yield back down to 0%. this is -- the 10 year german yield back down to 0%. this is bloomberg. ♪

francine: this is bloomberg surveillance. i'm francine lacqua brussels. it taylor is in new york.

tom keene has the day off. theresa may got a couple of extensions, one technical and another until april 12. now we have the charts. down to 0%, the lowest since 2016 because of weak pmi figures in germany. also the uncertainty with brexit and the fed. taylor: i'm happy to do this chart for you. athave the german ten-year zero. new zealand bonds dropped below 2% for the first time. u.k. bonds are below nine basis points. the 10 year is below 250. more is going on in the bond markets. we will have more, next. this is bloomberg. ♪ this isn't just any moving day.

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simple. easy. awesome. stay connected with the best wifi experience and two-hour appointment windows. click, call or visit a store today. ♪ francine: this is "bloomberg surveillance." tom keene has the day off. he's almost european with his holidays at this time a year. parliament rejects may's brags a

deal again. again -- it deal brexit deal again. the u.k. must come back with a new plan by april the 12th. that could mean a long delay or a no deal brags it. let's get back to our guest in our london studio. he's a chief investment officer. john, what are the chances that theresa -- theresa may gets approval from parliament next week? john: at the moment, low. she stood as think slight chance last week before .he speaker intervened the fact that she has attacked seems -- makes it seem

like she will fail next week which puts real pressure on her leadership. is a strong emotion that at the middle of parliament is beginning to unite. you're beginning to get more conservatives saying this is be a toughermight brags it. either it becomes a different deal controlled by the government or it becomes a different deal controlled by parliament, but other way, it is difficult for theresa may who staked her credibility on that .eal francine: what do you think is priced in the market? there are a number of other options like general elections being called or a second referendum. what is the favorable outcome for the markets right now?

>> i don't think a general election is the answer because i don't know what would be in the manifesto for brexit. we've seen divisions in the so it'stive party difficult to see what they would agree as their policy in this. currently, i think i would agree with john. the markets are discounting the fact that she uses the third votes and parliament takes control. the more -- the majority of parliament are remainders who would seek a softer brexit or renegotiate a different deal. it the stakes are higher and we are in uncharted territory. francine: thank you both for joining us. in the meantime, let's go to corporate news to get the latest on deutsche bank.

the german letter is promising to end years of decline, but the depends onhat growth. arons. us now is steven says of all, deutsche bank -- theyave the decline will stay the decline. why do we believe them? >> it is certainly an optimistic forecast to make. 2018 was a difficult year, especially in trading. conditions are still pretty bad, but not as bad as the fourth quarter. completed the custom investment bank, but to assume growth in the economy and the world economy is solid is optimistic. we will see if they can deliver on that promise.

francine: we are here in brussels where we are covering day two of the summit as leaders are now walking outside where they were meeting. we saw them come in at the gibraltar building. we went past there many times they seem to be of higher spirit than yesterday. we heard from the luxembourg prime minister saying they have a little bit more of a plan than a couple of weeks ago. a leaders are getting ready couple of meters away from where i'm standing, we need to figure what the next step for everything is in terms of brexit. let's get back to deutsche bank and back to steven arons. i want to talk to you about the bonus pool. what happens to bonuses this

year? steven: as we reported one month ago, it was cut by almost 50%, by 14% to be precise. -- 15%,n't a surprise by 14% to be precise. that wasn't a surprise. what is important about the they ares to see that trying to strike balance between cost cutting and keeping talent. that is what this decline -- the signal they want to send a so, it is not a surprise and that is what they are to a near -- want to send, so it is not a surprise into.at is what they are taylor: we saw photos of angela

france's well as leader. we are getting more of that and will monitor headlines we get for you. in the meantime, let's get a check on first word news. viviana: bloomberg's learning president trump is considering stephen moore. moore works on the trump campaign and is from the reagan administration. he's close to larry kudlow. concerns that italy is getting closer with china and president xi jinping. toorrow, italy will sign up the belt and road initiative, the first g7 country to do so. critics say the infrastructure project allows beijing to change the project for leverage -- trade the project for leverage. administration is downplaying chances of an imminent trade deal with china. steve mnuchin and robert to beijing for

talks. officials say it is unlikely there will be a deal until trump and xi jinping meet. that may not happen until april. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am viviana hurtado. this is bloomberg. taylor: and another big story we are following is the trade talks continuing between u.s. and china. mark burgess of columbia is still with us. if we go around the captain's again about getting a trade bill or not getting a trade deal. that the markets get ahead of ourselves. it seems we are little bit skittish and its may not. have we missed priced the risk? mark: i think that's one of the -- have been following

because the trade negotiations are slowing the economy. trade tensions impose last year -- imposed last year to damage to the chinese economy and, in turn, the german economy. i think that is adding to the mood music of slowing growth and lower yields and lower inflation involving higher equity prices. taylor: when we talk about higher equity prices, i want to ask you where we are starting to see some of these trade headlines in the trade -- and the trade fears and the trade headwinds heading corporate balance sheets. we heard from a few companies this week like fedex and bmw, starting to highlight margins pressures. are we starting to see the impact of some of these headwinds on corporations? mark: i think it's a combination of that and where we are in the cycle. earnings revisions have been negative over the last nine months or so. we are still expecting growth in corporate profits, but the

growth will be moderate. there are a number of industries and companies where the trade sanctions are imposing headwinds. francine: thank you so much. in the meantime, we are getting live pictures of the eu family photo. earlier that theresa may would stick around for the photo and then back to london. before.left it was interesting to hear the luxembourg prime minister say that she left early she is serious and she will work on a deal to get it through parliament. that was an interesting take. next we willine, talk about uber's mag ipo. valuations, agh company met unicorn status this week. this is bloomberg. ♪

francine: this is bloomberg surveillance. -- viviana: this is "bloomberg surveillance." shares of nike are lower. a world's largest sports apparel company delivered strong third-quarter earnings but came up short on north america sales. ine is beating expectations other regions including europe, china, and the middle east. an unexpected round of job cuts at 21st century fox. the firingas learned is focused on senior management in the fox film division. the l.a. times are reporting more than 3000 people will lose their jobs. the new york stock exchange

winning what could've been -- what could be one of the five biggest listings of all time. uber is expected to publicly file for its ipo in april. the listing good value uber at up to $120 billion. that is your bloomberg business flash. taylor, francine? francine: we are here in brussels, dated above the eu summit. yesterday went well into the night, but the leaders you see are gathering for a family photo. you are listening to us on the radio. we will push it out on social media. they talk to around midnight to find a solution for the u.k. and theresa may. this is what they decided. it's a two-week extension, but if the deal gets through parliament, they get extensions that would bring them to may 22.

welcome to the 21st century, taylor. taylor: it is drowned and ipos. let's get something back to viviana was mentioning. ipo and market we face in the u.s., if you come into my terminal, it has been a slow start to the year. only $13 billion and ipos listed so far. if you go back to the depths of the economic crisis in 2009, even when companies do go public, it hasn't always been successful. snape has underperformed its ipo under facebook. at oneften much a 72% point. the difference is snap was not able to differentiate itself from facebook. the question is if lyft can differentiate from uber. let's take a look at the revenue comparison between them. itt trails in uber when

comes to revenue, but analysts say they are a competitor still. they are also able to monetize their user base. if we take a look at the rides, lyft rides are growing interactive revenue has doubled in the past few years. lyft has a better view of uber in the u.s.. lyft increased its market tear into thearket share 30%. still with us is mark burgess. mark, i will not throw us -- throw you under the bus, but broadly speaking, if we take a look at valuations and tech valuations of where we are in the economic cycle, is this a sign things look overvalued to you? how are you pricing in some of the tech valuations? unlike the 1999 tech

bubble when we were speculating which companies would be the winners and were forecasting revenues to be in the future, we didn't take into account businesses today which have strong revenue growth and are in a good position. i think it's very different. my own personal opinion, you have to be optimistic about business models going forward to have competence and valuations of many of the tech companies. francine: mark, are you saying they are in a bubble? is there anything else that looks like it is in a bubble valuation wise? mark: i think you have to be very confident about the growth projections to have confidence in many of the share prices we see today. whether we are in a bubble or not, that is a statement. the tech valuations look hopeful. francine: mark, thank you as

always. up next, we talk with gina miller about what next in the brexit debate as theresa may gets an extra two weeks from the eu. this is bloomberg. ♪

francine: this is bloomberg surveillance. good morning everyone. good afternoon if you are watching from asia. take two of the eu summit leaders and taylor riggs is in new york. has been brexit averted, at least for next week, with the prospect of a possible.it still let's get to a person who has been critical getting parliament involved in this process. she is gina miller. gina, it is great to speak to you. i was thinking about yesterday about what theresa may could you done differently and

want to challenge government to make sure parliament had a deal. where do you think we stand now? are we closer to an agreement or is there a possibility of another deal brexit? gina: nothing has changed, specifically. the only thing changed is the timetable. everything is still possible. when we go to parliament, we don't know if the speaker will allow another vote on mrs. may's deal. if he doesn't, it's likely we will go to indicative vote. the whole problem from day one has been this process has been back to front. once mrs. may had lost the case against me, my view is that she should have gone to parliament and consulted them to test what there was a majority for to go forward and then negotiate on a path. now, she is consulting them at the end of the process when she put in place red lines and a deal which she much have known

-- must have known would be difficult to get through parliament. i do think what we are seeing it being delayed until the 12th. francine: it was under the assumption of eu leaders that now they have a technical extension attached to the withdrawal agreement and political decoration that that would be substantial change. gina: what is really interesting about what brussels has done is that they went over the head of mrs. may. the 90 minute meeting was a disaster because she couldn't answer what was plan b. they are speaking directly to parliament and said we give you a bit more time to do the vote

to find out what there is a majority for. if you can't do it by the 12 of april, there's another deadline. done one extension, they are a stepping stone to allow parliament the time to decide what there is a majority for. the thing about this week coming is that the light will shine on labor. this will mean these indicative votes if we go for it. labor will have to step forward and explain what their option is. so far, they have gotten away , but for mpsuage to vote for something, they will have to be quite specific about what it is. that is difficult because you have to leave a eurosceptic leader of a party. what labor will do this week will be interesting. francine: it's unclear theresa may was given the choice between a no deal brexit and a long extension, 12 to 24 months.

if she chosen a deal brexit, would parliament stop her? gina: it has to go back. no deal brexit still has to go back to parliament. parliament has to scrutinize whatever the outcome is. deal, no deal, and extension, parliament has to have the ability to make their voice heard. decide on no deal, there will be legal ramifications for that. taylor: i wonder how much longer theresa may has. we wake up in the u.s. and it is almost 6:00 a.m.. we hear a few more calls hear about theresa may not making it much longer. how much time does she have? gina: it's difficult because we act, whichxed term means it is difficult to call a general election. because of that, it makes it difficult. there are more and more

rumblings that the 1982 committee are very unhappy. there is this growing unhappiness with her, but they triggered a vote of no-confidence, which means she is safe until november until they decide something drastic. the party has to decide itself. people think her speech was disastrous and there are rumblings all over, but it is not that straightforward. it has to be in this period where we have two extra weeks. to have aot time conservative leader challenge and that two-week period. conservative party will have to extend, or there has to have an extension until may to allow the leadership extension. this is dangerous and the limited time period. francine: gina, thank you so much as always.

gina miller, founding partner of of scm direct. we will talk about the german ten-year because of pmi data is worse than expected in germany, and because of the concern with fed. we also have a little bit of banking news, and then the news overnight of uber. this is thanks to our great reporting on the ground as they the nycto choose instead of the nafta. what does that mean for the sector? we will discuss that as well. this is bloomberg. ♪

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the eu gives theresa may another two weeks to avoid a no deal brexit. a european union in search of unity on china. butident xi touches down are the g1 and g7 compatible? and uber may choose the nyc over the nasdaq for listing. this might become one of the five biggest ipos of all time. this is bloomberg surveillance, live from brussels and from new york. tom has the day off. we have been trying to figure out the implications of the inension it midnight crisis brussels. just behind me, theresa may got two extensions. taylor: while you are there in brussels getting tone on the ground, we are getting other market moving data across europe. the weaker pmi data is coming in the cross europe, germany, and

france. german headline is the ten-year, down to 0% for the first time since 2016. this is a global bond a story. 10 year treasuries are at 250, japan yields are down to a 2016 low. new zealand and australian bonds, there is this risk off rally pushing all of these 10 year yields back down to near record lows again. it's unbelievable. it's unbelievable, but it goes back to fueling the fire. the chapter that europe has become more and more like japan. let's get straight to your first word news. hi, viviana. viviana: president trump says it is time for the u.s. to fully recognize israel's sovereignty. --s is a political you gift political gift to benjamin netanyahu and breaks years of u.s. policy. during the 1967 war, israel

captured the -- from syria. advisers aremp's encouraging taiwan to submit a formal request to buy more of these, more than 60 f-15 fighter jets. it's a policy u-turn by the trump administration and one certain to provoke china. has not sold advanced fighter jets to taiwan since 1992. the grounding of boeing jets could impact u.s. economic data -- boeing planes could impact u.s. economic data. note says business investment and growth exports may see inventory growth and less of a boost. another two weeks for theresa may to avoid a no deal brexit. european union leaders telling don't british lawmakers endorse her deal next week, she will have until april the 12th to select two options, one is leaving without an agreement and the other is requesting a much larger extension.

f parliament passes her proposal, the u.k. can stay in that you until may the 22nd. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. am viviana hurtado. this is bloomberg. taylor: thanks, viviana. let's take a look at how the brexit saga is impacting u.s. markets. you see a little weakness in the s&p futures market. we had a big day yesterday, but some of the dow this central banks are -- dovish central banks are causing concern and what they see in the economy. the semiconductors is jumping to a record high. risk there are seeing in their chipmaking and demand side of things are starting to dissipate. -- story is all about you had our bloomberg intelligence strategist

highlight that at 240 could even be possible. we have seen pound strength relative to the dollar which is reversed again. we see weakness in the pound. a lot of the brexit saga sort of is unfolding and more questions than answers, at least on my end. francine? francine: eu leaders have averted a threat of a no deal brexit, at least for now. they agreed to give theresa may two weeks to work out what to do. if lawmakers don't endorse or deal this week, she will have until april 12 two decide to leave with no deal or request a much longer extension. here's how some leaders are reacting. >> i hope we can all agree we are now at the moment of -- i will make every effort to ensure we are able to leave with a deal and move our country forward. >> we have done our best.

we have done our best. is --he solution >> this completes the full package. i believe everyone is aware this is an event of historic significance so we must proceed carefully. >> it's a real democratic crisis. this crisis is british. in know what must we become stuck in this situation -- no way must we be stuck in this situation. joining us now is our european union reporter and a reporter with us. the mood this morning seems to be lifted a little bit. theyey seem on how interacted with reporters and with you that they are feeling a little better about the situation? absolutely, francine. yesterday was a sense of

frustration. today the word is relief. european leaders stepped away from the note your brexit moment that was due in a week's time. that has given the prime minister another two weeks to think about the repercussions of a no deal and come with a way forward. i spoke to the prime minister of luxembourg and he said he thinks a 50-50 chance -- there's a 50-50 chance the deal might go through. emmanuel macron thought it would be 5%. also, that did bring up the idea of a second referendum. this time, he said it openly and publicly that if we don't get a positive vote on this deal, maybe we need to think about a complete revamp and another vote could be on the table. taylor: stephen, let me bring you in the brexit -- in on the brexit angles.

with the extension to april 12, strategists said we replaced one edge of the cliff and in another two weeks, we have another edge of the cliff. what will change in the next two weeks? >> since we get another run at this boat, mrs. may is on her way back here now. it seems -- vote, mrs. may is on her way back your now. that seems maybe to be tuesday of next week, but numbers are not looking good. she made an aggressive speech where she blamed the members of parliament for the lockdown. these are the people she has to her.ade to vote for not much optimism on the side of the channel that that vote can be one -- won. brussels spelled it out. she has to ask for a long extension or decide on no deal. parliament have ruled out no deal and mrs. may said she cannot let brexit go beyond.

perhaps we will get more indicative votes and parliament is taking more control of the process. up until now, parliament is incapable of saying what it wants and very capable of saying what he doesn't want. all options remain on the table. another cliff edge looms this time in april, rather than next week. one thing we did last night is that europe doesn't want no deal to happen either. they came together and offered the extension. they don't want to see big economic impacts and for them to be blamed. we may see more of that unfolding in the weeks to come. . francine: thank you so much, david merritt. for more insight on brexit, we are joined by charterhouse director. robin, are we exactly where were week,- where we were last trying to get this deal through parliament, or are we on a much longer extension?

robin: we are exactly where we the 29th fixed deadline has been moved. has been movedt is an important adjustment. the fact we have accepted 12thsions until april has opened up this scenario. for conditional language where she implied -- although i would prefer us not to have a british election for the european parliament, which is one of the conditions for the process to go beyond april 12, but she said she is strongly against it, though she didn't completely rule it out. i think we are likely to see indicative votes alongside the vote on her withdrawal agreement. it is all still open. taylor: i'm going to make a joke, and i know this is a

serious matter. someone came up with the definition of insanity which is doing the same thing over and over again but expecting different results. thiseading a few op-eds morning that have theresa may hoping she will get a pass vote and it will swing her way. what has changed here? robin: it's about the balance of power around the vote. the fact that you saw the defeat shift from 200 votes to 149 lost votes is telling about the balance of power. she has to decide which way can she go. can she pulled the brexiteers , can shepect a deal pull alongside in this vote because now there is a spectrum that the on april 12, that could be a lengthy process. that spectrum disappears wednesday evening and opened up again on thursday and friday. will that be enough to discipline the democratic unionist party?

what changes is not what she is asking them to vote on but the context. taylor: thank you, robin nibl ett. coming up next, wells fargo's head of security strategy. you are looking at a weaker pound. what that means for the dollar, coming up. this is bloomberg. ♪ ♪

taylor: i'm taylor riggs in new york with francine and brussels. you are all over the price -- place in europe. i want to get breaking headlines. tosident trump is speaking

fox business and coming out to talk about the fed. he says hopefully the fed won't do tightening and pivoting to tread -- straight to say the deal with china is coming along well. the key headline is trump saying hopefully the fed won't do tightening. he is getting some of his ways with jay powell remaining dovish. the tenure is dipping below to 50. all global 10 year yields are falling down near 2016 lows. hopefully, the fed won't be doing the tightening. francine? chinese president xi jinping has arrived, but he did not have a warm welcome. european allies see a threat to sovereignty. the u.s. is fighting the risks. one partner in italy's coalition was so uncomfortable that their

leader is leaving town for the day. governments are set to sign a controversial a random initiative. joining us now is head of currency strategy for wells fargo. thank you for joining us in london and new york. robin, when it comes to china, is italy wrong? we heard a lot about it here in the eu summit. they are concerned one of the member states is going at it and creating this g plus one consortium. robin: it all depends on what conditions they will consider signing this mo you on this belt and road initiative. the deep concern is the initiative is a bilateral deal you do between your country in the chinese government, which the chinese government sets the terms and tone. i understand the tying

government will combine a commitment to undertake any the ri type infrastructure investments within the framework of the asia investment infrastructure bank. aib does have a some requirement for transparency, environmental sustainability, all things the european government has railed against. they are definitely rocking the boat. they're sticking a finger up, if i can use that phrase on air, to other eu government saying we are doing what we think is best for our interest, but they are trying to keep themselves inside of the eu framework by linking it to the aaib. how do you think we as the u.s. and europe should deal with china? is there going to be a significant trade deal between the u.s. and china that will give the u.s. a lot of the

things they have been asking for? nick: i think there will be a trade deal. it should address some of those issues in terms of intellectual property. there will be pledges to buy a lot u.s. products from china as well. tos probably still going take a while, maybe a few weeks, but i think it will be significant. i think that's one of the reasons the chinese currency has been stable. about the me more chinese currency and impact on the dollar. our the markets pricing in a trade deal or not? nick: i think they are. they're probably pricing some of , some rollback. in terms of intellectual property and technology in the forced transfer, it will take a while. some enforcement type mechanisms, but this is an dynamic, especially

for the u.s. president as he heads toward the 2020 presidential election. i think he will be motivated to get something done. taylor: we are getting those headlines from president trump saying he is hopeful a deal with china is going -- coming along very well. pivoting over to the federal reserve, trump is speaking to fox business saying hopefully, the fed won't do the tightening. that is pivoting right back into the 10 year yield and movement we see there. robin, thank you. look, francine, at the bond market, you are seeing the 10 year below a 250. you have the german ten-year making a big move in the last hour, dropping to 0%. you see a slew of these yields going back to the lows of 2016. this is bloomberg. ♪ is bloomberg. ♪

francine: this is bloomberg surveillance -- viviana: this is bloomberg surveillance. shares of nike are lower in premarket trading. they'd are delivering strong -- they are delivering strong third-quarter earnings by came short in came up u.s. sales. for the jumpy am -- tiam.

of that increase was to compensate him for a pay cut in 2017. it was designed to calm shareholder objection. deutsche bank is looking to reverse its declining revenue in its annual report. their lending the market environment -- saying the market environment -- that is the bloomberg business flash. taylor, francine? thank you so much. let's talk more about deutsche bank. is our bloomberg german reporter. stephen, what is the outlook for deutsche bank here? as we heard, it is a positive outlook. deutsche bank expects revenue to rise up for the first time since 2015. i think people are happy about it. the share is slightly down, but

-- up at open. is this a realistic outlook even the market environment? can they really achieve revenue growth from the first quarter, which is traditionally their strongest? what does the bonus pool actually mean, the bonus pool cut? steven: it means -- look at it historically. bonus point has been declining uninterrupted since at least 2010. for a decade, except for a strong decline in 2016, when there was an unprecedented bonus cuts. there's never to the bank to become smaller, but also regulation on pay that you can give the employees.

14% is a bit more than the 10% average. remember, last year, they cut headcount by 6%. if you add that together, it is a bonus cut in line with precedent. taylor: talk to me again, let's go back to the potential merger or i would argue a takeover between deutsche bank and commerce bank. what is the reaction from the street now that we have had time to digest the news in terms of failure value of the bank. -- bank? steven: it's funny because the market reaction initially was positive. i think investors were happy that this was out in the open. both banks, prices went up on monday after they announced the talks on sunday, but in germany, they have been quite -- there

has been a strong backlash by politicians saying the government should stay out of this. we've had plenty of reports that the finance ministry is backing and engineering this merger. people think there is a lot of government influence. there are some people saying this doesn't make economic sense. there has been a lot of pushback and it will be interesting to see how much that pushback will influence the bank. francine: thank you so much steven arons. we are getting, pictures from rome of the italian president and president xi jinping of china. this is bloomberg. ♪ you.

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this is beyond wifi, this is xfi. simple. easy. awesome. xfinity, the future of awesome. want more from your entejust say teach me more. into your xfinity voice remote to discover all sorts of tips and tricks in x1. can i find my wifi password? just ask. [ ding ] show me my wifi password. hey now! [ ding ] you can even troubleshoot, learn new voice commands and much more. clean my daughter's room. [ ding ] oh, it won't do that. welp, someone should. just say "teach me more" into your voice remote and see how you can have an even better x1 experience. simple. easy. awesome. francine: this is bloomberg surveillance. you are looking at live pictures of the italian president holding a brief -- a press conference in

rome. we found out that italy was rattling the u.s., but also the eu, with its support where china -- support for china's road. presidentecting the of italy and president of china referendum. let's get to the first word news. viviana: theresa may is signaling if parliament rejects or break the deal again she would rather leave without an agreement. -- rejects the brexit deal again, she would rather leave without an agreement. if not, the u.k. must come up with a new plan by april the 12th, meaning a long delay or no deal brexit. bloomberg learned president donald trump is considering conservative economist stephen moore for a seat on the fed

board. moore was working on the trunk camp and -- trump campaign. administration is downplaying chances of an imminent trade deal with china. robertmnuchin and lighthizer had to beijing next week for talks. officials say it's unlikely there will be a deal until president trump and xi jinping meat. that may not happen until -- meet. that may not happen until april. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am viviana ortega -- viviana hurtado. wasor: as viviana mentioning, u.s. officials are downplaying the prospect of an imminent trade do with china. trumps talk team heads to beijing next week. u.s. officials are saying a deal is not expected until president trump and she meet.

a date has not been set yet. oxford us now is in economics economist. london,th us, over in is the catamounts director. at the u.s. look economy, can we withstand potential tariffs more than china's economy can? we were using china's economy as a bargaining power. >> i think that is not necessarily the way to view trade tensions. trade tensions are negative for have the but we potential to withstand some tariffs and escalation of tariffs. we think the current stance of tariffs between the u.s. and china is expected to drag the economy by 1/10. if we see further escalation, especially in the context where there is a possibility for market volatility, the market could become more expensive in

growth and could deter investment. right now, we think there's a possibility of some form of handshake deal. the underlying tensions between the economies are likely to stay longer. taylor: how does the underlying tension go into your world of currencies? nick: an eventual deal or handshake deal is factored into the market right now. if you look at what has been happening recently, the growth forecast is coming down. i think it's going to mean slow growth. if you look at the u.s., 12% of andr exports are from china 20% on china's end. it will probably mean volatility for currencies and eventual dollar weakness.

francine: we're just looking at live pictures of president xi who arrived in rome today and is now flanked by the italian president. u.s.could china give the to satisfy president trump's demands? gregory: a firm commitment that there will be an uptick in u.s. exports to china. some effort to address the very large trade imbalance in china's favor, but most importantly, while that would be windowdressing, what the administration is looking for is what greg issued earlier -- greg brought up earlier, some way the u.s. could turn the screws back up afterwards. in the years time, it looks like there is no real change taking place. it is the desire on the u.s. side to have a unilateral capacity to reach the agreement. that is what is causing the problem right now. greg, what do you

think the chances are of a trade deal? i keep on hearing the argument that president trump does want to deal because it shows him as --ough negotiator to g negotiator who gets what he wants. looking at the 2020 presidential election, the anti-china, need to be tough on them, has worked with his base. gregory: there is a desire to get some form of deal. a comprehensive trade agreement will be difficult to reach because of the underlying tensions and because of china's industrial policy and the lingering trade deficit. also because of this question on how do you enforce and verify any trading agreement between the two countries? it will be difficult to reach that comprehensive trade agreement. if you're thinking about a memorandum of understanding, we know that word is forbidden at the white house, or if you talk about a handshake deal, that is more likely with promises that china will import more from the

u.s. and work toward a stable violate and won't intellectual property rights. that would be a handshake deal, and we know how those go. taylor: we heard mixed talk about this perhaps leading to a weaker dollar. was a big topic of conversation with jay powell. the strong dollar is not necessarily about to disappear. the fed is leading the charge in terms of dovishness around the world, but we see other central banks follow the fed. there will bee much weakening and the dollar ahead. i think the dollar will stay relatively strong in this environment, which is one of the factors that has constrained inflation. we don't see much upside to inflation from where we are in the u.s., given cyclical opponents, given the trade-off

between unemployment and wage growth. we don't see inflation as a big risk, which is why we are cautious. we believe the fed reached terminal policy rate. taylor: as we go global here, we got disappointing numbers out of the eurozone. we are getting big moves in the euro and a of the euro weakness. does anything about the weaker data we are getting today change your view on the euro? nick: our view is that it will take a while for europe or the united kingdom with brexit and some of these issues to come off of the sidelines, that over time, eventually, there will be dollar weakness. remarkable for a couple of weeks where we see become more flexible. , likehe bank of japan last year, they changed it around their yields. to see japan and germany at zero is quite remarkable. to see those u.s. 10 year yields

going down as well, all reaction to the policy, is quite interesting. francine: and robin, that goes back to some of the data we found that was weaker than expected. our markets underestimating -- and even foreign-policy experts, underestimating what germany will look like without angela merkel? robin: without angela merkel, that is being factored in already. ,ou have a likely successor somebody who is tacking more strongly to the base of her make the center of the cdu and csu a bit more credible as a long-term partner within a future german government. that could help create greater stability in germany and be a little on the upside on that relationship. one point quickly on the u.s. china issue, we must remember the u.s. china negotiation is not a bilateral negotiation --

not just a bilateral negotiation. you have a big agreement between the japanese and the eu, the trans-pacific partnership continuing without america. two trump space wanting to win on the trade negotiation, they trump'sng out -- two base wanting to win on the trade baseiation, -- to trump's wanting to win on the trade negotiations, they are losing out. taylor: coming up, we will see how this falls into the equity markets in a few hours. mike wilson, chief u.s. equity strategist leaves our "bloomberg daybreak: americas" team. this is bloomberg. ♪

taylor: francine, we have more earnings crossing. this time it is tiffany's. let's swoop over to fifth avenue and see how they are doing. there forward guidance, they see their earnings-per-share increasing by mid-single digit percents. management is reiterating their view for 2019 are saying fourth-quarter total comp sales

on a constant currency basis are missing estimates coming in at 0% versus estimates of 1/10 of 1%. the key line for me is forward-looking view. that 2019 earnings-per-share is increasing by a mid-single digit percent. typically, we have seen downward revisions to earnings, so we see an increase their. pivoting back to the bond markets, it is time for our single best chart's, the headline story for the day. it is global dovish banks following yields. crossingn ten-year is 0% back down to the lows of 2016. in white, we have the japan 10 year following down to the lows of 2016. then, the 10 year on jay powell's comments, dipping below to 50. greg, talk to me about this. we were speaking to some of our interest rate strategist and

they say to 40 might not be too far off. do we see rates rising or might not be too far off. do we see rates rising or falling? gregory: we see weakness globally, some slowdown in momentum. we see the european economy showing weak data. the latest data in germany was quite weak. we see a gradual slowdown in economic momentum. sees globalmics growth downobal from two years ago. the potential is we see movement in yields, but that will be dependent on how inflation evolves globally. look at theyou longer-term picture, we see moderating momentum and inflation is likely to miss most targets around the world. that's not really a sign yields

will go back up into a stable manner. taylor: you mentioned something in the last segment, volatility, the lack of volatility across all major asset classes. are you concerned about the impact that all of these global central banks are having on the lack of volatility, pushing down volatility in some of the currency markets? gregory: it's not a new phenomenon. we had volatility for a while -- nick: it's not a new phenomenon. we had volatility for a while. the fact is central banks have been so active for quite some time in the past has driven that volatility down. it's not particularly desirable. you want a little movement in the markets. going forward, there might be a possibility of increased volatility. you saw a reaction to the federal reserve and ecb a couple of weeks ago. 2019 and later toward

is more common tree from the central banks, we want to see more increased volatility. francine: overall, what is your outlook for central banks across the world? are they all turning more dovish than expected? nick: they are. coming back to the question about bond yields, they probably won't get much larger as the federal reserve is on hold for now. one thing that is perhaps underappreciated is that there is reasonable momentum in the sector. be some was going to kind of stabilization improvement in the global economy, it will come from the consumer and the server sector. although that won't lead to an immediate move by the central banks, i still don't think we are about to start a huge easing cycle. it seems given that the fed has elon gated cycle, when can they hike next? gregory: i don't know if they

will be able to hike next. what we heard from chair powell at the latest press conference was that, unless we start to see much firmer inflation and symmetry around the 2% -- tita percent target, we won't see any further rate hikes -- 2% target, we won't see any further rate hikes. i think the fed is on hold for the foreseeable future. i think we reached the terminal policy rate. if you look further out, it doesn't mean we will go into a recession, it just means we go into a slower growth environment. further downside risk going into 2020, but the underlying fundamentals remain strong. we have a strong labor market and consumer spending that remains resilient, despite weakness around the turn of the year. taylor: thank you. daco.was greg dayco --

i want to recap some of the headlines out of tiffany's. the key thing for me is that 2019 earnings-per-share is increasing instead of decreasing by mid-single digit percents. they are reiterating their views for 2019. fourth-quarter total comp sales are missing estimates, coming in at 0% versus estimates of 1/10 of 1%. 2019 earnings-per-share is increasing by mid-single digit percents. we are waiting for shares to open up this year on the tariffs. tom is not buying enough diamonds. ipoext, we talk uber's mega . executive joins bloomberg later this morning. this is bloomberg. ♪

francine: this is ""bloomberg surveillance" -- viviana: this is ""bloomberg surveillance"." women around the world and not

well represented on corporate boards. this week, the punch the numbers. let's do the math. about a quarter of the directors on u.s. boards are women. if nothing changes, it could take another two generations before the match of the workforce. companies based in california must have at least one female director by the end of this year. by 2021, most boards will have to have at least three women. even if only california-based companies make the change, one estimate suggests the shift will increase women overall on boards by 1/5, about 691 morphine other actors. if the california law applied nationally, 1007 hundred 60 companies in the russell 3000 would need to add women to their boards. you can read the entire

story in the new issue of bloomberg businessweek available right now on newsstands. that is your business flash. taylor: thanks, viviana. now to uber. take the is said to new york stock exchange for a mega-listing this year. it's likely to be the biggest public offering of 2019 and the overall valuation for uber good hit as much as $120 billion. it also could be one of the top five biggest listings of all time and lyft looks to start trading on the nasdaq market next week. francine? francine: who is in the driving seat as the time to hit the market arrives? emily chang takes a closer look. 2019, the year so many highly anticipated tech companies planned to go public. two standout.

uber, engaging in rapid global expansion like food delivery, bike sharing, and flying taxis. plus, a valuation bankers say could score $125 billion. lyft may best be described as focused. launched in 2009, lyft grew out cofounders 2007 startup which connected college students looking for rides. it focused almost solely on growth in the united states. than one dozen cities in 2009 to 95% of the country in 2019. lyft claims a control 39% of the u.s. ride-hailing market. it is just starting to go international, launching in toronto and ottawa city in 2018. it's keeping up with its top rival by getting in on scooters and by sharing. yes, it is also working on self driving cars, buying blue vision

labs, beefing up staff, working ,n autonomous technology beefing up staff to 300 people. as it goes public, it is trying to hope to impress. 541% to $2.2d up billion last year from just 340 $3 million in 2016. with an estimated valuation of 20 to $25 billion. 32% to losses increasing $991 million since 2018. while lyft was second to launch, it is first in line to go public, weeks or months ahead of uber. the hope is investors will hail lyft's ride. francine: we will be watching anything with uber.

"bloomberg surveillance" continues on radio. taylor, thank you for a great week. tom sent us this picture. i look forward to getting him back so he looks less stressed. do you believe it? taylor: that is quite a little scary. francine: when you look at the markets, we went through what brexit will bring, we will go through what the 10 year german going below zero means for the markets. the big question next week is europe becoming more like japan. our conversations continue. this is bloomberg. ♪ ♪ this isn't just any moving day.

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weaker market. germany faces negative yields. global bonds rally. german bund yields hit a two-year low. in the eu gives prime minister toresa may two more weeks get her deal passed. --e alix steel carol massar alix steel was carol massar, and for david. pleasure to have you with us. carol culkin -- carol: one of his favorite targets is the federal reserve. here's what he had to say. pres. trump: i hope i did influence, but i don't care. i think i was right. and th