>> good morning. this is bloomberg daybreak: europe. deal johnson's brexit heads for key votes tonight as the government looks to pass amendments at blistering pace. president trump says trade talks between the u.s. and china are advancing. as beats on the bottom line wealth management assets reach a record high. we hear from the ceo for the end of the hour. the hour.the end of ♪

to daybreak europe. let's recap those numbers. unitbs wealth management bringing in net new money in the third quarter, almost $16 billion, meaning assets in that unit hit a record. atrd quarter net came in $1.05 billion, a clear beat on the estimate of $9.71 billion. beat on therofit, a estimate for ubs. profit came in at a beat, but ubs seeing $100 million restructuring charge at the investment bank in the third quarter. it also warned that lower interest rates would hurt income from lending compared to last year. the ceo, we will speak to later, saying in the statement, "we

continue to take action to grow productivity. we also have some breaking news coming through from novartis. a lot of numbers to come through here. the 2019 guidance has been raised. if we look at third quarter for operating profits, that comes in at $3.75 billion. the estimate is $3.59 billion. third quarter core eps, $1.41, eight on the estimate. third quarter net sales also beat the estimate. up in the high single digits. it did see a mid high. novartis delivering another strong quarter. let's get to the broader markets. some optimism. japanese markets are closed but indexi asia-pacific

excluding japan has been showing gains optimism around trade seems to be the driving story. we see real heavyweights and bellwethers at amazon, microsoft, and caterpillar. s&pome back 3000, where the closed above yesterday. cable on the front foot. 129.83 is what we are looking at. let's get to that, u.k. prime minister boris johnson will find out tonight if he has any chance of getting his brexit deal through parliament and if he can do so before the deadline. the main action happens around 7:00 p.m. in london with what is called a second reading vote. isning us from westminster bloomberg reporter sebastian. in my mind, i have second reading, program motion, third reading. run us through the timetable. sebastian: as you say, it kicks

off at 7:00 p.m. tonight with that second reading. this is the first time mp's will have a proper vote of the bill that implements boris johnson's brexit plan. all the numbers suggest we will see that past, possibly by a whisker. remember, there are various reasons to vote for that. you don't have to support the bill. then we get to the program motion. this is about the time, about pushing it through at breakneck speed because boris, as he is no doubt tired of hearing, wants to get frexit done by october 31. he will need that to get permission to push this bill through. if he passes through that, then we move on to committee stage straightaway. this is when we could get amendments. this is mp's chance to change

the plan, get their own flavor of brexit. there is no consensus on what brexit should look like in parliament so perhaps we get a different form taking precedent. there is still no real holistic view on what brexit should look like. like bill it sounds could get blocked, delayed, or could end up very different. which scenario out of all of those is very likely? sebastian: it will probably pass second reading. text,s a very big legal of pages and 125 pages explanatory notes. it would take weeks. then they have to make a call on this. there are a lot of mp's arguing that we need more time to look at this.

voting now on the program notion is there opportunity. if we do get through and we are moving on, then we get to those amendments and this is a chance for labor mp's in leave voting seats, who want to get some form of brexit through, to pass an amendment. then they can go back to their seats, their constituencies, and say, i voted for brexit but it is not necessarily as hard as the one boris johnson is advocating. week --f we get to the the end of the week and the bill hasn't passed, what happens then? does johnson call an election? he squandered that when he booted the 21 mp's out of the party voting against a possible no deal.

the brexit party is still in no play if brexit is not delivered. they are advocating for a no deal brexit. johnson's chances of majority are hamstrung there. if he does get that majority, then he has that support to get through. that is a very risky prospect when he has not delivered on what he said he would, he hasn't created this brexit that he promised by october 31. nejra: thank you so much. joining us now for the hour, as guest host, michael sneed, head of derivatives strategy at bnp paribas. expect haitians of the market are pretty high for a vote -- expectations of the market are pretty high for the vote to get past. that would take cable to 1.35, ine targeting even higher

the medium-term. you put cable fair value at around 132. michael: the way i like to think about it, take a step act from the politics and focus on the macro fundamentals. then we derive from that, where should it be trading? of 133.es us the value that tells us you have a lot of the risk premium taken out. the market would reenter long-term positions. those are not yet extreme but if they were to become extreme, that would be a sign that cable is starting to top out. we think we see most of the move with the risk. nejra: 140 is not that likely even if the deal does not get past. we think: -- michael: it is low 130's.

where we think there is a little equities and also in credit. to be athere seems sizable risk premium priced in. we think pricing in about a 20%, 25% probability of a no deal brexit. nejra: it is interesting you 100. up the ftse the ftse 250 has moved most on the prospect of a deal being passed. as that move been overdone. do you think there are better opportunities in the ftse 100, even with the strength in sterling? it has lagged because of the impact of sterling. the negative impacts from sterling, we think, will be minimal going forward, giving

the transfer the ftse to rise. thatyields, we have seen they have come back in line with kind of fair value for the first time this whole year. giltof that is the rise in yields. part of that is the fair value has declined after growth has slowed. we think they are trading about where they should be, even without political risks being taken into consideration. nejra: transfer this over to european assets. does this mean european equities will get a lift? which part of the european market do you see as the most sensitive and therefore most likely to catch a bid if this all ends well? michael: european stocks, there has been that implicit risk premium priced in the market. european banks, they have had a

huge rally over the past month. we think, going forward, it will be much more about the european growth story, ecb, and european trade talks that could potentially be coming up. nejra: is european high-yield place that could benefit? michael: could be. as sterling assets recover, you see that coming out of high-yield and there could be room for that to continue. nejra: great. michael sneyd from b.n.p. paribas sticking with us. let's get the first word news from annabelle droulers in hong kong. hasbelle: justin trudeau won a second term with a limited mandate that would require other parties to govern. for years ago,on the liberal party security majority to govern alone. -- secured a majority to govern

alone. they deal with china could be signed at the meeting next month. beijing had indicated negotiations going well and had already started buying more agricultural products. israeli prime minister regimen netanyahu has failed in his bid to form a government and forced to return the mandate to the president. the president is expected to give those rights to the -- to benny gantz. thousands of protesters gathered in the city squares around she lay -- around chile yesterday after rioting and looting that left 11 people dead. a half thousand people have been arrested after arson and riots have brought cities to a near standstill.

global news, 24 hours a day on twitter, tictoc on powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. ♪ be's on --ng up, ubs ubs beats on the bottom line. we will hear from the ceo sergio ermotti. up a president trump talks potential trade deal next month but wilbur ross says the devil will be in the detail. if you are traveling to work, tune into bloomberg radio in the london area. this is bloomberg. ♪

nejra: this is "bloomberg daybreak: europe." let's check in on the markets in asia. juliette saly has more.

juliette: mostly positive moves but china's trade market is tracking lower. the pboc today injecting the most in open market operations since may. elsewhere, you are seeing some upside. the kospi is doing well. a lot of surge in semiconductors. in japanat move because japan of course is closed today for the holiday. a lot of corporate moves in asia. india tracking lower mainly due to the fact that you have seen the indian i.t. giant at the forefront of a whistleblower accused the ceo of irregular accounting. china mobile also under pressure

in the hong kong session on the back of third-quarter numbers. they are saying the aca recovery in the fourth quarter. corp, weore, keppel broke the news yesterday that the singapore investment arm wants to increase its stake in keppel to 53%. analysts saying that the price of the deal show that the shares may have been undervalued and it is dropping the most since 1988 today. to some numbers just breaking. third-quarter revenue coming in at 6.0 one billion euros. third-quarter organic revenue is down 2.5 percent. the third-quarter gross margin comes in at 20.1%. the fourth quarter gross margin

is seen lower sequentially. adverse working day impact. the employment market. the ceo justeaking after 6:30 a.m. let's get the business flash with annabelle droulers. annabelle: softbank is looking to take a controlling stake in we work. it will value the company at about $8 billion and that would give a 60 to 80% stake. earlier this year, the company was heading for an ipo of a valuation of $47 million. companies accused of fueling the opioid epidemic may be closer to resolving thousands of lawsuits

after rate generic drug manufacturer agreed to pay to settle in ohio. agreement may become a benchmark for why the -- for wider industry settlements. santander has agreed to sell retail in puerto rico. they say it will boost the capital by as much as six basis points. santander first entered the market in 2006. facebook boss mark zuckerberg has denied giving recommendations to democrat pete food -- has confirmed giving recommendations to democrat pete buttigieg's campaign. zuckerberg and his wife sent emails and the people they suggested were hired.

that is your bloomberg business flash. president donald trump says that china has indicated trade negotiations are advancing, raising expectations that a deal may be signed next month. it comes after commerce --retary wilbur ross equities in futures gained on possible trade signals after u.s. stocks climbed above 3000 yesterday. from b.n.p.d paribas is with us. do you think the risk assets have further scope to continue gaining and for how long based on this narrative? michael: we have seen it improve and we think it has room to go further. it came out of a backdrop when the market was in a reasonably risk-averse mode. , given investors questioning whether or not this

trade agreement is perhaps a turning point in the whole pretension scenario, we think they are looking at that as a positive and we think that could rally further. nejra: does it go all the way through to the november meeting, do we carry onto year end? michael: we think that this is going to be a short-term bounce. the reason for that is that a lot of the moves you see is sentiment driven, based on expectations that executive better. we think, when we look at the economic data, that the damage has been done. you are starting to see spillover from the slowdown in the manufacturing and service sector, and in the u.s., slowdown in consumers. we think this will progress through the quarter when there might be positive news on the trade front. nejra: we have come a long way

from the fourth quarter of 2018. it would be a huge drop to match what happened then. even if we saw a pause in risk sentiment, would it be a slight pullback? the reaction function. we think growth is at the low end of the range. if we look at our market profile, we are reasonably optimistic because we think central banks have proved to be responsive. we think the fed will be responsive with two more cuts this year. so, two more cuts from the fed this year is what you are expect. what does this mean for treasuries? we closed at 180 yesterday. do we keep selling off in treasuries as we see these risk assets again like you were

talking about? michael: in the short-term, we think the treasury yields have scope to rise further. lagginges seem to be that move. year.e a target of 186 10 toward the end of the year, fed cuts, week data in the u.s., we think that will be pushing back the expectations. that means treasury yields, we think, will be declining again. nejra: 186, all the way down to 1%, so that means volatility. michael: yes. i think investors will be caught by surprise. if you start to pick up in bonds again, you start to think that all bond markets will rally.

think, falling down to the minus 0.8%. nejra: ultimately, how would you treat it? put it onbe nimble or now because that is the endpoint? michael: selling treasuries, looking for that target. however, we do think that yields put be an opportunity to off receiver positions, looking for yields to decline. nejra: commodity sector as well because oil often comes under pressure because of concerns about the demand side. what is your view on oil? michael: the view is a little bit split between the time horizons. short-term, we think actually commodities are really lagging this move. we think oil has room to move up

higher. for wti.e of about $58 the other is aloe minium. -- aluminium. we think on this risk on environment, it has room to move higher. nejra: what about gold? if you are putting gold above treasuries, does it rise as others fall? summer, gold, over the investors side as a property and gold did really well. gold has come off a little bit but not as much as we thought it should do given where yields are. we are actually bearish short-term on gold. longer-term, with the fed easing further, that does mean that gold will probably be moving lower and bouncing back. of an coming up, the end

era. ecb president mario draghi's -- we look decision back. we will be speaking to the ceo of ramstad. this is bloomberg. ♪

nejra: this is "bloomberg daybreak: europe." ramstad seeser fourth quarter growth margin slightly lower. joining us over the phone, his first interview of the day, is jacques van den broek. how would you categorize these earnings? ? ques: europe is stabilizing based on somewhat easier comps. some slowdown in the u.s. but

overall happy with the fact that our global margins has increased compared to last year again. costs while our again investing in our digital transformation and we had a great free cash flow, the highest ever in our history, almost doubling compared to last year, which is great news for our shareholders, we think. nejra: you talked about some slowdown in industrial sectors in the u.s.. --that a result of with ourwe are on site clients in the u.s. and a lot of the rest of the world. i would call them cautious. of course, the u.s. being a consumer economy, q4 will be important to see what happens there. on a somewhat smaller note, there was a strike at some gm

plants that affected it. some slight cautiousness in the u.s.. not yet alarming for us but we do need to flag it, of course. nejra: it may not yet be alarming but as we look to the fourth quarter and the prospect of possibly trade tensions continuing into next year, our companies in the u.s. actually responding? do you get the sense that they will be, in future, pulling back on hiring or will they continue to support the labor market in the u.s.? theues: that is always million dollar question. we take it as it comes. we are daily talking to our clients. a farope, germany is in .orse state in the u.s., we are still

cautiously optimistic. it of course has been a very long bull run, excessive growth for the last two, three years. you point tonejra: germany and say that is in a worse state. is that to do with hiring in the automotive sector? jacques: we started to see a slowdown in june of last year. the comparisons are quite easy. don't see it bouncing back. this is obviously sluggish out of our total negative growth of 2.5%. at a global level, we can directly attribute 50% to the automotive slowdown. even this morning, it was announced that they will lay off people and that is also due to automotive because they make

auto body parts. it is a long chain. trendswhat about hiring in the u.k.? what sense can you give us about those and how they might shape up in the fourth quarter. interesting about the u.k., almost every quarter we talk about brexit but we don't see anything particularly negative. i think everyone is sort of biding their time, u.k. businesses around the zero mark. 1% of gross profit, it doesn't really keep us awake at night. it is a stable picture. nejra: great to have you with us this morning, jacques van den broek, ceo of ramstad. good to know that brexit is not keeping you awake at night. the end of an era at the ecb.

president mario draghi is set to reside over his final policy meeting on wednesday before handing control over to his successor, christine lagarde. we look over the past eight years through the euro crisis, the introduction of qe, and controversy. ready to dos whatever it takes to prove -- to preserve the euro. words, ecbse president mario draghi is credited by many with saving the euro. hehis first two meetings, undid the 2011 rate hikes. he later took the key deposit rate to an unprecedented 0% to battle the greek then european debt crisis. that was just the beginning. >> the deposit rate has gone

negative, historic for any major central bank. >> for all the practical purposes, we have reached the lower bound. >> as the european economy continued to deteriorate and bond yields searched, the eu introduced quantitative easing in early 2015. opposition to the ecb was growing. despite signs of recovery and growth in jobs, as draghi approached the end of his term, it became clear that europe still needed support. >> additional stimulus will be required. this outlook is getting worse and worse. draghi cut rates again and controversially resumed qe. >> the ecb is ready to do whatever it takes. >> what next?

christine lagarde hopes to avoid draghi's motto. >> i hope i never have to do something like that. nejra: mohamed el-erian says mario draghi's actions at the ecb will help the transition even though they have not always been well received. >> i am not sure the global economy is bottoming out. if anything, i think we could have another round of downward revisions in imf forecasts. we will have europe in recession next year and that is not priced in full he gets. yet. fully b.n.p.michael sneyd from paribas is still with us. will we see the euro zone in recession in 2020? michael: we do not expect a

recession next year but we do expect very slow growth. nejra: why no recession? is it because the ecb measures will work? accommodative very quickly. you don't see any major imbalances within europe. it is not like heading into the last recession when you saw very big imbalances. however, there will be pockets of recession. germany is likely to be teetering right from the edge. a big concern for us, where will any further stimulus come from? we believe details will be on the ability for fiscal expansion in europe. , quiteng we found there little growth for there to be fiscal expansion, mainly because of the rules around fiscal easing that you have within europe. the fiscal expansion will be

much more of a structural story. theitutional changes within euro zone rather than the cyclical story where governments are able to loosen the taps. as christine lagarde loosens the rains, we keep talking about a reversal rate. the rates being more bad and harmful than impactful in positive? michael: we think the rates could go further negative, not by much. the implication does help reduce some of those negative impacts. would the supply-side stimulus really be what is needed here? michael: where there could be room for stimulus in the nearer term is infrastructure.

also green bonds and environmental stimulus, issuing debt in order to invest in renewable energy, which is a longer-term goal, the objective being -- nejra: coming up, our conversation with ubs ceo sergio ermotti. this is bloomberg. ♪

nejra: this is "bloomberg daybreak: europe: " let's get back to the numbers from ubs. the most eye-catching headline coming through is net new money in the third quarter. basically, ubs getting money from wealthy clients, meaning

assets hit a record. that is something very much in focus. also looking at third-quarter net income, $1.05 billion. the estimate was $971 million. it was a neat on the third-quarter net. pretax profits for the third quarter also came in at a eat. $1.27 billion.s in terms of some of the potential downside or news that was a little bit less positive, chargedbs did say restructure the investment bank. also flag day hit to revenue from negative interest rates, so basically a warning that lower interest rates will hurt income from lending compared to next year. the ceo saying, we continue to

take action. seeking to turn a corner after a and aarred by legal fines deepening slump in the share price. let's hear from ceo sergio ermotti, speaking to my colleague, manus cranny. i am glad we were able to bring a strong performance into this difficult context. manus: in terms of the investment bank, profits down by 59%, you announce a restructuring. what does that look like? sergio: market conditions in the last four quarters have been very challenging. skewed towardre europe and asia then we are into the u.s. this is still a business where the u.s. is dominating in terms of business activity. client sentiment is a little bit

better than outside the u.s. manus: you will take $100 billion as a charge. what do you expect? sergio: we expect 19 million a year in cost savings. most importantly, it will give ourn opportunity to refocus activities, for example, in the markets business, we will really focus on our execution, our structure, and our financing businesses, leveraging all the technology investments we made in the last few years. in banking, we will focus on industries and a global business more than on a regional business and also leveraging the extra fees we have. nejra: that was my "bloomberg coanchor manuse"

cranny speaking to ubs ceo sergio ermotti just a few minutes ago. manus is with us now. give me a sense of what else sergio ermotti was saying to you. t on a lot of key numbers. blog, i willlive do my report shortly. net new money continues to be positive. for certainly was a beat the marketplace. chargesion dollars in to save $19 million. you will hear the product focus shortly but it will not involve huge job losses, they say, at the moment. this, i get the sense, is a bank trying to get? been to fifth gear. coming in on the wealth management side, his focus in terms of focusing on wealth

management and bringing some of that expertise from credit suisse to bear in the management division. you get the sense that they are doing quite well in the americas in terms of the wealth management side, but the shakeup is what i think will catch the attention. but inry yesterday, terms of net new money and the clients, there is a slide in the presentation. to of their clients opening -- hoping to buy the dip. the issues between trade and brexit. nejra: what do we hear about capital returns? for a $2e target was billion by 2020. you will hear confirmation a little bit later on. they are up to 600 million at the end of the third quarter.

ae target was initially billion dollars. he sort of corrected my phrasing as well. to get to a billion dollars by the end of this year. i think you will get a confirmation or update by the end of the year. to make 40% return on equity is about reengineering the re-boosting the initiative within wealth management. if you take those two, how do you get to 15% return on equity? 15%, the sense, to get to you will need to normalize. there is a choice. whether it is too ambitious a target and whether a normalized market environment is around 13%, or do you go in by an asset somewhere around europe or by an asset in asset management?

maybe that is a question for christmas. nejra: you have got all the great questions and i look forward to hearing. manus: they keep coming. nejra: i will see you at 7:00 a.m., back on the show. manus cranny, my coanchor. let's get the first word news with annabelle droulers in hong kong. annabelle: boris johnson will finance -- will find out if he has any chance of getting his brexit deal through parliament. the second vote is scheduled to take place at 7:00 p.m. u.k. time. he probably has just enough support to win but he will immediately face a more difficult vote on his rapid timetable of pushing the vote through parliament. won a secondu has term as prime minister but with a reduced mandate that will

force him to rely on other parties to govern. in liberal party was leading 155 districts, short of the 170 needed for a majority. in the last election, they achieved a majority to govern alone. president trump raising trade expectations that an agreement with china will be signed at the aipac meeting next month. he indicated negotiations are going well and they have already started buying more agricultural products. softbank is looking to take a wework.ing stake in we are told they will value the company at about $8 billion, giving softbank a 60% to 80% stake. earlier this year, the company was heading for an ipo with evaluation as much as $47 billion. israeli prime minister benjamin

netanyahu has failed in his bid to form a government. he is being forced to return the mandate to the country's president. rivlin will pass that spots ability to benny gantz, who is expected to face an equally difficult task. global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. ♪ nejra: thank you so much. as we get into the full swing of earnings season, there is lots of companies reporting this week after u.s. banks kicked things off last week. we will see how european banks are faring. we just heard from ubs not long ago, a clear beat on net income. netts hitting a record with new money inflows coming in at almost $16 billion.

other banks include rbs and barclays set to report. we will also get earnings from the auto sector, closely watching for these numbers after poor manufacturing data out of the u.s.. tesla and ford motors kick things off tomorrow. the trade war rumbles on while snap reports today in the likes of microsoft, amazon, and twitter report later in the day on thursday. other firms to watch include boeing and mining companies. fair to say that this week will be an avalanche of earnings. what is your take so far? we are getting into the swing of it so far. >> so far, pretty much as expected. the cyclicals, the industrials have seen weakness. you have seen a very strong u.s. bank earnings, largely on the back of a strong consumer sector

in the u.s.. fair, already, and to be this often happens, but analysts are taking a knife to their 2020 profit estimates. they have just cut by the most since january. they always lower their forecasts as the period draws near. 2020, there are a few headwinds. you have the slow growth. you also have the end of economic cycles where growth is slowing but the labor markets are still tight. from an economic perspective, wage pressures are ahead of productivity gains, which is gains, which is bearing high costs on corporate. they are being squeezed on the cost side and the revenue side as well. that makes it a difficult time for all companies. nejra: let's talk about the

banks. one thing that really came through was the strong consumer sector. to be fair, trading did that are than expected for a lot of them. we heard from ubs this morning but generally, you are underweight banks in europe. michael: one thing to bear in mind, you already had going into these earnings a lot of underperformance from banks. speaking about 10% underperformance of banks. however, going forward, one of the things that we think gives a risk is low growth in the euro zone. also the bond market expectations. see german bund's go down as expecting, we are also talking about ecb and the prospect of deeper cuts. that will again be another headwind because banks are struggling to pass on deeper

rates. nejra: i am definitely fixating on your negative call for the 10 year bund yield for the end of the year, and of course going back to the revenue and costs. . that is the challenge for european banks, trying to get that topline growth in ways other than just trying to offset it. you have already mentioned the cyclicals not doing that great. week.reporting this have we seen the bottom yet nejra: -- yet? inhael: one thing we do see telecoms and europe, that is partly because normally, historically, telecoms tend to behave like utilities. when yields go down, they tend to outperform. a lot of need for a lot of investments with movements to 5g and competition.

we think that is fully baked into the price. nejra: so telecoms ra buy for you. thank you for joining us, michael sneyd. coming up, we will turn to brexit. can boris johnson get it through? this is bloomberg. ♪ devices are like doorways

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manus: it is "daybreak europe." these are your top stories. boris johnson's brexit heads for a keelboat as the government looks to pass legislation at breakneck pace. live in westminster. global stocks lifted as president trump says talks between the u.s. and china are advancing. ahead of next week's apec summit. as beats on the bottom line wealth management assets reach a record high. i spoke with sergio ermotti, who struck an upbeat tone.

>> a very challenging market condition. i'm glad we were able to bring a solid performance in the context. nejra: welcome to "daybreak europe." we will hear more from sergio ermotti in just a moment with wealth management numbers in focus and assets hitting a record with net new money from the third quarter. we have some breaking headlines on the bloomberg. jeffedhead line is that carter is named ceo with the retirement of adrian. we have a new ceo stepping in. in terms of the numbers we are looking at, sales up.

coming in soft. net revenue a little soft as well at 3.29 billion pounds. a little bit of a mess on the estimate. that's 3.32. the main headline is a new cfo. jeff carr stepping in. juliette saly in singapore has more. good to see you. japan is closed, but we see optimism around the trade talks. juliette: that has lifted the msci asia pacific index up by 0.4%. on track for a second session of gains on the back of the optimism. japan is out of action today. the china market is under pressure. the csi 300 down about two fits of 1%. we had the lpr unchanged earlier in the week. putting the most amount of liquidity in to market

operations since may. one of the analysts was saying it is like giving the milk and then taking the cookies away. watching what is happening in singapore, one month high. that is after cable surged on the back of that bid from 51% stake in the company. prices in china have been huge. fueled see here inflation has driven yield -- real yields close to zero. liuere speaking to betty and she was saying there is no chance prices are going to subside if we see cpi above 3%, that's going to contain the pboc in terms of cutting benchmark rates. continuing toces be ahead scratcher when it comes to chinese inflation.

handling testt a headline from anglo american. third quarter output is falling 14%, it is keeping its guidance though. we have an update on third quarter copper output. 158 point 9 million tons versus 171,800 euro year. back to our top corporate story of the day, it is ubs. you are looking at premarket numbers after a clear be on the bottom line. wealth management pushing asset sales to a record. to .6% onicated up third quarter numbers. saving $90ng, million in the investment bank. , as the tliv blog has it, there is pent-up demand. or from sergio ermotti very

shortly. those nailbiting finish stories. but u.k. prime minister boris chance of he gets any a breakthrough brexit deal through parliament. whether he can do so ahead of october the 31st deadline. main action happens around seven p.m. in london with what is known as a second reading of the vote on the government agreement. the issues from westminster's green is bloomberg's sebastian. run me through the timetable tonight and forward. >> 7:00 p.m. is the first chance for mp's to have a say on this implementation bill for boris johnson's deal. we think there might be the numbers to pass up, but remember

, if the deal goes through, we go to the -- this is what would allow the government to push this bill through as quickly as they want to. three days, which is fast for something that often would take weeks or even months. if that goes through, we are straight on to the next stage, the committee stage. that is when amendments come in. this is crucial for mp's who back brexit to have their own flavor in mind. they might want to add a customs union. they might want a referendum. mp's start tother scupper johnson's plans. if johnson is in the clear we have to go to the third reading. if not, we could be into shaky ground. this could take longer. nejra: indeed. the bill could end up getting blocked or it could look very different with amendments. addedget those amendments

and then we get onto that shaky ground you were talking about, what happens then? we go to an election? or it could still get past that third meeting even with the amendments? >> if you have a look at the indicative votes to decide what sort of brexit they did want, we saw a customs union and a second referendum. neither could get the majority of the house. nothing can change between the u.k. and the eu. if they commend the customs union here, boris johnson is going to negotiate that. many see this as a way of pushing toward a second referendum. an election is a possibility. but remember, if brexit has not been delivered, boris johnson has not kept his promise. this could not go down well. you have the brexit party still in play. they are putting pressure on

johnson's government from the right wing. they are advocating a clean brexit, which is essentially no deal brexit, even more extreme. it evenld even -- make more difficult for johnson to get that majority in order to get anything through. sebastian, great context for parliament. joined by david page, .enior economist great to have you with us this morning. the pound is showing stoicism, holding onto gains. the pound believes brexit will be delivered. is that a fair assessment? do you share the confidence of the pound? iswith the pound believes ,hat the risk of no deal brexit has receded on the back of the fact that johnson now has his

own deal to deliver. an extension and you might get a general election scenario. if johnson won that general election, you get back to square one. the risk of no deal is still high. that is what sterling could price through. now that johnson has a deal, he's going to try to get that through. what we are seeing is the d pricing of the risk that was very extreme no deal, rather than absolute confidence. at the same time, there is a that you might be able to squeak this through. he could jump over hurdles put before him. >> that seems to be what people were saying over the weekend. for sure, we take your point on the no deal risk. that has now gone down to 5%

probability. , arebase case from here you on board with what other analysts are saying, that the vote is going to pass eventually and we are going to get a deal that gets through? >> it's not obvious. the vote is very tight. it looks like it comes down to about four or five votes. yes, you can see that happening, but we still feel there is enough margin here but you could see a slipup. technical to get the vote passed through, we will find that out after tonight's vote, or whether it is a more substantial delay that requires a general election to give him better numbers. majority iss insufficient to see him command a definitive majority. manus: i am curious, richard jones, one of our columnists has

written on a theme that has been written on by a number of people. let us say we passed legislation in the commons this week at some juncture. you then have six months in 2020. have until the middle of 2020 two ask for an extension to negotiate a free-trade agreement. are we misunderstanding the concept of a negotiated deal? there is a long and winding road to not ending up at hard brexit, isn't there? >> absolutely. we are not really worried about the end of 2020. this is an absolutely key point. the material point is that we are going to see a change in incentives for the u.k. government. by the time we get to the point of looking for an extension, it seems very little viewed that we will get a free-trade agreement. historically it takes longer. we will need an extension. we will need the transition. from the government's

perspective, by the time we get agreeing, we are fully at the deal -- we would have had an election. the u.k. tories have delivered a large majority. that reduces johnson's to seekns -- incentives a politically defined hard deal. it is more likely at that stage she is more relaxed and we see the transition taking a number of years. we think two or three years to allow for that. >> if the deal boris johnson has negotiated worse than what theresa may negotiated? if so, what does that mean for the bank of england? >> probably. we are looking at investment over 10, 15 years. there is a great amount of uncertainty. what this does is lead us into a free-trade agreement, which will be noticeably less aligned with the eu. we sacrifice the access to our

largest export market on the hopes of getting free trade agreements with the rest of the world. it is not obvious we are going to get those. it is not obvious we are going bear the bad side effects that come with those. the impact on growth going forward is going to be very small, very hard to notice on a year-to-year basis. the impact on the boe is going to be hard. what we have seen from evan mark governor carney over the last couple days, activity should try to bolster business investment. so you sort of agree versus the dovish comments from colleagues previously. , thank you so much for joining us this morning. a ceo up, we speak to

next. this is bloomberg. ♪

london, 42 a.m. in minutes away from the cash market open in europe for equities. this is "bloomberg daybreak: europe." 8:17 in zurich. clients at ubs have added $15.7 billion net new money. lifting the assets and wealth management units to records. told me about marketing conditions, restructuring charges, the end -- and the importance of asian business. >> still a very challenging market condition.

were able to bring a solid performance in this context. in terms of the investment bank, profits down, you announced restructuring. what does that look like? >> market conditions have been very challenging. are favoringions our strategic choices. we are skewed toward europe and asia more than the u.s.. this is still a business where the u.s. in terms of calendar, business activity, a bloomberg better than outside the u.s.. savings?at cost is it going to be job losses? 19 per year cost savings. most importantly, it is going to give us an opportunity to focus

, inactivities, for example the markets business, we will really focus on our execution, restructuring, our financing businesses. leveraging all the technology investments we have made in the last few years in banking. fewerl focus on industries and more -- then on regional business. you have 5300 people in that division. are there going to be significant job losses? will be't think they significant in the context of the numbers you mentioned. of course we need to adapt business to the current market conditions. manus: your product of excellence has been since you skilled back on the rates business, you have scaled up on fx.

where is product excellence going to focus? a on execution, we are still leader in equities, in fx. of course, we are still under invested or underrepresented in rates. we sold good development on balances in the financing part of the business. in terms of our banking industriese focus on and global business regional approach. have ladles of net new money. where did that mostly come from? on notre really focused quarter on quarter.

i'm very happy we have trained slightly above 2% net new money. the vast majority was coming from asia. i am pleased to see that across positive ore had neutral impact of net new money. your clients are waiting to buy the dip. do you get a sense that if we got a good trade deal and negotiate brexit, there is a pent up desire from the clients to act, actively get involved? >> if all these challenges you mentioned are somehow addressed or clarified at least, there is room for investors to come back in the market. the vast majority wants to.

around 46% of investors would think so. 66% wants to see a dip. it depends how the dip is going to play out. last december, a year ago, we saw it dip that was too quick and too dramatic to trigger a real interest. we need to see an opportunity where things get resolved were correction in the market is somehow the adjustable by investors. manus: is your glass half-full or half-empty in terms of resolving the big issues? sayn that sense, i would half half. manus: we talked about the net new money. i want to know what you have decided in the unrealized opportunities. what are they? >> he has on boarded very fast

and is helping with our current strategy, a series of opportunities we wanted to explore and execute on. situations where somebody starts into a new job, we expect the person to contribute to the development of the strategy and not only the execution of the existing one. and new bankers are going to change the agenda. sergio ermotti there. let us see what the market makes as the day goes on. another earnings to get our teeth into. what have you got? >> germany software has reportedly bit -- reported ebit. this is on revenue of 224 million euros. the group also confirmed its outlook. shares have gained over 5% on trade since the report. joining us from germany is

sanjay brahmawar, ceo of software ag. thank you so much for joining. judging by the numbers, are you april to -- are you able to compensate for weaker growth? >> we had a strong q3. what we can see is that the first results, operational and financial, are starting to deliver on the promises. onare seeing a recovery digital business. we had a slow start in the first half that has recovered. i can see that our market in north america where we have challenges, we have stabilized operations. we can see results coming through the actions we have taken. overall, our transformation is showing the leading indicators,

recurring revenue, has grown year on year. what we can see is our aansformation now is percentage of bookings, 63%, double last year. absolutely, we are seeing our pivot happening and we can see ourselves winning with taste in the market of the digital transformation. morning.very good acquisitions as a means of boosting growth, is that part of the agenda for you? what kind of companies would fit the bill? i've got making sure our entire team is focused on the organic growth we have put together. we are executing strongly. results are coming through. i'm not excluding any opportunities to accelerate. actively looking at what might be aligned with of the strategy of being the market leader in

hybrid integration and analytics. those are the areas we believe we can go. how much will the internet of things contribute to growth? goldman sachs has a number out there for 2023. 7.5ay: we see the market as billion today, going to 25 billion by 2025. these are numbers that are being given to us. we can see that growth happening if you see our own position. we have been growing double every year for the last couple of years. ourally, this year, estimates are between 75 and 125%. we can see these use cases are now getting traction with clients, they can see the opportunities. we are also realizing how they can start up lamenting these products. we have added about 100 people to be able to help customers implement iot now.

nejra: sanjay brahmawar thank you for joining us. ceo of software ag. "european open" his next. ♪

matt: welcome to "bloomberg markets." this is "the european open." today the markets say here we go again. optimism on the trade front and for a brexit deal boost stocks. cracks the 3000 mark. brexit at breakneck pace. bori