manus: this is bloomberg daybreak middle east. our top stories this morning. china says parts of the first phase of a trade deal with the u.s. is basically completed. the white house says tariffs may now be put on. -- postpone. boris johnson calls for a december election. jeremy corbyn will only back it is no deal brexit is off the table. as the aramco ipo is put on hold again, saudi stocks enter their best week in more than a month. we explain why. the chairman of one of the buys largest private developers is urging a complete halt to all new home construction to help

reduce the city's glut. here are exclusive interview. -- hear our exclusive interview. ♪ manus: it has just gone 9:00 across the emirates. it is daybreak middle east. warm welcome to the show this morning. we are in limbo. will we get a december 12 election? labor looks as if they will hold out. could there be more pressure coming to bear on the pound this week? we settled down by 1.21% last week. we broke the overall trend. they say sell the rallies. ubs had a tactical overweight position. sterling remains cheap. i leave it to the words of blackrock. it's like a 1980's pop song. never-ending uncertainty.

let's have a look at the oil markets. we are gliding to a deal. what is that going to do to the oil market? stockpiles dropped for the first time in five years. a big week for the oil market. all hitting the table this week. oil had a nice rally last week. let's get your first word headlines from around the world. desiree humphrey is with me right here on the ground. desiree: thanks. the leader of the islamic state militant group has been targeted by the u.s. military in syria. he has been killed. that news comes as president trump says he's going to make a major statement at 9:00 washington time today. the president tweeted that something very big just happened without elaborating. begun shutting off power to an estimated 2.8 million californians in the

largest and longest deliver it blackout ever. the giant is turning off the lights for about 940,000 homes and businesses across northern california as it tries to keep power lines from igniting wildfires during the strongest windstorm in years. president trump is suspending some trade preferences toward thailand over concerns about worker rights. that's adding to the obstacles facing the export reliant nations own economy. it affects $1.3 billion in trade purchases and will take effect in six months. leadertic unionist party has threatened to frustrate boris johnson's efforts to push his brexit deal through. she's warning the u.k. leader that her party will continue to oppose the accord in parliament. johnson says he will seek an election on december 12 but he needs the support of two thirds of members of parliament and the opposition labor party has said it will block the vote.

german finance minister has slashed a first-round win for the leadership of his social democratic party. that is boosting the chance of survival for angela merkel's coalition. 22.7% of the ballots. he and his running mate will face critics in the november runoff. the vintage green cardigan kerkhove more -- kurt cobain more has sold for $334,000. that makes it the most expensive sweater auction of all-time. the government is unwashed and still marked with cigarette stains. the auction included a handwritten poem by two particular and a guitar used by prince. global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. ♪ manus: thank you. a little bit of breaking news

coming from one of the heavyweights on the summit. third-quarter profits. the estimate, levy double tech. third quarter profits, 830 million reals. the estimate was 2.1 9 billion. this is a significant miss on the actual third-quarter profit. waiting to see if there's any -- slippage as well on the sales front. to that extent, we will see how this stock opens a little bit later today. relations between sabic and clarion worsening, unable to agree about deepening their bond between the two of them. these are the top line numbers on clarion. we will get more of a breakdown on that as the morning goes along. possibly some significant items in there. as we get more detail, we will bring that to you in full.

let's return to our top story about trade and the optimism therein. it will push sentiment in terms of the markets. china saying part one of the phase one deal has been completed. the two sides read -- reached consensus. the comments in beijing follow positive rhetoric struck by the white house. >> we are doing very well with china. we are good with the farmers. the farmers will do better than anybody. everybody is doing well. china wants to make a deal. they would like to see some reductions in tariffs. they would like to see some tariffs that are scheduled to go on very soon, they would like to see them not go on. china really lets you know it. they want to make a deal. manus: it's that week. policymakers are excited to cut. trade is warming to the idea that it may be the last rate reduction for some time. the odds of a december move have

fallen from a near certainty to just 20%. best 28%. my guest post this morning. it's good to see you this morning. a lot of optimism. deal.one of a chinese how important is this for market sentiment? >> markets are looking for any piece of good news. let's be fair about what this is. this is phase one. it is still verbal. let's call it the paltry trade deal. what has been agreed is more on products being sold -- ag products being sold to china. things like poultry. cooked poultry get sold back from china to the u.s.. that sums it up. it is about agricultural products, which is what trumpcare is about at the moment. he's looking at the elections. all the other issues, ip rights,

subsidies, state-owned enterprises and their dominance of the chinese landscape, all those have been put into the background. the chinese are happy. they want to avoid another set of tariffs in december. everybody would like to have a photo opportunity next month in chile. manus: if phase one goes through, will we see a lot of cash? the you expect a rampant reattachment to equity markets if phase one goes through? >> i think it's already in the price. you don't have a lot to look forward to. you've already been overly optimistic. now you have a little bit on your table to be happy about. that's not the big trade deal everybody was talking about. manus: i looked at some korean data. japan factory orders fell to the weakest level since 2016. south korea has put in the worst performance.

let's look at it in the due to the library. it is the worst performance since the financial crisis. they are warning that this is ascribed to trade wars. how much more can monetary policy do from central banks to repair the damage from trade wars and and the cycle -- and the cycle? >> the short answer is very little. what we are seeing in asia is the supply chain of china suffering because of the trade deals. that includes south korea. there has been some trade diversion. some chinese companies are now using subsidiaries in vietnam, bangladesh, and elsewhere to export to the united states. that has not delayed the effects of the decline in trade volumes on a global basis. manus: i'm going to interrupt you there. we will turn to the conversation very shortly. let's go back to the sabic set of results.

there was quite a shocking number that came through. they missed on the thor quarter numbers. -- third-quarter numbers. charging 1.5 billion in regards to their provision, their investment in clarion. this is a very significant moment. it will have quite a significant market impact today, one would imagine. as we get indications on how sabic will open. sorry to interrupt you there. that is what it is bringing to the markets. i want to pivot to lebanon. you have a little bit of history with lebanon in regards to your roles and ability to interpret what's happening in the market. , theys of disruption worst-performing equity market in the world. what is the next shoe to drop in the financial consideration for lebanon?

write that the fault is something you are looking at much more aggressively. >> what we need to look at -- manus: debt restructuring, my apologies. >> what we are likely to have is a debt free profiling. manus: what does that mean? >> a large number of maturities over the next years, particularly in domestic currency. you repackage them into a new bond which gets subscribed by the central bank in the local banks with maturities over 5, 7, and 10 years. that removes liquidity pressure over the next few years. it allows you to undertake fiscal reform which is what lebanon needs. manus: bond owners will have to take a haircut? >> 90% of the debt is held by commercial banks in lebanon and the central bank. leave the euro bonds and external visitors -- investors

aside. do it in terms of lebanese cap -- currency. you can manage it. what you want to avoid is a debt default. 70%bt default, given that of banks assets are in sovereign paper, you want to avoid a default. that would wipe out the equities of the lebanese banks. everybody wants to avoid that. it would be a true financial meltdown.

manus: democratic party union leader has threatened to frustrate boris johnson's efforts. she's warning the you can leader that her party will continue to oppose parliament. johnson says he will seek an election on december 12. to hold it, he needs the support of two thirds of the members of the british parliament. the opposition labor party has said it will block it. my guest house this morning. lots of stories going around. labor is set to block demand for

december 12. they thought we would get an election in january if the eu extends. do you concur? >> i think the eu will extend, probably until the end of january. any election in a highly polarized parliament and country is unlikely to resolve the issues. the only way forward that i could see is a referendum. that is the elephant or camel in the room. manus: labor have offered that if they get into power. i don't know if that's a real risk. >> that's because labor wants to get into power. jeremy corbyn wants to be p.m.. you have to look at the wider issues. where is the u.k. heading? it has nothing to do with party politics. everybody is still playing party politics at the moment instead of looking at the wider outcomes , the outcome for the u.k. economy moving forward. manus: your base case for 2020,

a referendum? >> i expect a referendum in 2020. if not earlier. manus: referendum risk, what does that do to sterling? we give back 1.2%. we get back 1.2% last week. what does referendum due to sterling? >> any proposal of referendum would be all the value of u.k. assets as well as sterling. it would be a boom for u.k. equities, assets, and property. manus: you are working on the assumption that a referendum would deliver us -- deliver a remain outcome, yes? >> i do. manus: what makes you so sure? >> the numbers we now know about the u.k., the assessment of u.k. brexit, are very clear. every single assessment has said that the u.k. will lose between 2% and 6%. that is a massive decline. the public is now aware,

particularly young people. young people back then did not vote. there's a whole wave of young people who are now much more aware of the issues, more likely to vote. that will be the swing vote. exeter's have the dominated before. young people and remainders will dominate now. manus: demographics will do the damage, perhaps. thank you so much for coming to broad church with us this morning. go back to tv . his comments on lebanon are relevant. you can pick up nasser's comments there in regard to a bank from -- run for lebanon. many things covered. dive into all the functions we use. become part of the conversation on tv . this is bloomberg. ♪

manus: dubai's largest private developers are urging a complete halt to all new home construction to help reduce the city's property glut. yousef, exclusively to the chairman warns that relentless development could spell disastrous results for dubai's banks and the economy. >> in, there is no currency risk. that is a big advantage. world-class infrastructure. safety, the 1 -- one of the most safest cities. you come to the political instability. you come to the government which is very pro-business and active on business. time where the light every religion and sector can live in the city into whatever they want. the city has very strong fundamentals to grow and is

still the growth of the city can become 10 times more. yousef: at the moment, it's not enough. >> i understand that. the city has an amazing leader who has built the city, working day and night to reach where it is. he is the working to take it further. it takes all the -- takes all icks all the- t boxes for the most amazing city in the world. it competed very quickly with singapore, hong kong in a short time. why are we having this problem? , a bomb exploded. the the currency fall? did we have a demonstration in the street? we don't have all those issues. what is happening is very simple. we had a very good market. it peaked in 2017. property market is cyclical.

years,l see a good five you will see a slowdown. we are having a nice, slow, soft landing which was healthy and good. what happened in 2018, we started having a slowdown. then some of the big boys in town started dumping the supply. and creating one of the most ridiculous things for the city. the payment plan is not good. it is not good for the consumer. it is purely encouraging speculation and has a disastrous result. yousef: what has the committee done so far? what can they change, from your perspective? >> i don't know what the committee has done. i am not part of the committee. they have a mandate. i'm sure they are working on it. i'm sure they have a plan for it.

to be fair, it has only been a few weeks. it will take some time to see what can be done for that. didn't ask me, they me, my answer is simple. stop the supply. not forever. for a year come 18 months. all the developers in the last 12 months have reduced supply by 80%. , dubai reduced it a lot ofreduced it, the private sector has stopped it. every single developer other than amr has stopped supply or reduced it 80%. one company keeps dumping and dumping and dumping. yousef: if that continues, the crisis -- this has now reached a critical level. this is now an emergency. >> yes. 100% agree with you.

now we are entering a crossroads. either we fix this problem and can grow from here, not tomorrow but in 24 months, if we don't, we will see disaster. this will have impact on the banking system. yousef: allow me to follow up on that. are you planning to sell any assets at all? >> we have no issue from a financial point of view. last year, we made two launches. we used to do 20. this year, we made one launch. next year, we will do one. we curbed the new products. we have not bought any land. we reduced our land buying. we have enough land bank. look at theill as management and a board. we decided, we will not by every piece of land. we will not do major launches.

we are running our business very well. yousef: evidence to the pain is the stock price. leveldown at the lowest since 2014. how are you going to turn that around, given the challenges in the market? >> my job is to perform. i cannot control the stock market. the stock market is the subject of sentiment and geopolitical issues. what the whole market is doing. 4000 unitsdelivering this year. we will be delivering next year 6000 units. i am on the delivery focusing. we are not going to do many launches. we will focus on selling what products we still have. our financial position today is very strong, apart from 6 million an extra -- in extra. , one was dueue

last april. we paid it fully and on time. my next bond is due in 2022. if they give me a 6% discount on that, i can pay the next may. we have the money to pay that one. two years ahead of time. we are paying our contracts on time. the only thing we cannot give dividends because our profitability is down. we are not going to give dividends in this market because the saturation of the market. i want to keep the cash in the company. the most important thing for me, to pay those two bonds. yousef: up next, -- manus: up next, nor on the -- more on the breaking news for the hour. sabic. this is the lowest quarterly profit in 10 years. it is based on a provision that they are taking in their numbers, they are taking a billion, of over one

1.5 billion saudi riyals. clarion investment has a 25% holding. a great deal of discomfort in that relationship. this is bloomberg. ♪

manus: we are 30 minutes away from the start of your trading right here in the emirates. it is sunday morning. dazzling with your first word headlines. the leader of the islamic state militant group has been targeted by the u.s. military in syria. newsweek is reporting that he has been killed. that news comes as president trump says he's going to make a major statement at 9:00 washington time today. the president tweeted that something very big has just happened, without elaborating.

pg&e has begun shutting off power to an estimated 2.8 million californians in the states largest and potentially longest literate blackout ever. the bankrupt utility giant is turning off the lights to about 940,000 homes and businesses across northern california. that as it tries to keep our lines from igniting wildfires during the strongest windstorm in years. china says parts of the first phase of a deal with the u.s. are basically completed. the two sides reached consensus in areas including standards used by agricultural regulators, peter navarro says tariffs on china might be in play. democratic giddiness party leader has threatened to frustrate boris johnson's efforts to push his brexit deal through. she warned the u.k. leader that her party will continue to oppose the accord in parliament. johnson says he will seek an election on december 12 but to hold it, he needs the support of

two thirds of members of parliament and the opposition labor party has said it will block the vote. turkey's foreign minister says germany's offer to establish an internationally supervised saison in northeastern syria isn't realistic. the comments cast doubt over european efforts to broker an internationally acceptable compromise in the conflict. global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. ♪ let's bring into the conversation are middle east markets reporter. we just had the sabic results. 1.5 billion write-down on clarion. we are waiting for first abu dhabi bank. this sabic news is going to be quite substantial. >> it definitely set the tone for trading in riyadh today. it was a big mess, lower than any analysts estimated.

riyals5 billion saudi was not expected. this deal backng into the spotlight for any investor or analyst looking at the company right now. it is a one-time impairment. at the same time, it delivered the worst result for the company in 10 years. it is time -- unprecedented. clarionions within between the saudi's and the current management is not going very well. i think it's more than time that investors are going to bring it back to the top of their concern list. manus: on that thought, for any viewers were turning and, there are a couple of other lines to bear in mind. when you strip out that 1.5 billion, third-quarter sales down 23%. the estimate -- operating profit down 53%.

lower average selling price. .he very personification let's move the agenda along and talk about ohana. we have some pressure emanating on industries in qatar. >> we had another set of results. qatar, declining profits of 47%. this is a big name in the local market. the second-biggest member of the may index in doha. they also mention uncontrollable external factors to actually try to explain this result. basically blaming decreasing economic activity. there should be a spread within the qatari market as well. it's a market very concentrated with banks. this is one of the names that is actually outside of the financial sector. it shouldn't be a good day of trading there either. manus: i mentioned banks.

we have abcd which is on your radar. why? >> we have a pipeline of results for this week. you mentioned, for some dumb be bank. they put their results out last thursday. we should see some reaction in the market today. we have our analyst here in dubai, estimating that they will be able to deliver a 8% growth for 2019 after the set of numbers we saw for the last quarter. that is actually positive for the name. we have emirates expected to deliver their numbers here in dubai this week. thank you very much. the very latest on the quarterly results in the region. my guest host, good to see you. notes you say, saudi is no longer negative. when you look at news flow around sabic, very idiosyncratic.

it's a very global story. this is the pressure that is exerted in terms of the earnings stories. >> absolutely. you are absolutely right. i'm not saying that things are looking up and coming or rosier in the saudi market at all. you do have to keep in mind, it is down 20% from when we went aggressively negative. there may well be further downside risk. as far as taking an outright negative view, it's really not as intense as it was before. manus: you have a couple of pieces of evidence that are worth looking at. i never thought i could get as excited about cement but you made it come alive. the your heart out. this is one of the idiosyncratic pieces you put into your research with stanza to this thesis about saudi. how do you look at data like this? let's have a look at the atm's

as well. why are these important indicators? >> it's important to keep in mind what the bigger picture is. and how the relative development of a lot of the indicators that you are getting has been progressing. there was a long stretch where you thought for several years these indicators consistently felt and fell. they are not going to fall forever. at some point, it will hit bottom. manus: has the fiscal plan begun? to burn >> for sure. -- begun to burn? >> for sure. when i was trying to look for it, that inflection point might start to show a bit of a bottoming out. you have certain areas showing improvements. manus: the bad news and good news. aramco is delaying. the ipo has been halted. the market takes this as good news. why? is it because of the flow. suddenly being redeployed?

it always leads to a temporary liquidity withdrawal. the removal of that is obviously going to be a net positive. or at least historically, that is the case. now, there is a great deal of uncertainty over how much of liquidity we might see. in the short-term, it looks like it has been averted temporarily. manus: one of the markets from a volatility point of view is lebanon. a tense state of disruption. i focused on the bond market. they expect a debt restructuring. this is what we have here. 2021% 2029. you are seeing that spread between the two. we are looking at becoming more and for did. how would you describe the market perception of lebanon in the reverberations thereof? >> there is a distinct increase.

lebanon has been through a lot of economic problems. there's never been a concern that there would be any kind of run on the banks. over the last six months, it has become a definite concern. it has never really been the case before. i'm not very fond of that phrase , this time it's different. in terms of the sacrament or risk perception, it is different this time around. -my guess said, expect a run on the banks. are those two scenarios that you concur with? >> no. we don't have that in our expectations. it is a plausible scenario, considering the duration a wish -- in which the economy has been dealing with. considering the scale, lebanon

has a significant amount of change implemented quickly through a default. that would be painful. the issues that lebanon needs to address will take several years to bear fruit. think that ae, we lot of the issues that lebanon is contending with right now, while they will take some time, we don't see a run on the banks or a credit event. those can be averted through cash injections from outside donors in neighboring countries. where the amounts involved aren't staggering amounts. manus: can we broaden the conversation? you have riots in july. we've got overwhelming and people protesting on the streets of london. we have lebanon in a state of crisis. hong kong, week 20. when you look at the level of angst in the world -- our bloomberg economic is plotting

the riots. you have a call on gold. i wondered, to what extent is that protectionist trade from gold driven by concern about global links? gst?t -- thanks -- an >> what you are seeing in terms of the backdrop, we have a super trend, a five-year the medic be we have taken. the rise of a populist right-wing politics driven by sustained wealth inequality amongst other things. for sure, that plays a role. i wouldn't say that is the key reason. it definitely plays a role. near-term, our view on gold is neutral. we think it will fall further. if you are willing to take that three-year view, especially from a technical standpoint, we are very bullish on gold reaching as

much as 1700. if you take that three-year horizon, you are effectively taking into account probability regressionefer -- kicking in. thank you very much for joining us. to intel now. they reported earnings and stock rose 8% on friday. concerns loom with the u.s. china trade war. bloomberg spoke to the ceo to see where the chipmaker stands. we arere out -- performed by $1.2 billion in the quarter. we expect about 200 million of that was pulled from the fourth quarter in light of the anxiety about availability of products. not a whole lot of it but some of it. despite that, we did take up our

fourth-quarter outlook as well. >> in june, you said you were reviewing your supply chain. it was in the context of the trade disputes in the u.s. entities list. i'm wondering if you can share any insights from that review. are you making any changes? >> for our customer base, we have china as a large market for us. in terms of customers for china consumption. that havelobal oems more of their assembly and test operations in china. what we are saying is, in light of the debate around tariffs, we are trying to work with our customers to ensure that they can get their cut -- product most effectively by leveraging our global supply chain to diminish the impact the tariffs could have on their supply for global markets. we have a wonderful global supply chain. we work closely with our

customers to deal with the dynamics that we are wrestling with. i would say, we are encouraged that china and u.s. are talking. we are a strong believer in global trade. we don't find tariffs to be a constructive mechanism for global trade. we are very encouraged that the two sides are back at the table. in the meantime, we will leverage our global supply chain competencies to mitigate the impact on our customers around the world. >> what are your shipments to huawei looking like? they have been blacklisted by the u.s.. >> we don't talk about specific customer demand. they have been an important partner and customer of ours over the years. we continue to see them to be an important customer going forward. at the same time, we have to adjust and adapt to the laws in the markets in which we serve. we will continue to serve them to the extent we are allowed to

under the current entity list. >> are you getting those temporary waivers and licenses does apply to them at the moment? -- licenses to supply to them at the moment? >> we have put applications in to get licenses to ship. we have not heard back yet. we hope to hear from them sometime soon. manus: up next, turkey's central bank cuts interest rates yet again. can the lira withstand more easing? will conflict in syria play any role? we will discuss. that is next. this is bloomberg. ♪

manus: let's get a business flash. is exploring a takeover of tiffany to expand in the u.s. jewelry market. that's according to people

familiar with the mac it -- matter. tiffany shares have gained this year. lvmh has risen 40%, you get a market capitalization of 215 billion. bloomberg has learned that softbank's vision fund plans to take a write-down of $5 billion. that is to reflect a plunge in the value of its biggest holdings including huber and we work. sabic agreed to bailout we work in exchange for 80% of the company. citigroup is setting the stage to name its first female ceo. the bank has promoted her to president, the second-highest position. she has been running the operations across latin america. the ceo is committed to leading the bank in the coming years. wppgiant advertising group has posted its first quarter of sales growth in more than a year. the firm one more business in the u.k. in the western europe. it says it has seen significant

improvement in north america even though business there is still down. that is your bloomberg business flash. manus: thank you. turkey's central bank has delivered another surprisingly large interest rate cut. it reduces its key rate to 14%. that was more than every forecast polled by bloomberg. good to see you this morning. it was quite a surprise, wasn't it? >> yes, it was. to put this in context, those analysts polled by bloomberg expected to see that interest rate cut by 100 basis points to 15.5%. instead, we got a 250 basis point cut. it was made possible by easing inflation in turkey. we saw that number fall to 9.3%

in september. that is lower than anyone expected at the time. cut ofthe way for the this magnitude. the question becomes, will inflation continue to let the central bank continue to ease, regardless of what the turkish government says or want? can the inflation allow for this going forward? immediately, not so much. this is probably it for the year. manus: what are the limiting factors? you say, that's probably it for the year. what are the limits? is it about the u.s. tariff -- u.s. turkey threat of demolition coming from the u.s. onto turkey? frankly, that is probably the least of the factors immediately weighing on that decision-making. we did see some assets leave turkey. $960 million worth of assets

flowing out on the week that ended october 18. we have seen a lot of those losses in the stock market and bond market. you are back much closer to where we were at the start of october. there are other things. politics both inside the country as well, something we are watching. if the u.s. were to change its mind, and really get behind the sanction bandwagon again, there is momentum for that. we saw it stall in the senate in the united states. there are other things. growth has been slow. recessioname out of a in the last half of 2018, you haven't seen strong growth so far. there is stuff like foreign currency reserves declining pretty substantially. that week of october 18. that was a question we had about

accounting with the central banks generally. manus: thank you very much. reporter tracking the lira volatility. low interest rates and britain's brexit hit, britain and the economy will make it tougher to make targets next year. that's even as the banks traders outperformed most of wall street in the third quarter. the ceo spoke to bloomberg. >> our return on equity in the third-quarter was in double digits at 10.2%. in six of the last seven quarters now, we have generated a return on capital of over 9%. we still feel pretty good about the 9% target for 2000 19. -- 2019. as you look into 2020, you have the macro environment in the u.k. where economic growth is somewhat muted. if we continue with the uncertainty of brexit, one has

to think that you will continue to have soft growth in the u.k.. we also have lower interest rates. in the lower interest rate environment, it puts pressure on the bank's net interest margin in the profitability of its deposit base. given the current interest rate view across europe in the u.k., now the u.s. as well, if we have economic softness, you need to put some caution against the 10% target for 2020. we will maintain that target for now. >> what do you expect in terms of brexit right now? election?come an it could put an end to all of this uncertainty. what we've said over the last couple of days and weeks, what we are hoping for is an end to the uncertainty. i will not make a position from the bank, whether it's this private deal or that type of

deal. uncertainty behind us and allowing the financial system and banking system to begin to execute with an idea of what the future will look like, i think that's important. i think that's important for the country. thatne vote in parliament voted in favor of a deal, the european union had also been supportive of it. that was a good step forward. we have uncertainty now that may lead to a general election. we will have to see how that plays out. sabic we will talk about and that is next here on bloomberg. ♪

manus: breaking news of the past hour has been on sabic. they have taken a 1.5 billion of theirge in terms holdings in clarion. it is a relationship which is

asring on a perpetual basis sabic took a one point thrive billion hit to their numbers. it hundred 30 million real. a 1.5 billion hit to the numbers. if you delve deeper into this story, it is about the discomfort evaluation between sabic and clarion in terms of the assets on how to run the business. sales are down. operating profits are down. attributing the problems to the lower average selling prices of their chemical products. you are seeing third-quarter operating profits collapsed by 50 -- 53%. sales, alsor tumbling by 22%. they hit 33.69. that's below the estimates. i give you a live shot of london. we are in brexit limbo.

what does it take to get labor to vote for a general election? will there be an extension to brexit? how long will that be? and the ramifications for boris johnson. we discuss on daybreak europe tomorrow. this is bloomberg. ♪

alix: chile in crisis. protests erupt in the country. workers go on strike and the copper price is higher. in defense of shale. citi says shale is under attack and the naysayers will be wrong. a famed investor gives his best commodity pick. sugar, a relative value play, and maybe natural gas. i am alix steel. welcome to "commodities edge," 30 minutes focused on the company's, physical assets and trading behind the companies with the smartest voices in the business.