>> good from london. -- good morning from london. global stocks trade lower ahead of a press conference from president trump. he said he will announce new policies in china. says the -- coronavirus is worsening u.s. inequality.

to chancellor merkel set repair a second round of stimulus up to 100 billion euros. friendship bars and restaurants reopen. the reopening narrative gaining momentum, but that is not what markets are focused on. it is the increasing tensions between the u.s. and china dominating. when president trump talked about holding a news conference about a possible response to china, perhaps retaliation if you will, we saw the u.s. architect take a hit. we don't have a timing for the news conference but we have read on the screen in asia, and terms of futures, reacting to u.s. futures. european futures even more so but perhaps playing a bit of catch-up. the 10 year yield is slipping. the yen is strengthening.

oil trimming its biggest monthly advance on record, being swept up in the broader negative sentiment. president donald trump said he will announce you -- new policies in china. it follows beijing's attempt to impose security measures in hong kong. this has further exacerbated tensions between the two world's largest economies. great to have you with us. what are we actually expecting trump to announce? >> there is a spectrum of options in terms of how far president trump wants to go to punish as you say china over this security loss of hong kong. he could take a targeted approach, looking at visa restrictions for certain officials, freezing assets for certain officials in hong kong and beijing. he could go further, looking at putting tariffs in place for

removing completely the special trading status hong kong has enjoyed since 1992. goseems more likely he will down the targeted route, but we will not know until he gets up in front of the podium and addresses the press. china has said we will hit back with countermeasures and we will probably expect beijing to respond fairly quickly after this announcement from trump depending on what actions he goes for. nejra: you read a lot of the common tree around this. one quote that caught my attention from an expert was, there is no offramp. people saying that tension is always set to get worse. what sides are there -- what signs are there this could get worse? >> it is this entrenchment of positions on both sides in the u.s. and china. jinping,president xi they are focused on the

longer-term trajectory of the country and staring at in the direction they think is needed to get china back to the position where it is a dominant power. they are looking to 2022, the coming unionist party conclave -- communist party conclave. xi jinping wants to make sure he is in position to continue as president of china. there are no signs they are going to back down on core territorial integrity issues like hong kong, taiwan. these are simply immovable as far as beijing is concerned. you have president trump backed into a corner over what many would say is the mishandling of the coronavirus in the u.s. by his administration. he is lashing out at china. he had hoped to talk about the success of the phase one trade deal. one thread that

binds these two countries but that is looking wobbly. we expect the trumpâ demonstration to ramp up these attacks. this is a bipartisan issue and you are seeing that in congress. even if it is not trump in the white house, the oval office past november, if it is joe biden, it seems the pressure in china from the u.s. will continue. it may be a more coordinated effort. we will have to see. the trajectory for these countries, they seem to be locked into this downward spiral. nejra: certainly not looking promising. also, trump signing a social media executive order. this is a separate point but it was something that moved nasdaq future when i -- futures when i was sitting here 24 hours ago, he reaction the cash market is not as strong. we got some details.

>> the details of this action by trump on twitter? is that what you are discussing? >> exactly. social media order for tech companies. >> let me give this one a shot. president trump has been tweeting about ballots, postal ballots in the u.s.. been a bugbear for the republican for a number of years. democrats have wanted to expand the ability to post in l it's they want to ensure the voter base. an interim more people are able to vote. backdent trump has pushed on that as have republicans. they are concerned about what it would mean for the electoral demographics. he has been tweeting about this. tweeting and accurately. twitter put a disclaimer saying there were fax that were not consistent with the truth and

they could give more information to people looking at that platform. he has come out and hit back against this. he signed an executive order. there are questions about whether this is legal. twitter itself has hit back fairly firmly on the back of this order and said it has a duty to point out when things are inaccurate. mark zuckerberg takes a different view and says it is not the role of social media companies to monitor speech. try to correct inaccuracies. tom mackenzie, eric china correspondent in beijing. we appreciate your time as always. let's get to the first word news's. the u.k. is opening a path to citizenship for 300,000 hong kong residents holding overseas passports.

the foreign secretary says if china continues down the current path, they will change the legislation. it will lift the cap 212 months. in germany, angela merkel is planning a second phase of stimulus worth 50-100,000,000,000 euros. learned christian democrats are pushing back to avoid too much debt. the are set to discuss proposals next tuesday. in japan, factory output dropped the most since the tsunami. fell sharply. it comes as the government announced it was doubling the size of its virus response. a third night of violent protests in minneapolis. georgeows the death of floyd, and unarmed black man.

if they do not get the protests under control, president trump says he will send in the national guard. coming up, slow and steady reopening to read the citigroup ceo committed to bringing chris beck into offices as soon as data shows it is safe. this is bloomberg. ♪ -- bringing workers back into offices as soon as data shows it is safe. this is bloomberg. ♪

nejra: this is "bloomberg daybreak: europe." risk assets bracing for this news conference president trump is expected to give in china. european- u.s. and

futures lower. oil also getting swept up in the risk off sentiment. president trump saying he will announce new u.s. policies in china after beijing passed a national security law curbing freedom in hong kong. larry kudlow said china would be held accountable by the administration. possible penalties range from sanctions to ending hong kong's special trading status. how much potential do escalating tensions have to sweep away the optimism around reopening of post coronavirus? >> the second half of the year, the u.s. election will be the political event markets are watching. what we are seeing is the first step drawing our attention toward that.

u.s. china has been the big issue for three years now. it has proved to be a difficult task for markets to navigate. from suchere opening a low base, economic activity is so subdued because of the lockdowns. the globalt disturb recovery. still, for businesses looking to hire and invest -- this: the point you make, has been an ongoing issue in terms of trade tensions, a lot of people saying this is only going to get worse. there is no offramp here. neither side is going to back down. given where we are in terms of a base for the global economy, shouldn't we be a lot more

worried about this right now? the market seems to be fairly encouraged. there is evidence economic this could be -- unless it is going to get really bad. what this will probably be is trendsng donald trump heading into the election. trump seems to have mishandled the crisis fairly badly. likely, it is headed into the election the u.s. china issue will become a bigger deal. while this could be an opportunity to try to divert attention away from domestic matters. guest stays with us.

loads more to talk about. citigroup is pursuing a slow reopening as employees remain anxious about commuting in. it will be driven by data. >> it is not about setting a date. i tell employees, you are not with a blast up email saying, tomorrow is the day, come back. --are taking a grand jeweler granular approach. it is in even. -- uneven. it has not spread at the same rate. health-cared responses, economic and policy responses. not just in the u.s. but around

be world, there is going to a varied pace of recovery from this. i's perspective, we are going to take a granular approach around the data. using a line at my wife uses, while we are all in the same storm, we are certainly not in the same boat. i think we have got to be very mindful of that. >> clearly one of the hardest decisions a ceo has to make is people back. big client shows up at the front door with a fever, do you welcome them in or turn them away? tell me how you are thinking about those kinds of issues. business model has

given us some advantages. we have been in asia a long time. we knew it was likely covid would be coming west. to havehe ability learnings on the ground to what was happening on the ground, what was working and what was not. i think we were pretty early movers and some of the decisions we made. overarching, since then, it has been about the health and safety of our people. making sure we can do everything within our power to ensure that. to think about returning people to the office, it is likely to be slow. it is likely to be granular. it will bee sites, job by job.

the great news is the investments we have made in technology, the efficacy of which remote working has worked for us, i think it is nice to have that flexibility. if you look at the things we have done remotely, it has been extraordinary. in terms of lending. annuals of holding our shareholders meeting. closing our books to report earnings in nine days. the things we have been able to do for our customers and clients and have been able to do for the communities we serve. >> give me your best guess. i know it is data-driven but give me your best guess. start putting people back into your global headquarters in downtown manhattan? bringis all about can we them in and keep them safe? it is not about a desk or

in office. through thecoming turnstile, the cafeteria, the elevators. and then the bigger challenge, i don't think we are in phase one. as you bring more people back and densify, how do you scale those protocols? traders back in the trading floor a priority? >> there has been a lot of talk in terms of companies saying people never need to or will return to work. i am comfortable saying that is not who we are. we will continue to imagine as the ways we work. but at core we are a client facing business that is in many

ways an apprenticeship's nest. the craft, the trade is passed down. human interaction is critical. that was the citigroup ceo speaking to bloomberg. theinuing jobless claims in u.s. are showing a downward trend. with the american market is telling us about the economy. this is bloomberg. ♪

nejra: this is bloomberg daybreak: europe. claims have maintained their downward trend and continuing claims have posted a decline.

suggests evidence loans under the paycheck protection program helped many businesses limit or avoid layoffs. speak powell is due to later today. that comes after warnings from regional fed presidents about the effects of the pandemic. the philadelphia fed president said the virus is worsening inequality. the san francisco fed's mary daly said the shock will likely last longer than thought. up on what mary daly , also from durable goods orders not coming in as expected, should we take some positive signs from the data in the u.s.? or see it as a blip in what is a negative outlook?

>> it is hard to be positive about economic activity when it is probably as much as 30% down across economies including the u.s.. theyof the data suggests will be less bad. , wee tend to the outlook have a long way to recover before we get anything like january or february levels of out put. there is always the risk of the second wave. it is difficult to imagine consumer households could become very confident in that outcome. the recovery could be somewhat sluggish.

nejra: your latest macro essentials, you talk about more signs of hope. you talk about re-openings and developed markets. >> for the second wave, it is difficult as an economist to figure virus trends. as long as countries move slowly so they can see this feedback and the data, the risk of a second wave should be mitigated. second -- economy moved too quickly to face the second way. you have to look at economic activity. energy consumption. daily data points suggest activity is creeping up. probably what we will see is over the course of maybe a rapidr or two, you get a

jump in economic activity. thereafter, things will be slower to recover. we call this the tic shaped recovery. it is gradual, back to trends. we are probably two years away from the 2019 level. >> against that backdrop, what more do you expect from the fed before the end of the year? >> i think it is possible and the advantage of yield curve control, the central bank has to buy fewer bonds. pricing does most of the heavy lifting. involuntary issues,

savings have been very high. shops have been closed. higher or not we keep a rate of precautionary savings, that is the question. that is a fiscal policy problem. nejra: as we help you navigate cycle, hererus news are some things to watch out for. european gdpnge of meetings. and then india is set to report gdp for january to march. and at 4:00 p.m., a discussion with the former fed vice chairman. risk off tone in the market with u.s. china tensions increasing.

this is bloomberg.

nejra: good morning from london. i am nara terry -- nejra. lower aheads trade of a press conference from mother. -- from president trump. harker saystrick the coronavirus is worsening inequality.

we speak with loretto meckler. chancellor merkel said to prepare a stimulus of up to 100 billion euros. french strands and bars reopen. news straight out of france. renault about to eliminate 14,000 jobs and cut production capacity. the red headline. plan, consult on french sites to optimize production. to 3.3 millionty vehicles by 2024. that is down from 4 million. out of those jobs i have talked

they are going to cut 14,000 posts in french -- france and 10000 and the rest of the world. eliminate 14,600 reduce --wide and reversing the downturn hat that has rocked the global auto industry. we are seeing a risk off tone as we await a news conference from donald trump. few details in terms of the timing of what might be announced but certainly causing nervousness. past couplever the of weeks, u.s. futures coming off slightly. prevents --g a more

pronounced move in u.s. futures. took -- cash moved took the hit. the yen is stronger against the dollar. a bit of weakness in the dollar otherwise. oil getting sweeps up as well. president trump says he will -- china'srther crackdown and trump's threats to retaliate have further escorted tensions between the nation -- world's to largest economies. europe and the ipo market, that sprung back to life as stock offerings fly off-the-shelf. gianttest, the coffee begins trading today. brings the total value to $18 million. great to have you with us.

shift areof sentiment we seeing? european firmsg rush back. for a more attractive environment to price. rush, having bankers trying to capture this. the turnaround was 10 days. ipo for itsquickest size. bankers rush in, getting a lot investors. there is demand for these ipos. investors are desperate for companies that seem like they the pandemic.

that continues after the ipos are priced. the most recent ipos have beat the benchmark year to date. >> it is not just equity sales. smashing records in the u.s.. trilliongure, $1 raised in the investment grade bond market. this is smashing every record we have seen. binge ishis borrowing because of the fed. they said they would support companies impacted by the coronavirus. so far, they have not gone and bought individual bonds. we see this intention -- intense rush to raise cash through the bond market.

we have seen this may the highest number of bankruptcies in the u.s.. need that cash. investors are buying them up. this of course brings with us risks. there is likely to be a reprieve of the bond sales in the second half of the year. that is especially true if we get an economic turnaround in the second half of 2020. nejra: great to have you with us. limitent trump looking to the protection of social media companies. he signed a rule limiting the liability -- an executive limiting the liability of them. workedave extraordinarily hard to make

sure all of our systems are built in a fair and neutral way. we are a global company. all of our policies are done at a global level. if someone has an issue, they can always appeal. rolls-royce has been cut to junk i s&p. the rating agency's outlook for the company is negative. it is another blow as the engineering giant to revive earnings. scrappyany said it was 9000 jobs. thousands of jobs in the case reportared having to their gender pay gap. giving an out, half of companies took it. the decision is worrying advocates who see the pay gap widening. day, andws, 24 hours a

more than 120 countries. by jersey has been ravished the coronavirus. david westin spoke with the governor of the garden state. they discovered -- discussed the dangers of reopening and how to prevent more loss of life. >> i hope what we can offer is the basic sort of themes. public health creates economic health. as much as we are chomping at the bit to get everything opened again, if we transpose those steps were jumped the gun, i think we throw gasoline on the fire. we have been deliberate. we say all the time data determines dates. don't ever want this to be abstract, we eulogize a handful of people every day.

i call families to make sure it stays personal. this is moneyball. this is, what is the data telling us and what does it allow us to do? i hope we get that right. so far, so good. toyou also give credit people in new jersey for complying with the restrictions. at thetioned chomping bit. ityou start to back off, and is not just an on off ship -- which, how do you ensure compliance? >> it probably is. both individuals and staying at home, wearing face coverings as businesses, big and small, the compliance has been overwhelming. clearly, as the weather has gotten warmer, as the clock has

continued to tick, as folks see hard-hit, thatss is human nature and i get that. are there more folks today than a month ago saying i'm going to open june something? yes, there are more. we have started to open up. over the next few days, we are going to announce more steps. >> what about the politics of it. ofhave seen a fair amount politics. could active. what has been the politics? do you have the politicians backing? >> for the most part, we do. there have been some demonstrations. nothing of the scale we have seen in michigan but together demonstrations.

would prefer folks do not bothers me more than the demonstrations. there are always exceptions but we have had a good across the aisle give and take. we have needed them. we need laws to get past. we need the ability to borrow money and fill up the budget hole we have. so far, so good. there are some folks, naturally in any democratic reality, are going to go off and do their own thing. >> one of the tricky things is reopening the schools. as we approach the question, what is the criteria you use? folks we areomised

going to give them guidance. pre-k-12.n we are talking to the universities and higher ed community as well constantly. my bias is we get back to school. virtual stuffhe as well as any american state. i want to seat us back in school but it has got to be a new normal. nejra: that was new jersey governor phil murphy speaking to david westin. planning tonault eliminate 14,600 jobs worldwide and reduce reduction capacity by a fifth. this is aimed at outlasting the downturn that has hit the industry.

withhave had to deal factory shutdowns as a result of the coronavirus pandemic. 14,600n includes cutting positions in france and more than 10,000 further job cuts slated in the rest of the world. to achieve those savings of more than 2 billion euros, the plan is going to cost about 1.2 billion euros. -- emmanueled macron pledged a different -- additional stimulus. we will discuss the outlooks in britain next. this is bloomberg. ♪ ♪

a strong financial sheet, balance sheet repairing for 9/11. this is three times worse. >> we think in june there is going to be more demand for flying. demand is lower, there could be some consolidations. is rescuing the airlines. >> why is it the german and french government, are the biggest -- the inworrying is leveling of the playing field. >> it will take years for the traffic to recover. taste of what a is coming up. guy johnson host a special

report weighing in on the future of flying. "coronavirus: grounded." government iss preparing a second phased stimulus between 50 billion euros and 100 euros. wantocial democrats spending at the higher level while the conservative bloc are pushing back. officials will present proposals this tuesday. were talking about the recovery globally. you said you expected it to look little bit more like a tick. given the stimulus in the cards for germany, do you expect the stimulus coming from germany not just to upset the downside risk but bring about a better recovery? the world is very uncertain.

sure alli am pretty economic policy is doing is containing the downside risks. raising the chance we get something that can resemble a normal recovery. this virus is going to be with us for quite a long time. mightare optimists, we think there is probably a medical intervention toward the end of next year. that means for six months, the anxiety will be with businesses, households. and the normal path of recovery where you get building momentum is likely to be stifled every that is where governments come in. it is true in march, we were heading for a financial crisis. we have averted that. this is not creating upside

risk. have is cautious optimism. you point to the recovery fund, that really europe surprised this week. do you expect it to be implemented in its current form? if it is, how beneficial will that be for europe's economy? arts we will think we get quick implementation. that will be very positive for the recovery. this is mainly containing the downside risk. it helps out a lot with the politics. budget negotiations were fairly unhappy. worried, would

italy leave at some point? it also helps out with economic recovery. let's turn to the u.k.. business confidence had slumped. despite the steps to reopen the economy. there was a survey done by king's college. in the u.k., people are more concerned about their health than the economy. they might be cautious getting out there. does that make you cautious on the outlook for the u.k.? >> we are more cautious in the u.k. outlook than the u.s. outlook. already,oned it confidence will be very low. you have the additional issue of the u.k. trade negotiations.

confidence may remain subdued. the risk applies to all countries. are confidence is low, we inclined to save, we are not inclined to spend. the risk is the global economy falls into a liquidity trap. if we get to a situation where the private sector is relief saving and the second half of the year, we will need system high deficits to get us out. politicians are a bit squeamish about the idea of high public debt. thank you so much for joining us. great to have you on the show. easing restrictions, both france and the u.k. announce measures to slowly reopen. this is bloomberg.

let's turn to france where domestic travel restrictions will be lifted and bars, restaurants, and museums will reopen tuesday. the u.k. is also easing somewhat. great to have you with us. a europe continuing to ease. tell us what is next. >> the number of infections, that is allowing governments across europe to ease some restrictions put in place with the lockdown. in the u.k., you are seeing oris people say he wants gathering in small numbers. he wants shops to be reopened. it is a similar story in france. the government is saying we want

freedom to become the new normal. restaurants open up. of thent to lift some travel restrictions within the country. emmanuel macron was under huge pressure to open quickly because this is so crucial to the french economy. the big question is what is going to happen with the external borders. there is still a travel ban that could be extended. the europeans do want to see lifting of internal borders by june 15. >> great to have you with us. recap the news. jobsn to eliminate 40,600 -- 14,000 jobs worldwide and lower production capacity. it is aimed at outlasting the downturn. reynolds ---

renault has been rocked by the coronavirus impact. 10% of the carmaker total will be in france. more than 10,000 further jobs will be scrapped and the rest of the world. savings, theose plan is going to cost about 1.2 million euros. a decisive week for an alt. -- renault. they were also downgraded. elsewhere, we are heading for a weekly and monthly gain. we are seeing risk off. you see it in futures, and the yen. as we look ahead to a news conference from president donald trump about china. risk assets taking a hit. this is bloomberg.

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♪ anna: good morning. looking to bloomberg markets, the european open. i'm an edwards alongside matt miller in berlin -- anna edwards alongside matt miller in berlin. matt: good morning. we are looking at features that are heading down this morning, drops of 1% on some equity indexes. so, it looks like we could have a risk on friday after an incredible rally oblique.