francine: the boe holds steady. we will be speaking with the governor later today, as the central bank says it will not -- willand to precoat not recover to pre-covid levels until 2020 one. white house and democrats still far part of major issues. president trump says he will take executive action. plus, companies better than expected as the chief executive confirms he is looking at

options. good morning, everyone, and welcome to "bloomberg surveillance." i am francine lacqua here in london. now, there is quite a lot going on in the markets, simply because the stimulus in the u.s. is getting people quite excited. part of it is what we are hearing from central banks around the world, the projections. this is what the markets are doing overall. stocks are turning higher. gold at the same time is ascent, and then we have the word on the latest american stimulus package. we need to mention pound, rising against the euro, after the bank of england said it did not plan to tighten policy until the inflation outlook is more clear. now let's get to the bloomberg first word news. here with me in london is laura white. hi, laura. laura: as fast as they can, but that does not mean safety is

being sacrificed. dr. anthony fauci he hopes the vaccine is at least 70% effective, but he says he would still feel good if it is at least 50% effective. classical history of viruses, particularly respiratory viruses, are such that if they are going to be something that is as capable as this virus is efficiently spreading from human to human, ultimately, if you really want to put the nail in the coffin of an outbreak, you are going to need a vaccine. lars: -- laura: twitter and facebook have blocked a video shared by u.s. president donald trump, saying it is because of coronavirus mints information. -- coronavirus misinformation. him sayingntained that children were virtually immune from the coronavirus. the chemical suspected of causing that deadly explosion in beirut has been lying in storage for six years. that is to document seen by

bloomberg, and despite warnings from customs officials about the hazard. ammonium nitrate can be used to explosives and fertilizer, and it is the equivalent of tnt. global news, 24 hours a day, on air and @quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am laura wright. this is bloomberg. francine? francine: laura, thank you so much. before policymakers voted unanimously to keep asset targets at 45 billion pounds and hold rates at a record low 0.1%. -- boe says its is to the downside. joining us now is john bilton, who is head of global multiaxial strategy -- multi-asset strategy

at jp morgan. if you had one question for him, is that the fact that forecasts are going the opposite, but they also seem to try to give the message to the market that they are not tightening any? time soon cowed do you soon? time how do you square up the two? john: obviously monetary policy is a perfect exercise in learning by doing. you have to take information in real-time, but at the same time, you're looking to balance risk. i think some good news came out today, which is the fact we are seeing consumption happening, coming up a little bit. we are seeing some positivity on the strength of the rebound. the unemployment rate, which will continue to be a drag on the u.k. economy. but what i think andrew bailey has rightly done is recognize that there are still risks here. we do not know when we will get

the second wave. point at know what vaccine will come, and of course you have breakfast illuminate. -- brexit still looming. as many tools to manage the economy as possible, and i think against that, one of the reasons why the central bank perhaps demeanors on negative real rates at the moment is because of the uncertainty it presents to the banks, and of course an economy that is on somethingnt which would not be necessarily buy's, who are watching earnings. francine: john, what do you think it will take for rates? john: they have been relatively clear about what the key risks of acr. most of the key risks are, morer one, resulting in

widespread shutdowns and economic disruptions. again, spreading through the economy via the unemployment rate, via the household consumption. andng any money in hand, that of course is uncertainty around brexit and what shape a deal may take by the end of the year. were we to end up in a situation where a deal was unachievable, but i think the bank of england has generally been pretty clear throughout that that would be a negative shock and the realtor -- merrill term for -- in the near term for u.k. francine: what do you take on the pound? what does it mean for u.k. assets? first of all, if we have a brexit and a second wave and possibly a second lockdown, is this a perfect storm for the u.k.? john: well, you know, it is one of those things. the currency in the u.k., as we know, does have a habit of being a lightning rod. we have seen that time after

time. immediately after the 2016 vote, of course the pound come under -- came under remarkable pressure. it has really followed the ebb and flow of the debate ever since. it has strengthened some in recent weeks. it is very important to that we could see the upside of these darling, but make no estate, if we see weakness in the u.k. economy, if we see a no deal brexit, it feels relatively evenly balanced, as things stand at the moment, and we would not expect to see a big move in either direction near-term. but certainly i think we need to take another look at the mid to low 120 range in the event of a no deal scenario. that is certainly something we

have to be mindful of. francine: john, where do you see in u.k. assets, if any? john: the u.k. is in a difficult spot at the moment, and i think of this as a global context. on price-earnings ratios compared to its peers, it has not achieved enough to say it is a value by at the moment. the u.k. relies on dividends. it is a high income market, by and large, but we have seen a number of a dividends trend and there has been talk of pressure maintaining dividends at a lower level, perhaps even being, you time stalled for a period while we work through this particular crisis. when we look at financials, negative real rates, in a second wave of the virus, a significant energy sector, and pressure on the dividend. the u.k. market, frankly, it is difficult to see that you are

going to get a near-term boost. we would find value actually outside the u.k., so we would rather a global context, perhaps being a little underweight u.k., leaning more to the u.s., eurozone, and emerging markets at this time. that said, it is worth bearing in mind for much longer term investors things do tend to right themselves, and there is inexpensive access to what will probably be a recovering dividend over a number of years. so a lot of it depends on how because's pockets are, the u.k. probably has more bad news to come before we see a u.k.to the upside -- equities relative to other markets. francine: john, what would it -- for youu to take to change your mind? is there something else? for example, the government, more in terms of fiscal policy, would it make you more likely to buy u.k. assets?

john: well, i think the school is an important point here, the deployment of fiscal, which is incredibly important. remember, the u.k. market, the stock market, it is a relatively international market. one some uncertainty on the outlook. even if there is strengthening a bit because of a, you know, drop in uncertainty,. the u.k., in a broad-based global recovery, you would expect u.k. equities to go up with everything else, but the trouble is, the u.k. is still a relatively defensive market, and in a defensive market, you know, you are going to see better performance through local cyclical markets, such as japan, emerging markets, so the choice, even if we have got a rising global economic tide lifting all boats, and maybe even then the u.k. does not perform as well. i think what we need to see is a little more dynamism, a little more recovery on the u.k. domestic outlook.

so a bit of a consumer confidence, perhaps, a little bit more of a targeted fiscal stimulus, which, ultimately, accrues to the u.k. economy directly in a way that actually improves both corporate and consumer confidence. and in doing that, we can see something of a resurgence. but here and now, it really is, in many scenarios, a tough spot for the u.k. market because of the sector makes, because of the somewhat defensive nature of the market is not that the market cannot go up, it is just that, globally, the u.k.'s peers may be in a more favorable position from a sector and cyclical gear perspective. francine: john bilton from jp morgan asset management stays with us. as a deal approaches, democrats and the white house are still far apart on a u.s. stimulus package. we will discuss the world's biggest economy, next. this is bloomberg. ♪ bloomberg.

♪

francine: economics, finance, politics. this is "bloomberg surveillance." i am francine lacqua here in london. now, let's talk about u.s. and the democrats. that is ahead of the end of the week deadline to reach a deal for one of the white house's chief negotiators have warned there is little time to negotiate. still with us, john bilton from jp morgan asset management. john, what are you expecting package? aid how big does it have to be to be meaningful, or do you just want something for the symbolism of it? john: well, i think there's a lot of expectation about this, no doubt, but we do expect, you know, a reasonable sized commitment.

you know, for all of the politicking going on at the moment, we are hearing a lot about the disagreements, at the end of the day, if you pare it down, it is not a question of direction. both sides of the aisle appeared to be wanting something done here. the question is about the magnitude. it is not as if we have got a huge difference, probably the biggest difference being on the state and local funding, whether there seems to be a wider gap. things will likely for unemployment support, etc. it does not appear that things are actually that far apart. so we remain optimistic that we will get some kind of a package. but let's be absolutely clear -- already, what we are seeing is a significant amount of stimulus, unprecedented amount, that the u.s. has already released. , and over 10% of gdp headline terms, probably even more than that, and the package is being talked about in terms

of 5%, 7%, in terms of scale, so it is significant. i think that is why the market remains optimistic. also, we have a situation where it is not necessarily in anyone's political interest for something not to go through. so while i am sure we will see trading and we could get a little bit of nerves as we approach some kind of deal or deadline, we are optimistic that something will come through. francine: john, would you be buying gold right now? think, you know, sitting by policy, let's look at it. i think, when you look at gold, one thing you can be certain of is that gold will give you nothing. and if you look at what the short end of the curve will give currencies,major it will give you negative, so relatively, gold looks pretty good on that basis. it is amber,, you know,

finite resource, a finite asset, nobody is making more that, and as a result, it tends to respond in price terms. queuing an ongoing desire both as a safe haven and as a cash alternative. but the move we are seeing in gold, certainly has some momentum to it. but we can see an end to this period of negative real rates, and we have become -- the situation where gold becomes a real shine for investors. francine: john, thank you so much, john bilton, head of global miles they also strategy at jp morgan. coming up, i will be speaking with andrew bailey. nejra t has will be joining the show shortly. this is bloomberg. ♪ . ♪

nejra: this shuai

is bloomberg surveillance i am a retainage in london. let's get to the bloomberg business flash come with laura wright. hi, laura. laura: hi, nejra. setting aside over 1.3 billion euros to cover the expected result, the bank policies 79%, a stimulus across much of the industries, hit by the unprecedented impacts of the coronavirus. saying the goal is to/headcounts by 22,000. europe's biggest analyst posted a loss for the sector. centeris stepping up its in europe with a 420 million euro investment in ireland. it will create hundreds of jobs and improve the safeguarding of user data. it comes as it finds itself in

the center of tensions between washington and beijing. the company is looking at ways to distance it international and domestic chinese operations in order to appease regulators. samsung has set out its premium android device line for the rest of the year. it launches a galaxy note 20 series, but it is not just a smart phone, it is echoing apple by focusing on an ecosystem for its product, including a smartwatch and wireless earbuds. largestwas the world's smartphone maker in the second quarter. and that is your bloomberg business flash. nejra? nejra: laura, thank you so much. let's look at what has been a busy morning for earnings. here is dani burger. dani: earnings don't stop. one of the biggest movers to the upside, if you account market cap for the stoxx 600, a really strong show here, profit rising by 8%, handling the virus and

better than much expected, some of the chinese sector recovery as well as what is called a very strong showing in their software development. if you want to look at the second biggest mover by market cap, that is going to be -- helped by an e-commerce boom. sales doubled their last year. compensating really for some of the pandemic-related store closures. adidas found they were buying more frequently, so their shares are up more than three point 5%. morgan stanley did call the earnings a "mixed bag," because sales may have done better than expected, but overall earnings did disappoint. expectations were so low from the buy side. finally, one of the big movers to the downside is glencore, on track for its biggest drop in about two months, down by more than 3.5%. the big story here is they scrapped their 2020 dividend.

they had put it on pause earlier in the year, but remember, a lot of people hold this stock as an income place, so this will truly dissuade a lot of those types of investors. money into its trading business, entity combined eddie -- into the commodities space. one of the things that did cause them to rack up some debt, but that trading like we saw at bp, for example, certainly aiding glencore in the quarter. nejra? nejra: dani burger, thank you so much. glencore seeing losses in the ftse 100. it would not provide an outlook for the rest of the year, so the ftse 100 not doing too well in this session, but overall, you are also seeing european equities in the red. it did recoup losses for a little earlier, but down by a quarter of a percentage point off the european equity benchmark after again yesterday. of course the s&p 500 yesterday was within 60 points of its february record.

could we get there today? futures looking a whole another direction right now. 2000, $2046.90nd an ounce. the dollar is weaker, near a two-year low, and the pound, $1.3150 on the cable. coming up, we will get more from our interview with dr. anthony fauci. that is next. this is bloomberg. ♪ s bloomberg. ♪ hike!

simon pagenaud takes the lead at the indy 500! coming to the green flag, racing at daytona. they're off... in the kentucky derby. rory mcllroy is a two time champion at east lake.

he scores! stanley cup champions! touchdown! only mahomes. the big events are back and xfinity is your home for the return of live sports. >> economics, finance, and politics. i'm nejra cehic. let's get the first word news

with laura wright. laura: the bank of england is not ready to follow its bits into the round of negative interest rates. it was the benchmark at 0.1% unless asset purchases are changed. the bank says it does not plan to tighten policy until there is progress in achieving the inflation target. it also doesn't expect the u.k. economy to reach precode levels until the end of 2021. u.s. efforts to crack down on chinese technology looks to be extending will belong -- well beyond tiktok. mike pompeo is urging american companies to block chinese applications from their app stores. is so-called clean network not binding. see on trusted chinese apps removed from chinese app stores. president trump has mentioned pending action on tiktok and for good reason. with parent companies based in china, apps like tiktok and

others pose a threat to american citizens, not to mention tools for sisi content censorship. pressingmocrats are for more concessions on economic relief. one of the white house chief negotiators has warned there is little less -- little time left to negotiate. president donald trump wants an earlier debate with challenger joe biden. they've got three fresnel debates -- presidential debates planned already, but they are hoping for a clash between the two candidates before early voting starts in september. and a deadly explosion in beirut -- materials have been lying in storage for six years. despite warnings from customs officials about the danger. the amount is ammonium nitrate was set to be equivalent to 1800

tons of tnt. global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more this is countries, bloomberg. nejra? so much.ank you just got some news on barclays crossing at the bloomberg right now. edward bramson has made a comment in a letter this week, this has been seen by bloomberg news, and what we have learned is that the activist investor is boosting his stake. also keeping pressure on the trading. -- on the treating rejig. it has not stopped the top shareholder from renewing calls to shrink the investment bank. let's get back to coronavirus. for a coronavirus vaccine continues. the decision in the u.s. over the political handling of the pandemic.

to david westin yesterday about this very topic. dr. fauci: when you talk about the situation we are in now, we are in the middle of a pandemic and we have other considerations that have to do with economic and political and other things. i have nothing to do with that. if you are talking about a medical question, listen to the medical experts. that is the advice. and you will not get a conflicting message from the medical experts about things like hydroxychloroquine, about what the results of a vaccine trial are, or what the results of antibodies -- when it comes to public health medical things, listen to what the medical experts say. david: i was president trump getting his medical information? there seems to be conflict over things like hydroxychloroquine. is there vetted information that he has access to? dr. fauci: i don't know that

because i don't have privy to all of the input into the president. the only thing i know is what we do, and we do that through the task force, through the vice president. the vice president then briefs the president, or like we saw yesterday, the president invited us all to the oval office to brief him in person. let's lookfauci, into your krystal ball right now, and assuming we don't have a fully effective vaccine in the next 18 to 24 months, what is the trading floor on wall street -- what does the trading floor on wall street look like, public events, schools? dr. fauci: i sound like a broken record, which is good because i want to sound like a broken record. that is that there are things that we can do without shutting down the country that can get those numbers down to a manageable amount that you could do things that would be very

productive and enhancing of the economy. we should not think of either locked down completely -- either lock down completely or caution to the wind. there is a middle ground, that we can do, the five or six things that i mentioned to you, that will allow us to prudently and carefully open up the economy. it is not all or none. i think there is a misperception that in less we either lock down or open up, there is nothing in between. there is something in between. the issue is -- and i want to give this a point because i really am going to over the next days keep repeating it over and over again. we've got to make sure that all the links in the chain of the united states of america as a country, bringing that virus down to a level that we can function where we don't have the lockdown, where we can read -- revitalize the economy -- we can

do it. it all the links have got to work. analogies or use metaphors that people understand. people,d have a lot of 11 states doing really well. when you have segments of the population that do not appreciate that even though they may not get sick from the virus, if they are careless and allow themselves to get infected, they are propagating the outbreak. so it doesn't go away. that kind of obviates all the good things that other people are doing to stay safe. i use the analogy only because i learned this from my daughter. my daughter, when she was in college, was on the varsity of a division i crew team in college. i used to go to those matches. and you are an eight-person boat. the only way you win the race, when every rower on that boat is doing it correctly.

you get one rower on the boat -- aseither accidentally they say, catch a crab and go off, or are not giving it enough, the boat doesn't win. it is the same thing. we are all in this together. unless we all do it, and do it correctly, we can get it down to the point we can open. dr. fauci speaking with david westin. -- dr. fauci speaking with david westin. joeng up, we will hear from keiser shortly about results to lift more plans from the business. this is bloomberg. ♪

nejra: this is "bloomberg surveillance." let's get the bloomberg business flash with laura wright. hi, laura. aura: nintendo has posted soaring prophet helped by the popularity of switch sales and hit game animal crossing, despite the console being hard to find from most of the year because of supply and shipping issues. the gaming giant is facing a production target for the switch to about 25 million units. samsung is launching the galaxy 20 series, but it is not just a smartphone. it is focusing on an ecosystem for its products, including a watch and wireless earbuds.

that is your bloomberg business flash. nejra? so much, laura. a strong first half of the year for barclays trader has not stop its top shareholder to renew calls to shrink the investment bank. edward bramson says that barclays should mimic cut at deutsche bank's trading operations to improve profitability. details from italy, estefania joins us. what did you learn from the letter that bloomberg managed to get a hold of? >> thank you so much. grandson is back, basically, and -- branson is back, and basically by increasing his stake even by a marginal amount come he is showing his commitment for the long run. so he is proposing that basically barclays goes down the

with ae bank route, massive restructuring of basically the corporate investment bank. to improve profitability and cause them to optimize capital. though,he thing is, with the latest set of earnings, the investment bank actually beat estimates, so these criticisms -- are they justified right now? i know they are long-standing criticisms from edward bramson, but the results may put a question over that. stefania: absolutely. the strategy has been working during those two quarters. whether they are making the shortthat this is just a term gain and they can really phase the strategy over the entire lender over just a couple

of quarters of trading that is happening under the circumstances considering the , themic or the markets circumstances we have seen. he is basically keeping his point that barclays should really have a big look at the and they should restructure the whole security unit. he is also asking for the first time, we actually have an idea of the restructuring that he is suggesting,. basically he is suggesting that barclays should consider a 24% reduction of the corporate investment bank assets, which is quite a lot. nejra: briefly, do we have a response from barclays yet?

do we think we will get one? that is the comment from the client. that is -- there has never been this comment from a letter from an activist. recently considering the restrictions. we are not obviously operating in a normal environment. nejra: we will let you get back to work. thank you, stephanie of spaz --eady -- stephan yeah stephan es is already. the coronavirus crisis, better than a results. joe kaeser has dismantled large parts of what was once one of europe's above are just conglomerates, through ipo's, spinoffs, and sales. we spoke with joe k's early this morning and asked about the fle nder spinoff.

>> we are talking about spinning off flender, which is a profitable company. presented in to be 2021 for shareholder approval. obviously want to include our shareholders in the operation, which believe has been tremendous. and that is the plan. >> thanks so much for joining us. can you dive a little bit deeper into that? it, is the evaluation of and would you consider a cash bid from private equities? give us a little more details. well, with regard to der, we have restructure the company. it is a very attractive growth market, such as renewable energy. it is one of the world market leaders in years.

it is a very strong company, and we have a plan. our plan is that they are going to return the proceeds to shareholders via spinoff. we want to have that approved in 2021. whoever believes that they have a better idea for the customers, the employees, and the shareholders, we would be happy to listen. matt: joe, you are on your way out, and there are reports that roland busch will take your job as ceo in october rather than in february, as previously had been planned. and you also confirm that this transition is going to happen sooner at siemens? joe: we have always been very smooth,at we want a long-term oriented transition. so roland bush will take over

the responsibility for 2021. i think that is only logical because they discussed the responsibility and the accountability for the whole fiscal year. he has been a long-term plan which we actually have been announcing already six months ago. had a very long plan. he is the right guy. he is really strong. good managers. i'm happy to see that he is taking the responsibilities and bringing the company to the next level. there is a new generation that we announced yesterday, all the people on the board, and i'm very happy with what i see. nejra: that was siemens ceo joe kaeser. a demand for diabetes drugs weathering the pandemic. ceo, larseak with the jorgensen you -- largest your

consent, next. ♪

nejra: economics, finance, politics. has raised its forecast for the years as demand for diabetes and obesity medicines weathers disruption from the coronavirus crisis. the data company, the biggest --ulin manufacture, says sales are set to grow between 3% and 6%. now, lars fruergaard jorgensen, the ceo. thank you for joining us. what is interesting what we have learned from earnings on the diabetes medicines. you pointed out that people need to get treatment even if there is a pandemic going on. but there has been perhaps some signs that be have shied away from hospitals during the pandemic, being scared of getting infections. so perhaps you could say that new diabetes patients are not getting diagnosed. does that mean that there is any potential risk to this trend for

you and your daddy's meet -- in your diabetes medicines? nejra: you are right that -- lars: you are right that we have seen in the first half of the year, patients picked up more medicines to protect themselves, as these are lifesaving medicines for people with diabetes. as we saw countries closing down, there were patients visiting physicians to get on do treatment, modifications treatment. that impede get our growth in the second quarter, but less new -- that impacted our growth in the second quarter, but less new patients. we were down some 30%, 40% across some brands, but that is picking up, so around 50%, back to a normal level. when you have diabetes, you need treatment, and if you no longer can control, you need to get on a better medicine. so we see patients are flowing back into the physician offices again. nejra: that is interesting. when do you expect it to return

to normal, pre-pandemic normal? lars: in our guidance, we have assumed that we will be back to a normal level throughout the second half of the year. obviously that relies on how covid-19 pandemic plays out. what is interesting to observe, society, we are learning to during together covid-19, coexisting, so i think we will see second waves here and there, but i don't think we will see complete lockdowns that mean we will go back to where we were in march or april. we expect a gradual normalization throughout the second half of the year. nejra: ok. ongoingsk as well about pricing challenges, especially in the u.s. you have said it expects the pressure to continue. for how much longer, and how with that impact your business?

lars: we see, if you look at the total market in the u.s., for the first six months, it was down, the value of the market, by 11%, and that is a continuation of -- for quite some time. we also see that there is pressure on pricing because a number of products that are being put out against each other, and in addition we see u.s. unemployment meaning that a number of people living with diabetes and other diseases have less and less insurance coverage, which means that they get on plans that have a lower price point, and we also have affordability options to help patients. so i think we will see a continuation of price pressure in the u.s. with this structure. we are confronting our business -- we are converting our business, so the segment where we have the toughest price pressure in the u.s. is coming very small, and now our growth is short up by these products.

nejra: you mentioned growth. let's talk a little bit about costs. what savings have you been making? what cost cuts have you been doing? crisis onincreased profit is leaning toward cost savings, and we have saved a lot of money not traveling around the world and conducting our business. we have also saved money on promotional efforts. representatives could not be in the field, running conferences like we normally do, and we also had a slower burn. a billione that danish krone or have been saved this year because of covid-19. some of that will be moved to the second half, and we are raising our profit growth from 2.5% to 5% because of these savings. nejra: a billion kroner saved because of covid, that is interesting.

how much does it cost you to stockpile for brexit? numberell, it is not a that we kind of worried that much about because we are committed to the patient. we have made sure that there is enough products in the u.s. to hopefully get us through a difficult period of time here. but it is important that policymakers come together and sort out how this should be handled. ok, lars fruergaard jorgensen, we appreciate your time. the ceo of novo nordisk. thank you so much for joining us today. "bloomberg surveillance" continues in the next hour. don't miss francine lacqua's interview with bank of england governor andrew bailey. this is bloomberg. ♪ experience the ultimate sports hub.

where you can find games, news and highlights. all in one place, right on your tv. the xfinity sports zone. use your voice to search every stat and score. follow the teams you love. and, even get notifications with breaking news alerts and more.

with the xfinity sports zone everybody wins. now that's simple, easy, awesome. say xfinity sports zone into your voice remote today. tom: this morning, the bank of

england studies the experiment known as negative interest rates, it calls the experiment "less effective." chairman powell -- governor francinell speak with lacqua and the 8:00 hour. jobs day on friday. the president looks for a "big report." and the doctor is very in on the pandemic. his message is very clear. dr. fauci says listen to the medical experts. good morning, everyone. bloomberg surveillance from new york, from a very bank of englandy london. nejra cehic is in for francine lacqua as she interviews governor bailey. this is a huge deal for the bank. nejra: it is a huge deal. the redhead line is that he is saying negative rates are in the