francine: the johnson and vaccinepauses it's trial. rise in ad imports sign of a robust domestic recovery in the world's second-largest economy. three weeks until u.s. elections, president trump returns to the campaign trail in florida. >> i'm immune, i feel so powerful. kissl walk in there, i'll everyone in that audience.

i'll kiss at the guys and the beautiful women and everyone. trump there.sident welcome to bloomberg, a servant -- welcome to bloomberg surveillance, i'm francine lacqua. earnings in the u.s. and that could move some banking stocks. overall, stop -- think stocks are dropping. -- bank stocks are dropping. period forbusy corporate earnings. after fluctuating something with workers in the u.s. gulf heading back following hurricane delta's landfall. a major step towards reopening. news.get the first word here with me is leigh-ann gerrans. has announcedon bars and clubs will closed in the worst hit parts of england.

his health advisory's it won't be enough. he says local authorities will need to take more action to take the virus under control in some areas significantly more. crossing to the u.s., the confirmation hearing of amy coney barrett descended into a partisan clash over obamacare, the pandemic and president donald trump. she cast herself as someone who puts personal preference aside, pointing to what she sees as a vital limited role for judges. she says justices are not on the bench to make a value judgment. the coronavirus pandemic will cost the u.s. around $16 trillion. four times the cost of the great recession. that's according to larry summers and david cutler. they arrived at the figure by adding the cost of loss-of-life and help to direct economic impact.

facebook seen twice as much fake news than they did in 2016. the outlets that repeatedly published false and deceptive content has increased over 100% since four years ago. at the latest evidence facebook is struggling to stem the flow -- it is the latest evidence facebook is struggling to stem the flow of misinformation. global news 24 hours a day on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm leigh-ann gerrans, this is bloomberg. china's exports rose for the fourth straight month while imports surged. pointing further recovery for global trade and a domestic rebound. 'se data indicates china relatively rapid return to production has enabled it to take full advantage of manufacturing reopening and consumer demand elsewhere. the resurgence in europe and

elsewhere poses a threat to recovery and with geopolitical tensions with the u.s.. to talk about this, a sovereign credit analyst at pimco. thank you so much for joining us. i don't know how you look at the fixed income space overall. by,hina were anything to go is a recovery going to be quicker than expected? >> i would say yeah, the chinese rebound has been stronger than elsewhere. pathld say china is on a that is probably better than other places for a couple of reasons. china had an effective response to the crisis. they had a very strict lockdown but then they got cases under control relatively rapidly. china is oriented towards production of goods where there has been high demand. think about ppe and sanitary

products. all of that glitters is not gold however. if you look at chinese consumer spending, of the recovery has been slow. i do not think we can use china as a barometer for elsewhere. we view a slow recovery elsewhere. which could end up fueling some geopolitical tensions which are already in place if china tends to do better than others. francine: are you thinking about trade wars being back on the horizon and what does that do to central bank policy and what does it do to fixed income? --we had a second dirt risks, china's rise would be one. i think a more multipolar world with geopolitical tensions, there's just -- they are just good to be part of the outlook. if biden were to win, there is a chance of a somewhat more

friendly rhetoric from the u.s.. but we think either president will probably continue to have a fairly aggressive stance with china. i think it is something that will weaken global growth in coming years and it will be inflationary given the moves. francine: this is what we are asking on our blog. were markets underpricing you pandemic impact? comes to fixed income, i think monetary policy is set to remain extremely expansionary for a long time. we view central banks as trapped. in the near term there is the pricing, the demand is very weak. eventually, even as the economy normalizes, of the crisis will --, the crisis will leave

a lot of debt on the table. we think central banks will be forced to keep interest rates low. we will probably eventually have a higher tolerance for inflation even if it were to rise, we think there would be more tolerance than in the past. i think the fed actions recently tend to confirm that. see the: where do you best value? where do you see the biggest opportunities in sovereign credit? >> we think interest rates are anchored, they are range bound. much to buy and core fixed income because of the fixed interest rates. you want to keep them if you have shocks, jurisdictions that do not have negative rates could go negative and make -- those which are negative could go further negative. some would say u.s. treasuries are more attractive than european bunds given the higher

rate level and higher potential for rates to fall. ,f you look at other sovereigns of the known core sovereigns, italy remains attractive for a position. the spreads for -- the spread to bunds have tightened a lot. given the eu and ecb policy responses, it is not that easy in markets to find that kind of spread for that level of risk. is one to lookly at. as much as china is rebounding more sharply than others, we are skeptical given the week global environment. we are skeptical the central bank will be tightening policy anytime soon. chinese rates could be something to look at. btp move will italian

on how the government actually spends all his money they have from the recovery fund in terms of grants and loans? does not depend on european central bank action? think the ecb has been essentially matching any net issuance by increasing its asset purchases. we expect more pandemic emergency purchase. we expect another announcement by year end. that is critical. the recovery fund is also important and it is a first in terms of having cross-border transference funded by common issuance. about 2%set to receive of gdp a year for the next five years. which is meaningful in terms of the growth factor. there is potential for the misuse of funds by italy.

, but ire several risks think the symbolism of the europe response is important. they have delivered in a more timely and aggressive way relative to previous crises despite a stumbling start. francine: thank you so much for joining us today. 100ng up, the nasdaq rallies more than 3% in yesterday's session. we discussed the price action next. this is bloomberg. ♪

francine: economics, finance,

politics, this is bloomberg surveillance. let's look at shares of premarket of johnson & johnson. this is after they said they had to halt one of the clinical trials of its covid-19 vaccine after a participant fell ill. this is the second time a front runner developer has paused testing to create a viable immunization against the virus. we will have more on vaccinations shortly. let's get to the bloomberg business flash. --disney is shaping up shaking up operations to refocus on disney plus. the company is putting its tv networks and direct to consumer divisions into one big group called media and entertainment. willing content chief oversee their business but they will be able to choose what movies and tv shows air on disney's streaming services. >> we want to take a consumer

first approach. we want the consumer to guide us on how they want to see content. they really want to see more and more content on disney plus and hulu. >> as francine mentioned, johnson & johnson says it's covid-19 vaccine study has been temporarily halted after a participant experienced an unexplained illness. if the second time a trial for one of the front running has been paused. they say the illness is being evaluated and they will share more information after the investigation. later deskking banking regulator is said to be easing restrictions. the sector has been under pressure to sacrifice earnings to support the economy. lettinglator is now lenders report earning declines of 10% or less. that's below the 20% drop seen

in the second quarter. that's your bloomberg business flash. the nasdaq 100 jump to more than 3% yesterday and within striking range of its all-time high. leading the gains -- the gains is apple. joining us to discuss that is dani burger. what was behind this? >> at one end, we have these news stories of these companies rallying. apple has its iphone release coming up today, amazon prime day kicking off. twitter was upgraded yesterday by deutsche bank. we don't like to look at just the surface story. there was plenty bubbling under the surface that contributed to this rally as well and that is the options market action. about softbankn buying a lot of options. softbank said it is not a whale or even a dolphin.

this was pointed out by andy brenner. yesterday, both the volatility gauge for the nasdaq and underlying index jumped. usually they are opposite. because they ended higher indicates that the risk for the nasdaq was being led higher by bullish options. onn we get bullish options these, you get them to hedge the call options they are selling and they will buy the underlying stocks. a lot more action than the etf down here and even the index by itself. 38% of option volume is led by single mains and that's likely those retail buyers. it's likely a lot of smaller players jumping in and buying these options, creating rallies of the lights we saw yesterday. thecine: dani burger with

latest on some of this tech rally. to the chief talk -- of johnson & johnson after the company positives vaccine trial due to an unexplained illness. this is bloomberg. ♪

francine: this is bloomberg surveillance. the pandemic is front and center once again. johnson & johnson temporarily halting its vaccine study after a clinical trial participant explained -- experienced an unexplained illness. in the u.k., boris johnson has closed bars and pubs in the worst hit areas of the country. his top health advisor said it won't be enough. joining us now is paul hunter. thank you so much for joining us. the second in three or four months halting a trial. is this part and parcel of how these trials work? >> it is part and parcel. including the very , ise numbers of people likely some of them will get ill

. some reasons may be associated with vaccines, but most likely it's one of those things caused by something else. what you have to do is every time you get one of these severe really work out whether or not it was because of the vaccine or with something else. and whether that has implications more widely. this is something that happens many times in a lot of vaccine studies. we should not be too concerned at this stage. overall, are we expecting a vaccine too much? do we want it so badly that we risked going too quickly, or is that just a perception with certain people who are not scientists? do need think we really a vaccine. i'm quite optimistic we will have a vaccine, probably not

this year, probably early to mid next year, that is effective, but you're quite right, we cannot rush it because we cannot afford to produce and circulate a vaccine that is not as safe as humanly possible. otherwise, you would undermine the entire vaccine program. so yes, we are likely to have a vaccine. i certainly believe we will, but we cannot release it until it has been properly tested to the standards that we have worked to for years. francine: how would you currently describe the efforts of various countries to try and contain the virus. the rules are vastly different from country to country, especially if you look at the u.s. and the u.k., but even france. >> it has been one of the big

disappointments about this that, of the science does not vary from one country to another country. the virus itself behaves in much the same way around the world. , different countries are really doing some very different things. , we havein the u.k. seen scotland and wales doing things different to england. havey, we should not actually ended up like that. should have had a properly agreed policy and strategies applicableresent and more widely. variation,ve such

leads to confusion, it leads to people not really believing what they are told. i am certainly disappointed we are not -- and this is not just directed at the u.k. by any means. we weren't able to have a proper coordinated european response to the virus. , who shouldofessor give us the framework of what to do? i think the who has generally done a pretty good job over the course. it's been very clear in its statements. when the science has needed the changed,s to be -- has the who statements have changed. aboute been talking following the science. early on in the epidemic, it was

up -- there was a lot about the science we did not know that we do now. and the process of the who has gone through to produce its guidance and its technical guidance has been exemplary. it produced documents that have been well thought out and good quality science with critical reviews of the evidence. francine: thank you so much professor paul hunter. coming up, as the italian government pushes for a bigger role in the tech -- corporate world. this is bloomberg. ♪

francine: economics, finance, politics. this is "bloomberg surveillance." i'm francine lacqua, here in london. quite a lot going on with the markets.

if you look at the markets positioning ahead of a lot of earnings coming out later, and the focus is also on some of the news we had overnight, which is j&j halting their vaccine trial because a person had fallen ill. we are trying to get to the bottom, as are they. let's get to first word news with leigh-ann gerrans. leigh-ann: over in the u.s. last night, president donald trump returned to the campaign trail as his doctor said he tested negative for coronavirus and is not infectious. at a rally in florida, trump said he felt so powerful after his recovery from covid-19. the trip was the president's effort to reverse his slighted polls in key swing states. founder raysociates dalio says china has the upper hand over the u.s. and a range of issues. he said time is on beijing step aside and the clash with washington, and that the next u.s. administration have to deal

-- china'ss doing continuing rise. european central bank officials are upping their call on governments to keep supporting the euro area economy. speaking yesterday, president christine lagarde said her biggest concern right now is that measures will be phased out to abruptly -- phased out too abruptly . global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more i'm 120 countries, leigh-ann gerrans. this is bloomberg. francine? francine: the italian government has been increasing its grip on the country's strategic assets in recent months. the go to vehicle for expanding its influence in the business world has been a savings bank which is controlled by the ministry of finance. giuseppe conte's government has

endowed the cdp with more than 40 billion euros to buy companies, and the state's back a 7.3 -- it will have percent stake in the venture. investor into sia. i am delighted to be joined by pure apology stephanie. first of all -- by pierpaolo di stefano. i think we are having a couple of technical difficulties with pierpaolo di stefano, but we will be back with him very shortly. with some of these strategic partnerships and how they release their money. coming up on surveillance, vaccine& johnson pauses

trials due to an plane illness. in healths and losers care this is bloomberg. this is bloomberg. ♪. ♪ . this is bloomberg. ♪

francine: this is "bloomberg surveillance." joining us is dipaola distefano -- pierpaolo di stefano. thank you for joining us. decide top in the end affect euronext.

>> euronext is our partner, most important. a teliana ishat back to the center of the development of the business. this is a very good investment for us. it is something that we see as an important infrastructure for the italian economy across sectors and therefore for us it was an absolute priority as a project. rightne: cdp also has the to name the next euronext chairman. who will it be? >> it is early to say. we have a process, so we will progress as the dizzy -- as the phase.es into execution it will be another three quarters before we get to closing, and we will make sure

that we release the proper name at the top of the advisory board. you manage atdo the same time being part of treasury almost but also being an independent private market player. pierpaola: we are an independent market player. we ran a portfolio equity investment which will -- as of today, we are a primary investor in some of italian blue chips, and with a specific infrastructure, we see no conflict with some of the strategies that the government is implementing. but at the same time we actually manage private savings. so we need to make sure every time we look at an investment that there is no conflict. ,, we are firmly convinced there is a positive way of running this business

without necessarily conflicting with the government. francine: how exactly are you financing your purchasing spree at the moment? have a largell, we veryof equity, and it is a efficient way of using our capital because through euronext itself, we managed to have a combination of borsa italiana within euronext and we think that is a very efficient way of implementing a transaction which at the same time will give us the primary role in conjunction with other orders and ensuring a long-term stable future of thenext itself within current development that we are seeing in europe, especially in terms of single equity market. francine: how important is it for you that there is a stake in the game for it? going back to financing, is this

with savings of italians, or is it extra funds by the government, or would you think about raising money in the markets? raise quitee do frequently money in the markets. in terms of fixed income products, but at the same time, we do have a large pool of assets which is essentially all the savings that are combined through the postal offices, and therefore we have a responsibility come as any other climate -- any other private investor, the assets that we gather, and therefore that is exactly the reason why we behave as any other sovereign fund or infrastructure or pension fund does in the context of market transaction. we have a long-term view. we look at investments, we have the view of a patient investor, and at times, or more frequently, as permanent capital.

such a big andg powerful mandate, does it put italy back on the spotlight when it comes to private investment and private companies? pierpaolo: i don't know if it's back on the spotlight. it provides leverage vis-a-vis a number of other industries. with the pandemic, i think it is crucial that working together with other institutions and other european players such as euronext, in order to come up with project and deals that allow for growth internally and externally for a company. is cdp also priced jack as a lender in markets or come -- christ as a lender in markets or companies -- why is lender inriced as a

markets or companies that -- an asset: we do have base that allows us to look at very long maturities, and engage in projects that otherwise would funding on the markets through traditional instruments. on the equity front, again, we have the ability of using both direct equity investments and indirect asset managers in order to amplify the of action of cdp. we have the flexibility of providing a substantial boost to the economy, and that is our mission as of today. francine: do you see a deal with atlantia being announced this week? pierpaolo: i won't comment on that. i think it is something which is surrounding a list of companies. it is a difficult transaction,

it is something which i would rather not comment on. francine: can you tell us whether you at least have any planned meetings with atlantia management? pierpaolo: we do have an interest in investing. it is very consistent with the dna of cdp, which is very, very exposed with the confection business for a long time, so we do have an incident -- we haven't interest in -- we have an interest in a transaction of this kind. but according to market practices and in the context of a transaction which entails a number of stakeholders, on both sides, therefore we will not accelerate anything unless it is something that makes sense for us and for our stakeholders. francine: and i understand and of course respect that. can you tell us anything about the single network? i know there is speculation where the you will buy that

stake in ml. pierpaolo: that is another important transaction for us, and again seems to be perfectly consistent with his strategic intentions of this government, and something that we will certainly welcome. we are not sure if ml will dispose of a portion of its investment in open fiber. differentonsidering options as of today, and we have to respect they will. opportunity arises in relation just come increasing our exposure to open fiber but more broadly toward the single network, we will certainly -- we are certainly ready to so. francine: mr. pierpaolo di stefano, thank you so much for coming on today. shaping updisney is his business to offer more of its streaming service.

we will hear from the chief executive next. this is bloomberg. ♪

francine: economics, finance, politics. this is "bloomberg

surveillance." i'm francine lacqua, here in london. johnson & johnson is temporarily halting its vaccine studies after a clinical trial participant experienced an unexplained illness. the company said it would share more information after further investigation. last month astrazeneca temporarily stopped a test of its own vaccine candidate. pauses in late stage testing are common. less focus on pharma and the impact of the pandemic. turning us is martin henrichs, head of health care m&a at ubs. great to speak with you on bloomberg. are we going to see a flurry of activity as some of these big companies try and look at their pipeline and either streamline or bulk up in places where they should? martin: first of all, concerning in the coronast

environment, you might recall what johnson & johnson said a few months ago. one thing i know for certain is we are going to be 100% itcisely wrong, and i think is relative -- it is relatively difficult to forecast. the other thing, with the core trials happened in -- you mentioned johnson & johnson. the question that we will have this and the trials, such as unity,f the duration of aspects of certain patient populations -- we will not see a one-size-fits-all approach for covid vaccines, but we will see multiple approaches and it is relatively difficult to forecast when we will end up with a pipeline --

francine: there seems to be huge disparities because of health stocks. overall, how does covid-19 change the winners and losers in the current crisis? does it drive up valuations for anything that has even a small inclination toward covid-19? martin: first of all, i would say health care stocks as a .ategory has outperformed -- mostr forms of both european companies -- since the beginning of the crisis in health care, it has served other for example, msci europe, which has dropped 12% over the same time period. at the beginning of the covid crisis, to answer your question, the pharma diagnostic services, as well as life-sciences tools has been the relative

outperformance of health care stocks in europe, and we have indeed seen some health care stocks going through the roof because their products or services play a role in the resolution of the crisis. but to the biotech names with covid vaccines in development, such as biotech -- and in europe, also pointing toward the share prices of online pharmacy groups, which it had particularly strong ones. with all winners, we also have losers. the relative loser includes med and services companies, exposed to a lesser procedure. somepedics as well as biotech names. now, then the question on valuation, health care -- francine: go ahead, martin. : health company

valuations have crept back to the pre-covid 19 levels, and are actually now well above their 10 year average. very interestingly, meditech services are trading above pre-covid valuations despite generally negative share price performances. if you look at the valuations in particular, they are the highest level over the last 10 years. valuations are slightly down compared to pre-covid levels, and in line with their negative share price development. but it is fair to say that all forhis does not yet account earnings estimates, which we undoubtedly see in the q3 results. francine: thank you so much for joining us today, martin henrichs, the head of health care m&a at ubs. it is said that debt relief

should be extended through the poorest companies through the next 10 years. he told jonathan ferro that the pandemic has worsened inequality, with developing nations suffering the most. >> it has already gotten bad. that is showing up in the numbers and is likely to get worse as we go into 2021. one notable part of this global recession is the inequality of it. in 2008 there was a great financial panic that hit people's stock markets and their bond portfolios and so on, but it did not have as much effect on the developing world. this one is much deeper in the developing world and is likely to deepen if there are further shutdowns in the advanced economies. one of the things our numbers show is that the advanced economies, the recession has actually been somewhat less severe than the estimates in june, but for the developing

world the recession has been worse than what was expected in june if you exclude china. china is in a bit of a recovery phase, but the other developing countries are still in a worsening recession. jon: given what you are saying is playing out right now, whether the cure for this virus at the moment and the approach from developed economies is worse than the disease, given what you're are seeing in poorer countries. david: it is hard for us to judge. history will look back and try to assess. for the poorest in the world, if covid is a problem, but a bigger problem for people is no jobs and increasingly this problem of food shortages, scarcity, as their incomes go down. one of the things that hit the is thatng world so hard

remittances got cut off for workers working outside their country. that might be across the border or it might be in one of the advanced economies. they would be sending money back every month to their families, and that got caught off rather suddenly. another thing is just the activity, the activity level of the world for so many countries is down 10% from what it was a year ago, and that means health problems for children, they are out of school, they are not getting their vaccinations, and onmany cases malnutrition is the steep rise. jon: we talked about the problem. there is a huge one. let's talk about how you are looking to remedy it or at least offset some of the issues. end.ieve it expires year you want to expand it. can you walk me through how far out you would extend that initiative? david: we would like to see it extended another year. i should note it is only

providing shallow relief and we need to do much more. the reason it is shallow, what this has done is said that the poorest countries should not in this crisis, given the severity of the crisis, starting last may 1, they were able to stop paying their debt service. that means principal and interest, to official bilateral creditors. the richer countries plus china, and they could stop those payments, and the commercial creditors were supposed to join that initiative as well. that means banks and hedge funds, for example. unfortunately, they didn't. even the bilateral official creditors didn't fully savings for so the these countries -- we are talking about the poorest countries in the world. they are paying their debts in some cases, and so that i think should be broadened, and then also extended into 2021.

francine: that was the world bank president, david malpass. yesterday was the first day of the world bank/imf meeting. half of the banks are focusing on what j&j announced, halting trials of the covid-19 vaccine because of a nondisplaced -- of an unexplained illness. it is weighing a potential setback of progress toward coronavirus vaccine. we also have a busy period for corporate earnings. i'm looking at dollar treasuries advancing. more bloomberg surveillance. ♪

francine: pause. johnson & johnson halts its

covid-19 vaccine trial after an unexplained illness in a participant. futures slip. china's rebound. exports and imports rise in a sign of a robust domestic recovery in the world's second-largest economy. and there are three weeks until the u.s. election. president trump returns to the campaign trail in florida. good morning, everyone, and welcome to "bloomberg surveillance." i'm francine lacqua in london. tom keene is in new york. i know we have the banks that we have to spend a lot of time on, but we also see trials halted temporarily by johnson & johnson because of a participant fell ill. but this is part and parcel of what these trials do. tom: you will have to make it up for me. i have read it three times and i don't understand it. as jonathan ferro