u.s. presidential races narrowing in iowa. joe biden narrowing in battleground. month foreuros a solidarity fund during lockdown, and 7 million for partial employment. entech -- and tech sales overnight. good morning. london.cine from happy friday. -- a lot oflong moves, not only because of tech in europe, it's interesting to see that equities have not infiltrated some of the current trees but we will see what happens. tom: happy tuesday, the

candidates were in florida yesterday with an emphasis on the latino vote in battleground states across the eastern will, minnesota, wisconsin, iowa. eventful to say the least, but the number one story is the inability to capture a bid. we will have plenty of extra data checks. let's get to first word news ritika.k cap -- nancy pelosi and steven mnuchin and are playing the blame game, minutia and accused policy of holding of the stimulus bill by refusing compromises, pelosi says the white house is not responding on a number of sticking points. joe biden has appealed to hispanic voters, telling a rally that if florida goes blue, it's

over, indicating that biden and president trump are virtually tied. europeanrkel says the union should have acted sooner to control the pandemic. saying that political realities a stop stems from imposing restrictions earlier. and shares of apple are lower today. company reporting missed wall street estimates. apple gave no forecast for the holiday quarter, but tim cook says the new iphone 12 has been well received. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. bank -- i am our bank -- ritika gupta. looking here, equity markets don't perform.

the vix is backup at 40 levels on the bics -- on the vix. i look at the yield move. this is backup to .8% on the 10 year yield. this correlation really bears watching. better andyields do maybe francine will get to that in a moment. with the dollar strength, euro 116 .2. the turkish lira is day on day with dollar strength the euro is at 0.62 percent. the turkish lira is day on a day off. francine: it was a big markets week, today even bigger because of tech stocks. i wanted to show you what european techs were doing. there's more concern about the outlook of technology giants. european shares

with opening lows and we did have glencore for example reducing its production targets for the third time this year, that brings us back to virus restrictions which could post the euro into another recession. i'm looking at the french and spanish economies which is really being derailed by the pandemic and new restrictions. plenty on the markets. do you want to go back to technology? this was a surprise. i think i counted five giants reporting yesterday. take a surveillance nap in new york city and then i get speak with archie content officer and we bruise the tech earnings. the amount of trillions of dollars of revenue involved is enormous. what's key is they delivered. in general,panies,

delivered on revenue growth with a little bit of challenges. overall, first blush was actually pretty good. then it wasn't. excepting google, there was some really distressing features about the outlook forward. uncertainty it about the outlook forward, rather than gloom. i think the narrative is that. technology stops -- technology stocks actually beat the sales but it was forward guidance that had us worried. with us is christian miller, he is the managing director of portfolio, strategy, and asset allocation. thank you for coming on bloomberg. when you look at what markets gdpdoing, are they tracking ? central banks? stimulus?

it's interesting what you have set on tech just now because it's been the big leader. it's very much been central banks and lower rates that have boosted the tech sector. the big problem is that the stocks, by virtue of the decline in yield, these have gotten much more expensive. by virtue of that, they have a much longer duration. they have more cash flow in the future. if you have small disappointments, that can have a huge impact on share prices. as a result stocks get more volatile. it is similar to the tech bubble. the tech bubble in the late 90's, very different companies, to be clear. there was profitability and the balance sheet. but there was a lot of duration in the market. equities were very expensive. for two years you had a very volatile equity market.

. think you are facing that now while the tech earnings were possibly good as was said earlier and not as bad. matter,sappointments but also the real yields over the past few days have actually gone up. that's the double whammy, which is negative for these tech stocks. francine: i know tom wants to talk to you about real yield in a second, but if we have a disappointment for technology stocks, when we have a lot of governments going back into lockdown, presumably that means we are going to use a lot more facebook and amazon. what to the rest of the asset classes have question why do they stand a chance with the extra restrictions and the number of infected cases going up? ritika: that's the debt -- christian: that's a difficult situation. tech has been a key winner in this crisis. the more cyclical assets have

really suffered. since the summer, we have seen the market trying to embrace the picture. going into the end of the year there were two major catalysts, the u.s. election and the uncertainty as well as potential development on the vaccine. there was the hope that this the market. as you have discussed, we are now dealing with a second wave. as a result of that, the cyclical pockets are also facing headwinds. i think it will be difficult for the cyclical rotation to game unlessest again steam you see stabilization with the covid situation. you could have some uncertainty relief from the elections. you could have a bit more policy support. but i think we are in a phase where the market is incredibly sensitive to any covid news. it has really shifted.

a lot of investors have said we can look through some of the covid data because the mortality rates being lower in the vaccine is around the corner but the market has changed. marker, at to set a the end of october, over the fears out there, as you mentioned with the covid and the pandemic epidemic. i want to look at some realities of headlines. u.s. gdp yesterday, a better statistic. the german economy this morning, a better statistic. italian economy this morning, a better statistic. on and on. ofthe november, or the march 2021 shot? did we sustain better through the pandemic and we got to a better point after the pandemic? ritika: that's youstian: --christian: mentioned earlier, we priced the data already before, this idea that the first covid we would

end and we would get a strong recovery. that has really sustained the market rally. but now we are dealing with the second wave. i would agree that we learned a lot about what the lockdown with regards to shortened and permanent damage. we could have some very strong recoveries and as one would expect, we have a similar type covid wave with cases in lockdowns, especially with the policies, it should not have the same impact on markets as it did last time. there's always incremental uncertainties. we do have the elections, would probably keep people from re-engaging with markets, despite the selloff. and we do have uncertainties with your guards to the vaccine, in the summer there was still optimism that we would get the vaccine by the end of the year. possible,hink that's

i think markets have certainly lost bit of faith. tom: can you buy the european banks? in terms of asset allocations and i don't want you to comment on competitive or strategic issues but is there any shocking valuations in the e.u. banks? christian: i think so. i can tell you, we have not been particularly bullish on this space for a long time. and i think generally our view has been growth value. we are shifting a bit down the value of a spectrum currently, and the banks are part of that. we have seen a significant widening of the value. for value tolot, do better than growth. and we do have the view that growth does pick up significantly next year.

it might be pushed out a bit with the second covid wave. but we think the vaccine will eventually stabilize these concerns and there are a lot of gaps in services sectors and the bond market is still incredibly depressed. , you are notelloff getting bond yields further down. that gives you a sense of symmetry, so things get better, bond yields are likely to go up. but if they get worse they don't go down. are very levered into bonds and rates and that gives you a positive symmetry. while tech is well above the levels they were before this crisis, the banks are pretty much at the -- in terms of their share prices. we feel like it's good symmetry, and it does trade not feel like it's getting easier with a second covid wave. but we do feel good about it.

tom: we will continue this discussion with christian. isures are down and the vix 33.almost 2.39 stay with us, this is bloomberg. ♪

>> incoming information signals that the euro area economy recovery is losing momentum more expected.an activity in the services sector has been slowing.

consumers are cautious in the light of the pandemic. the impact of the second wave on thes is going to depend on banks. but let me tell you something, the european central bank, and the whole euro system will be extremely attentive. we cannot just and still. we are going to use all of the information -- the instruments that we have, with the entire flexibility that we have. we have little doubt, given what's expected as a result of the risks that we are take -- of the risks that we are seeing, that circumstances will warrant the recalibration and implementation of these packages. francine: that was christine lagarde opening the door for further stimulus, using the word

recalibrating into december and asking the governments to spend more to weather the crisis and the pandemic. christian, howh much can central banks actually do? are we at the end of what they can do and it's all about stimulus? it's all about supporting the people who cannot get to work, companies like travel and leisure which are at a standstill? what does that mean for deck creation? christian: we have seen support from the central bank and i materialexpect incremental stimulus is probably too much. the most important driver for the markets will be the picture including fiscal stimulus. you will have central banks and willet purchases

still be focused on providing liquidity and financial market stability. but i think in terms of the current starting point, to get markets to break out of this volatile range, we really need growth. of: what's the significance a lower oil cry -- oil price. on this,urrie has been and the shock. what is the significance? ,hristian: in the near term it's part of the reason why markets have traded so weekly -- weak. are an unstable equilibrium because there's a lot of inventory. at the margin, if you have a second wave, the real concern will be the oil prices like what you had earlier and why that matters is for inflation expectation. one of the most important drivers of market are the real

yields. if you see inflation essentially decline this will decline and pushing up real rates. perspective, oil prices are moving lower. that's a clear negative. you can argue it's a positive for consumption. a positive for the consumer. but that doesn't matter in a covid wave. right now it's a clear negative that you have weak oil prices. it reflects the concern that the market cannot embrace a positive world outlook. christian, we are four days when the u.s. election. some of the polls in certain swing states are narrowing, do you need more of a hedge in your portfolios? onistian: the uncertainties the elections does contribute to the volatility that we have had. in conversations we are having

with clients, there is certainly a desire to take advantage of the current volatility in the sense that people want to buy. but there's a lot of questions where people say maybe i just wait until after the elections and especially international investors there's a lot of uncertainties because we have seen surprises around political events. my sense is the elections, if they have a clear outcome, should provide relief. at the margin, it should support risk appetite. if you get the blue wave, a democratic sweep, i think our strategists think it could shift cyclically in the markets because it supports expectations of fiscal stimulus. that's the trading template. it's a clear outcome, uncertainty relief, if it's a unified government, and if the

democratic sweep you could have a slightly more cyclical shift. and you could also see value do a little better versus growth because you have a lot of these profitable growth companies possibly suffering from taxes and regulation. christian, thank you. he's with goldman sachs. futures at -40. stay with us, coming up, mark mobius will join us. this is bloomberg. good morning. ♪

ritika: this is bloomberg surveillance, i have the business flash. amazon is projecting a big jump in sales in the current quarter, beating analyst estimates. ist indicates the largest expecting a surgeon online buying for the holidays. shipping expenses are still growing faster than revenue. facebook is indicating that a major advertiser boycott had a limited impact. the social network says they rose better than expected at 22% in the third quarter. and the number of monthly active users beat estimates. there was an unusual decline in users in the u.s. and canada. that record-setting -- is generating investor interest. total debt tohai $.8 trillion yesterday. that exceeds a supply by more

than 870 times. that's your latest bloomberg business flash. tom: thank you. we are looking at markets, another down day, this is off of tech disappointment and further pandemic news. -38.es dow futures -3.11. and we continue to see resiliency this week of the dollar. westech at 36.40. interestingnd gentleman who served president obama and president trump. this is bloomberg. good morning. ♪ ♪

tom: good morning, everyone. "bloomberg surveillance" on a friday from london and new york. we are continuing to monitor the tragedy in nice.

information,much but we will watch that today, articulate the actions of mr. micron from france. that movesk at how forward in the coming days and weeks. lukens diplomacy, lewis is with us. he is a rare breed. public service to the nation with president obama, vice president biden, and also president trump. we are thrilled he can join us this morning. there will be a massive partition of a trump win and biden win as well. let me first go to president biden, which will be a radically different state department than what we saw with mr. trump. is it obama redux, or will there be a different biting tone at state? lewis: i think it is a different tone. the world has changed.

a lot of the instincts joe biden had as his career through senator and vice president, his friends and allies around the world will still be there, but the way foreign policy is framed and the objectives will be different with more of a focus on bringing jobs back to america and trying to rebuild the american economy after the devastation it has seen. tom: in diplomacy, you served the nation in africa, the united kingdom. the question is obvious, this comes from economics, which is long-term unemployment and the impact upon society. ,f we have a second term trump do we risk a diplomatic history says? we do.

the state department has been devastated during the trump presidency. the president does not trust the state department, does not believe in diplomacy, does not understand the importance of alliances and relationships, has made an effort to weed out senior state department people he sees as untrustworthy, the famous deep state, which does not exist. another four years of that would really devastate the ranks of the foreign service. it would take a long time to rebuild the state department after eight years of president trump. francine: many people voted early. who voted early? is it people who did not vote last time around or people who were afraid of queuing up because of covid? lewis: i think it is a combination of both. there is not a lot of great data on who is voting early because most of those people have voted by mail-in ballot.

the numbers are staggering. americans who of are going to vote this year have already voted. i think we are seeing from surged the country a in young voters. that bodes well for biden. it is a combination of people who have not voted before who are energized to vote this year for various reasons, but also people who are worried about election day because of the coronavirus and want to make sure their vote is in early. is there the trump shy voter? biden has off saying a narrow lead, but what if it is much narrower than the polls tell us? lewis: i never bought into this notion that there is a huge cohort of trump shy voters.

to the extent there is, that is more than offset by the huge numbers of young voters who are coming out to vote who do not get picked up in the polling. the polling has been fairly accurate. there are a number of things that are different. the number of undecided voters is much smaller. four years ago, over 10% of americans had not made up their mind yet. that number is down to less than 5% this year. there is no viable third-party candidates. it is a binary choice. people have made up their minds generally. trumpare maybe some shy voters, but not enough to sway the election. tom: thank you so much. we look forward to speaking to you after the election, whether that is decided november 3 or march 3. mr. lukens worked with the state department for president obama. the dow futures -317. there is a persistent downdraft.

dollar flatness right now. .1677 is maybe the lead item. yield ine negative europe after mice gdp surprises from selected countries. with first word news, here is ritika gupta. ritika: they were not able to agree on a coronavirus package before the election. now nancy pelosi and steven mnuchin are battling over terms for a postelection deal. the treasury secretary accuses the house speaker of refusing to compromise. 's says she is waiting for mnuchin's response. record quarterly growth. 33%.-quarter gdp surged to economic activity after widespread lockdowns earlier this year.

u.s. economists are projecting the u.s. economy will grow 3% to 6% in the fourth quarter. the most coronavirus cases in one day, 89,000 cases recorded as a jump in infections in new york and new jersey and a record outbreak across the midwestern states. victory by joe biden would offer a path to killing an oil pipeline highways. after taking office, president trump cleared the way for construction of the dakota access pipeline. it has been operating without permitting since a quarterly. 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 ritika gupta. this is bloomberg. francine: thank you so much. coming up, we talk with stephen

, imperial college of london infectious disease professor. we will talk about asymptomatic cases. that is coming up on bloomberg. ♪

>> we have found ourselves in a dramatic situation. this affects all of us without exception. >> renewed challenges to public health and the growth prospects of the euro area. vulnerable, test, alert, protect. none of that is sufficient in

the current situation. >> obviously, there are painful choices. because there is no restrictive measure -- >> we are all wondering when we will come out of this crisis. now is the time for patients, determination, and discipline. leaders onuropean the latest virus measures. in the u k, boris johnson is facing growing pressure to implement another national lockdown. according to the findings of the imperial college london, infections are doubling every 90 days. riley.joining steven professor, thank you for joining bloomberg. when you look at the dynamic in london and in the u k, does track and trace work, or does it not work? track and trace is

really test, track, and trace. it provides as rapidly as possible a test for people who have got symptoms. that is very important. that is needed at all levels of infection. it could be done better. the second part is contact tracing. i think at this stage because ,evels of infection are so high it is very difficult of the tracing part to make a big impact on the epidemic. waycine: is there another of dealing with this infectious disease at this point going into november other than a lockdown? lewis: i don't think a lockdown -- steven: i don't think a lockdown is a useful term. that brings everyone's minds back to march in the u.k. across europe, countries are

considering uniform national strategies that they think have a better chance of reversing the virus and with a variety of components in those measures that does not amount to the same type of intervention that was used in march. keenerofessor riley, tom in new york. thank you for being with us. we are thrilled to have you with us today. teamc medicine, you and a published covid-19 south korea and implications for lifting stringent interventions. to cut to the chase, they got it right in your definitive study, we got it wrong. why can't we do what they do on the pacific rim? steven: that is a great question. there are two sides to that. the actual policies and the way they implement those policies

are very good in this pacific rim countries. that is part of it. the speed at which testing was distributed in south korea, and also their ability to do cluster investigations was cute. .outh korea was a long time ago in the global scale of things, that was a relatively small outbreak, but they did well. the pattern is so clear between pacific rim countries and europe and america, we have to looking deep rooted cultural issues. are we in europe capable of acting collectively with the same degree? tom: i think this is critical. the fact is we conquered diphtheria, typhoid, on and on. it is a virus, not bacteria.

i get that. the leadership has failed. is it a lack of will of politicians and leadership? honestly, tom, i do not think it is just that. element, are is an strong element of leadership, but it also reflects the intrinsic values, the desire, the way that we are or not capable of acting collectively. that is what we have to focus on. now, they have intervened earlier, they're going for a low prevalence strategy. they are a great example in europe to watch. will germany achieve lockdown light, low prevalence going into the winter? those are the examples we have to look to in europe. francine: how many people have the virus, can transmit the

virus, but are asymptomatic? how do we test those people? study, when wer randomly approach people and test them regardless of their symptoms, we get between 50% and 70% do not show symptoms on that day. the short answer is it is very difficult to get at even with very high volume testing. it is hard to get at those. the testing that really works is when people have symptoms to provide them rapid access and results to a test, and those are the highest volume tests. if we get very high volumes of at large can look screening programs, but they are going to needed to be run

carefully. it is not immediately obvious that they solve the problems in one go. francine: stephen, thank you much. steven riley, imperial college london infectious disease. with johnse talk hopkins public health professor. we talk about the midwest in the u.s., four days to the election. that interview at 6:30 a.m. in new york, 10:30 a.m. in london. this is bloomberg. ♪

ritika: this is "bloomberg surveillance." shares of twitter are falling today. the company says it added half new users in the third quarter that analysts expected. expected twitter to see gains from digital sports. 16%,-quarter revenue rose

beating estimates. the fastest-growing part of google sought youtube revenue growing 32%. sawbucks better-than-expected quarterly results. same-store sales were down 9%, better than it was in the spring when much of the world was on lockdown. that is your latest bloomberg business flash. tom: thank you so much. now onto tech. i do not want to talk fancy products. i'm to talk financial results. disappointment about the uncertainty forward. alex webb is the bloomberg opinion, in charge of our measurement of uncertainty in technology. involvingn employees trillions of dollars of double-digit revenue growth. why the uncertainty forward? alex: i think it is clearly a

mixed picture for different companies. , for instance, engagement really peaked during the lockdown as people were sitting at home. that seems to be plateauing now. it is still growing at a fair clip. apple not really giving a what it expects to make from the iphone's in this christmas quarter. google and amazon, clearly a lot more buying stuff on amazon, and .ngagement on google is up thes a mixed picture, but terror they have been on this year is skittish for investors. 36: can you extrapolate out

months, or do you have to extrapolate out to christmas? alex: it is hard to look that far ahead, particularly given the pace of hardware, usually these companies will keep themselves in the forecast for the impending quarter. amazon seems unstoppable. at realontinued to grow pace. we do not know the effect antitrust will have, whether there is the potential to tackle some of these company's business models in a way that disrupts their growth. it seems the market does not think that is good to happen in a severe way. thisine: overall, is evaluation problem? it harkens back to early 2000 with the tech bubble because valuations were so high. the numbers were not that bad, but investors were expecting more, so they corrected. alex: they significantly

outperformed the broader market this year. some of these tech companies, the market itself would not have performed as well without their outperformance. the possibility we are in the middle of a bubble. some people have said that is the case. different companies with different priorities here. apple, if they could get people in china to buy their 5g ipod, maybe they could justify some of those valuations. when you look at google and facebook, they are particularly dependent on advertising, and that is now being tackled by regulators. that does create skittishness. i feel like s.a.p. happened three months ago, but it was only monday. was it idiosyncratic?

could we see those stories prop up again here in there? alex: these are all companies with their own specific problems and strengths. company that was not as smart as it could have been to push into the cloud. there are a lot of clout companies doing very well, microsoft and amazon. in the cloud, it is not just one business. adapting.been good at sap has not. i'm sure there are others who have not been able to capitalize as rapidly as they ought to have. tom: when are we going to know about fourth quarter? do we really have to wait 90 days, or the and guys like you have the ability to

channel will we will see in november and december? alex: we will see reports out of taiwan. what apple will do is they will book capacity from their suppliers. if they find they are not going to meet that best case scenario, they will direct down that capacity. you will see reports on that coming out of taiwan, companies like foxconn that make iphones. follows theeveryone stories written by our colleagues. tom: have you already ordered your iphone 12 blue? i have not. i have an iphone 11. i don't think i need one. my fiance has an iphone 12. tom: you cannot be seen in the bars of mayfair without that iphone. it just says alex webb. alex: thank goodness there is a

lockdown. alex webb, really quite good on this. on the data front, it is a little bit of an improving take. we are monitoring the tape. it is correlating, not the angst of yesterday, but futures -32. -32.35. ard joins us in our next hour. please stay with us from london and new york. this is bloomberg. ♪ businesses today are looking to tomorrow.

adapting. innovating. setting the course. but new ways of working demand a new type of network. one that's more than just fast. you need flexibility- to work from anywhere. and manage from everywhere. advanced technology. with serious security. and reliable coverage, nationwide.

forward-thinking enterprises, deserve forward-thinking solutions. and that's what we deliver. so bounce forward, with comcast business. tom: this morning, continued pandemic. the international monetary fund,

they adjust very grim view of the british economy to evermore grim. they say the government must help those who end up losing their livelihood. techndemic and challenging outlook, s&p 500 down about 8% in the last two weeks. four days and counting, michigan, wisconsin, minnesota, and iowa, they matter. trump and biden do battle in the battleground states. from new york and london, tom keene and francine lacqua. francine, i was thunderstruck by the imf adjustment to the united kingdom. let's call it weeks, but come on, days after the blue book of the imf came out. this is something the imf does every six weeks. we used to cover