francine: election day is tomorrow. president trump and joe biden chase swing states as early voting hit a record. england prepares for a month-long lockdown as a partial shutdown begins in germany today. gately may be next to reimpose restrictions. ryanair says risks are skewed to the downside as the chief executive calls the lockdown political mismanagement on a grand scale. welcome to "bloomberg: surveillance ." i'm francine lacqua in london.

the u.s. election and there is profit taking in parts of the market. investors, trying to figure out what a biden possible blue sweep and the senate means for markets. the focus is on brexit. rushing outstories and we go to the fed and jobs tumbling. -- oil two other stories we are watching, euro area october are thanring pmi, that expected, 54.8 instead of 54.4. se extra -- this is pretty lockdowns. watch down for some of the stocks because there was an input error. maybe we look at individual countries instead of the stoxx 600 as a whole. let's get to the first word news in new york -- in london with

leigh-ann gerrans. and thank you. with one day until the u.s. presidential election, democratic nominee joe biden is leading incumbent donald trump in a series of polls. he remains ahead nationally as well as in key battleground states although some of the races remain extremely close. a number of polls put widen and ahead in the key swing state of pennsylvania. the u.k. is set to enter a lockdown thursday. non-essential stores and restaurants will close, but schools will remain open. the government is bringing back -- though the shutdown was announced as lasting a month. the cabinet minister signaled yesterday it could be extended if the virus numbers don't improve. close togotiators are breaking the impasse over one of the biggest obstacles to a deal, fishing. it is a sign an agreement a be

reached by the mid november deadline. sources tell bloomberg decides are nearing a compromise on what access the u-boats to u.k. fishing waters. the world's strongest storms this year has killed at least 10 in the philippines. search-and-rescue is underway hit thephoon goni province yesterday. province remains unreachable -- unreachable and crews are working to establish communications. global news 24 hours a day, on-air and quicktake by bloomberg, powered by more than 2700 journalists and analysts in .ore than 120 countries i'm leigh-ann gerrans. this is bloomberg. francine: thank you so much. after a long year of campaigning and more than $14 billion spent in the most expensive in history, election day in america is tomorrow. here's what we heard on the campaign trail this weekend. >> i think it is terrible when

we can't know the results of an election the night of the election in a modern-day age of computers. i think it is a terrible thing and i happen to think it was a terrible decision for our country made by the supreme court. it was a terrible decision for our country, and i think it is a very dangerous decision. >> the president's allies have been talking about declaring if the on tuesday, even votes aren't final. what is your response? >> my response is the president is not going to steal this election. >> let's give them an extra three days and take all the time you want. people want to know, and bad things happen in places like pennsylvania and nevada -- we love nevada, but you have a governor there, bad things can happen. that little intervening let's take plenty of time. no, that's a terrible ruling for our country. i don't care. it's a terrible ruling.

it is a shame. >> the good news is on tuesday, you can choose change. you can elect joe biden. you can elect, harris. -- kamala harris. you can choose a better america, and you don't have to wait until tuesday to cast your ballot, michigan. francine: that was president trump, joe biden, and former president obama over the weekend. isning us with the latest kathleen hunter from our politics theme. first of all, good morning. how likely are we to know the winner on election night? kathleen: that will distin election from past elections, we likely won't know the winner on election night or potentially when they or thursday. are alls indicate their lot of states where the race is still very close. we don't know how accurate those polls are.

some margins are close to the margin of error for the polls. we know that trump is already sowing doubt about the legitimacy of counting mail-in ballots that a lot of states aren't allowed to begin counting until election day, so we could be in for a bumpy week. francine: what states are you watching? i keep reading about possible civil unrest. without being alarmist, how possible is that? kathleen: i think that's a real possibility. we've seen indications over the weekend, for instance, in texas, there was an incident where some time -- trump supporters forced a biden campaign off the road or tried to do that. i think there is the possibility we could see unrest around the polling, in person: tuesday. that is something we will be watching for. and even -- i think we lost kat

hunter attic or shall time so we will try to get her back to go through the states. florida is probably one of the tightest races and he speak to pundits, they say if president trump loses florida, it is likely joe biden becomes the president. impact onout the dollar, joining us is james foley, head of fx -- fx strategy at rorabobank. does the election mean for dollar? >> it is not just about the white house race. it is also about the senate. the markets for some time have been focused on the fiscal agenda, whether we will get this fiscal stimulus and if so, what size is it going to be? if we have the republicans holding on to the senate and the weocrats in the lower house,

will still have a conflict that has characterized this conversation about the fiscal package. it is possible the market could be disappointed about the expectation, the size of the fiscal stimulus if the republicans hold on to the senate. if you like, there are various permutations and combinations. it is not just about who gets the white house. francine: what are you expecting to be in the senate? we do have a blue wave, do you see that on dollar straightaway or does it depend on something else? jane: if we have a blue wave, democrats winning everything, i think the market expectation will be we will get a big fiscal stimulus package and that will be a boost to risk appetite, at least in the short-term. over the medium or longer term, people will start to concern themselves about tax hikes and that could have the opposite effect on risk appetite. thes difficult to know when

medium term starts, this comes back to the theme about timing but a blue wave immediately could help risk appetite, perhaps boost some of the risky currencies, perhaps and could have a detrimental impact on the u.s. dollar given its safe haven appeal. francine: we are getting breaking news. we did report five minutes ago there was a concern on the euro stocks 600. it has resumed trading so everything seems back in order. it was a temporary glitch and the stocks europe 600 is up after that glitch. i wanted to make sure our listeners new everything was -- make sure our viewers were aware. a joe biden in the presidency and white house, does it have a direct impact on trade and therefore on renminbi? the it have an impact on

south african rand, some emerging market economies and mexican peso? jane: absolutely yes. ,hen it comes to u.s. politics the congress, the senate have the purse strings over fiscal aspects but it is the president who has more autonomy over issues such as trade and we saw that during the last four years with trump. the market expectation, and we've seen this over the last month or so, is biden takes the white house, there will be less animosity between china and the u.s. i would be very careful about drawing that conclusion. of surveysat a lot in the u.s., what we see is over the last four years, voters on both sides of the electorate divide become more suspicious about china and i think that goes for europeans too, if we go back 20 years ago, many western countries assumed as china wealth increased, we would get

more democracy. instead, what we have is more military power, more noises from china about wanting to be more dominant in tech, treading on the toes of the americans. i expect there will be a lot of tension, not so bellicose as trump, but under a biden presidency, there will be tensions with china. one thing we need to watch out for is whether or not a biden presidency is a little more taking a side with australians or with the europeans against china, so i think we have a different presidency but in some ways, we still have china tensions. jane, this is our mliv question. and ourfantastic blog, question today to experts is what should investors fear most this week? what do you think that is? jane: i do think it is the

contested election. if we get the contested election, that fear we could have social unrest -- over the last few months, what we seen in fractiouspeople are and add unemployment. people are having concerns in some parts about the income they have to feed their families, etc., and you add the contested election. if we go back to research, go back to surveys, what we see from the pew agency, does this election matter to you? of peopleuge amount in the u.s. really engaged about this election and that is reflected in the sheer numbers of people who have already voted. people are engaged. stressare economically and i do think in election, we have unofficial -- official

unrest and that could be divisive. francine: thank you so much. jane foley from rabobank stays with us. at the poundlook given the lockdown in london and the u.k., but given we could be making ways toward some kind of deal on brexit. tomorrow, much more on the election. we'll bring you special coverage, analysis today and tomorrow. this is bloomberg. ♪

francine: england joins austria and greece on imposing tougher restrictions this week. boris johnson announced the partial lockdown which would cause shops to close from thursday. paper exit deal could be secured by november. -- a budget deal could be secured by november. let's get more with emily ashton. amongstunhappiness boris johnson mp's. how big a rebellion is he facing? >> boris johnson didn't want to impose the second lock down for weeks if not months, but the new projections from his scientific committee left him with no choice, he says, because projections show deaths will rise throughout december and

beyond if there is no action. he's going to go to the house of commons this afternoon and said the second wave is going to be more deaths if we don't act. there are conservative mps that are anti-lockdown and there is a vote on wednesday and you will see a number of them vote against it, including people like brady, an influential conservative mp, the chair of the 1922 bench committee whose concerned about the fundamental if they are not able to see their family for a month. a few conservative mps will abstain but he has the support of the opposition groups, labor and he's likely to get his lockdown through. francine: we will have more on brexit. close to an agreement. emily ashton.

still with us, jane foley from rabobank. i don't know what changes your pound perspective, does this lockdown make it more difficult for the bank of england to set policy thursday. make it difficult. if we look ahead, that goes for all of europe. some of the data we are having october, your could say the same for last week's gdp data, still out of date -- already out of date because since the data were recorded, the news about q4 has become worse. for the bank of england, the topic is will negative interest rates become more likely or not. nobody really wants to go through negative interest rates. there are risks to negative interest rates but at some point, it could be the economy, if it were to get so sour, it

becomes a more realistic proposition. i don't think we are there yet but i think the market will be listening to the rhetoric for the -- from the bank of england to gauge whether or not that particular policy has become a little more likely than a couple of weeks ago. francine: what does this mean for pound going forward. we seem to understand through sources and it could be the reserves -- reversed that we are getting toward some kind of deal, especially on fisheries, which means we could have an agreement on brexit. jane: that's exactly right and to be honest, if it wasn't for that news this morning, sterling would be a lot lower. it is significantly lower against the dollar, but that is partly a function of dollar strength. if we look at it against the euro, what we have for euro-dollar is sterling weakening a little on the back of the lockdown news, but

eurosterling is at the bottom of the range and that is because there is hope that by the middle of november, we could have a deal and the news that we have, the headlines from bloomberg news today suggesting there may have been concession made on fisheries, feeding that optimism, but i use the word optimism a little too lightly because i think there is going to be a lot of political cloud facing sterling the next six months for now. i think if we get a deal, it will be a fairly narrow deal, perhaps not the comprehensive one people hope for a year ago. any hope for relief on sterling would be limited is short-lived. we've got the possibility of border disruptions in january and after we move into next year, we will have a lot of question marks about u.k. politics. we know boris johnson's popularity is low. we've seen recent polls suggesting if there were

election now, labor would beat the tories. there is question over the future of boris johnson and whether or not he can abstain command over the next year -- stay in command over the next year. francine: thank you so much. plenty more with jane later. we will talk about the fa oft er -- fate of boris johnson and china and renminbi. are set to worsen this winter. ryanair's chief executive says virus curbs reflect a failure of government policy. our interview with michael o'leary later this hour. this is bloomberg. ♪

francine: this is "bloomberg: surveillance." i'm francine lacqua in london. let's get to the business flash with leigh-ann gerrans. leigh-ann gerrans: nestle is close to its next takeover target. the payment provider is in merger talks with next, hoping to reach an agreement for a share deal the follows the purchase for 4.5 billion euros. shares in the firm have doubled since the country's -- company's ipo in april. ryanair is bracing for deeper losses this winter as a new wave of lock downs threatens its bring back flights. europe's biggest discount carrier will provide 40% of usual capacity and says that

could drop further. ceo michael o'leary criticized new restrictions, calling them a failure of government policy. that's your bloomberg business flash. you.ine: thank a lot going on. we have to look at the markets. 24 hours away until the u.s. starts voting and that could move the markets. risk assets are all over the place at the moment. it is volatile when it comes to the market. recovery isomic going from strength to strength, that is the view of bloomberg economics and we will focus on the only major economy set to grow gdp this year. that is next. we will look at renminbi. this is bloomberg. ♪ businesses today are looking to tomorrow.

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surveillance." i'm francine lacqua, here in london. u.s. tomorrow that the votes, a lot going on because we get onto boe. there is a lockdown in europe, so we have to look at market moves. let's get to first word news with leigh-ann gerrans. leigh-ann: good, francine. joe biden's warning president against declaring victory before the results are clear. it follows a group or an act that the president has told associates he plans to claim a win if results show him ahead, even if the outcome is not really known. anger is rising across europe as government imposed new lockdown rules. protests have erupted in madrid and other cities as officials block travel from other regions. and germany are expending shutdowns for november. 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: thank you so much. china's october pmi fell slightly while consumer spending suggested the out come -- the economic recovery is on track. from theexporter cashing factory defied expectations. still with this is jane foley from rabobank. your assumption of china, this is the question we were asking the imf. if everyone else is in lockdown and consumer spending goes down elsewhere, can china sustain it? jane: china is of course trying to stabilize domestic demand. i think you're right in pointing this out. what we had in the third

quarter, we saw this very much so in the u.s., gdp data, it also in european data, too. a big increase in gdp as consumption increased, in retail sales as they began to recover as well. when that of course held -- that of course helped chinese exporters. is arguably ina a better position than many other countries because of the lack of the virus there, because of this perception that asia generally, perhaps led by china, is doing better in terms of coping with the virus, allowing a bit more economic freedom in their economies because of the reduced covid number. it will get some support from there, but i think you are right, the optimism with respect to china has to be tempered because of the economic restrictions we are seeing across europe. jane, when you look at

renminbi, what this renminbi do from here? jane: again, this is quite interesting. a market consensus is beginning to gather some pace, which is china is doing better than the rest of the world. grow predicted china will the only major economy that will grow significantly next year, for instance. all of these expectations are really helping the market gather optimism about the chinese renminbi. i come back to the point where i think it is perhaps a little bit too hasty to assume there will be less friction if we do have a biden presidency between the u.s. and china. i do think that there will be a lot of deep-rooted suspicions. i think that a biden presidency at allianceser with other economies, with other countries against china. some of the market optimism that we are seeing about the

medium-term outlet for renminbi could be a little bit misplaced right now. thank you so much, jane foley with the latest on renminbi, and all the big currencies we are watching out for at rabobank. if you look at the markets and you look at what we are getting out of the u.k., we had some data point out of europe. this is for london, october, taken with a bit of caution because it was before these extra restrictions and extra lockdown that took place. u.k. october manufacturing pmi 3.7 -- 53.7, and we also had a glitch on the stocks europe 600, and that was fixed. europe stoxx 600 extending gains to around 100%. we will have plenty more on the market throughout the day. as the pandemic sweeps the globe and wildfires ravage the west, the only thing that seems faster thisnspiracy theater

conspiracy theory. that has beenf piercing it's with your politics since 2017. the idea has a large following among celebrities come and believes there is a deep state working against donald trump. what is being done about these groups and how are they impacting this year's election? emily chang reports. just about one year after president trump's 2016 victory, a hint was trumped on the suitor anonymous discussion board 4chan, the hillary clinton's arrest was him it's an -- was imminent. more and more from claims called q clearance anonymous, promising to deliver the next big revelation that would bring down the democratic party. in 2017, qanonts

has continued to evolve into a widespread belief that there are actors in the so-called deep state trying to take down president trump. the president has repeatedly retweeted q were non-supporters but has denied knowing much about them. pres. trump: i don't know anything about it other than they do supposedly like me. i just don't know about qanon. >> you do know. pres. trump: i don't know. what i do hear about it is that they are very strongly against pedophilia. and i agree with that. emily: a conspiracy theory that became common in the 19th century -- like fire needing fuel. what is so bad about a theory? facebook, twitter, and youtube have all tried to band together to limit q in on, it and other baseless there is that could end up inciting real-world violence. in 2019, the fbi warned that conspiracy theories by domestic extremists will likely emerge, spread, and evolve in the modern

information marketplace, occasionally driving groups and individuals to carry out criminal violent acts. he were non-is one of the extreme ideologies that has driven thought between belief, taking it further. >> this message, a possible reference to the hillary clinton email investigation. trainsecutors allege the engineer admitted to police he intentionally derailed and it had this, believing an altered purpose related to covid-19 or gulf bring -- or a government takeover. >> police are asking people to stay away from this area. emily: in an effort to combat misinformation head of the election, online platforms continue to remove posts associated with qanon. when the lines are blurred between social media news media, the question remains -- when is it moderation and when is it

censorship? emily chang, bloomberg, san francisco. francine: coming up, europe's biggest discount carrier says things are set to worsen this weekend as new coronavirus curves reflect a failure of government policy. our interview with michael o'leary is up next, and this is bloomberg. ♪

francine: this is "bloomberg surveillance." a lot to get through, but let's get straight to the bloomberg business with leigh-ann gerrans. leigh-ann: a new report says u.k. companies are on average borrowing about five times more than usual this year. consultancy ey says bank lending has climbed 43 billion pounds for the first eight months of the year. that is up from under $9 billion for 2019. ey says many are likely to start reducing the debt until 2022. spac has seen plunging profits this year after the australian lender was hit with a record fine for breaching and i money laundering laws. it also faced swelling -- anti-money laundering laws. the firm says 2020 was a particularly challenging year. the result is disappointing. a --rom peak is buying

is --e equity firm pt pt over one million customers for it $.1 billion, including debt. $8,000l valued at around per broadband subscriber. internet providers have done well during the pandemic as more people are staying at home. that is the bloomberg business flash. francine? much.ne: thank you so you're's biggest discount airline says losses are set to worsen this winter as a new wave of coronavirus lockdowns frustrate writer's attempt to bring back flights. chief executive michael o'leary spent with -- spoke with manus cranny and annmarie hordern earlier today. about 38 million passengers for the full year to the end of march, we think we may have to work that number back slightly.

but we are running pretty much ahead of schedule for the next ,onth or two, forward-looking which was already terrible. the risk would be to the downside. there are -- they are a continuation of the field policy of the u.k. government for the past 12 months. the lockdowns are a failure. they should be avoided wherever to get the testing system in place to avoid a second lockdown is the goal. the u.k. government, the irish government is locking it down the model of november would be the best month. testing,ere is rapid 15-minute rapid tests. ,s that not where we should be seeing our governments spent more of their time and money so that we can move around? is that not ground zero to get

us off the ground? michael: i'm not sure how well -- there is no doubt that governments should have used the first lockdown to massively boost their capacity. all of johnson & johnson's promises, including brexit, there have been -- like all of oris johnson's promises including brexit, there have been channels. -- we shoulde are be vaccinating a million people a week. that is the way you get on top of it. you do not lockdown once and then lockdown again. this is political mismanagement on a ground scale, and what is missing is that effective white -- thatat widescale effective widescale testing on the population, each week, that

is a way to get rid of these lockdowns. manus: you strike me this morning was slightly more positive rhetoric, getting through the eye of the storm. opportunity ing this crisis, if there is one at all? think the opportunity here is to reprice the aircraft order for the next five or six years, and we have had advanced discussions with boeing on orders come on order pricing come on compensation. none of those can be conducive to the -- there has been an enormous opportunity in the last three months, to refined the cost in almost every year going forward, and going forward we will have more lower productivity labor cost, bigger growth incentives going forward. we will be able to pass on all those savings to our customers in the form of lower airfares.

i have no doubt in my mind that customers all over europe, the first thing they will want to do think thingsr -- i will rebound very strongly, and ryanair will make market share gains in that recovery. ryanair chief executive michael o'leary, speaking with us earlier today. great to have you on bloomberg surveillance, said. what is the greatest challenge for ryanair? >> the biggest challenge for ryanair at this point is trying to figure out when demand is going to come back, and essentially they have a managed -- they have managed to keep their costs in check. with the new government restrictions in the u.k.. what is michael

o'leary's outlook for the coming months? >> michael o'leary is talking about how demand will be lower in the season, which is typically the slowest spot of the year for airlines, and ryanair is saying that there losses in the second half would be worse than the loss in the first half. ryanair is also challenging rival airline bailouts, so some are refusing a bailout at all, like it could be alone or something like that. what is the latest on this? >> ryanair has been challenging bailouts, including the ones like lufthansa, air france, and others in europe. their contention is that it it will the market, and allow other airlines to offer flights below cost. that argument has been you feuded by other airlines but they just need the money to survive. ryanair has filed legal

challenges against these bailouts, and looks to see what really happens from here, and the european courts allow this to continue or not and crackdown .n bailouts francine: thank you so much. coming up, much more. tomorrow's u.s. election. we will bring you the coverage, that is coming up shortly and this is bloomberg. ♪

>> i am an owl, i'm not a dove. >> monetary policy cannot be the only game in town. >> we are not here to close spreads. this is not the function of the mission of the ecb. we will use any and all flexibility we have to make sure our monetary policy is properly

transmitted to all jurisdictions. action has to be taken, an ambitious and coordinated fiscal stance remains critical. certainly under current circumstances, it is very likely that the full envelope of debt will be used. this recovery is still today uneven and incomplete and uncertain. we will be looking at everything. now, in the meantime, we are not going to just stand still. backine: that was a look at christine lagarde's first year as ecb president. let's look at what you should be watching out for this week. it is about the u.s. election. later today we get the information on the u.s. manufacturing pmi data. tomorrow is u.s. election day, and wednesday america formally withdraws from the paris agreement on climate change. the bank of england is expected to increase bond purchases. the fed will likely hold steady as well.

we will have plenty of news to talk about. after global equity markets rounded out their fourth week since march, investors are gearing up for another volatile stretch. between the u.s. election and tighter restrictions in europe, bakraoui risks are dominating. -- macrovery latest is risks are dominating. dani burger, how is the election being prepared for tomorrow? dani: equities are moving higher today, so there is no sense of panic in terms of the day before voting begins in the u.s., at least on the day of the election will stop sources i have been -- that with say that for most investors, they can afford to stay on the sidelines for what could be a very volatile event tomorrow and the ensuing days, what could be a very expensive day if they are positioned wrongly heading into it. comesf the expensiveness

down to the prices of hedges at the moment, and we are seeing that play out in markets, bonds and goals not moving -- bonds and gold not moving too much in the past few weeks. so investors are likely running and not changing their position when it comes to haven assets. gold up today, fell last week. yen got a few bid last week, but investors have been saying the flow is mostly from japan. you have investors waiting on the sideline, not wanting to titian around with a think the markets will -- to position sideline, not wanting to position around what they think the markets will do. are left for those who still playing in the market, what are they buying? dani: according to takata of nomura, what is left is most likely retail players in the ,wiss trading more short-term

oriented strategies. he says because of that they are buying and selling right now with a lot more noise than what you would expect if you had a lot more real money in the markets. not to read too much into what we are seeing during this time when there leading short-term, that one consistency in the europe, the u.s., and asian trading sessions over the past few days his momentum has been getting high flyers, biggest names. that is what is selling off in the market and it could be indicative of retail traders to get profits on the more high flyers coming into the election. also, takata from know your mira -- from nomura says he sees hedge funds backing off to cutting their longs in europe in europe and the u.s.. they have tended to be selling s&p 500 and nasdaq 100 futures in these first couple days or first-last days heading into the election. dani burger, thank you so much. the very latest on positioning

on the markets and what we are watching for. the markets, there was a blip earlier on in the trading session. the stoxx 600 actually opening with a bit of a delay. but now everything is fine, and with volatility on the markets, let's get that board up so i show you exact the what i'm looking at. stocks are actually rebounding, oil repairing some of the retreat that we saw earlier on, and the other one we need to watch out for is gold, gold advancing, and quite a lot to do with pound. pound is on the weaker side, but jane foley is telling us pound is weaker but not as much because we are expecting some sort of breaks a deal. "bloomberg surveillance" continues in the next two hours. tom keene joins me from new york. we will focus on frexit and we will focus on the markets. -- on brexit and we will focus on the markets. this is bloomberg. ♪

francine: u.s. election day is

tomorrow. president trump and joe biden look for support in key swing states as early voting hits a record. england prepares for a month-long walk down to combat coronavirus as a partial shut down begins in germany today. italy may be next to impose restrictions. reiner chief executive michael o'leary calls the lockdown political mismanagement on a grand scale. good morning, everyone, and welcome to "bloomberg surveillance." the focus on the markets, there was a lot of volatility this morning. now that things are stabilizing, we have the bank of england on thursday, but all eyes are on the election tomorrow. it's is not only for the white house but of course the senate race as well. hugethe senate race is a mystery. the focus got greater. there were some interesting twists and turns over the weekend. in the markets, the higher yield regime