and be healthy. get off the floor and get on the aerotrainer. go to aerotrainer.com, that's a-e-r-o-trainer.com. ♪ >> good morning from bloomberg's middle east headquarters in dubai. these are today's top stories. hitting the brakes. market euphoria over a virus vaccine loses steam amid concerns that there are still hurdles to overcome. u.s. cases hit new highs and hospitalizations approach a record. losing momentum. equities had touched all-time

highs on the news with the money flowing to value and cyclicals. havens are clawing back some ground today. retaliation. the european union will impose tariffs on $4 billion of u.s. goods starting today. the eu's trade achieve calls on both sides to drop countermeasures. a very good morning. if you think about it, we had that tantalizing, parabolic move, i would say, in this market yesterday evening. i was here late. isar rationing around the markets -- i saw rationing around the markets. this morning, we face i suppose reality. >> feels like a massive night out and this morning was a bit of the hangover reaction. michael purves says it

perfectly, talking about the vulnerabilities of the vaccine narrative. if the republicans gain control of the senate, this is very much so for them less onerous to want to do a fist -- lee onus -- less onus for them to want to do a big fiscal package. let's take a look at what we did see yesterday, that euphoria manus is talking about. i want to show you the close yesterday across europe. the dax a percentage away from actually undoing all the losses on the year. look what happened around the cac, the ibex, around the peripheral. spain up nearly 9%. it is more sobering. dax futures taking money off the table, down more than a percent across the futures market. , 90 basisar yield points. we have seen investors flee

these havens. you saw that yesterday in the yen, at one point down nearly 2%. had a 7% jump yesterday. today, we still traded just under $42 per barrel. you have to think, his royal highness yesterday, short-sellers, i think yesterday they had their day in court. it was a booster shot for risk, as we have been sank. vaccine being developed by pfizer and biotech prevents more than 90% of infections. anthony fauci called it an extraordinary set of results. the reality of timing and logistics sets in. joe biden took a sober tone, warning that the u.s. is facing "a dark winter" as the part endemic continues -- pandemic continues. joe: i will spare no effort to slow this pandemic down once we are sworn in.

to get our kids back to school safely, our business is growing and economy running at full speed again. approved vaccine manufactured and distributed as quick as possible to as many americans as possible. >> maria tadeo joins us from brussels. outlined to us what is going on in terms of the vaccine trajectory. >> look, i think you framed it very well. this is almost the morning after. you had major euphoria happening yesterday across the world, particularly here in europe, especially with this trifecta of euro assets. you get biden in the white house, some deal when it comes to brexit and the vaccine. when you look at the numbers we have today, europe is very much immersed in the second wave of infections. we are seeing those restrictions in place for longer, becoming more structural. there is no indication that the lockdowns are going to be

removed anytime soon. we know the european commission yesterday really welcomed this development. this vaccine, 90% efficiency. saying thater leyen the european union would add an order of 100 million doses to try to provide for the entire continent, but you are looking 27 different countries. who is going to get the vaccine first? when you get this to the people, will they want to get the vaccine? there is a debate from people who say, i don't want to get the first batch, i am concerned about, i may want to wait. there is this gap between getting the vaccine and getting it to work very efficiently. the medical community has welcomed it. this has been done almost at a record time. reaction, which is in the european markets, was so

much more, i suppose, obvious in the equity market reaction. to that extent, is this about who will get first? in other words, this is a european tie up with a u.s. company. one leans into germany at the top of the list. >> it could do. what i would add is that yesterday was not just a reflection of the vaccine. clearly, in europe that had to do with the rally a lot, but it is also this idea that the european budget, european stimulus package, all of this is being worked on at the same time. we had hints that could be unblocked sometime later today. europe could be ready to go by the end of 2021. so to speak, it's everything coming together in europe yesterday. very clear hint from european authorities that there could be a package that could be ready to go and approved by the end of

the, this vaccine coming together -- by the end of the week, this vaccine coming together. who is going to get the vaccine first and which country? if you are ursula von der leyen, you don't want to say germany gets it first because it's the biggest country and puts more money into the european budget. at this point, germany is not the most infected country in europe by any means. manus: ok, maria. let's see how the rules of the vaccine play out across the world. maria tadeo with the very latest. head ofus is esty dwek, global macro strategy at natixis investment management. there was a parabolic move in some stocks, stay-at-home, tech. a number of huge narratives that shifted. the oil market shifted by 10%. with the pfizer announcement, have you re-rated or rethought

any of the timelines that you might consider for 2021 on strategic moves? really.t to be honest, it is very exciting news. it is definitely a at the end of the tunnel -- it is definitely light at the end of the tunnel. i don't think the timeline for a vaccine has really changed much. the level of efficacy was exciting. there are so many more questions before it becomes available and plenty more questions when it becomes available. it's also a question of seeing the plateau of cases in europe, trying to get a bit more confidence in the recovery, that the outlook for 2021 is going to get a little better. the vaccine news most certainly helped, but it has not changed completely. in general, markets tend to front run a lot of this. it won't be a question of when

the vaccine is available, it will be when we can start to return to normal or little bit. some of these more cyclical sectors should start to get bit more seriously. >> that was going to be my question. it was like a boat and you just see everybody moving from one side of the boat to the other side of the boat, this mass rotation into cruise lines, hotels, airlines. . is that going to stick? is this just a knee-jerk reaction? >> at this point, it seems like a knee-jerk reaction. there is plenty of room for catch-up in those sectors. at some point, they will rally. as you were saying, this is the morning after. there are so many questions left. it might not be in a straight line, but at some point commits coming. it might be sooner -- at some point, it's coming. it might be sooner than anticipated.

ares: it's amazing how we so utterly myopic in the space of like five days. from political risk to not even, what? we have not touched fiscal stimulus. this could be lighter than we thought. you square it around 1-1.5. why that number on fiscal? are you worried about mitch mcconnell's comments that it could be lighter than the number you penciled on fiscal stimulus for the u.s.? esty: absolutely. i think the range is more like half a billion -- sorry, half a trillion to 1.5 trillion. mitch mcconnell was more optimistic on thursday. he walked that back a little bit. same thing with nancy pelosi. reaction to

compromise and then coming back to both party's lines and where they stand before. labor market numbers on friday, all of that sort of supported mitch mcconnell's case that may be don't need as much. i don't agree with this. we absolutely need fiscal stimulus and we probably need more than this. some is coming. it might not be as big and we might not get the compromise that we were hoping for just a few days ago. even from a political perspective, because in this is going to be driven by what's best for those who run operations in georgia for each candidate. >> michael purves says the vaccine call squares off against the stimulus put. if there is a light at the end of the tunnel in terms of the vaccine, the vaccine just puts more pressure on them to not do a big fiscal package. do you think that's true?

do you think they will take this pfizer news and say, well, look, we are almost there in terms of the vaccine approach, we don't actually need cash to companies and consumers? esty: i think there is a risk they try to use it like that but i don't think it's the case. the timeline for a vaccine is still months, if not quarters, way. there are plenty of court -- away. there are plenty of questions about personal safety, about the more at risk groups, such as the elderly, trying to get two doses. forhave to divide by two the number of people that will actually get vaccinated. i don't think this brings it forward so much. it's always a question of potentially some good news end of this year, early next year. by the time we talk about distribution, the temperatures at which these vaccines would need to be kept and transported, and then given, we are still

talking about middle of next year before any meaningful shift in back to normal or feeling like an actual change in this. it's a long time to wait for stimulus, especially since the last phase came off three months ago. they might use it to justify a slightly smaller package, but i don't think we can use it to justify no package. >> in the u.s. yesterday, just passing 10 million cases and seeing a surge in the midwest. stayswek from natixis with us. >> the european union imposing tariffs on $4 billion of u.s. goods starting today. it's part of the tit-for-tat escalation in the fight over a legal aid to aircraft manufacturers boeing and airbus. will drop the duties if the u.s. will move levees it has imposed back in between 19.

president donald trump has fired defense secretary mark esper. the relationship had soured in recent months after he resisted the president deciding against using active duty forces to quaff protests around the u.s.. esper's departure may indicate a postelection shade appeared for stiffer miller has been named as acting chief. william barr has authorized justice department officials to open inquiries into election fraud. acknowledging there is no andlusive evidence, speculative, fanciful, or far-fetched claims should not be the basis for investigation. global news 24 hours a day, on-air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. manus: thank you very much. some breaking news coming through from you novell -- unibe

ll, the huge mall operator. shareholders have rejected a capital increase of 3.5 billion euros. they are going to review all possibilities and all alternatives. this is an outright rejection by shareholders. this plays exactly to the fed's notice last night. in the financial stability report. where the fed talks about uncertainty remaining high, investor sentiment is critically important. , somee financial system segments of the economy are going to be under more pressure. so this plays right through to that narrative, in terms of huge commercial properties like westfield. >> it's like you know where i go on my weekends. perfect. coming up, was it a factor rotation or momentum crash? vaccine hopes could reinforce

the move into cyclicals. that's coming up next. this is bloomberg. ♪

♪ manus: it is "bloomberg daybreak: middle east." manus cranny in dubai, annmarie hordern in london hq. the airline, tourism stocks are absolutely ripping it up. so-called work from home trade, that gets stalled. juliette saly is back in the studio. what's long, what's short? juliette: hey, manus. we are seeing those so-called covid losers absolutely on a tear today. we saw pfizer india shares rise.

it has been these tourism players, airlines, hotel operators in asia soaring. index rising asia the most since october 2008. as you say, that working from home trade -- nintendo shares following the most since march. still a long -- falling the most since march. let's get your morning call with societe generale's head of asian equity strategy. he says the news about pfizer and the covid-19 vaccine reinforces the positive matchup for equities and rotation into cyclicals and some of the laggards. in the near term, there is likely to be less performs

dispersion amongst the more and south asia and east asian markets. >> juliette saly in singapore, thank you for that market roundup and morning call. esty dwek from natixis investment managers still with us. we have asia flying higher off the vaccine news yesterday. softer,300 is notably down 0.8%. when you look at the globe, does the west's vaccine and narrative hurt chinese exporters -- vaccine narrative hurt chinese exporters? esty: i wouldn't say that. there are plenty of supports for asia and for china. the growth picture is still much stronger in china. lyey are one of the on countries that will post positive growth for 2020, that is back to 2019 levels across a

number of sectors, and it will continue to benefit from the environment for quite some time, especially if we get a bit more back to normal across a lot of areas. they are handling the health ichuation much better, wh even with the hope from the vaccine and news, we still have quite a few months of dealing with this across the world. this morning could be a case of taking a bit of a breather, you know, thinking about how that is going to play out or how much has already been priced into this. from our perspective, chinese and asian equities should continue to do well. manus: to what extent is longer long come along asia -- china, long asia over the consensus? that is flying higher. the current account balance is also trading higher, well, not

trading higher, but rising. are we reaching over consensus, overconcentration, long china? esty: we are definitely reaching consensus. i am not sure about overconcentration. we have china becoming a more -- a lot more prominent in terms of the emerging-market and broader indices. china should be given a bigger portion of investors' portfolios over the coming years. i think it's a trend, a move that we will continue to see. yes, i think the china-asia view is becoming consensus. as we see this reopening play out, there is the possibility that they do not outperform as much or for a short time. if we think medium-term, there is still plenty of support for the region. i do not think that is completely priced in at this point.

manus: thank you very much for joining us. that is esty dwek head of global macro strategy at natixis investment management. coming up, going green. could common climate change goals bring the u.s. and u.k. closer together? our conversation with the u.k. chancellor, that's next. this is bloomberg. ♪

♪ >> there is so much that unites our two countries. climate change is something i would put at the top of the list. the announcements i made today about the u.k. wanting to show global leadership and progress the climate change agenda when it comes to social services,

hopefully that is something we can work very closely along. it is something that biden spoke a lot about during the campaign. i am excited about the new relationship we will have with the new administration. ,> u.k. chancellor, rishi sunak speaking to guy johnson about his relationship with the president-elect. we have plenty of economic data from around the world and europe this week. let's take a look at what you should be watching out for. 10:00 a.m., we will get the survey from germany. it is expected to show a big drop in confidence over the past month. third-quarter gdp out of the united kingdom on thursday. we are going to get a read from germany on the cpi. look at that china data, pretty tragic, all about deflation. is that the risk for the euro area?

industrial production hits the tape. on friday, we get the french inflation data. i think that inflation narrative is something which the oil market really plays into. i am obviously a bit nerd-ish, so i went back to look at what it was when novak walked out the doors of opec-plus. vaccine is worth four dollars, or 10%. there you go. >> his royal highness yesterday speaking before we got that pfizer news. had said it is all about a vaccine and how the spread of vaccine can increase mobility. that will be the biggest part of demand. we are now just under $42 per barrel on brent. coming up, joe biden could give momentum to global green energy infrastructure. we speak to a key player in the industry next. this is bloomberg. ♪

manus: good morning from bloomberg's european headquarters in london, i'm annmarie hordern with manus cranny. this is "bloomberg daybreak: europe." market euphoria over a vaccine peters out that it has hurdles to overcome. u.s. cases hit new highs and hospitalizations approach a record. all-time highs as money flows to value and cyclicals. stay-at-home stocks were slammed.

retaliation, the european union will impose tariffs on $4 billion of u.s. goods today. both sides are called to drop countermeasures. very good morning to you, we are hugeg a hangover after a party that we saw yesterday across equity markets. so dramatic where the numbers in europe, if you look at the ibex and the ftse did. today is about the risks and concerns about the vaccine. storage, theut the distribution, who gets it first. if you look at stay-at-home stocks, this is where we add a momentary 360. peloton dumped 20%. netflix dumped 9%. it is a vaccine narrative, perhaps a shift, that has come

through in equities. s&p 500 went parabolic yesterday. your stocks blast higher. -- euro stocks blasted higher. a little bit of a reprieve. the dollar is lower because it depends on what you want to take, vaccine, we have made our peace with biden. the dollar continues to move lower. oil ramped 10%. goldman had a temper note this morning. in terms of the oil market. we will come back to that in a moment. there is breaking news on adidas. this will be important as the market opens. beat, butn, that is a those stocks are important. we have had a couple of read

headlines, we will keep an eye on adidas. let's turn to the environment. financial firms and large companies in the u.k. have to disclose climate change risks for 2025, that is part of a new set of measures. policymakers, politicians, executives have gathered virtually for the green horizon summit in london to discuss climate change. annmarie: across the atlantic, climate change is back on the agenda. president-elect biden will spend trillions of dollars to slash emissions and curb climate change. he wants america back in the paris agreement. the ceo of renewable energy is

with us this morning. thank you for joining us, dr. christian bruch --actually, we do not have him the moment. what i did find remarkable about dumpingrt, they are anything that has to do with coal-fired power plants. they will not provide turbines or other equipment, and they are split 50-50 in terms of fossil fuel and renewables. i wonder if this is them leaning more into her the renewable space. -- the renewable space. manus: we will have a conversation with the ceo of siemens energy. joe biden wants to ramp up climate -- the first tweet of the prim prime minister of the u.k. is about resetting the climate agenda. will it accelerate? ceo fromalk to the

siemens about the loss, and what he is doing to shift gears in terms of the gas turbine narrative he has, to a greener complex. coming up, we will dig into that and more, investor euphoria around the vaccine, what does it mean for markets? can it endure? this is bloomberg. ♪

manus: this is "bloomberg daybreak: europe." annmarie: we are back with dr. christian bruch, president / ceo, siemens energy. thank you so much for sticking around. apologies for the technical difficulties. i want to start with what you said, you will no longer provide turbines or other equipment for coal-fired power plants, but you are about 50/50 split in terms

of sales, half in fossil fuels, half in renewables. is this your company leaning into the renewable side? dr. bruch: good morning. thank you for having me. we are transforming the company, but we have to be clear, we have a mixture today. we have gas technologies, coal technologies, nuclear and obviously a lot of renewables. is of our revenue stream from either renewables or transmission technologies. what we decided and communicated today is that we stop participating for purely coal-fired power plants. this will be a transition because we continue to do services on coal-fired power plants with existing customers, and gradually convince them from going out of coal and moving to renewables.

it will be a longer journey for us, and getting from the portfolio to a future or folio which has to be based on sustainability. manus: good morning. mind, does this seriously takeo some write downs and restructuring charges in the business? how quickly will you pursue this change of course? what will it cost? dr. bruch: i think it is too early to tell. we are looking into the details and discussing with our partners . we have partnerships in this area to accommodate this change. we do not foresee to change our guidance for the year 2021, and we obviously will take this journey over a couple of years, because we have existing projects under execution, we have biddings we are committed to.

it will take some years to have this transition process, and we believe we can within our giving guidance accommodate. annmarie: i want to ask you about president-elect joe biden, the first time in with the top agenda of climate change. how will this affect your business? is biden winning better for siemens energy than trump? i. bruch: it is something cannot comment on. what i have seen in the u.s. with tremendous growth of renewables, and we have seen success with customers on how they have transformed over the last years. in the bidene administration, how transformational technology takes place irrespective of the administration. the financial markets and customers will push for more

sustainable energy solutions, and this will definitely help us orh various gas technologies offshore and onshore wind, which is a strong part of our business. i believe going forward, i would be confident whatever way the administration goes. politics is always tough. thank you for joining us, dr. christian bruch, president / ceo, siemens energy. making. chancellor is green innovation a centerpiece of his vision for britain's future. he looks to overhaul the sector. we have an exclusive conversation. remain one of the --do open places to be business anywhere in the world. we want to be a leader in green finance. today we announced we will be issuing green sovereign bonds for the first time next year,

and the first major economy to mandate the climate disclosure across the economy by 2025. taken together, it cements being a global leader on these issues. guy: let's talk about what is happening with the gilt market. how will a regular gilt differ from a green gilt? ,ill they have a yield premium and how will investors ensure the promises made as part of those green gilts are delivered upon? >> we have been watching this market for a while to make sure it was the right thing to do. but we have been convinced of looking at the market experience, obviously we can make sure the proceeds go to the areas and things people expect them to, and existing framework

to deploy as other countries have. to the point on pricing, what is clear looking at the market is what green gilts do is bring in a new class of investor, and we have repeated issuances of green bonds which trade it a typist spread to existing gilt and driven by different investors tapping in. the other benefit of launching sovereign curve is it means private companies have the ability to piggyback on that. it will help grow a private green market in the u.k., and give u.k. investors access to more denominated bonds. i think there is a lot of things other than issuing the green sovereign bond will help. guy: you think there will be a high yield for a green bond? that is what that spread will compress to? >> the markets will price what they want to do. we see the experience of other

countries, there are green issues that trade a tighter spread. is something we have been watching. the interesting thing is what else it catalyzes. the sovereign green bond market will help private issue more green bonds and make sure there is more liquidity. we are trying to attract capital into funding projects that will help us meet our ambitions on net zero. guy: we look like we will have a joe biden presidency. he talked about the fact there is more that unites us than divides us. do you worry that calculation has been changed? make life difficult for the u.k. on the trade front or make a trade deal less likely? >> enormous congratulations to

president-elect biden and senator harris. it is fantastic to see the first female vice president in the united states, and a signal that will send an inspiration it provides. i agree with the pm, there are so much that unites our countries. i have worked there for many years myself. climate change is something i would put at the top of the list. i announced the u.k. wanting to show global leadership. hopefully it is something we can work mostly on. it is something president-elect biden spoke about a lot during the campaign. i remain excited about the relationship we will have with the new administration. chancelloru.k. speaking exclusively to guy johnson. progress toward the covid-19 vaccine pushed investors to the most unloved stocks.

momentum names were punished. it gave value investors a glimmer of hope. a trade that has long suffered as tech gets all the glory and attention. was this the moment for value? dani: there has been a lot of strategists commenting saying look at the huge value rotation, but i would argue what we saw yesterday was not a rotation into value but a rotation out of momentum. if you look at what these factors did, momentum, the most loved names, those that have done the best the last 12 months. a market neutral version of momentum fell 4%. it usually barely moves because it factors out the other market influences. this is the biggest loss for this bloomberg index going back to 2008. value rose 0.3%. you have these big tech names

people had flocked to because there cash rich balance sheets got sold off massively. does this continue? it could change into a value rotation. loves heavy value strategy, so he would be the first to cheerlead the comeback value. regarding momentum, that is bigger today. it can happen at turning points. is hope out there that it turns into a value rotation. manus: but we are seeing money come off the table today. coming up, a massive surge in parcels ahead of the holiday season. at from coming up next deutsche post.

♪

manus: it is "bloomberg daybreak: europe." i'm manus cranny in dubai. annmarie hordern is in london. deutsche post has met the estimates of third-quarter revenue. an increase of over 4% on an annualized basis. the group says the fourth quarter will be exceptionally challenging. dr. frank appel is the ceo / interim director of poste & e-comerce, deutsche post. what is the biggest challenge going into the fourth quarter quarter, contextualize that for the market. challenge of the fourth quarter is the unpredictably of volumes. week to week in

day-to-day. this is unpredictable because countries are doing new measures , new lockdowns lead to further increases, and that is a challenge on a daily basis. we feel prepared for that, but it makes it difficult to predict the fourth quarter. annmarie: preholiday season you are seeing a surge like never before. in the u.k., stuck at home, cannot go christmas shopping. everything has to be sent via the post. are you prepared for this? is the parcel delivery world prepared for this? or can parts of the supply chain burst at the seams? dr. appel: we are well prepared. we have done our utmost to be well prepared. 10%-20%, if that goes up to 50%, the logistics industry will be challenged, but we have done her own most.

we think we are well prepared, and people will order more than ever before in the christmas period, because they want to protect themselves against covid-19, and the best way to do that is order online. note airfreight capacity is scarce, and you see a shortage in ocean freight capacity. what impact will that have? if we have shutdowns and everything being shipped, we have a constraint. how tight is it? course as long as intercontinental travel will not restart really, we will have a shortage. the good news for us is we have significant control of wide bodies and more in her express network to help express customers to get this stuff moved. the same we have taken on ocean

freight. there are some constraints on certain routes, but if demand is coming back, vessels we have put on the sea again. the logistics industry as well prepared. we are working to see it come back, and with the imminence of a vaccine coming soon, we will see a significantly better 2021. annmarie: we wanted to know how much is it in terms of logistics? how much will it be squeezed? the logistics industry is preparing very well. pharmaceuticalto companies, and not the only one.

we have seen in the first wave of a pandemic that the logistics industry has worked well to support any business. the logistics industry feels very prepared, we feel very prepared so it is not unexpected that a vaccine comes now. that is why the distribution to the world will not be a problem, but the challenge will be how it gets from the warehouse to the final location. that is a challenge for governments and authorities around the world. manus: we have a new president-elect, mr. biden. what could that tensely mean for the business next year? better trade relations? couldn't help your numbers next year? at the moment it is too early to what will happen, and what will happen to the congress. it is not known yet.

we have been seeing that trade is good for the world. globalization has been good for people around the world including the u.s. we hope that we will continue to have more amicable discussions about trades, but overall globalization has continued in the last couple of years, and it will do so in the coming years. annmarie: president trump has the willingness -- unwillingness to accept the results. could that destabilize the market and the situation? will things get worse before they get better? qualified toam not judge what is possible in the u.s. situation. i think there was a clear vote, let's see how the next weeks are coming and what the new administration will do. annmarie: thank you for joining us, dr. frank appel, ceo / interim director of poste & e-commerce, deutsche post. what we are seeing across the

equity space, interesting that --mostwde iade into people want to avoid the question at all costs. we are having a hangover after .he big party yesterday . to avoidey want comment because those ceos were brought into the white house. they do not want to be caught saying the wrong thing. the question we need to ask, the re-inflation trade, is it busted for the moment because of the reality about delivery? the real reality is about the potential delay getting the vaccine. annmarie: the u.s. has passed 10 million cases, a surge in the midwest. new jersey is closing down restaurants.

mayor de blasio is warning of a second wave. we could have light at the end there isnnel, but still grim news. that is it for manus and i. the european open is next. this is bloomberg. ♪ ♪ you can go your own way

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to "bloomberg markets: european open." i'm anna edwards. euphoriaack, market over a vaccine peters out amid concerns it has hurdles to overcome. u.s. cases hit new highs and hospitalizations approach a record. losing momentum, equities look set to fall from all-time highs. will the rotation out of stay