>> the way they have built up their forces, the way they have maneuvered names in place makes it a distinct possibility there will be major military action very soon. dani: good morning from bloomberg's european headquarters, it has just gone 6:00 a.m. in london. this is "bloomberg daybreak: europe." the stories that set your agenda -- manus: president biden promises

swift action in the event of a russian invasion. ukraine crude rallies. senator joe manchin says the fed needs to tackle inflation head on, but ecb officials warned of overreaction. asian stocks drop and u.s. equity futures steady for now. hong kong's covid crisis. hospitals face of overwhelmed as cases search. the city turns to beijing for help. a warm welcome to the show. dani, it is the potential cost of conflict, the fear of conflict that is igniting the haven status of bonds, yen, and fear of equities. dani: it is a whiplash in the market because bonds got a bit from that and had sold off on thursday. i want to point out the index of

bond volatility near the highest since march 2020. manus: yep, the question with the fed even dared to go for something frisky like a 50 basis point hike. if, and i must emphasize if, there is an escalation. dani: let's dig into these markets. we saw u.s. equities selloff heavily on friday so we are playing a game of catch up when it comes to europe. we are getting a little bit of a dip buying when it comes to this u.s., but emphasis on a little big. tech unchanged. small-cap futures up more, 5/10 of a percent. may more economic optimism that is not just the fed, it is geopolitical tensions that are the backdrop for these market moves. manus: absolutely, trade relationships between germany and russia pervasive, the nasdaq

down over 5% in two days. to the commodity markets, there is a real momentum, aluminum at a 13 year high. expect parabolic spikes, according to one of the big trading houses. nickel and rent up this morning. careering toward $100 oil as iea warns of severe underinvestment toward -- severe underinvestment. bitcoin is down. president biden has told president zelensky that the u.s. will act swiftly and aggressively against russian invasion. russia may order an attack on ukraine before the end of the beijing olympics but moscow has denied this. let's get to maria tadeo. sullivan i think reignited the

imagery of what conflict could come. it was a weekend of diplomacy -- it did mean a progress? maria: the short answer is no, to remind everyone, this is 48 hours of hectic diplomacy back and forth. started on friday, there was a suggestion that an attack on ukraine could be as early as tomorrow, that is tuesday, and targeting the ukrainian capital. the white house is not confirming dates but they are not denying that an attack to be imminent. this is sending everyone on a spiral reflected in the market action on friday. on saturday, we had president macron speaking with vladimir putin, the fourth call they had. he said if you're honest about dialogue, there can be no escalation. and then an hour long call between president biden and vladimir putin. there was no conclusion to that call. another warning that if there was an invasion of ukraine, sanctions on the russian economy would be very severe and swift.

the reality is we don't know what will happen in the next 48 hours. the russians continue to deny they have any intention to attack ukraine, they say this is western hysteria creating panic. we do know that today, the german chancellor, olaf scholz, will be in ukraine. tomorrow he will meet face-to-face with vladimir putin, and the focus is very much the nord stream 2 pipeline. dani: maria, thank you for keeping us updated on the moving parts. in hong kong, health officials are warning the city is facing a crisis with infections set the top 1500 for the first time in three days. that crisis in hong kong is dealing another blow to markets in asia. the city's stocks are down over one person this morning. let's dig in with juliette saly in singapore. a lot of pressures on this market. hong kong, cases being one of

them. what are you looking at? juliette: absolutely, the covid issue is rattling investors in hong kong. you can see the hang seng is down. we are getting jitters in the property market too, after a chairman indicated it will be a black iron age for that sector this year. more broadly, it is about ukraine concerns. energy stocks in the region pretty much the only reprieve, and gold mines holding up well too. a lot of selling in japan, it was closed on friday so they are playing catch-up. looking at bonds as well, we heard late last week that the boj was going to try to intervene to put a cap particularly on the 10 year as it was getting close to the comfort zone of a 25%. -- of .25%. there have been multiyear highs in australia and new zealand

similar to the rally you saw in the treasury market on friday, this as we continue to see the safe haven bid amid the concern regarding ukraine. manus: thank you very much, juliette saly in singapore. the big question is how to deal with storing inflation dividing u.s. officials. democrat joe manchin says the fed needs to tackle prices head on. the san francisco fed president says any abrupt move could destabilize the economy. oil continues higher, ever closer to $100 per barrel. let's get more with our chief asia economics correspondent. a lot of threats on the horizon, the latest signal and language from mary daly is trying to talk us off of the ledge of 50 basis point hike. what is your take of the daily comments yesterday? enda: i think that is fair, it sounds exactly what she did come

out and say. she made the point that look, they're most likely will be in interest rate hike, that she would vote for, and she made the point that anything more would be an abrupt move. the fed does not want to spook the markets or get ahead of itself. she seemed to be calming down the idea that the fed would need to meet out of cycle. larry summers was making a point that the fed didn't need an emergency meeting to at least turn off the qe tap. we know big investment houses are calling a 50 basis points of hike in one go at the march meeting, including deutsche bank. senator joe manchin saying the fed needs to get on with this and face the inflation threat. the fed is trying to straddle both of these arguments. on the one hand they are trying to make it clear that interest rates are going up but on the other they are trying to manage expectations that may not be what people think.

it is data driven and will be handled meeting by meeting. dani: you mention political pressures, you have joe manchin throwing cold water on joe biden's agenda because of the inflationary picture. at this point, what does that noise from washington mean for the inflationary environment? is there anything they can do or not do to combat the picture? enda: i think the first point to make is that it is all about the role of the central bank, the independence of the fed. during the trump years, there was a lot of pressure on the fed and chairman pal to bring down interest rates and now you can argue the opposite is happening with others putting pressure on the fed to checkup interest rates. the fed will want to be seen to navigate those arguments from a neutral point of view. the government's policy cannot be seen as controlling these broad inflation pressures.

we know that senator joe manchin has put the spinning package on the sidelines for now. the focus remains on the fed and how to manage expectations and now we have pressures to jack up rates when perhaps i don't want to do so as aggressively as the market is saying they will. dani: as always, thank you so much, that is our chief asia economics correspondent. let's get to the first word news. back with us is juliette saly in singapore. juliette: the ambassador bridge that links ontario with the u.s. has reopened after a five-day protest against vaccine mandates stopped traffic. authorities started clearing demonstrators saturday, and removed barriers at the site. it halted goods worth almost $14 million per hour. bp, shell and other oil majors are generating their highest free cash flow since the start of 2008, when oil first climbed above $100 per barrel.

despite outsized returns, the bp ceo has told bloomberg the company is refocusing its business. >> people think the energy transition must be a threat to a company like bp, i don't think like that. i think it is an opportunity. we are going into ev charging, into biofuel, we are going to go into hydrogen. these are things we can help solve, and instead of thinking of it as a risk or a threat or you crouch down in a defensive position and see darkness, it is actually a massive opportunity for us. juliette: you can catch that full conversation on leaders with lacqua airing later this month on bloomberg tv and bloomberg.com. swiss voters have backed a ballot measure to protect children and young adults from tobacco advertising. some 57% back to the initiative, and switzerland has strong ties

with the tobacco industry, including a global research facility for phillips morris international. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. manus? manus: thank you very much. juliette saly in singapore. hong kong health officials are warning the city is facing a crisis with infections set to top 1500 for the second time in three days. let's get more from stephen engle, who has the latest. how, i suppose, where are we in terms of inflection point on the numbers and the capacity -- what is it like there at the moment? stephen: i have said it before and i will say it again, hong kong is in a pickle because they say they are not going to do a mainland or wuhan style lockdown , that is coming from the chief secretary, the number two official in hong kong after carrie lam, who returned from china visiting a lid officials

over the weekend, getting pledges of support for supplies and perhaps rebuilding a new facility for quarantine and isolation. but he also got assurances china is not necessarily pushing hong kong to do a strict lockdown. the problem is hong kong put all of its eggs in the basket of keeping the virus out, and now it is overwhelming the hospital system. there are no more beds left. they are basically saying if you are a healthy individual and you have symptoms, and if you even use a home test -- hong kong is continuing with zero covid but it won't do an outright lockdown, so we will have trouble with this highly

contagious omicron variant. dani: thank you very much. our chief north asia correspondent, stephen engle. coming up, u.s. officials diverge even more widely over what to do about resurgent inflation. that conversation is next. this is bloomberg. ♪

manus: it is "daybreak: europe." the u.s. inflation clicked in at a 40 year high. nothing to panic about, that is according to paul krugman. he told bloomberg the fed needs to act but there is no need for shock therapy. >> i think we are in a situation where the fed clearly needs to start hiking rates, and probably not shock therapy, definitely not shock therapy.

the question is whether they want to get people's attention. we are in a situation -- this is a very hot economy and it is the fed to drop to cool it off a little bit. dani: but we did have at the other end of the spectrum former treasury secretary larry summers , and he thinks immediate action is needed. >> here is what i think the fed should do, i think the fed should have a special meeting right now to end qe. manus: what do we need? alexander is an fx strategist at bnp paribas 360. we will get into the carry trade in a moment but those are two very different views. we need shock therapy or re-don't need it at all. how should the fed react? do we need to do something more radical than is on the plate at the moment?

good morning. alexander: good morning, we don't think we need shock therapy. our base case is we get six hikes by the fed this year. it is a possible -- it is a possibility they deliver 50 in march, shock therapy, but it is not very bullish for the dollar. rather than the level of front and rate spreads, what matters for the dollar is the narrative. the narrative on monetary policy has shifted from divergence to convergence. at a time when positioning on the dollar is stretched and sore valuations. to us, the path of least resistance is the dollar will weaken and we are looking for 118 euro-dollar by year-end. dani: if you see the dollar peeking this year, when do we get to that and why? alexander: we think we've already seen the peak in the dollar. if you look at history, the dollar tends to peak just prior to liftoff by the fed and we think this is no different.

really what that reflects is the narrative this time is shifting. the ecb we think will deliver 50 basis points of hikes this year, we think they have very much left the door open to hikes this year, and that is coming at a time when euro-dollar long-term is above 130, according to our proprietary models. the market is still pretty short euro-dollar. we still think there is upside in euro-dollar. manus: i want to pursue the divergence/convergence. divergence was the elsa of dollar -- alpha of dollar strength in the past month. by the way, welcome, this is your first time on. you can relax now. we all can breathe. [laughter] i find this interesting, ozzie

and qe will come up, as it were, you think they will strengthen. -- aussie and kiwi will come up, as it will come you think they will strengthen. alexander: they trade cheap, so fx is already position for risk off, and should stabilize and act as a base case. those currencies should do very well against the dollar. they also benefit from the market not being positioned in them. the market is short aussie dollar. we are looking for a move up to 75. dani: i should also say the first time you are joining us is on valentine's day and i am pretty sure manus's love language is commodity and currency. you are hearing that.

goldman sachs is saying a new currency war is emerging. previously used to be one of the weak currency, now you want your best for policymakers to try for strength, to help ease price pressures against inflationary concerns. you also seeing that regime shift? alexander: you concern lamech that case, again, the key point here is the fed should worry about inflation rather than currency markets. i make the case that the ecb shift was a significant and that will lead to repricing in euro-dollar, but also some euro crosses. one cross in particular we think will benefit from the shift in the ecb's euro-swiss. given the year-end bund forecast, we think euro-swiss can get up to 110 this year, and that is across we like. we think swiss is an attractive

funding currency in this environment. manus: i went out for a cup of coffee with a couple of fx traders on friday, and i was very behind the curve, no shock. basically they said the carry currency of choice had been euro and the only thing left you can use for carry is in this year and they were so bullish on dollar-yen. do you share the view that the carry currency of choice this year, the funding currency has to be in because of the pivot by the ecb and the fed, and are you bullish on dollar-yen? alexander: very much share that view. the boj will maintain its dovish stance this year and that puts it in a different camp to other central banks. it means the relationship we've observed in recent months between dollar-yen and u.s. yields will remain stable. our forecast is for 10 year treasury yields to get up to 230 basis points by year-end and we

think that is consistent with dollar-yen railing. we are looking a move up to 118 but it may extend beyond that. dani: alexander, you will stick with us. coming up, tensions continue to mount of a russia's military buildup near ukraine. what are the market risks? we will discuss that next. this is bloomberg. ♪ ♪

dani: welcome back to "bloomberg daybreak: europe," i am dani burger in london with manus cranny in dubai. tensions continue to mount over russia's military buildup near ukraine, but what impact is it having on markets? still with us is our guest. alexander, is not just geopolitical tensions, it is the concern we've been talking about of the convergence of tighter policy.

what does the defensive playbook look like at bnp paribas? alexander: we would argue geopolitical risks are not currently a key driver for the dollar but i would make the case that fx is positioned for a risk off. we see this across to of our models, our evaluation model is suggesting these currencies look cheap relative to other asset classes, and our positioning models are showing the market is short these currencies, in particular against the dollar. should risky assets continue to look fragile, we don't see a lot of scope for fx to underperform. instead we see scope for aussie and kiwi to outperform. manus: that complements your convergence to divergence remark from earlier.

four voted for 50 basis points. do we get it at the next meeting? is that your base case? what does that do to sterling on across? alexander: we came into this year bullish on the pound and we have since moderated to neutral and that reflex we think the boe is already well priced. we are looking for three more hikes this year in march, may, and august, but we don't expect that to filter through to the pound and a significant way because markets are already there, they are pricing in a lot more than that. scope for sterling to strengthen as a result of the boe tightening is more limited. i would also make the point that euro sterling long-term value is 84, and since we are no longer forecasting significance divergence between the ecb and boe, we don't think euro-sterling should trade too far away. manus: ok, alexander, welcome to the show. come back and see us soon.

let's see how these calls play out. alexander, fx strategist at bnp paribas 360. coming up, another guest joins our team with her inflatio

>> the way they have built up their forces, the way they have maneuvered things in place, exit a distinct possibility there will be major military action very soon. manus: good morning from our middle east headquarters in dubai, i am manus cranny. dani burger alongside me at london hq. these are the stories that set the agenda. dani: president biden promises swift action in the event of a russia invasion of ukraine.

crude rallies pushing toward $100 per barrel. price pressures. senator joe manchin says the fed needs to tackle inflation head on. ecb officials warn of overreaction. asia stocks drop but u.s. futures higher. plus, hong kong and covid crisis. hospitals overwhelmed as cases search. the city turns to beijing for help. happy monday to you and happy valentine's day. is volatile was -- it is volatile and was we start the week. this move to havens, buying treasuries as we contemplate rising tensions. manus: the equity market is trying to grapple with the cost of any conflict. the fear has no basis in the fx space, as we just heard, they are prepared for that, very little rundown the come from them. but undoubtedly, it is a double

punch, the fear of conflict, and also a more activist fed, which mary daly from san francisco try to step back. dani: you have the conflicts playing out, we had larry summers saying the fed to act and paul krugman saying shocking the markets is not what we should head toward. manus: and that's not what emp pair about either. let's get a snapshot of risks. it was literally carnage in the equity and bond markets on thursday into friday. europe is playing catch-up to the u.s. the nasdaq was down. there is a small, anemic and in s&p futures and the broader russell market. we are looking at the real relationships between germany and russia. france and russia. those are the trade risks and a

relative sense and also the energy risks. we are also looking at the alumina market along with oil and nickel. dani: we are looking at aluminum , it continues to push higher. on the board we have copper, brent, nickel. a lot of the story is about rising tensions. that is priced into markets. reduced supply as well. finally, bitcoin, the perennial sense of how much risk is in the market, how much risk appetite is lower, just under 42,000. i want to get back to the picture of the bond market. we are seeing yields pushing slightly higher in the u.s. this morning, but we have this bid for bonds after the concern for russia/ukraine tensions. because of the fed and the one-two punch, we are looking at the move index at the highest since march 2020. let's get into that with pooja kumra from toronto dominion bank. thank you for joining us.

how would you characterize the fear factor in the u.s. bond market right now? pooja: good morning to you all. the situation after pricing almost 50 basis points of hiking, we had news of the potential war situation. is not a surprise basil a pullback on friday session. [indiscernible] if you don't see any pushback, it is hard to see the markets move more than a few basis points. i think that kind of optionality is there. whether it is for the ecb, that hawkish pricing is hard to let go. you could see more of

generations in the tenure sector , which is affected by fed hikes. i thinks there could be further flattening and after the last couple of sections, we have rate hike expectations. manus: lots to unpack. good morning. i see from your estimate you're going for a terminal rate of two and a quarter to two and a half for the cycle. that is back at levels you saw in the last tightening cycle. do you really think the fed can get that far with rate hikes without inverting the curve or causing a recession? pooja: that is a good question. i think the fact that if you look at how things have evolved. in 2018, when inflation was 3%, the 10 year yields were at 3% as well. right now inflation is 7% but 10

year yields are 2%. i think there is a strong base for duration keeping the 10 year in hold. if the fed continues to hike rates, we could see further inversion of the curve, even threatening to negative. it shows that there is so much liquidity in the system that there's already -- how much tenure rates can rise. -- 10 year rates can rise. dani: you don't see a recession coming. does that mean as well we could prevent an inversion if we switched to a more active cutie? -- qt? not just passively winding down the balance sheet. pooja: exactly. i think for all of the markets right now, they want to start

hiking cycle, because i think qt is something that has a slow impact, and something we have learned -- and there is more duration supply coming. i think first the fed becomes more active with regards to qt, and not just from the fed, you will see risk in the 10 year, which is lacking, will start rising. manus: part of the argument i'm having with people in the marketplace is we have a slight sense of hysteria on thursday and friday, nay panic in the bond market. but if you step back and look at the breakevens where inflation will be in three years's time,

or five or 10 years's time, is not as cataclysmic as the bond market suggested on thursday and friday. can you ask lane the differential to me between the paranoia -- can you explain the differential to me between the paranoia and reality? pooja: there was a lot of panic. manus: i was trying to not be like that media frenzied lunatic commentator. [laughter] pooja: definitely there are expectations. [indiscernible] the next six months we are seeing supply shortage, and energy prices going higher and higher. that's why we will see one or two quarters of very high -- it

is not the medium-term inflation expectations from the central bank. that is exactly why most central banks are trying to be more hawkish right now because they want to temper inflation expectations currently, and not something into to three years. it is not they are behind the curve, is that inflation is very tricky for them. they want to temper down the current expectation, which is hurting income right now. dani: speaking of a complicated situation, what happens if we get more geopolitical tension and treasuries become the asset of choice to seek a haven in? what happens in that scenario? pooja: the markets are positions for very aggressive hikes. i think if we do reach that situation, you think -- 50 basis

points hike, i doubt the central banks would let that situation emerge given they basically have -- ready to act aggressively. i think reducing the number of hikes that has been priced, which is aggressive. and i would expect more curves to flatten just because the 10 year yields are expected to move in the strategy. i would expect more pushback from central bank so markets can trust them, so they can reduce hikes prices and we haven't seen that yet. right now don't trust central banks. that's why i see the 10 year and 30 year part of the curve -- and that's why we anticipate a flattening of the curve. manus: i think you have summed

it up beautifully. i think that is somebody coming to the front door. it is ok. [laughter] live tv. dani: the bond market is volatile, the people are literally knocking down her door the find out what is going on in this market. [laughter] manus: have we stopped panicking in your household, are we back? pooja: we are back. i am so sorry about this. dani: is it someone upset about the bond markets? pooja: yes. dani: fantastic. [laughter] we have answered the door, that is settled. manus, it is a volatile market at this moment.

what do you make of the boj? we were talking earlier fx wise bnp paribas about the funding currency, the boj saying they will buy. is the pain over in the japanese market? pooja: we saw the boj will -- unlike most central banks, they have said they will keep their policy supportive. but right now it is driven mostly by treasury. i think that led to the ecb. even though the ecb has not been that aggressive and they have backtracked, they are basically moving to treasuries. if you see a risk off, that is how i would see bond trading. manus: ok, i hope whoever it was

at the front door comes back. [laughter] i tell you what, we don't need anymore panic, you are right. pooja kumra, stay the course. we will see you soon, best of luck. let's get to the first word news -- issue with us or is she going to run away? juliette saly. juliette: no doorbell ringing here. after a five-day protest, the border between the u.s. and canada is reopened. they worked to remove barriers at the site. the protests held up goods worth almost $14 million per hour. blackstone has stopped a pursuit of crown resorts after crown accepted the u.s. private equity giant's takeover offer. the deal ends a sorry chapter in

crowns history after was found unsuitable to run its sydney casino and found of wrongdoing at its operation. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. dani: juliette saly in singapore. thank you. coming up, is the world singing a turning point in the covid pandemic? we will look at the latest data, and look out for any more of our guests with a knock at the door. this is bloomberg. ♪

dani: it is "bloomberg daybreak: europe," i am dani burger in london alongside manus cranny in dubai. hong kong warning of a crisis as

covid cases leave the hospital struggling to cope. more than 1500 infections will reportedly be reported today. michelle cortez, you're dealing with rising cases in hong kong has asked for beijing's help. what is the strategy look like in hong kong at the moment to cope with rising case counts? michelle: hong kong remains committed to a covid zero policy. what they are calling dynamic zero it this point, which basically means they have it as a goal to track down every case, isolate it and eradicate the virus from hong kong if at all possible. of course it is completely outside of the city's ability to do that across the board. they don't have the hospitals, isolation facilities, tests. it cannot be done. so they've reached out to china, they are coming in with tests and building isolation hospital

and they are trying to get the virus under control. 1600 cases today, another 2000 we are expecting. numbers on the right. that seems low but those are numbers we have not seen here previously throughout the entire pandemic. we now, as the rest of the world has seen, with severe disease, deaths follow. we are hoping hong kong can get this under control in some way. manus: meanwhile we've got the big take on how the pandemic will evolve from here for the whole of the world. and it depends at what speed and where you are, when you think about what we just covered. we talked this morning about hong kong in a very different position to the rest of the world. michelle: absolutely, we see already many places in the world are moving beyond the pandemic as it is. you don't have to wear a mask, you might not have to be tested, vaccines are optional, you don't have to prove you have been vaccinated. basically everyone is on their own at this point in many parts

of the world. governments, political leaders and just citizens are willing to accept the risk on the ground. other places still have yet to get vaccines or access to the kind of vaccinations we've seen in the u.s. or europe, where anyone who wanted a vaccine has already been able to get it. and in other areas they are less protected and wordy -- and worried about seeing a surge in cases. dani: a complication, moving toward a world that is more normal, is a new variant. what are the odds, the possibility, of more variants on the horizon that could up and things again? michelle: every expert we talked to without exception says there will be additional nations with this virus. the question is what are they going to build off of and what will they look like in the end?

all of virus wants to do is survive. it has the infrastructure -- it changes it's also it can evade existing immunity, so we know that will happen. the question is does it build off of something like delta, which is more verlander -- viru lent and can build off of that, or will it be like omicron that does not cause as much death. we don't know what it will look like, and we have seen time and time again the u.s. and london particularly being hit repeatedly about whatever variant comes along. that will not stop until everyone is hopefully protected with vaccines. manus: our senior medical reporter, michelle cortez.

coming up, tensions continue to mount over russia's military buildup near ukraine. we look at the market risks on bloomberg. ♪

manus: it is your monday morning "daybreak: europe." eking out the teeny, tiny gain after friday. these are the u.s. equities. with a today skid -- two-day get, the worst since 2020. the nasdaq took a a bath, dropped over 5%. there was a fundamental moment in these markets of when you saw

conflict risk and said risk coalesce in a toxic combo. dani: i will say, i know you are looking at equally flows, but one day yesterday, we saw nearly 3.2 billion pulled from the qqq 's, the biggest outflow for that fund. should we talk about geopolitical risk? it is hanging the market as well. tensions about invasion into ukraine, pushing oil closer to the $100 mark, but potential conflict also hitting a raft of other materials crucial to the economy. joanna off-center joins us. you do everything, bitcoin and oil markets. tickets into the reaction over these tensions. joanna: it really is spreading throughout assets. you have the swiss franc doing well. you have palladium increasing. russia is a major supplier of

that, about half the world supply. you have wheat increasing, that is a huge export from ukraine. a number of these commodities are rising as we get to this increased attention. manus: good to have you with us this morning. everyone is writing and talking about it, $100 oil. it is becoming very much a reality as we talk about conflict and underinvestment in the oil industry. what are the latest protagonists of triple digit oil? joanna: it is something that looks basically inevitable at this point, right? you have j.p. morgan chase not just talking about $100 oil, possibly $150 per barrel oil, they say that would almost install the global expansion. if you look at the bloomberg economics model, they say climbing to $100 by the end of

the month could lift inflation by half a percentage point in the u.s. and europe by the second half of the year. there could be a delayed effect as well. manus: ok, joanna, let's see where the oil market takes us. joanna ossinger with the latest on cross asset flows in the market. she touched on equities and the qqq. goldman cut their target. the macro backdrop is considerably challenged. they still say there is 11% upside but there are challenges. dani: still sing the upside, but it is interesting to see these calls of what leads us higher. we got more calls for value. russell 2000 futures outperforming by have a percent, better than most of the market, but still a be ride. value a higher sector because it is economically exposed. manus: the only thing that

stopped complete implosion, the bond market on friday, was unfortunately the risk of conflict. that started the flow to the upside in terms of yield. we will let the europe team take it up for debate. ♪\ \

dani: good morning. welcome to "bloomberg markets: europe." i am dani burger. mark cudmore joins us from singapore to take us through all the market action this hour. the cash trade is just less than one hour away and here are your top headlines. stocks slide and oil gains as ukraine risk goes through markets. invasion may be imminent. mary daly insists the central bank will be data-dependen