dani: this is "bloomberg daybreak: europe."

i am dani burger in london. pricing in a step change for the fomc begins its two day meeting in the optimism that prices will start to slow. taxing the windfall. president biden threatens to impose more levies on oil firm'' record profits. meanwhile, prices drive aramco to bump up profits. credit suisse chairman axel lehmann tells bloomberg that the bank is not open to take over discussions. >> we are going to decide -- thrive again, so we do not have any takeover discussions at this point. we believe we will stay independent. dani: this morning, it is yields lower, dollar lower, stocks higher after the 75 basis point hike from the fed this week.

perhaps they will go 50 or 25 after that, but before we can get to a step down, we have got to get 75 first and we have two cpi reports before that december meeting. there is a lot to factor in. if we get 50 basis points come december, that is still a jumbo hike. that is part of the reason we saw bonds selloff yesterday. have come down a bit and we are just above 4%. a little bit of back and forth. it would still be hawkishness. are we going too far with the steps change narrative? despite that, asia is taking it as an opportunity to sell the dollar, the dollar weaker by 0.4 percent and equities are up half a percent. we had the trading desk at jp morgan say that if we were to get a surprise events this week, we could see equities rally 10%. that would be a monster move in

the equity market. we have seasonality on our side, the first of november. november is typically a better month for this equity market. the yen is stronger this morning after mof spent ¥6 trillion on supporting their currency. that is a record month of october for them. that is the picture in the u.s. on the yen for you. we have seen a rebound in chinese shares hoping to help asian markets for the second session paid a we also had the rba signaling more hikes to go. on top of it is juliette saly. juliette: certainly a rebound in hong kong. the hang seng tech index is now up 6%. also seeing those chinese stocks listed in hong kong that wept there holding at 2005 levels of rebound too. we did have disappointing export data out of tough korea but the

kospi is rising today and a turnaround in the offshore yuan as well who had its lowest level since 2005 as well after we saw weaker than expected fix coming through from the pboc. it once again showing the moves in the depreciating currency and the aussie is in focus after that rba decision. let's look at the trajectory from the rba because it was a 25 basis point hike, but we have got the cash right now at 2.5%, which is the highest we have seen since 2013. the question now, where do we see rates move? ing saying that it will likely continue with the smaller rate hikes of 25 basis point hikes, but they see inflation peeking around 8% at the end of the year. the cash rate target around 3.8%. dani: great round up as always. let's get to some of our other

top stories and reporters around the world. enda curran will take us through the potential shift in sentiment towards the fed. manus cranny is still at adipec getting the heavy hitters at oil, and yvonne man also broke some news with credit suisse's chairman. let's start with the fed ahead of the next meeting. some analysts are seeing a change of pace on the horizon. it is sentiment from j.p. morgan, goldman, morgan stanley, each of them seeing that they see the inflation slowing ahead of the rate speaking. how much validity do we see behind this narrative that this potential 75 basis point hike this week will be the last of its size? enda: it is because they have hiked so aggressively this year. at one the leaders step back and see how the rates are

influencing inflation and economy, we see signs of a slowdown. we get jobs data out of friday and it is crucial to determine where the fed will go from here. it will all be about the signaling that mr. powell sends beyond here and that is why some economists think that they might slow down the pace of rate hikes going into next year. we start talking about peak interest rate hikes for the fed because these officials need to step back and see how these rate hikes are going. no one is talking about an end to the federal rate hike. mortgage costs are still going to be going up. the debate now is at what pace they will be going up. that is why some analysts say that we might be near the peak of that rate hike. that is why thursday is so important. dani: to your point of how fast we go, if it is 50 basis points, that is still a big hike, not a dovish outcome.

thank you for joining us. saudi aramco has reported its second-highest earnings as a listed company. that continues to benefit from this year's surge in gas prices. its operating profit was 300.23 billion riyals for the third quarter. let's bring in manus cranny who is at the adipec conference in abu dhabi. looking at aramco first, yet again it continues to be monster profits for the oil and gas majors. manus: absolutely. saudi aramco is a permanent windfall tax, it is nevada, the holy grail within saudi arabia in terms of funding for 2030. the gearing for aramco is going to be important and the dividend will be $18.8 billion to shareholders. that will be one of the things that the market will focus on

when they open. if you look at the monster profit from them and from chevron and exxon and all of the u.s. producers, you begin to understand why the political narrative from joe biden is accelerating in terms of the potential for attacks -- a tax, a windfall tax on windfall war profits. it is about investing in production and that is what the u.s. administration wants to achieve. but is this political grandstanding ahead of the midterms? that is what we need to ask ourselves and has this policy got any chance of flying at all or is it a turkey? when i asked the former cp -- ceo of bp, he highlighted the crisis in bp and the narrative of pulp of tics -- politics around oil. we had a good conversation with him around that, but also the advisor to the u.s. president on

energy will be with me later at 10:30 london time to discuss the windfall tax. is it just schizophrenic policy from the white house? the drilling of federal land, producing more oil. it is a whole mixed bag of messages. we will talk about that and whether there is a detente between saudi arabia and the united states of america. what is the offramp between this fractious relationship at the moment between saudi arabia and the united states? dani, good morning. dani: good morning. that is what might impact companies. what about oil prices themselves? as you say, it comes at a midterm where biden is hoping to keep the price of gasoline down. manus: it is a blame game, blame the oil companies are penalizing the consumer.

they have seven bucks on the west coast of america to drive your car. that has consequences for long-term investments, but we put that out there is a conversation as well. vitol already says we are in demand disruption. the oil minister warned yesterday very clearly that he keeps squeezing turkey by the neck and you will have a deeper recession. as well as that view from eni that prices will be around $90 this morning. the secretary-general of the ief talking about oil easily breaking above $100 if this supply situation really constricts as the russian barrels come off the market december 5. between now and the spring, that is 3 million. dani: can i also say that i do love a good turkey metaphor considering we are now in

november and it warms my american heart heading into thanksgiving. manus: i want to be that turkey at the white house. dani: don't we all just want to be a fat happy turkey who is not at the white house thanksgiving table. stay tuned for all of his interviews there at the week. turning to credit suisse, the chairman says that the lender is not open to take over discussions after unveiling its long-awaited turnaround plan. the 4 billion-dollar capital increase will make the lender rocksolid. let's bring in bloomberg's yvonne man who did that interview. axel lehmann standing firm that credit suisse is not up for sale. what did he say? yvonne: for all of the bargain hunters out there that were looking at credit suisse's stock and thought it is looking attractive right now for some kind of takeover, axel lehmann did try to put some cold water

on that narrative out there and saying that we want to stay independent. he has talked about not giving these grandiose announcements but all about humility and consistent execution. it is that execution risk that investors are concerned about because there are a lot of things credit suisse has to do right in order to pull this restructuring off. they have to fully sell the securities products business, they mentioned next week they might secure that with apollo global management, and also subscribers with this capital raise of 4 billion. we heard that 1.8 billion swiss franc have been committed from anchored investors so far. he himself also on monday that we learned $1 million worth of shares as a display of confidence in the bank's overall strategy. he is saying that things are on the right track right now. here is more from the chairman. >> i think we came along way as

a group. we really came a long way to make the right decision. we are merely looking at some of the fundamental issues that we have to go back to, but the core of the business, the core of the origins of the business, so we might see that peace trend and that is what we will execute. i am excited. yvonne: he is excited and we had to ask him about the outflow situation given what we saw in october, the barrage of news, the social media storm that he called. he said outflows are looking like things have stabilized and he is expecting things to turn around. he is starting to hear back that clients do want to come back. dani: i remember during their earnings they talked about this idea that it was mostly due to social media, the speculation that they had those outflows. we will have you back there at the program to get more into that. the bird's yvonne man in hong

kong. -- bloomberg's yvonne man in hong kong. 7:00 a.m. u.k. time, we will have the house price index. also this morning, we get bp who is reporting third-quarter earnings. we talked about the bonanza of record profit for these oil and gas majors. ingves is due to speak at an event in sweden and we have a few key data points from the u.s. we will get data manufacturing and spending. coming up, could a fifth outsized rate hike the u.s. spur run -- spur warnings that the cusp of version is inevitable? this is bloomberg. ♪

dani: are the chances of a u.s. recession increasing? does the fed need to slow down to prevent that from happening? powell's favorite yield curve shows where the curves are versus where they are in 18 months is on the cusp of inverting. this tumbled near 0.2% from 0.7% back in april. joining us now is tatjana castro , cohead of public markets and portfolio manager at muzinich. it is this swelling narrative whether we look at the 18 month yield curve, whether we look at these various banking strategists coming out and saying there will be a step down and we cannot continue going at it. do you buy that argument that the fed will have to embarq on a

slower pace of rate hikes? tatjana: i would say they do not have to pay it luckily they can slow down a little bit. it just shows you how used we get to a certain environment. 75 basis points is really outsized and we do it repeatedly, so i think we are almost passed an unusual period. all the heavy lifting has been done and as the market is pricing in, there will be a few more, and the pace is still rapid. in the past, you would have a rate hike every quarter, not every six weeks. we are still on a six week case, but there is a little more of a step down in how they step up. i think the market is supportive to price a slowdown in this step

that they are taking. dani: you make an important point because we are still on track to continue to get rate hikes every meeting. maybe not 75 basis points, but 50 is still a jumbo rate hike. if that is what we are going to get and we are looking at goldman talking about this idea of a slower pace, if that is indeed what we are going to get, is it right to be buying bonds? is it right that equities rally again because that future of 50 in the continued hikes still feels hawkish. tatjana: it does feel hawkish but up the same time we have to remember that is already priced into the markets. 75, 50, 25, 25, this is already all priced in. we are very constructive when it comes to fixed income for two reasons. one is the absolute carry around

5% in the u.s. that is very attractive. even if you see a little bit of a hike in yields, you will still end up with good positive returns. and then there is a chance that the yield rally a little bit. on top of that 5% carry, when yields rally, you make it 6% or 7% next year. that looks very attractive indeed. dani: what about this high-yield bond market? we see some parts of the treasury curve inverted, and we are still far from that when it comes to debt. i believe we are about 460 at this moment. are there more cracked in this high-yield market to come or are you feeling safe to jump in right now despite the fact we have not seen yields and spreads stretch to previous recession level eras? tatjana: spreads are not quite

there. there are the underlying fundamentals. the european market, 75% of the high-yield profit is there. if you look at the recessionary period, the default rate is quite low. it is only in the low single digits. it is only when you go into the beast that it starts stepping up to the double digits. we do not expect there to be a large increase in default rates. at the moment, the europe market has been pricing in about 40% of the european market the default over the next five years. none of us expect that many defaults. dani: i do wonder, that level of default, if no one is expecting that, but surely somewhere in this world awash in debt with capital structures geared up to negative interest rates, is

there somewhere that will be under pressure that you worry about as we move away from lower for longer? tatjana: yes. the way we look at it is the refunding costs that are important. one is the funding structure. if you have a bond that is a fixed rate bond, it may mature in the next three to five years. after that, if interest rates remain at the level, they have to refinance at a higher level and it depends on where spreads are at that point in time. the other is debt which is usually floating, and that will go up as interest rates go up, and how much of the floating rate has been hitched by companies, how prudent they have been. all of those things you need to look closely to come and other thing is -- we have always heard

in the past that inflation is good for high-yield businesses. to that extent, this is why we see that high inflation, that companies are able to pass in inflationary costs to the end client. the revenues are not that bad, the debt remains the same, so you deal ever -- de-lever was nominal rate increases. dani: i have got to jump in. i am so sorry. we have got to go to break real quickly. we will hopefully get that break from you in a moment. tatjana greil castro, portfolio manager at muzinich and co. coming up, the boe is set to start qt. this is bloomberg. ♪

dani: the bank of england is such to become the first major central bank to actively sell off assets accumulated during a 13 year loan stimulus program. for more, we are joined by lizzy burden. set this up for a spit how significant is this, the start of qt for the boe? lizzy: it is significant because the bank of england is the guinea pig for markets when you take away easy money. have had -- we have had months of mature gilt rolling off the sheets, but this is the first -- it was stepping in with emergency bond buying to rescue pensioners from the market turmoil that came off the back of trussonomics. what it shows is that the bank of england has confidence in the markets. this moment had been delayed from october 3 but now it is here.

this is andrew bailey saying that we need to retool the bank in case of another crisis down the line so we are equipped. it does not stop it from being uncharted territory. dani: that is lizzy burden. let's get back to tatjana greil castro from muzinich and co. the training wheels are off, the boe is no longer buying bonds to help the pension funds. qt is starting today. how vulnerable and fragile is this gilt market right now? tatjana: there is still a lot to come. we have the budget still and we had a big rally in guilds the last few weeks. there is room for a little bit of widening for higher rates in the u.k. going forward, but clearly a lot of uncertainty. dani: quickly here, apologies for rushing you all morning, we also have the boe rate decision. how much can they do given that we do not have the fiscal agenda yet? tatjana: it is priced in to be

75, but there is a risk that they only do 50, especially with the gilt sale at the same time. dani: fantastic stuff, short, sharp, and concise as always. tatjana greil castro, portfolio manager at muzinich and co.. coming up, more from our exclusive interview with credit suisse chairman axel lehmann says the bank is not for sale and it will thrive again. we will get more on that shortly. this is bloomberg. ♪

dani: good morning. this is "bloomberg daybreak:

europe." i am dani burger in london. pricing in a step change. the fomc begins its two day meeting as treasuries and stocks again optimism. the rba boosts by a quarter of a percentage point. president biden threatens to impose more levies on oil firm'' record profits. higher prices drive aramco to bumper profits. credit suisse chairman axel lehmann tells bloomberg that the beleaguered bank is not open to take over discussions. >> we are going to thrive again. we do not have any takeover discussions at that point, because we believe we can. dani: the central bank, the fed does not have to move slower, but it can afford to move slower. that is what tatjana greil castro from muzinich and co.

just told us, which makes sense for the markets to pricing in a slower pace of rate hikes. but even 50 basis points is still a jumbo rate hike. even so, we are seeing yields move slightly lower this morning after they spiked around 1.1% yesterday. we had a program that came through the u.s. 10 year yield, but now we are seeing the asia session taking advantage of that. we are also looking at dollar weakness this morning, down 0.5%. this is gearing up for a fed rate decision, but we also have jobs data, cpi reports before that december rate decision, so it is a challenging calendar when it comes to risk events. s&p 500 futures are starting the morning on the front foot up half a percent. jp morgan's trading desk says that should we get a surprise from the fed, equities could rally 10%.

it is a market that is geared up for 75 basis points from a more hawkish decision from the fed. as the same time, we are seeing a yen strength coming through. the dollar weakening about half a percent versus the yen after a record amount was spent from the mof last month to defect the currency. let's turn to one of our other top stories and it is credit suisse. the chairman's himself says that the newly unveiled reconstruction plan says that the bank will come out stronger. he told bloomberg's yvonne man that the bank will thrive again. >> this is a fantastic franchise, you should not forget the 166 years of legacy. we have asset management, so this is the core of the group and we are going to thrive again so we don't have any takeover discussions.

we truly believe that we want to stay independent. yvonne: you speak of wealth management was has -- which has always been your historic strength. some investors have been worried about the visibility of the bank. many are worried about bringing in new money until you have your house in order what happens if those clients do not come back meaningfully for 2025? >> there were a lot of rumors that were spreading about credit suisse that were really unfounded. you look at the liquidity ratios, balance sheet strength, and you clearly saw the reaction, which was one of the key objectives of the announcement was that 81 spreads came significantly down, so that is a strong signal of confidence. yvonne: there was a significant amount of outflows the first two weeks of october. are you expecting those outflows

to reverse? >> they will reverse. at the beginning of october was the social media storm that we had. the outflows have clearly stabilized and we even see some outflows coming. i expect that we will have more inflows. yvonne: what are the risks of those outflows accelerating? >> i cannot see them at that point of time, so they will stabilize completely. we are not in a blackout period anymore so we access the overall market. we have a lot of clients who have told us they will come back. yvonne: it seems you are exiting out of businesses where profits were coming from. what is the logic in cutting when the other side of the equation is the ability that you cannot generate those profits anymore? >> going forward, credit suisse is a wealth management centric franchise centered around entrepreneurial wealth clients and we do not need that type of

businesses that are isolated from the rest of the group. that is why sp, and we are the exclusive discussions with apollo and penrose. i am highly confident over the next week we will come to an agreement. yvonne: what about the asset management side? is there a sale of part of it? >> these are the rumors. we need to move the specialist asset management so we do not need to be the biggest globally, but we need to have growth capabilities that we also need from a product and product provider perspective for our wealth management clients and institutional clients. yvonne: the restructuring is being funded by new investors, the saudi's. there are questions raised around the swiss government allowing this sort of stake given the saudi's human rights

record. >> we are very happy that we have investors like the saudi national bank. it is a private institution and this is also a region that is growing so we are very happy that they secure that type of investment into what they believe is a great franchise at credit suisse. dani: axel lehmann there. let's also bring in yvonne man who conducted this interview. really great interview. one of the two words i wrote down, rocksolid paid he said that the bank can stay rocksolid with the restructuring plan. what gives him the confidence to say that? yvonne: and i asked him, 4 billion, people were thinking he was too modest. the estimates were around 5.9 billion at some point, and he always talks about not wanting to overpromise.

they always want the humility execution. for them, it was important to stress that they do not see plans to raise more than that. i did ask him if there was a need to raise more in the future. what he has seen so far is that maybe there are getting more angered investors around this capital raise. 1.8 billion swiss francs is what has been committed by anchored investors so far, and he himself pledging and buying $1 million worth of shares, the display of confidence around the bank strategy. he feels that the worst is behind them and they are on the right track, is the tone of what i heard from this interview. and it came to the outflows and the like, he felt that things were turning around, that clients are coming back, they have a sense that the storm is over. and with the stock, they are not really talking about fueling any -- fielding any takeover offers

at the moment despite what some people say. you see that it credit suisse chart right there and it has basically been cut in half, the stock. most might think this is a bank that is vulnerable to some sort of takeover offer. axel lehmann trying to get the point across that is not the case and they do want to stay independent. dani: we also heard you ask that question about the saudi national bank, which might raise some eyebrows among the u.s. and the swiss government. what did you make of his response? yvonne: he seemed to size up that question. it is not just the question of the swiss government that might allow this stake but also that first boston is mostly going to be a u.s. centric bank. so how do u.s. regulators get on board with this geopolitically with the thought of a potentially problematic middle east investor in a u.s. business? he tried to sidestep that saying

that it is a profit institution, and even discounting geopolitics, does credit suisse have to adjust how they look at these markets with different risk profiles? this segues into the china discussions as well as we see u.s. and china tensions rise. he is in china this week for the hkma event and i asked him about the prospects for him for asia. he said that there is inherent growth still in the region paid he seemed to push back against if they were considering dallying back on their commitments in greater china or even in asia despite the slowdown we are seeing in the mainland and those geopolitical tensions. dani: thank you so much. bloomberg's yvonne man bringing us that exclusive interview with credit suisse's chair. let's get the first word news with simone foxman in doha.

simone: brazilian president jair bolsonaro is still keeping silent after his defeat in sunday's election. the electoral count says that he lost the vote to lula by less than two percentage points. the margin is very narrow. also in previously criticized result's electoral system. president bynum -- bolsonaro has previously criticized brazil's electoral system. i have next week's midterm elections, biden called on big oil to put consumers before profits. democrats have tried unsuccessfully to levy windfall tax for over a decade. ukraine has warned of widespread blackouts after a wave of russian missile attacks damaged power and water supplies on monday, including in the capitol. the kremlin meanwhile says that grain shipments would be quote

much riskier and dangerous after it pulled out of the black sea agreement, blaming an attack on its naval vessels in the region. australia's central bank has raised rates by 25 basis points and signaled further tightening to come. the rba lifted the cash rate to 2.85%, the highest since 2013, in a move which indicates a move away from increases. the central bank also cut its outlook for economic growth. global news, 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. dani. dani: thank you so much. simone foxman in doha. coming up on the program, we will speak to the ceo of austrian oil company omv. many credits will bring that to us live from adipec -- many cranny us -- manus cranny will

bring that to us live from adipec. this is bloomberg. ♪

dani: it is "bloomberg daybreak: europe." i am dani burger in london. let's head outside of london to other pack in abu dhabi where we have manus cranny standing by with our special guest. manus: good morning to you. we are at adipec 2022. alfred stern is the ceo of omv. thank you for joining us this morning. those in your seat have been more concerned about the supply of oil constraints. you are more worried about european gas flows. why? alfred: europe had a significant import of russian gas over the last couple of years and its pipeline constricted its gas. there is simply not enough lng

capacity at the moment to compensate all of this. over the last couple of months, people have done strong with storage very full, but let's see how the winter turns out and how cold it will be. manus: you are saying that i am looking at the forward curbs on gas at 140 bucks. if it is a cold winter, how much of a spike could we see in the market? alfred: we have seen over the last couple of months extreme variability between 50 and 300 euros per megawatt hours and that we has -- and that is something we have already seen. therefore i would say that continued stronger ability is something we should count on. manus: week asset allocation is something that another guest talked about yesterday. how much can we deliver in reality? alfred: wishes -- it is about allocation.

you could have storage units that move faster. -- is scheduled to bring their first terminal i the end of this year osama -- terminal by the end of this year, so it is moving fast. manus: this would come off the market is result of the next concurrent sanctions. what kind of hit to the oil market in europe will that deliver? do you have a clear vision of the risk associated with that? alfred: at omv we have eliminated russian crude from all of our refineries to make sure we are not exposed to any of those risks. secondly, what we have observed is that there were's -- there was some redirection of russian crude to other regions of this world so the differential between russian urals has

reduced the last couple of months. let's see how this pans out when the sanctions actually start in a few weeks from now. i think oil is more liquid. the bigger issue in europe is around gas. manus: let's talk about what needs to happen in that gas market. there is talk of a price cap and that is socialized, that would be a socialization of that. you confirmed it for me, not a windfall tax. it is a solidarity combination, but what i understand on the gas side, what is demand like at the moment in europe? we have the secretary-general from opec saying we are already in a recession. how much demand instruction are you seeing in gas -- instruction are you seeing in gas? alfred: it was a warmer than

usual october and it looks like november will also be warmer than usual. in western europe, it is 40% of the gas in the country used for heating households, so the warmer months will reduce the demand, and this leads to the storages across europe being fueled faster than anticipated. manus: you cannot live on that forever, can you? alfred: that is absolutely right. this is good at the moment, but it is not the strategy or the longer term way of how we work with this. manus: with the beginning of recession, we have got another set of jumper rate hikes from the ecb. will it be a deep recession in europe, a hard landing? alfred: we see higher energy and electricity prices. we see the days of production and some of the chemical

industry is under big pressure. in the industry, the view is that a higher portion of energy has a lot of challenges at the moment and we will see some pressure on this in the next quarter's. manus: i am learning something new every day when i come to work. one terawatts our of lng fuels a big boat and can heat many houses. this is the deal that you signed with adnoc. what does this do in terms of replacing russian gas? how much bigger can this relationship with adnoc go for lng contracts? alfred: we have made sure that 100% of our supply obligations, we can complete supply with normal russian gas. we will have the pipeline capacity, we will have the gas, and we can do this in case the russian supply stops completely.

we have also filled our storage completely and from an omv perspective we are safe for this winter season, but we would agree with adnoc that we are looking further ahead. it is a problem where we are looking at the entergy corporation's. -- energy corporations. how can we fuel energy supply for the next winter, and that is what this was about? manus: what do you expect that to get to in the next winter of 2024? what is understanding between you and adnoc? alfred: we have had a long-standing relationship with adnoc and we have created many great situations. i am sure that corporation will be possible in this case. manus: some people were saying to me that you need demand destruction, which is a tough

time for the consumer, but you need demand destruction take place and not a price cap. what do you say to that? alfred: i think it is a supply and demand imbalance that we are currently facing which is causing the high prices and the only way to work this is increase supplies, make investments, ensure production growth, ensure capacity to bring other sources of gas in. at the same time, we should make investments into more efficiency to make sure we are bringing more. manus: that takes good policy and long-term planning from governments, something which might be more of a bumpy ride around the world. thank you for joining us, our first interview face-to-face. the omv ceo, alfred stern, from adipec 2022. dani: thank you. coming up, we will have the latest on elon musk's shakeup at twitter and the future of

content moderation on the site. this is bloomberg. ♪

dani: we have got a strong surge this morning in china equities. that yuan and oil, this as we see unconfirmed social media posts on reopening, some speculation that a committee is being formed to consider scenarios on how to exit covid zero. they are just rumors at this point, but hong kong tech is taking off. let's bring in tim culpan who covers tech. what do you make of this, a monster sized rally coming from tech? tim: especially as you point out that it is a rumor.

it is not actually a plan to open or relax covid zero, merely a thought of a committee to discuss exiting covid zero. that alone is what people are excited about. any good news on the covid zero front which has shut down the country, causing a lot of drama for people to move around the country, causing problems at factories and so forth. any thought that might be over anytime soon gets people very excited because they have had so much dark clouds hanging over the industry for a couple of years now and the last couple of months. any rumor of any positive news is getting people very excited. dani: because you can talk about anything, we want to take advantage of that. elon musk becoming the sole director and removing all nine board members. what does this mean for twitter? tim: he is the top dog, he has got rid of everyone at the top so the back stops at him.

that will be very interesting. he says he wants to concentrate on product so there will be an engineering focus that will include code reviews and things like that. in terms of content moderation, we do not actually know. we are in limbo paid he told the world recently that he is looking at holding off. dani: it feels like every day is a new surprise. thank you very much. bloomberg opinion's tim culpan giving us the latest from twitter and these china equity markets. hong kong tech up more than 8%, oil up nearly 1.5%. "bloomberg markets: europe" is up next. this is bloomberg. ♪

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>> good morning