tom: good morning, this is "bloomberg daybreak: europe." these are the stories that that your agenda. china's bank cash injection.

beijing is considering pumping up to one trillion yuan into the biggest tape banks. shares in asia surge with tech stocks driving the regional benchmark to buy two year high, a gauge of chinese shares in hong kong up for a 10th consecutive day, the longest winning streak in more than six years. the u.s., europe, and arab powers push for a three-week cease-fire between israel and hezbollah as they look to preventing wider conflict. it is a day when there are two key catalysts, more stimulus coming through from chinese policymakers, and the tech story being provided by the resultant outlook coming through from micron lifting tech stocks in

asia. we will break that story down there for you. european futures on the front right after modest losses yesterday. european futures looking to get around .61%. ftse 100 looking to add 10 points. the nasdaq up yesterday and the s&p down but only modestly. s&p futures pointing to gains around 27 points. nasdaq futures on the front foot looking to add 182 points. the strength focused on micron focused on demand for ai chips. let's cross asset. not a lot of movement in terms of treasuries, but you saw the two year yield flirting with the 150 level. softer dollar is part of the trade is well today. bloomberg dollar index on giving lift whether regional currencies. the pound at 133. some lines from megan greene

urging caution from the bank of england. brent that 72.91. gold that record levels of .1 of 1% at 2659. let's cross to mark cudmore for analysis on the market moves of the day. let's start with the china peace. what is your view on what we have been hearing, further support for the banks, liquidity injection for banks. what is your sense of whether these gains can be sustained and what the implications are for that economy? mark: i think these gains can be sustained. what we saw was a major turning point in the story. if you want to take this and a few of today's announcement, the situation in china has been there is been a lack of demand for that kind of love. supply is not the issue. the capital injection does not

make a big difference. they are already well capitalized, but that is the wrong way to look at this. the point is that they are continuing to add to measures having already given the massive cocktail of stimulus for every sector. they are trying to generate animal spirits targeting the equity market, which is important, but they are really targeting the equity market a blood providing support for the consumer, m&a, property market, mortgage rates, almost every single aspect they are providing marginal help, and they are saying we will get markets higher. already this week we have seen equity markets getting close to $1 trillion of extra wealth added. the chinese consumer will be going to the long holidays next week feeling happier and healthier than they were only a week ago, and that will generate its own momentum. i think that overall we have seen a turning point this week even if today's announcement in isolation might seem marginal.

you should not look at that in isolation. tom: csi 300 benchmark .9 of 1% to your point. when it comes to that tech trade, agent tech stocks getting a lift. we will see if that carries through into europe. micron coming up with a forecast, the ai demand seems to be there. to what extent will that be a catalyst more broadly for global markets? mark: i think it is really important. from a macro level it is bullish for stockmarkets out there. we have got ok global growth, ok u.s. growth despite the panic about slow down and it lent that gdp fed indicator is targeting 3% for this quarter. meanwhile, central banks desperate to ease. if financial conditions are good, energy prices are cheap. it is incredibly bullish from the macro level. from the micro level u.s. stocks

are extremely expensive. valuations are pricing out a wonderful world, and we are worried at some point as of the ai you for steam? micron is another message from the micro level as well you do not worry just yet, and i think that means this bull market continues into year end. i do i think the u.s. markets are at the forefront of gains because of the election and they are priced at a rate support and already pricing and exuberantly, but global markets continue to do well into year end, and we have put out for the worry about the ai bubble collapsing at least for another few months at least. tom: mark cudmore with a fantastic d5 into market reactions from key themes in the trading day today including the tech story, micron, and more details in term of all is a response from china. we look at you more analysis on the tiny piece of that as well in the next couple of minutes. let's get you a taste of what is

on the agenda here in the u.k. and across the world as well. 7:00 a.m. u.k. time, h&m earnings, an interesting gauge in terms of the consumer and the exposure to retail in the environment of a more challenge consumer. a touch point on the consumer in the u.k. and across europe. we will break that for you. 8:30 a.m. u.k. time, a fascinating one on the central bank front, snp of switzerland. that rate decision fully expected to cut, but by how much remains a question as inflation is on target but growth is challenged in switzerland. that will be crucial. we will break that for you, and it will be the last decision by thomas gordon before handing over the baton. we will get a gauge on initial u.s. jobless claims. we know increasingly fomc

officials are switching their focus from inflation to the labor market of the u.s., and that is why that data point is particularly consequential at this point in time. bloomberg has learned in considering injecting up to 142 billion dollars of u.s. capitol into their banks. beijing unveiled broad productions to keep policy and mortgage rates are revived that economy, so how should we interpret and how should the markets interpret this potential move? another big stimulus shot or assigned that china's banks are now distressed given the heavy lifting a fed to support this economy, to take on those cheaper loans and mortgages? let's bring in minmin low. what did you take from this potential proposal, this potential liquidity injection, the first time since 2008 for china's banks? >> it is very significant, first

time since the global financial crisis in 2008, and it comes at a time when their profit origins have been at a record low of 1.5% as of end june below the threshold of one point 8% deemed as necessary for reasonable profit, and we are seeing time and again that the banks have been asked to do national service for the economy, to cut mortgage rates, lending rates to provide dividends at a time to shore up the stockmarkets. those mortgage rate cuts were estimated to save homeowners !30 billion yuan, monday no longer going to the banks, and we are the pboc governor on tuesday promising about the monetary stimulus is going to come at a neutral impact on bank's profit margins, so perhaps this release are in catch injection is going some way to stabilize that, but also quite he wants to because we know that these banks actually when it comes to the

capital equity ratio, it is well above the gay percent requirement for systematically important banks. so they actually did not need that capital injection technically in order to continue the operations day-to-day, so our bloomberg intelligent editors saying they be this is a signal that the pboc is going to guide the bank to take on more credit risk, to lend more to perhaps distressed property developers or cash-strapped local governments, and if they need to take on more credit risks, then these banks will need to bolster the balance sheet to protect against the chance of an increasing amount of nonperforming loans. tom: may be preparing to banks for further action to support the economy. meanwhile, it seems like officials are finally heeding the warnings, the calls from economists. a members of the pboc sangha need to get cash into the hands of the chinese consumer. is that part of the plan in terms of giving money to the

poorest in the country? >> stadia begin as the government is going to give direct cash handouts to the extremely poor. there are about 4.70 million of them. we do not know the side of the handout, but it is a departure from the past where we know president xi has been resistant to welfare that chinese officials have said could encourage laziness. this comes with the state of the economy, may be making the government to reconsider this move to provide direct cash handouts. they are supposed to get this out before the start of the golden week holiday next week, typically a time of peak travel and spending, but maybe the extremely poor will not go on a holiday but it can give a boost to the essential items, household appliances, the consumer staples that has been a group of stocks that is one of the worst performing sectors in china so far this year. by the way, it is the 75th anniversary of the founding of

p.r.c., so the government and the party are showing his love and care for the citizens as well. tom: we love a bit of loving care from this ecb. -- ccp. a three-week cease-fire between israel and hezbollah has been put forward by the u.s., europe and arab nations in an effort to prevent all-out war. hezbollah is get to comment on the proposal while israel's ambassadors as a diplomatic solution is preferable. >> i would like to see a cease-fire and the return home of israelis to their homes in southern lebanese to their homes in southern lebanon. it will happen either before the war or after the war. we hope it will be before. tom: joumanna bercetche joins me now for what we have been hearing from lebanese officials and the israeli side.

but as the response bent to this potential cease-fire? >> yesterday there was a perception the next 24 hours would be key for the direction of what happens in the ongoing war -- rates in lebanon. this proposal came through yesterday. it was sponsored by the u.s., several eu leaders about qatar, egypt signing on to proposal saying it is time to conclude a diplomatic settlement that it was civilians of both sides of the border to return to their homes in safety. we just heard from the israeli ambassador to the u.n. saying they are open to the possibility of a cease-fire. earlier today i had the opportunity to speak with the lebanese economy minister, nt said it would be welcome. they would like to suggest cease-fire, nt has had discussions with hezbollah, and they seem to have shown some flexibility in the last 24 hours

vis-a-vis the potential truce with israel, so perhaps a more positive signs coming from the language and rhetoric of both sides, but the death toll continues to climb. the lebanese health minister has said in total death toll is sitting at 636 cents airstrikes started with more than 2000 people wounded and 5000 having been admitted to hospitals since things have started to escalate. tom: the toll on the human level is there. you have been talking to a minister from lebanon's government, so give us more flavor in terms of what to guess been saying about the impact on the ground? >> even before the war started lebanon's economy was in a state of decline, so a massive economic deterioration over the course of the last couple of years, huge levels of inflation. the currency is devalued 90%, and that was the starting point. you add awards event, the fact

that for the lebanese foreign minister hundreds of thousands of people displaced, and it is putting pressure on the country's infrastructure, economy, and things like sourcing key materials that are necessary, things like food, medical supplies, supplies or babies and families. let's listen to what the economy minister had to say. >> the economy is it a very bad place. this war has added a layer of challenge to lebanon. in 2023 we had expectations of group -- growth, hoping that certain sectors like tourism and the food industry would flourish. all of that has disappeared. growth is nonexistent at this point. >> growth is nonexistent at this point, and this was the state it was in before the war started. later on in the interview he said they have enough supplies to cover the country's needs for the next 4 to 6 monhts --

months, which underscores the proposal of this cease-fire proposal because it would provide temporary relief. tom: 15% of people below the poverty line before the escalations intentions in this conflict. thank you very much with the context around the story continuing to what a fold in that region. let's get back to the china story, because lines breaking on the terminal. this is a redhead, china striving to complete its annual economic goals. the politburo has been beating, and we have been waiting for this. the annual economic goals of china by the end of this year are for growth around 5%. up until a few weeks ago you had many wall street banks cutting their forecast and a bloomberg economics for the growth picture for china. the expectation was they would miss that target. that was before the

announcements around stimulus that have come through this week, and out the politburo stepping up on that front saying they will strive to compete with annual economic goals. that explains a lot of the stimulus that comes through. the stimulus is targeted at making sure they get to that growth target. the politburo will make efforts to boost the capital markets as well and support m&a of listed companies. we will bring you more details. donald trump lashes out at zelenskyy for not striking a deal to end the war in ukraine. we have the details next. this is bloomberg. ♪

tom: welcome back to "bloomberg daybreak: europe." former president donald trump as lashed out at zelenskyy for

criticizing him and for refusing to make a deal to end the conflict with russia. for more on this our news director joins me with the details. zelenskyy has been hoping to meet with trump. trump then lashing out. >> this is not good news for zelenskyy, because he was hoping to meet donald trump on this visit. they are fed a troubled history, but the prospect of donald trump in the white house next year means they need to have some kind of report -- rapport, relationship, so key is opening for the meeting, but donald trump has criticized him for making a pit stop at a weapons plan in pennsylvania. he said it was favorable for the democrats and also because zelenskyy has criticizing trump, so it has gotten messy weekly, and the wheels have fallen off the hopes for this meeting as a

result. zelenskyy is meeting joe biden, but they have an established and warm relationship. he is meeting kamala harris, the democratic contender, and that is important too, but the setback for him is come next year if it is donald trump in the white house, what does that mean for future arms sales, delivery of weapons and other financial aid to ukraine? tom: is it spreading beyond trump and jd vance to broader parts of the republican party where there has been strong support -- it is divided, but there has been some support for zelenskyy? >> some senior republicans have been ardent supporters of ukraine pushing the u.s. to do more to support ukraine come but there seems to loves upset them -- seems to have upset them,

this visit to the factory. when it comes to things like congressional support for ukraine, that is important to get some of these packages through. there is only so much the president can do themselves through their own power, so congressional support is important, and that might be failing depending upon the makeup of congress come next year as well. this is difficult for zelenskyy. he is going around the u.s. talking about a victory plan, and a lot of allies are saying it is not a moment for victory. you will have to negotiate. tom: thank you very much for context around the program. coming up, economists forecast a .25 of 1% cut from the snp. good they be wrong in terms of the forecast like there were about the fed? we discussed the possibility of a swiss surprised.

that is next. this is bloomberg. ♪

tom: welcome back. could we be in for a swiss surprise, economists expected 25 basis point cut but some are saying they could follow the footsteps in the fed with the bumper reduction. our guest joins us from zurich as we count down to this decision. a lot of excitement when it comes to the snp. what are the pros and cons of options on the table for the swiss national bank? >> it is true we could be in for a swiss surprise. if they do what everybody says this will be a day like any other, but in fact what we have

to keep in mind is that the rates are in switzerland are lower than almost anywhere else, so they have to reserve firepower. since the economy is not doing too bad different from other european markets like germany, switzerland is doing fine, so they could opt for a hold, which would be a big surprise. they could also follow the fed and do a 50 basis point cut, because on the other hand they have a problem that inflation might undershooting. the swiss national bank as an inflation target between 0% and 2%. they got this range, in the inflation forecast for next year looks low, so some people are worried inflation might go too low, so they could go big. because the snb does not get afforded guidance, it is wide open and we could be in for a swiss surprise. tom: it is the last rate

decision by the chair of the snb. is that likely to play into the decision-making? >> not really. you could think of marconi who left the boe with the 50 basis point cut. thomas is not the kind of guy for that. i talked to a well-known economist who said he will just look at the facts, proving your point, going for your ego would not be swiss. i would not say it plays into that a lot. tom: it would not be a swiss move. our guests on the countdown to what is proving to be an exciting snb decision. later today we hear from the incoming national swiss bank resident on that rate decision

and his friends before he takes up his will next week. that is an interview you want to tune into. how did zurich compete indeed generate fai solution? our exclusive interview with a venture capital firm backing the sector. that is next. this is bloomberg. ♪

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tom: this is bloomberg daybreak: europe i'm tom mackenzie in the london. these the stories it's at your agenda. china's politburo says it will implement what it calls for sole interest rate cuts and necessary fiscal spending as it looks to further ramp-up support for a economy. tech stocks driving the regional benchmarks to a two-year high. chinese shares in hong kong up for a 10 consecutive day. it's longest winning streak in more than six years. plus, the u.s., europe and it air push for a three-week cease-fire between israel and hezbollah. they look to prevent a wider conflict. china stealing a march on these markets. it is not one and done from the policymakers in beijing. the politburo doubling down on the policy measures already announced by the pboc, and here's the important piece on fiscal support. that's what the economists now

are looking for after the pboc came through with the flurry of significant measures earlier this week. the fiscal support says the politburo of the gathering of the most senior leaders in china. they will do and ensure necessary fiscal spending. we will be looking for the details on what the fiscal spending means, but we've also had reports they are handing cash to some of the poorest ahead of the national holiday and of course mulling a potential liquidity injection into the state banks to the tune of a trillion u.n.. for around a trillion u.n. around 140 billion u.s. dollars. politburo stressing they will implement forceful interest rate cuts. chinese markets rallying once again. benchmark up 2.5 it was on track for another full straight year

of losses. over in hong kong the hsi jumping 3%. hstech index with a heavy tilt to the tech industry up 5.5%. msci asia-pacific of one point 7%. all this feeding into upside on the futures when it comes to europe looking again around .08%. tech is also part of the story because micron surged in late trading after a demand posted its sales and profit forecast and asian markets getting a lift on the back of that around chipmakers. how does europe compete in the genai revolution and what is holding the region back? oliver crook with a guest who can walk us through how to position and how europe can boost its competitiveness on technology. oliver: thank you so much.

we got the draghi report a couple weeks ago. it was long awaited. it basically serves as a animating document for the new european commission that amounts for a formula for how to boost european competitiveness and failure to do so, he says, will guarantee a slow agony for the european content. one of the think -- continent. one of the thing he points to is that they have not found it a single company in the last 50 years that has a market cap that exceeds $100 billion. every single one of the once in the united states that exceed a trillion dollars in market cap were founded in the last 50 years. had he built the company of the futures, you need the startups of today. so here to help us appraise the landscape of the industry in europe and try to fix it is the partner and cofounder of earlybird venture capital. henry, thank you for joining us. how do you bring european tech into the 21st century? >> at the end it takes four elements to create large cap on a significant technology

company. as starts with the talent, it goes with respective technology. and this is the predicament we face in europe and we simply do not invest sufficient capital in growth. if you just take germany, we invested in 2023, just 7 billion in growth companies. if i even can parrot what we had back in the phase of the first one, we have been in our prices, in the area of 100 to 150 billion annually. we are 10 to 20 away and where we need to be with comparative. >> how do you lift the hurdles, how do you get the letter injected into the sector. >> the only ways to mobilize private money. and it's not so that we do not have the capital.

in principle, long german insurance industry is investing 300 billion annually goes predominately into government bonds. it goes in greek, german, french and government bonds because, in the first place, they first see zero equity back up for a investments. whatever you do as an institutional investor growth capital, you have to back out with 100% equity. obviously it's not going to work. so if you find ways to redirect that private money into what we like it to be in growth, that would definitely solve the problem. we won't be able to save -- change solvency overnight because there are too many countries involved, but we could probably use the credit worthiness of the public government. of europe in order to reduce and

to bring that capital into the sector. oliver: what are the ingredients in the virtues that exist, the skills, the talent, the universities that can be leveraged to have a sector here? >> we are not liking the size -- lacking the size, the talent in the technology. we see so many impressive companies and technologies being invented and started here. we are missing out on the last mile. something is emerging, it's getting traction. institutions from other inches of the world provide the capital and attract them into their region. oliver: we have a concrete investor happening with that. >> marble fusions coming out today. with good news that they were able to raise their series b.

it is a very disruptive fusion company. however, there is also a larger piece of public funding involved and it's predominately coming from the u.s. it's a fact that the demonstrator, which is not going to be built where i would love to have a, it's going to be in colorado. in providing significant money and saying, this preference it needs to be around in your period obviously the company has to tried to demonstrate a goes to the gas. >> one of their growth drivers in the next couple of years, where you see europe standing? maybe it's potentially overhyped. >> it will change the world, but

it's like with the internet, initially, we expected to change when they come quicker than it did. it will come in the same applies for ai. oliver: thank you for joining us. approval of the european tech landscape. how to get more and competitive in a moment where you mario? he warns it is at risk of permanently falling behind. i will have it back to you. tom: it's a crucial conundrum for europe's tech sector. the growth piece on the scaling. in berlin with ed. more breaking lines coming through around the german chemicals giant. of course with that global exposure, basf year to date for stock is flat. in terms of a return of cash to shareholders, basf saying it aims to return 12 billion euros, to holders from 2025 to 2020 eight, that is via dividends and

share buybacks targeting around 12 billion euros. this is a stark free to watch at the open, 8:00 a.m. u.k. time. the redheads crossing the line on your bloomberg terminal. year to date the stock is flat. we will see if this juices the upside for basf, which faces challenges around the energy input in gas and of course the supply chain conundrum. looking to return more cash to shareholders. tech stocks and more. china still with us, drive asian shares higher. we will discuss the global market outlook with janet from rbc. that is next. this is bloomberg. ♪

tom: welcome back to bloomberg daybreak. asian markets of hit a two year

high on the back of searching tech stops. the head of market analysis from rbc. thanks for joining us in the studio. we have the lines crossing from the politburo. they double down on the support around interest rate cuts. we are waiting for the details on that and we know is the key part of the ingredient that economists say was missing from the monetary policy. the significant support joins us this week. my question is how do you play the china story right now? >> thanks for having me. i do think that the stimulus package has been quite comprehensive and i think that the authority was to support the economy and property market. i do believe it could still be momentum for the market rally in china for how cheap it is. it has been very weak there.

further rally in the chinese stock market. but for us i think there are still? sustaining their rally. the details on the fiscal side is still missing. and also the boost of the stock market is the aim is to lend money to the financial institution. i think there is still concerns on the inflation side of things. it's still very weak, the momentum. that environment it is difficult to see how there would be a credit demand coming through. we will see demand coming through. at the end of the date of the corporate earnings results is still likely to remain quite depressed. the stocks in europe are a sensitive to chinese growth.

there are large luxury stocks with depressed multiples and there could be opportunity to get a better entry point into those stocks. tom: the window is still open to get exposure to luxury on the back of the china story. talk to us about more broadly the central bank cutting the cycle that we are starting to see, at least in terms of the ecb, the fed and the boe. how supportive will it be? markets pricing at 74 basis points for the federal reserve. we just have two meetings left of a 50 basis point cut. does that seem reasonable to you, will be supportive, is it indicative of a slowing or weakening u.s. economy? >> on the surface it does look quite excessive. they have already done one .5 percentage point. it does seem there is a urgency to cut rates sharply. tom: if they came with another

50 basis points, with that question your bullish call on u.s. stocks? >> i think it depends on the communication and jay powell handled it really well last time. if you look at where the fed funds rate is, if you compared it to say where core pc inflation is, it still shows a financial conditions are tight. they are still cutting rates further. it depends on how quickly they do it. so i would say it depends on the communication for whether they are doing that in the rate cut has duty inflation pressure and the fact that they want to ensure there is no recession coming. i think if they want to support the economy, it's a great thing for the financial market. tom: you are overweight stocks. what stock markets do you favor? is rotation play part of the thesis, rolling out a pink attack into the russell 2000 small-cap of the u.s.? >> i think the core of what we like his policy and growth at

this stage. i would say the risk is more balanced these days. we do see potential for a broadening of the equity market rally. i think it all depends on the resilience. the thing is we do see their weakening of u.s. consumer spending. so we are cautious of that outlook. we still like the big mega cap technology stocks because we see it as a quality growth area. in semiconductor stocks, which we think is both cyclical and secular. so for the broadening of the equity market, we are still close watching this space. tom: the curve -- >> i think a lot of rate cuts have been priced in on the front end. i think for the long end, it could be dependent on who will be in the white house.

for example, if donald trump is in the white house it could be more inflation. the market would perceive it as more inflationary. i think the events that could determine the results of the u.s.. tom: may politics taking a run on the photo -- federal reserve bennett makes the politics taking printer just center stage. thank you very much. still that overweight call on u.s. stocks, equities and u.k. with a focus on quality for now. now to the scoop on openai. bloomberg learned that the company behind chatgpt is giving sam altman a 7% equity stake. let's bring our tech reporter annabelle droulers. how's the shift for the team of openai that had been a nonprofit. quakes extremely significant.

thinking about this possible equity stake for sam altman. he's someone who has been on record. he's someone who said the only reason he would want to stake is so people can stop asking him why he wants a stake. he said he didn't want any ownership of the business because it was there to serve the greater good to benefit society. now it seems like that has shifted somewhat. but we hear from sources, it could be a 7% stake. to put it in context. alluding to that non-for profit structure. that's how openai was established back in 2015. it started to generate a lot of investor interest, for finding eai tools. they are expensive to develop. so they established a for-profit subsidiary that stat beneath the umbrella of not-for-profit structure in 2019. that led to some tension and it culminated last year we sat --

we saw sam altman being ousted around that point. they will do a corporate restructuring and have that for-profit structure sitting at the top. tom: significant structure for openai and potentially as we talk about ai we have a reminder that the demands for some of the components around jeni -- genai are not going away. very strong around the high-bandwidth memory part. i we right in thinking there is a read across to the broader market? how should we be thinking about this as an indicator of that demand? anabel: exactly as you say, it tells us that even though we had those concerns a couple of weeks back around nvidia, perhaps it was maybe not drying up, but a little bit and stamp she a it of how the investor fee was seeing around ai. it certainly looks like it's going to be set to continue because the latest orders from micron are coming in solid.

that guidance for the upcoming quarter is seeing revenue of about 8.7 billion dollars. the average estimate was 8.3. so it's quite a big jump from 8.3 to 8.7. 20 since better than expected so a dollar 74 -- one dollar 74 cents. what we got in the quarter ended, it was a 93% jump in revenue. as you say, micron has been a big beneficiary of its demand for chips with high-bandwidth memory. really critical to powering ai tools and micron again gaining from that. as you say, yes that broader sentiment shift or lift you can see here. we are seeing some very solid gains. tom: bloomberg's annabelle droulers breaking down the tech story with the focus of openai and the results of the alec. thank you, annabelle. staying on technology. meta has debuted its first

reality glasses called orion. it has lenses that would display text messages or videos onto the news as field of vision. meta's chief technology officer expects the glasses will become a consumer product within the next decade. >> i think we are more than one year way, less than 10 years away. but we have a very clear line of sight to consumer product. one of the big things going from this is understanding what can we learn to simplify or what do we need to do to keep in future designs. we really want to get this into a price point of not just consumers but developers. tom: play more coming up. stay with us. this is bloomberg. ♪

tom: welcome back to bloomberg daybreak: europe. the s&p passed its 41st record high. futures pointing higher today. janet was part of the mix. the valuation gap. the premium that you are paying for exposure to the s&p versus the rest of the world. right now that spread is at a record high. the yellow line representing the spread at seven point 95. you could see it or visually here with the s&p versus the global index when it comes to global equities. look at the gap that opened up. that is the valuation gap. some would say, look, this is justified given the rate cuts coming from the fed, given the mega caps and mag 76 within the u.s. equity space and not an europe, certainly not in china. that's justified. others would say maybe this is a vulnerability for the records i keep being turned out by the s&p. at some point there will be a reckoning could be the take from some pure let's look at what's

happening in terms of the moves as well into the front end of the yield curve, and how that stivers for expectations around inflation in the u.s. most of the time you can see this correlation. this is the blue line is the moves into the two year at the front end. the white line is representing a one-year push out view on inflation coming through from the markets. you can see the markets shaped gap coming up. inflation getting back up to around 2%. that's in line for the fed's target but at the same time you see more money moving into the front and at the two-year at one point flirting. the last time i checked it was around 355. markets around 74 basis points of additional cuts from the fed by the end of the year, which would include that 50 basis point cut as well. so that is interesting and may signal on inflation expectations that the soft landing will be achieved. the data on the gdp front will be interesting. the third revision for the second-quarter gdp print coming

out of the u.s. expected to come in around 2.9%. on an annualized basis is still pretty solid. the atlanta fed now gains a tracker of gdp that is now sitting at 3%. you can see how it's etched up in the month of september sitting around 3%. we will see with that gdp print speaks to. fomc officials increasing the focus on the labor market. bloomberg terminal can get access to these charts and others used throughout the show at gtv go on the bloomberg terminal. coming up, it's the opening trade, we speak exclusively with the former ecb president. stay with us. this is bloomberg. ♪

♪ ♪ with so much great entertainment out there... wouldn't it be easier if you could find what you want, all in one place? my favorites. get xfinity streamsaver with netflix, apple tv+, and peacock included, for only $15 a month.

anna: i'm anna edwards alongside guy johnson. an hour away from the opening trade. here's what you need to know.