>> good morning, this is "bloomberg daybreak: europe." i am tom mackenzie in london. these are the stories that set your agenda. president biden warns against attacking iran's nuclear sites

as he seeks to de-escalate tensions in the middle east. the g7 considers ramping up sanctions on tehran. chinese shares a drop in hong kong. in japan at the yen we can says the new japanese prime minister cast out on further boj rate hikes this year. the french president endorses a tax hike on the biggest companies terrain in the budget deficit. we will bring you more from our exclusive conversation with emmanuel macron. european futures pointing lower after both european and u.s. markets ended wednesday essentially flat. risk off seems to be the sentiment, stronger dollar appling as well. european futures pointing lower

by .6 and 1%. the ftse 100 looking to lose 32 points. s&p futures stateside looking to drop .2 of 1%. nasdaq futures lower by around 62 points. let's flip the board and have a look cross asset, 30 assessment around where the fed goes continues to be part of the play with guilds up in the session yesterday as of the 10 year closes and on a level of around 3.8%. let's reflect on what is happening in terms of the asian session with the focus back on japanese equities. the prime minister coming up with a surprise comment around the need to be cautious around any potential hikes from the boj. softer yen and strength coming through. japanese equities up 2%. we will get more on that story through the hour. in terms of the yen, 146 currently down .2 of 1%. the story in china is one of

weakness around property stocks and tech names listed in hong kong. a bit of a breather after 13 consecutive days of gains for chinese stocks. broadly across the asia msci pacific the regional bet are. i mentioned the u.s. 10 year, reassessment given that job stated that came in. adp numbers stronger than expected. we are building up to nonfarm payrolls, that data print on friday, which will round out the labor market detail that we have got through this week. there was evidence of cooling when it comes to adp on a three-month average basis. 379 is the yield on the benchmark 10 year. euro-dollar at 1.10. brent, 74 point 76 up 1.2% with a clear focus on tensions in the middle east. goal that 2655.

let's get more details in terms of what is unfolding in terms of potential is really retaliation to iran. the u.s. are urging israel not to attack iran's nuclear facilities for this week's missile barrage. president biden plans to speak with prime minister netanyahu as the u.s. and g7 allies plan further sanctions on iran. joumanna bercetche joins me with the details. what good is riel's response look like. we are expecting a response. we do not know what time frame, but what of the options they may be looking at? >> there is broad-based support within israel of this response to come soon important to be powerful. even the opposition leader is saying iran must pay a significant and heavy price, and you have more hawkish voices within the israeli government, then it saying israel should

destroy iran's nuclear program and energy facilities, so those are some of the voices coming through from israel. we are not privy to what they got thinking, but these are some of the options of being discussed. the response could include airstrikes from fighter jet similar back to what we had in april when they specifically targeted an air defense battery. it was a targeted strike on this air defense system. it could also take the form of clandestine operations similar to the taking out of an official , and israel never took direct responsibility for that, but it could be more targeted assassinations at the irc g level. the other option being discussed and which is why we are seeing a big impact on energy markets is israel could choose to target energy infrastructure, and here specifically speaking to some of our energy colleagues, they say

they can go after some of around's processing plants. there was one in particular called the persian gulf start referring to responsible for 45% of daily gasoline that is consumed within iran, so the product out of that refinery is mostly directed toward a domestic audience. which means in terms of global indications it would be more contained, so that could be one of the potential options on the table, and then quite literally the new eruption would be for israel to target some of iran's nuclear sites, and the whole world, the iea has flied to web ends grade nuclear material. if that did happen it would mark an extreme escalation, and the u.s. is trying to convince israel not to go down that road. tom: some of the detail on options for israel, potential options at least, and you mentioned the u.s. at what has the u.s. been saying

as israel builds up to this response? joumanna: well, it is very clear that the u.s. has said that israel fully has the right to defend themselves, and by didn't was asked about the israel replies oh -- reprisal, and he said all seven of us in regard to the g7 say they have a right to respond. the g7 had an emergency phone call yesterday to discuss putting out a statement in introducing further sanctions on iran. there was a two day interior minister g7 meeting taking place over today and tomorrow as to looking for a statement coming out of that meeting as well. it seems as though the u.s.'s role in all of this is clearly standing by israel that their ally in the middle east and supporting the right to self-defense, but at the same time trying to exercise some diplomatic influence to keep the response restrained. tom: bloomberg anchor joumanna

bercetche on the latest joining us out of dubai. from geopolitics in the middle east to central banks into reaction coming through in terms of comments from the new japanese prime minister. ishiba's a #in the yen after he said the country was not ready for higher borrowing costs. his comments was back expectations of another central bank i get a raise concerns about his communications to the markets. for more i am joined by mark cranfield in singapore. the prime minister ishiba seems to have gone from hawk to down fund boj policy. what is going on? mark: foreign exchange traders think christmas has come early. there were looking at the month ahead thinking it would be dull and the foreign-exchange world. he left the u.s. elections coming up in early november plus the fed meeting, and there were

thinking there would be too much confusion, a lot of caution. along comes the new japanese prime minister in the bank of japan and they gave a green light saying sell the yen for the next few weeks anyway, because the japanese election is not until the end of the month. [laughter] they cannot leave their good fortune. on top of that, you look at the jobs data, the private sector has given a bid to treasury yields, so there was a little bit of momentum for the u.s. dollar for the point of view of a touch higher in u.s. yields. then you get what seems like a one-way skew in terms of the yen . they do not want to raise interest rates, so that will play out in the yen, particularly when you consider the positioning. market was very neutral. at the beginning of august when we had that huge rally in the yen, it was skewed toward people already being short on the currencies, so they needed to quickly scramble to cover their positions, and we had to

intervention as well. it is a completely different scenario. those positions have mostly been washed out. traders were thinking they should not be doing too much, key positioning light into the u.s. elections. now they are fairly early in the month, they have a few weeks to play with, and they have been given a fairly clear direction by the japanese prime minister. dollar-yen, people in asia today are talking about the risk of going to 150, 155. at that would not be at the question considering they have time on their side and we may have been employment report tomorrow which is on the strong side as well. tom: 150, 155 for the yen. you talk about the jobs market another place income that u.s. jobs data, and how that ties into what is happening in japan. as a significant do you think the printers that will come through on friday in terms of the assessments for the federal reserve and in terms of how it ties into the dollar and bonds?

mark: it the last chance. if anyone still is thinking that the federal reserve could cut by 50 basis points again in november, this jobs report is the deciding factor. you can see the market has been withdrawing those bets to some extent. they are not is going well on the idea of consecutive 50 basis points cuts, but if we get a surprise in the employment report it would put it back on the table. at the moment that does not appear to be the case. estimates for the unemployment rate itself is to stay at 4.2%, and that is the deciding factor. that is the one we have seen earlier this year, when that number jumped to 4.3%, that triggered a rally into treasury market, bonds it did well and the dollar sold off of that because of that. this time around people think the jobs report will be a solid number overall, 4.2 will remain, and that is not enough to push the fed toward a bigger cut.

they will do 25 basis points. that has been the strong indication from jerome powell and other speakers, but these are needing a week job report -- weak job report to push them further. treasury yields will flatten. the yen is probably the currency that will be most affected by all of that. tom: bloomberg mliv strategist mark cranfield on the importance of the nonfarm payroll data causing tomorrow in terms of whether or not we get the 25 basis point or jumbo cut from the fed at the next decision. let's switch focused to french politics. french president emmanuel macron has given his backing for a new temporary tax on large companies as he looks to tackle his government's deficit. he was speaking on a panel motivated by bloomberg's stephanie flanders at the bloomberg mobile dialogue --

global dialogue. >> having excessive taxation on copper is well understood by large companies. if this is for one year. it should be limited, and we do not have to forget the rarity of our economy, our competitiveness, and our competition. tom: the french president speaking to rest of their. let's bring in caroline connan or in paris for the context. emmanuel macron was pushed on domestic challenges, of which there are many his new government is currently facing. anything that stood out to you from his response? >> it was quite surprising, because when macron is a broad he does not talk about domestic issues, and since the prime minister was named four weeks

ago he has not been involved at all in any choices and comments from his new prime minister. and at the same time, he is abandoning his own philosophy of never raising taxes, and this has been his mantra for the past seven years since his first election in 2017. so on top of that he is obviously officially backing whatever budget the prime minister will present next week. given the deficit will reach more than 6% this year, now looking for 66 billion euros of savings. to bring the deficit back to 5% next year. we know this exceptional tax will be temporary. macron saying it would last for one year, so that will be in the 2025 budget, and it should raise

about 80 billion euros to the stake offers according to french press. we also heard from the business lobby. they see this new text as a prerequisite to restore balance of public finances, and finally we heard from one ceo already, an energy ceo who said it is unfortunate, but it should have limited impact, because anyway they pay most of their taxes abroad. tom: thank you very much with a reaction to what we've been hearing from the french president speaking to bloomberg app the bloomberg global dialogue. to the u.k., a focus on the pound as of the pound moves lower by around .51% -- of 1%. the bank of england governor enter billy is given an

interview to the guardian in which he says, and i am quoting from the guardian, the bank could become a bit more aggressive in cutting interest rates again provided the news of inflation continued to be good. a couple of other lines coming through with the boe governor saying the economy was more resilient than expected, living costs pressure is not as persistent, and to guess watching the middle east events very closely. the key line that appears to be moving the pound lower is he sees a chance of more aggressive rate cuts. coming up openai's latest funding round values it it just $157 billion. we have a look at it was backing the mega start up next. we will also discuss openai and the boom in ai investments later in the program with yan taw boon

on how to invest around the genai hardware and software ecosystem. that is coming up. this is bloomberg. ♪

tom: welcome back. openai has raised $6.6 billion in its latest funding round valuing the company at $157 billion. let's bring in annabelle droulers. bloomberg app reported this prior to the details today suggest puts it in a category of its own, one of the most valuable startups in the world alongside spacex and bytedance. this is a big moment. annabelle: that is right, it is a very exclusive club openai is sitting in, one of the most valuable startups in the world, and it tells you how much tech

industry titans continue to believe in the use case for alien the future. one company chipped in $1.3 billion. we are told microsoft, which is the biggest contributor around $750 million. others include postal ventures, tiger global, softbank as well. looking at its estimated valuation which was $157 billion. the question is how does openai plan to use this cash given they have got that power to be working through. they will be putting it toward ai research and adding to view capacity. it is certainly transfixing a lot of people in silicon valley. tom: it is a huge ticket number. to some extent it is indicative

of the continued demand for exposure to some of the leading names in the genai space, but does the valuation cause anyone concerns? are there any eyebrows being raised about the skyhigh valuations? annabelle: there are some people who continue to pour cold water over the ai height, and it is the use case. we have yet to see a real-world breakthrough application for ai technology and see something that comes into the mainstream, it is a rate that is done well is an interview bloomberg did with the renowned m.i.t. professor, and basically he is saying at a time when you have got a high stocks that are outpacing the broader market and you have got every single industry looking at job descriptions, he is not saying it will go that far. he is saying at best only 5% of roles are looking to be replaced by technology.

where do we go with investor mania? he is looking at three different scenarios. the first is the hype calls over time. in the second difference he builds for another year and leads to a tech stock crash. in the third scenario you end up having many of that goes unchecked for years. he sees a combination of two and three they could have economic consequences. tom: a warning from someone who has a deep insights on this phase. some caution around its evaluation and what it tells us about the buzz around genai. coming up, counting the cost. hurricane helene, insurance losses expected to reach more than $6 billion and potentially disrupt the solar and chipmaking industries. we will explain why next. this is bloomberg. ♪

tom: the destruction from hurricane helene is expected to cost insurers roughly 6.4 billion u.s. dollars according to an early estimate and it has shut two minds are in that together produce 80% of the world's highest quality quartz. the material plays a crucial role in the production of semiconductors and solar panels. i am joined by an analyst from bloombergnef. where these mines so important to the solar and chip industries? >> this is really pure quartz. it is not used for making the

silicone itself. it is used for making the crucibles in which of the semi conductor is poured into cast of the ingots. the middle and outer layers have to be that pure. it is critical, but you can use synthetic quartz, and there are other minds around the world not fully qualified to do this yet but could be. tom: it is about the production of the ingots. the foundations for solar panels. to what extent does it expose once again, shut down, the potential vulnerabilities or real fond of abilities in terms of the supply chains around solar and semi conductors? >> i think the story has been massively overblown. extreme weather events due to

climate change are on the rise, the solar and semiconductor industries are not the main ones we should be worrying about. tom: which of the ones we should be worrying about? >> agriculture, food. the world only needs about 20,000 to 30,000 tons of this quartz. the companies have the ability to withstand shocks. it is the thing we need large volumes of data more of a problem and for which there is no alternative. tom: so it is a volume story, and agriculture is front and center. jenny, thank you for the context around what we are seeing in terms of destruction from hurricane helene and taking out some parts of the solar infrastructure industry. bnef caps off year in london next week with a stellar lineup

of guests. join virtually using the qr code on your screen. scanned that right now. that all starts on tuesday. it really smart analysis laid out for you within the space on tuesday in london. back to the markets where european futures pointing lower by .5 of 1%. short move in the pound on the back of an interview andrew bailey has given suggesting there could be an opportunity for aggressive cuts when the bank of england if inflation continues to move toward that 2% target. eu ♪ ♪ 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.

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>> good morning.

this is bloomberg daybreak: europe. i'm tom mackenzie in london. president biden warns israel against attacking iran's nuclear sites as he seeks to de-escalate tensions in the middle east. the g7 considers ramping up sanctions on tehran. chinese shares drop in hong kong. in japan, the yen weekends as the new japanese prime minister casts doubt on further boj rate hikes this year. open i -- ai with a valuation of $157 billion, catapulting it into the ranks of the world most valuable startups. microsoft and softbank among the bankers. let's check in on the markets right now then. the selloff in china and hong kong has actually moderated. the hsi is still down. the handoff is less grim than it

had been an hour or so ago. nonetheless, european futures down by 5/10 of 1%. few seafood -- s&p pointing lower by two tons of 1% after a lackluster day yesterday for u.s. and european stocks. nasdaq futures down 3/10 of 1%. let's have a look then at the asian session. it is still all about the china story and japan. that surprise coming through from the prime minister of japan. he came out after a meeting and suggested that he was in no mood to see additional hikes from the boj. softer yen, giving support for japanese stocks. the japanese yen down 1/10 of 1%. in china, different story. the selling pressure has moderated significantly. you have seen four or 5%, now you are down just below 2%. property stocks were hit. 13 straight consecutive days of

games. the broader msci down 5/10 of 1%. the currency of the moment had been the end. the pound is down 6/10 of 1%. aggressive cuts could still be part of the playbook if inflation continues to moderate. pressure on the pound on the back of those comments. continued concern about the moves in the middle east. currently up 1.3%. gold down to tens of 1%. let's get back to the story in the middle east, the escalating concept -- conflict. president biden plans to speak

with benjamin netanyahu as the u.s. and allies plan for their sanctions on iran. that comes as the u.s. urges israel not to attack iran's nuclear facilities. let's bring in dan williams who joins us out of jerusalem. dan, thank you for joining us. what is israel looking at right now in terms of the potential response? is it heeding the warnings from washington? >> good morning. this might've been expected. just 36 hours ago, the united states assumed a new tack in its tone on israel on this escalating conflict. his book in terms of severe consequences and said it would be working alongside and with israel on this. any expectation that might have engendered of joint strikes on iran appear to have been dashed with the statements by president biden, perhaps unsurprisingly. an israeli strike on nuclear facilities would be really your

region rattling event. it's unlikely that this outgoing u.s. president wants that to be his legacy. it's unlikely he would want that potentially to crash the prospects of his vice president kamala harris in the u.s. elections just a few weeks away. i doubt leadership was surprised by this. we've been hearing threats like that for 15 years now. there some doubts as to whether israel has the military capacity to exact lasting damage on those well protected sites, especially now. they will be especially protected. keep in mind that israel is already in a war which is stretching its resources and forces. i doubt there's any great surprise on either side that these statements have come out

now. tom: on that multi-front more then, as we look at a clock that appears to be ticking down to some unknown time, when israel strikes around. on the northern front, what's the latest on the ground in terms of the fighting that continues there? >> i think there's no doubt that that is where forces are most active. they went in with a large-scale incursion, just two days ago. while revealing to the world that they have been mounting smaller scale incursions for months to gather intelligence and prepare. as of yesterday, israel lost eight soldiers. all of them from the special forces. three of them officers with the rank of captain. that definitely appears to have dented israeli spirits. i don't think there's any doubt among the public that this mission or this escalated mission on the ground against

hezbollah is necessary in order to dislodge them from southern lebanon and eventually enables a return of 60,000 israeli residents of northern towns and villages who are displaced by attacks from hezbollah that have been waged since october 8, just one day after hamas began the war from the gaza strip with its surprise rampage. tom: thank you very much indeed. we appreciate your time and the analysis. now to the u.k.. the prime minister has promised to stand firm during what are likely to be difficult negotiations to forge closer ties with the european union. he made his first visit to brussels as british prime minister yesterday. meeting with the commission president ursula von der leyen. >> we are determined to put this relationship back on a stable

positive footing. we all want to see that. >> our alignment on global affairs provides a good foundation for bilateral relations. we have a set of solid agreements in place. we should explore the scope for more cooperation while we focus on the faithful implementation of the withdrawal agreement and the tca. tom: bloomberg's u.k. correspondent is in brussels and joins us now. so is this a new dawn for u.k. eu relations? >> i arrived in brussels to a rare sight at the european commission. the union jack flying here. it was here yesterday. it was gone today. that was an uncluttered bully -- incredibly frustrating press conference last night. more vibes.

no detail. he says the tone is important when it comes to resetting that relationship with the eu. privately, even eu officials are frustrated by the lack of nitty-gritty. the focus on the messaging. just like at home where the u.k. newspapers are filled with policy vacuums with stories of freebies and infighting, eu officials are filling this void with ideas of the round. they would like to see a youth mobility deal. they would like to see reassurances when it comes to fisheries. while they were clear and ruling out a return to free movement of people to the customs market to the single union, actually he refused to rule out deals on those big asks from ursula von der leyen. tom: ok. thank you very much indeed, on the ground for us in brussels on that visit. he tries on the edges to improve relations with brussels.

the french president emmanuel macron says europe is no longer a priority of the u.s.. speaking at the berlin global dialogue, he discussed the importance of the upcoming american election and what a second trump presidency would mean for europe. >> i think it could have consequences. differences in the security part of the agenda for sure. >> good consequences? >> consequences. [laughter] i don't want to speculate on the election. my point more than that is that the u.s. is a very important ally. but whoever will be elected and whatever the administration is, i think we have to be listening to her situation. europe is no longer the top priority of the u.s. the u.s. top priority is u.s., which is normal and fair. the second top priority is china.

for the rest, they are super and reliable. will it last? at the same time in afghanistan, we didn't have the code before. it's not a reproach. the eu is not the priority of the u.s. and this is why part of the wake-up call and part of what we have to completely reshape is our defense and security strategy. we are part of nato. this is why we have to invest much more for ourselves. we have to create much more european solutions. we have to find european solutions. this is a top priority. tom: the french president

speaking at the berlin global dialogue. now some stories making the news this thursday. u.s. prosecutors say donald trump should stand trial for his private crimes in trying to overturn the 2020 election. the newly unsealed court filing alleges that when told that vice president mike pence could be in danger at the capitol during the riots, the former president replied simply, so what? the special counsel files come after the u.s. supreme court held that presidents cannot face charges for official acts while in office. u.s. prosecutors are broadening a probe for price-fixing by sap. the justice department sent them a legal demand for documents on 94 civilian government agencies with which it has done business. the prop -- company prussic --

said the demand was expanding a civil probe that was already examining whether the company is overcharged the military. mercedes and bmw pressing berlin to vote against imposing significantly higher eu tariffs on chinese made electric vehicles. a push to avoid a spat with their most important market. it comes as number states are preparing to vote tomorrow on imposing tariffs as high as 45% on imported ev's made in china. talking of made in china, chinese auger maters -- automakers are looking at several options in europe to localize production and sidestep tariffs on chinese made ev's. the vice chairman and copresident spoke with oliver crook in berlin. >> being more local is not because tariff. it's not only because tariff. as a company has aspired to be a

leader in a market like europe, perhaps think about becoming more local. we are mocha local team. tom: coming up, i will speak with neuberger berman for his views on the biggest opportunities for ai investment. that conversation is next. this is bloomberg. ♪

tom: welcome back now. shares in nvidia are up in extended trading after the ceo told cbc that the demand for the company's blackwell chips is insane.

the comments come amid concerns about engineering snags that delayed the release of the chip here get sticking with the ai space. openai which nvidia has just invested a little more has completed a deal to raise $6.6 billion in new funding. this latest round takes the giant start up valuation close to 160 billion u.s. dollars as countries are scrambling to develop their own capabilities at producing ai accelerators, semiconductors. for the details on how to invest around this space, let's bring in the head of research in asia and portfolio manager at newberger bergen. you've been here in europe for a few weeks. meeting with clients. lots of questions about generative ai. i want to start with the demand question about gpu's. what is your outlook as we push into 2025 for those ai accelerators?

does it say -- stay at the levels we've seen so far? is there a bit of a slowdown coming? >> in fact, it's actually accelerating. given what we've seen over the summer time, if you remember the delays. in fact, demand has actually accelerated even more. i think demand for ai accelerated. competing platforms are not slowing down. the delay of new products has actually caused even more eagerness of these spending purchases as there's a race in the ai space. as we look at the cloud companies, the u.s. big tech companies, they are not looking to slowdown. tom: hyper scalars. >> in fact, more importantly, this is a strategic industry. not only for the tech sector but also probably physical -- broadly for the global economy. it's about efficiency

improvements as we face more aging problems, as we face more labor shortage problems. hiring the best talents isn't always easy. artificial intelligence ups improve a lot of that efficiency. down the line, it will enable a lot of new applications. tom: i was speaking to the director of tech investment a few weeks ago and he said he has clarity in terms of the capex spend on some of this infrastructure around ji -- genai. he says 2026, it becomes murkier to get does that time with what you are seeing? >> it depends on what we are talking about here. within the capex spending, we have to look at it from different aspects. for example, there are computing spending. there are also networking spending and storage spending. while compute might slow down because it is cyclical. once you are finishing your installation of dp use, you need more networking.

going into 2025 and 2026, while compute has built up networking demand will increase. obviously we still haven't gone through the storage cycle. i think that's another very exciting area as we move into 2026 and beyond. tom: i want to get your views of how to invest in this space. you seen angstrom investors about this been coming through. there will be a pain point at some point when investors basically strike and say, this is too much. we are not seeing the are alive. we haven't yet seen it. that would be some pushback. >> a lot of people are looking at one single killer app because of what you are looking at. i think over time, what we are seeing is not just one single killer app. is going to be millions of killer apps just like the economy. ai will be embedded into many

different applications, many different type of cloud services and so on. we are seeing that rising. not only are u.s. big tech companies spending because of the roi that they are seeing, we are also looking at retailers. efficiency improvement that's the key. tom: efficiency is key. where in the value chain is looking more most -- what is looking most opportunistic? >> the markets are very volatile. where we see great opportunities, networking, now that we have hundreds of thousands of gpu's installed in various data centers. networking them up to train more sophisticated large like which models, that's one of the key areas that has not been priced in yet.

tom: what is the energy play for you? >> still ongoing. demand for those more customized type of lower energy, or power efficient solutions, we are looking at more opportunities. tom: nvidia has a 90% market share. how long does that last? >> i think gpu's are great but they are general-purpose. they may not be very power efficient. we are seeing, for example, customized application specific chips developing. companies such as brown, -- broadcom. asian companies are well-positioned not just on the meta-side. tom: [inaudible]

>> the hyper scalers are developing their own chips. every tech company is trying to have this on their hands. tom: the 90% market share is being eroded over time? >> eventually. gpu's are here to stay for quite some time. it's very general-purpose. >> thank you very much indeed. how to get exposed to the genai ecosystem and where you can still find value. smart analysis on that front. plenty more coming up. stay with us. this is bloomberg. ♪

>> the notion that we would cut rates. financial markets are wide open.

financing is available. real estate prices are going up in every market. yet we are stimulating. it's not clear that we need more rate cuts at this point in time. tom: apollo ceo speaking exclusively to bloomberg with some caution as to whether or not we need further dramatic rate cuts from the federal reserve. that ties into what we are seeing in the japanese yen. let me illustrate what's happening in terms of the weakness coming through for the japanese currency. you can see here on the chart, that was the move yesterday. one of the biggest moves lower since we -- that we've seen since 2022. this is after the new prime minister came out. he was known as a hockey in terms of boj policy. he came out of the meeting and said, it's not the time for another hike from this boj. the conditions are not yet there. i'm paraphrasing. that has seen the markets phaseout bets that you will get

another hike from the boj by the end of the year. that has led to softness in the yen and a rally in japanese equities. it's all about the domestic politics of japan because there's an election at the end of october. maybe that's also a factor. let's have a look at another currency of choice. really to currencies that you are salivating over so far this morning. the yen and the pound. hold my beer because there is something going on here as well. andrew bailey saying there's potentially scope for an arrest of cut. so you see a move in terms of weaker pound and the buildout of expectations around the next cut for the boe. 100% chance according to traders. plenty more coming up. the opening trade is next. this is bloomberg. ♪

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>> here's what you need to know. the european futures in the red whilech